HomeMy WebLinkAboutItem 7a. Acceptance of the Annual Comprehensive Financial Report, Rederal Single Audit Report and Transportation Development Act Report for Fiscal Year 2024-25 Item 7a
Department: Finance
Cost Center: Accounting
For Agenda of: 1/16/2026
Placement: Business
Estimated Time: 30 minutes
FROM: Emily Jackson, Finance Director
Prepared By: Debbie Malicoat, Deputy Finance Director
Tavy Garcia, Senior Accountant
SUBJECT: ACCEPTANCE OF THE ANNUAL COMPREHENSIVE FINANCIAL
REPORT, FEDERAL SINGLE AUDIT REPORT AND TRANSPORTATION
DEVELOPMENT ACT REPORT FOR FISCAL YEAR 2024-25
RECOMMENDATION
Review and accept the Annual Comprehensive Financial Report, the Federal Single Audit
Report and Transportation Development Act Report for Fiscal Year 2024-25.
REPORT-IN-BRIEF
The City produces general purpose financial statements as well as specifically focused
financial statements annually, which are audited by independent auditors. This report
presents three audited financial statements to the City Council for review and acce ptance:
the Annual Comprehensive Financial Report (ACFR), which are general purpose financial
statements; the Federal Single Audit Report, which are specifically focused on revenues
and expenditures of Federal funding; and the Transportation Development Act (TDA)
Report, which are specifically focused on revenues and expenditures related to this
funding source.
As more fully discussed herein, the auditors have issued an unqualified opinion on the
City’s financial statements, which means that in their opinion, the financial statements are
presented fairly and in conformity with generally accepted accounting principles.
POLICY CONTEXT
The City’s Charter under Section 810 requires the employment of an independent certified
public account to examine the City’s financials.
DISCUSSION
The accompanying Annual Comprehensive Financial Report (ACFR) has been prepared as
required by the City’s Charter and applicable State laws regarding financial reporting for
municipalities. The ACFR provides a final and audited representation of the City’s financial
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condition across all funds for the fiscal year that ended June 30, 2025. The ACFR was
published on the City’s website on December 18, 2025, and is included as Attachment A to
this report.
In accordance with the City Charter1, the City’s financial statements have been audited by
independent certified public accountants from Badawi & Associates. The objective of the
financial audit is to provide users of the financial reports with reasonable assurance from an
independent source that the financial reports are reliable and represent a fair assessment
of the City’s financial condition. The auditor issued the financial statements with an
unmodified opinion which means that they are presented fairly and in conformity with
generally accepted accounting principles (see pages 29-32 of the ACFR- Independent
Auditors’ report).
The independent auditors also reviewed the City’s Federal Single Audit Report and
Transportation Development Act (TDA) annual report for the Fiscal Year. Results and
findings are discussed further below.
Financial Results Highlighted in the ACFR
Within the ACFR, the Transmittal Memorandum and Management’s Discussion and
Analysis (MD&A) summarize the City’s fiscal performance and provide an analysis by
management of the influencing factors. They also provide information on the City’s fiscal
policies, practices, and financial results. Key variances from projected ending balances for
2024-25 are highlighted in the Transmittal Memorandum. Both sections allow the reader to
gain insight into the City’s fiscal year experiences that lead to the audited financials and
provide context to the statements that follow.
Financial results for fiscal year 2024-25 were generally positive, although there has been
a flattening of sales tax revenues, a decline in development-related revenue, and
continued increases in costs. General Fund revenues came in under budget by $814,190,
expenditures came in under budget by $7.0 million, and net other sources and uses,
which reflect transfers between the General Fund and other Funds, ended up using
$258,770 less than anticipated. The result was an ending fund balance of $51.8 million,
which was $6.5 million above budget estimates. As the chart below outlines, most of the
ending balance is committed or assigned for future spending or reserve requiremen ts,
and not available for spending in conformance with GASB 54 (ACFR page 53).
1 Section 810. Independent Audits.
The Council shall employ, at the beginning of each fiscal year, an independent certified public accountant
who, at such time or times as may be specified by the Council, at least annually, shall examine the books,
records, inventories, and reports of all officials, employees, departments, and agencies who receive,
handle, or disburse public funds. As soon as practicable after the end of the fiscal year, a final audit and
report shall be submitted by such accountant to the Council, one copy thereof to be distributed to each
member, one each to the City Clerk, the City Treasurer, the City Manager, and City Attorney respectively,
and three (3) additional copies to be placed on file in the office of the City Clerk where they shall be
available for inspection by the general public for the period required by the laws of the State of California.
Restricted and special assessment district funds shall be segregated in the audit report.
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The unassigned balance of $3.5 million represents the amount available for additional
spending and will be considered with the Mid-Year Budget Review on February 17, 2026.
The unassigned balance is about $600,000 lower than discussed in the preliminary
Fiscal Year 2024-25 End Report due to the $594,469 that appears in the Restricted
category. These amounts represent accounts for workers’ compensation and liability
claims that are held in trust by the City’s insurance third party administrators. There is no
net impact to total fund balance, but there is an impact to unassigned fund balance
because these are restricted for risk management activities.
Capital Outlay Fund
The Capital Outlay Fund meets the definition of a major fund2 and is displayed separately
on the financial statements. This is due, in large part, to the current unexpended balance
of $32.7 million in the fund. Major capital projects are planned, but have been delayed,
resulting in the fund balance. Staff expects to be able to significantly spend down this
balance with upcoming capital investments including, but not limited to the Righetti
Community Park, Police and Fire building improvements, fleet electrification, Higuera
complete street and other paving projects.
Enterprise Funds
The City maintains four Enterprise Funds for its Water and Sewer utilities, and the Parking
and Transit operations. Enterprise Funds are business-type activities within governmental
accounting and are reported separately from the General Fund.
2 Major funds in governmental accounting are significant individual governmental or enterprise funds with
revenues, expenditures, assets, or liabilities that meet specific threshold criteria (10% of their fund type
and 5% of all combined governmental/enterprise funds). The General Fund is always cons idered a major
fund.
General Fund 2024-25
Final Budget
2024-25
Actual
Positive (Negative)
Variance
Revenues 127,728,819$ 126,914,629$ (814,190)$
Expenditures 99,228,674 92,208,464 7,020,210
Other sources (uses)(28,487,384) (28,228,613) 258,771
Beginning fund balance 45,329,766 45,329,766 -
Ending fund balance 45,342,527$ 51,807,318$ 6,464,791$
Nonspendable - 5,533,017 5,533,017
Restricted - 594,469 594,469
Committed - 19,892,934 19,892,934
Assigned - 22,317,944 22,317,944
Unassigned - 3,468,954 3,468,954
Total ending fund balance 45,342,527$ 51,807,318$ 6,464,791$
General Fund Budget - Actual Comparison
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The primary sources of revenue for the Water, Sewer, and Parking Funds are fees for
sales and services. In the Transit Fund, Federal and State grants represent most of the
annual revenue. All four funds experienced an increase in net position for the year, as
reflected in the table below (ACFR page 51).
ACFR Organization
In accordance with generally accepted accounting principles for state and local
governments, the City’s ACFR is organized into three major sections: Introduction, Financial
Reports and Statistical Tables. The following is a brief summary of the contents of each of
these sections.
Introduction. The Transmittal Memorandum and other information of general interest are
presented in this section, including a directory of officials, advisory bodies, and an
organizational chart.
Financial Reports. This section includes the City’s primary financial statements in five
major parts:
1. Auditors’ opinion regarding the financial statements.
2. Management’s discussion and analysis providing a narrative overview of City-wide
finances, influencing factors, and operations experiences throughout the year.
3. The basic financial statements presenting the government-wide year-end results
combining the activities of the major funds (General, Capital Outlay and all four
Enterprise Funds) into governmental and business-type categories; the fund financial
statements; and the notes to the financial statements.
2024-25 2023-24
Revenues:
Program Revenues:
Charges for services 67,751,096$ 65,364,673$
Operating grants and contributions 12,767,465 6,762,934
Investment earnings 8,639,215 8,566,073
Miscellaneous and other -
Total revenues 89,157,776$ 80,693,680$
Program Expenses:
Public utilities 44,884,602$ 48,497,795$
Transportation 14,975,809 14,315,288
Total expenses 59,860,411$ 62,813,083$
Increase (decrease) in net position before transfers 29,297,365 17,880,597
Transfers (3,214,820) (2,636,032)
Change in net position 26,082,545$ 15,244,565$
Net position - beginning of year 275,530,186 260,285,621
Prior year restatement (91,366)
Net position - end of year 301,521,365$ 275,530,186$
Summary of Changes in Net Position
Business-Type Activities
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4. Required supplementary information presenting the General Fund actual results with
both the original and final adjusted budgets.
5. Other supplemental schedules and financial statements providing financial information
for each of the City’s non-major governmental and agency funds. This includes a
financial schedule presenting Local Revenue Measure revenues and uses in 2024-25.
Statistical Tables. This section provides demographic and financial tables showing current
and historical trend information for the City and is organized into six major parts:
1. Statistical overview. General information about the San Luis Obispo community.
2. General financial trends. Ten-year summary information on net assets, governmental
revenues and expenditures and fund balances.
3. Revenue capacity. Ten-year summary information on property and sales tax trends.
4. Debt capacity. Ten-year summary information on debt service requirements.
5. Economic and demographic trends. Ten-year summaries of taxable sales, building
permits and valuations, housing, population and other demographic trends.
6. Operating information. Ten-year trend information on operating indicators by function.
The City structures its statistical section to consider debt disclosure requirements including
all relevant information so the ACFR can be used for submission to the Electronic Municipal
Market Access (EMMA) system.
Recognition for Excellence in Financial Reporting
Beginning in fiscal year 1983-84, all of the City’s ACFRs have been awarded the Certificate
of Achievement for Excellence in Financial Reporting from the Government Finance Officers
Association of the United States and Canada (GFOA). This is a prestigious national award
recognizing the City’s use of the highest standards in preparing its annual financial report.
The certificate for 2023-24 is included in the ACFR document and staff will submit the 2024-
25 ACFR for the award program.
Single Audit Report
This document provides several items. First, it provides a report on the City’s internal
control when it comes to financial reporting. Second, it provides a schedule of
expenditures that were funded by Federal Grants and the City’s compliance with
applicable Federal regulations. Third, it provides a schedule of findings and questioned
costs, if any. The findings are areas of improvement for the City when it comes to the
internal controls that are designed to manage the risk with which the City’s assets are
safeguarded, and its finances are accurately reported, which then translates into proper
administration of Federal funding.
There are two findings and no questioned costs. The City’s responses to the auditor’s
findings are incorporated into the Single Audit Report (Attachment B). The auditor’s
comments generally reflect the difficulties encountered when implementing the City’s
Enterprise Resource Planning/Human Capital Management (ERP/HCM) cloud -based
Oracle system and both are continuations from the prior year. The City is currently at
some stage of resolution on these issues, utilizing an Oracle consultant for the necessary
reconfigurations. With the implementation of updated payroll configuration in October
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2025, staff believe that these findings are now resolved and are working with the City’s
auditors to confirm. Again, these are areas of improvement and neither of them put the
City’s revenues in jeopardy or question the appropriate accounting of expenditures.
TDA Report and Financial Statements
This document (Attachment C) provides information on the revenues received by the City
pursuant to the TDA. The City receives funding from the TDA for two specific purposes:
1. The development and construction of local streets and roads, including
pedestrian and bicycle facilities. Since these funds are legally restricted, the City
has a special revenue fund created to account for this portion of TDA revenues.
The City received $66,918 in TDA funding during the 2024 -25 fiscal year and
$90,000 was spent on pedestrian facility improvements, due to unspent prior year
allocations that carried forward. There still remains $10,050 at year end, from
unspent prior year allocations.
2. The Transit Fund is an enterprise fund to account for the revenues received
pursuant to the TDA, the Federal Transit Authority (FTA) and revenues from transit
operations. These revenues are allocated under specific statutes and are legally
restricted to pay for transit operations, the development of public transportation
systems and transportation planning. The Transit Fund received $2,576,381 in
TDA operating grants during the fiscal year. Of these funds, $1,592,240 was also
unspent at fiscal year-end due to Federal funding received for Transit and will be
available for future use.
In addition, this report demonstrates the City’s compliance with applicable TDA
regulations pertaining to acceptable fare revenue ratios. For the fiscal year ended in 2025,
the City was required to maintain a fare revenue ratio of 20%, and the actual ratio was
228% due to a change in calculation allowing the inclusion of federal grant funds as local
funds for the purpose of computing fare revenue ratios. This mandate is discussed further
in Note 7 of the report.
Public Engagement
The City’s annual audit and issuance of the annual comprehensive financial report fulfills
a legal requirement and does not have a public engagement component outside the
required presentation before Council during a public meeting.
ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in
this report, because the action does not constitute a “Project” under CEQA Guidelines
Sec. 15378.
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Item 7a
FISCAL IMPACT
Budgeted: Yes Budget Year: 2025-26
Funding Identified: Yes
Fiscal Analysis:
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $75,000 $66,491 $8,509 $0
State
Federal
Fees
Other:
Total $75,000 $66,491 $8,509 $0
The City budgets the cost for the auditing firm annually. The cost is appropriated with the
annual budget approval. The current fiscal year contains a budget of $75,000 for the
previous fiscal year audit. Actual costs are anticipated to be $66,491 in accordance wi th
the City’s contract with the auditing firm.
ALTERNATIVES
The City Council could decide to revise or not accept the Annual Comprehensive
Financial Report for fiscal year 2024-25. The report has been prepared in conformance
with a variety of accounting and other reporting requirements and represents the
professional evaluation and analysis by the City’s independent auditors. The auditors
have rendered an unqualified opinion which means that the reports are presented fairly
and in conformity with generally accepted accounting principles.
ATTACHMENTS
A - Annual Comprehensive Financial Report for Fiscal Year 2024-25
B - Single Audit Reports for Fiscal Year 2024-25
C - Transportation Development Act Report for Fiscal Year 2024 -25
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ANNUAL COMPREHENSIVE FINANCIAL REPORT
Fiscal Year Ended June 30, 2025
ERICA A. STEWART, MAYOR
EMILY FRANCIS, VICE MAYOR
MIKE BOSWELL, COUNCIL MEMBER
MICHELLE SHORESMAN, COUNCIL MEMBER
JAN MARX, COUNCIL MEMBER
Whitney McDonald, CITY MANAGER
Prepared by the Department of Finance
Emily Jackson, Finance Director
Debbie Malicoat, Deputy Finance Director/Controller
Tavy Garcia, Senior Accountant
Courtney Miles, Accountant
Liliana Vasilev Q, Financial Specialist
City of San Luis Obispo, California
www.slocity.org
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City of San Luis Obispo, California
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2025
Table of Contents
Page
Introductory Section
Transmittal Memorandum...........................................................................................................................................................1-20
Report Purpose and Organization.................................................................................................................................................2
Profile of the City of San Luis Obispo .........................................................................................................................................4
Factors Affecting Financial Condition and Major Initiatives .......................................................................................................6
Financial Condition Overview ...................................................................................................................................................11
Relevant Financial Policies ........................................................................................................................................................14
Award for Excellence in Financial Reporting ............................................................................................................................19
Acknowledgments ......................................................................................................................................................................20
Directory of Officials and Advisory Bodies...................................................................................................................................21
City Council ...............................................................................................................................................................................21
Advisory Bodies .........................................................................................................................................................................21
Appointed Officials and Department Heads...............................................................................................................................21
Mission Statement..........................................................................................................................................................................22
Organizational Values....................................................................................................................................................................23
Organization of the City of San Luis Obispo .................................................................................................................................25
GFOA Certificate ..........................................................................................................................................................................26
Financial Section
Independent Auditors’Report...................................................................................................................................................29-32
Management’s Discussion and Analysis...................................................................................................................................33-59
Overview of the Financial Statements ........................................................................................................................................33
Financial Highlights ...................................................................................................................................................................36
Government-Wide Financial Analysis .......................................................................................................................................40
Financial Analysis of Governmental Funds ...............................................................................................................................44
Financial Analysis of Enterprise Funds......................................................................................................................................46
Combined Program Expense and Revenue for Business-Type Activities ..................................................................................50
General Fund Budgetary Highlights ...........................................................................................................................................52
Capital Asset and Debt Administration ......................................................................................................................................54
Economic Factors and Next Year’s Budget and Rates ...............................................................................................................56
Requests for Additional Information ..........................................................................................................................................59
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City of San Luis Obispo, California
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2025
Table of Contents Page 2
Page
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Position .......................................................................................................................................................65
Statement of Activities............................................................................................................................................................66
Fund Financial Statements:
Balance Sheet –Governmental Funds ....................................................................................................................................69
Reconciliation of the Governmental Funds Balance Sheet to the
Government-wide Statement ofNet Position ......................................................................................................................70
Statement of Revenues, Expenditures and Changes in Fund Balance –
Governmental Funds ...........................................................................................................................................................71
Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund
Balance to the Government-wide Statement of Activities ..................................................................................................73
Statement of Fund Net Position Business-Type Activities –Enterprise Funds..................................................................77-78
Statement of Revenues, Expenses and Changes in Fund Net Position Business-Type Activities –
Enterprise Funds..................................................................................................................................................................79
Statement of Cash Flows Business-Type Activities –Enterprise Funds ............................................................................80-81
Statement of Fiduciary Net Position -Fiduciary Funds ..........................................................................................................85
Statement of Changes in Fiduciary Net Position -Fiduciary Funds .......................................................................................86
Notes to the Basic Financial Statements ..............................................................................................................................89-134
Required Supplementary Information Section
Budgetary Comparison Schedule –General Fund.............................................................................................................137-140
Schedule of the Changes in the Net Pension Liability and Related Ratios –Miscellaneous
Agent Multiple –Employer Plan ..........................................................................................................................................141
Schedule of the Pension Plan Contributions –Miscellaneous Agent Multiple –Employer Plan .............................................142
Schedule of the City’s Proportionate Share of the Net Pension Liability –Safety Cost-Sharing Plan .....................................143
Schedule of the City’s Pension Contributions –Safety Cost-Sharing Plan ..............................................................................144
Schedule of the Changes in the Net OPEB Liability and Related Ratios .................................................................................145
Schedule of Employer OPEB Contributions ............................................................................................................................146
Notes to Required Supplementary Information ........................................................................................................................147
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City of San Luis Obispo, California
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2025
Table of Contents Page 3
Page
Other Supplementary Information and Combining and Individual Fund Statements and Schedules
Local Transaction Tax Measure Funding Schedule ..........................................................................................................151-155
Nonmajor Governmental Funds ........................................................................................................................................157-161
Combing Balance Sheet –Nonmajor Governmental Funds ..............................................................................................162-170
Combining Statement of Revenues, Expenditures and Changes in Fund Balance
-Nonmajor Governmental Funds ..................................................................................................................................171-179
Schedule of Revenues, Expenditures and Changes in Fund Balances –Budget and Actual:
Downtown Business Improvement District Fund .................................................................................................................180
Transportation Development Act (TDA)Fund .....................................................................................................................181
Tourism Business Improvement District Fund .....................................................................................................................182
Gas Tax Fund........................................................................................................................................................................183
Community Development Block Grant (CDBG)Fund.........................................................................................................184
Law Enforcement Grants Fund .............................................................................................................................................185
Public Art Contributions Fund..............................................................................................................................................186
Avila Ranch CFD .................................................................................................................................................................187
SB1 Road Repair Fund .........................................................................................................................................................188
SB1186 ASP Certify .............................................................................................................................................................189
Affordable Housing BEGIN Loan Fund ...............................................................................................................................190
Avila Ranch DPA Fund ........................................................................................................................................................191
Opioid Settlement Fund ........................................................................................................................................................192
Asset Forfeiture Available Fund ...........................................................................................................................................193
SLR PAYGO City Share ......................................................................................................................................................194
Code Enforcement Abatement Fund .....................................................................................................................................195
Police Evidence Available Fund ...........................................................................................................................................196
Debt Service Fund ................................................................................................................................................................197
Custodial Funds ........................................................................................................................................................................199
Combining Statement of Fiduciary Net Position –Custodial Funds ..............................................................................200-202
Combining Statement of Changes in Fiduciary Net Position –Fiduciary Funds ...........................................................203-205
Statistical Section
Statistical Section –Overview (Unaudited).............................................................................................................................209
Financial Trends:
Net Position by Component –Last Ten Fiscal Years ...........................................................................................................210
Changes in Net Position –Last Ten Fiscal Years ..........................................................................................................211-212
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City of San Luis Obispo, California
Annual Comprehensive Financial Report
Fiscal Year Ended June 30, 2025
Table of Contents Page 4
Page
Governmental Activities Tax and Franchise Revenues by Source –Last Ten Fiscal Years.................................................213
Fund Balances, Governmental Funds –Last Ten Fiscal Years......................................................................................214-215
Revenues, Expenditures and Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years .................................................................................................................................................216-218
General Fund Operating Expenditure Trends by Type –Last Ten Fiscal Years ...................................................................219
Statistical Section (Continued)
Revenue Capacity:
Assessed and Estimated Actual Value of Taxable Property –Last Ten Fiscal Years ...........................................................220
Property Tax Rates –Last Ten Fiscal Years .........................................................................................................................221
Principal Property Taxpayers –Current Year and Nine Years Ago ......................................................................................222
Secured Property Tax Roll Levies and Collections –Last Ten Fiscal Years ........................................................................223
Schedule of Taxable Sales and Permits by Category –Last Ten Calendar Years .................................................................224
Historical Sales and Use Tax Rates.......................................................................................................................................225
Schedule of Business Tax Certificates Issued .......................................................................................................................226
Debt Capacity:
Per Capital Outstanding Debt by Type –Last Ten Fiscal Years...........................................................................................227
Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt per Capital
Last Ten Fiscal Years ........................................................................................................................................................228
Direct and Overlapping Long-Term Debt –Fiscal Year Ended June 30, 2023 ....................................................................229
Computation of Legal Debt Margins –Last Ten Fiscal Years..............................................................................................230
Revenue Bond Coverage:
Water Fund –Last Ten Fiscal Years.....................................................................................................................................231
Parking Fund –Last Ten Fiscal Years ..................................................................................................................................232
Demographic and Economic Information:
Demographic and Economic Statistics –Last Ten Fiscal Years ...........................................................................................233
Principal Employers –Current Year and Nine Years Ago ...................................................................................................234
Regular Authorized Positions –Last Ten Fiscal Years.........................................................................................................235
Operating Information:
Operating Indicators and Capital Asset Statistics by Function –Last Ten Fiscal Years................................................236-239
Water System Statistical Data ...............................................................................................................................................240
Water and Sewer Rates –Last Ten Fiscal Years ...........................................................................................................241-242
Water System Ten Largest Users –Fiscal Year Ended June 30, 2023 .................................................................................243
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INTRODUCTORY SECTION
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City of San Luis Obispo, Finance and Information Technology, 990 Palm Street, San Luis Obispo, CA, 93401-3249, 805.781.7130,
slocity.org
Date December 16, 2025
TO: The Honorable Mayor and Members of the City Council and Citizens of the
City of San Luis Obispo
FROM: Whitney McDonald, City Manager
Emily Jackson, Finance Director
SUBJECT: TRANSMITTAL MEMORANDUM FOR ANNUAL COMPREHENSIVE
FINANCIAL REPORT FOR FISCAL YEAR 2024-25
We are pleased to submit the City of San Luis Obispo’s 2024-25 Annual Comprehensive
Financial Report (ACFR). Section 810 of the City’s Charter requires that an audit of the City’s
financial records be conducted each year by an independent certified public accountant. Such
an audit has been performed and this report is being published as part of the requirement for
the fiscal year that ended June 30, 2025, within applicable timelines.
Though the audit is conducted by an independent certified public account firm, City
management assumes full responsibility for the completeness and reliability of the
information contained in this report. We attest that, to the best of our knowledge, the data
presented is accurate in all material respects, and all statements and disclosures needed for the
reader to obtain a thorough understanding of the City’s financial activities have been included.
To provide a reasonable basis for making these representations, management of the City has
established a comprehensive internal control and review framework that is designed both to
protect the government’s assets from loss, theft, or misuse and to compile sufficient and
reliable information for the preparation of the City’s financial statements in conformity with
U.S. Generally Accepted Accounting Principles (GAAP). Because the cost of internal controls
should not outweigh their benefits, the City’s comprehensive framework of internal controls
has been designed to provide reasonable rather than absolute assurance that the financial
statements will be free from material misstatement. However, internal controls are critically
reviewed by the auditors annually and Finance staff throughout the year to assure compliance
with applicable Governmental Accounting Standards Board (GASB) rules and best practices
in government accounting. Additionally, the City’s governing body receives reports on a
1
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TRANSMITTAL MEMORANDUM
quarterly basis and additional reports in accordance with State requirements are posted online
on the City’s website at www.slocity.org.
REPORT PURPOSE AND ORGANIZATION
Audited Financial Statements
The City’s financial statements were audited by Badawi and Associates, a firm of licensed
certified public accountants currently under contract with the City. The goal of the
independent audit was to provide reasonable assurance that the financial statements of the
City for the fiscal year ended June 30, 2025, are free of material misstatement. The
independent audit involved examining on a test basis, evidence supporting the amounts and
disclosures in the financial statements; assessing the overall accounting principles used and
significant estimates1 made by management; and evaluating the overall financial statement
presentation.
The independent auditor concluded that the City’s financial statements present fairly2, in all
material respects, the respective financial position of the governmental activities, the business-
type activities, each major fund, and the aggregate remaining fund information of the City as
of June 30, 2025. They also fairly represent the respective changes in financial position, and,
where applicable, cash flows in accordance with accounting principles generally accepted in
the United States of America. The independent auditors’ report is presented as the first
component of the financial section of this report beginning on page 29.
“Single Audit” for Federal Grant Programs. The independent audit of the financial
statements of the City was part of a broader, federally mandated “Single Audit” designed to
meet the special needs of Federal grantor agencies. The standards governing Single Audit
engagements require the independent auditor to report not only on the fair presentation of the
financial statements, but also on the audited government’s internal controls3 and compliance
with legal requirements, with special emphasis on the administration of Federal awards (such
as Transit funding). This audit has been completed and will be filed and distributed to
appropriate agencies to meet Federal requirements and deadlines.
1 Significant estimates included in the financial statements are made in conformity with GAAP.
2 The Term “present fairly” means that the financial statements give a reasonable view of the financial results, financial position, and cash-flow of the reporting
entity.
3 Internal controls are systematic measures instituted by an organization to conduct its business in an orderly and efficient manner; safeguard its assets and
resources; deter and detect errors, fraud, and theft; ensure accuracy and completeness of its accounting data; produce reliable and timely financial and
management information; and ensure adherence to its policies and plans.
2
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TRANSMITTAL MEMORANDUM
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management’s Discussion and
Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and
should be read in conjunction with it. The City’s MD&A can be found immediately following
the report of the independent auditors beginning on page 33.
Organization of the Annual Comprehensive Financial Report
The report is presented in three sections: introductory, financial, and statistical.
SECTION ONE - The Introductory section includes this transmittal memorandum and other
information to familiarize the reader with the City, including a directory of officials and
advisory bodies, the City's mission statement and organizational values, and charts.
SECTION TWO - The Financial section consists of six parts: 1) the independent auditors’
report; 2) Management’s Discussion and Analysis; 3) the basic financial statements including
the government-wide financial statements; 4) fund financial statements; 5) notes to the
financial statements; and 6) required supplementary information; and additional statements
and schedules including the local transaction tax information, non-major governmental funds,
and agency funds.
SECTION THREE - The Statistical section includes selected unaudited financial and
demographic information generally presented on a multi-year basis. This information includes
financial trends, revenue trends, debt capacity, demographics, and economic and operating
information. This section also contains important information for the benefit of the required
bond disclosures and rating agencies.
As required by GAAP, these financial statements present the City (the primary government)
and its component units (entities for which the government is financially accountable).
Blended component units (although legally separate entities) are in substance part of the
government's operations, and so data from these units are combined with data of the primary
government. The City has three component units, the San Luis Obispo Capital Improvement
Board and the San Luis Obispo Public Financing Authority, both of which provide financing
for the construction and acquisition of City facilities, and the San Luis Obispo Parking
Authority, which manages and enforces the City’s parking regulations in compliance with
State laws. The Board/Authority is comprised solely of members of the City Council.
Activities of the Board/Authority are accounted for in the applicable City governmental or
enterprise funds.
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PROFILE OF THE CITY OF SAN LUIS OBISPO
With a population of about 48,700, the City is located eight miles from the Pacific Ocean and
is midway between San Francisco and Los Angeles at the junction of Highway 101 and scenic
Highway 1. The City serves as the commercial, governmental, and cultural hub of San Luis
Obispo County. San Luis Obispo is the county seat, a number of Federal and State regional
offices and facilities are located within the City, and California Polytechnic State University
and Cuesta College campuses are adjacent to and nearby the City. The City’s ideal weather
and natural beauty provide numerous opportunities for outdoor recreation at nearby City and
State parks, lakes, beaches, and open space areas.
As one of California’s oldest communities, the historical roots of San Luis Obispo run deep,
anchored by the enduring presence of Indigenous Peoples dating back at least 15,000 years
ago in the Diablo Canyon region. These first peoples hunted and shore-picked shellfish. The
Yak titʸu titʸu Yak tiłhini Northern Chumash Tribe, who have called the region home for over
10,000 years, have been integral in the historical development of the City. By 1504, coastal
land exploration took place by Spanish vessels, which carried members of the Filipino
community. Spanish invasion and colonization in 1769 led to the establishment of Missions
throughout California. The San Luis Obispo de Tolosa Mission was founded in 1772, the fifth
mission in the California chain of 21 missions, around which the City of San Luis Obispo
developed. It was first incorporated in 1856 as a General Law City and became a Charter City
in 1876. As a Charter City, San Luis Obispo has more local authority than cities that
incorporate under the general laws of the State of California. The Charter is the City’s
governing document, and any changes must be approved by the voters. The City’s Charter has
been amended several times since its adoption, most recently in August 2011.
Form of Government
As set forth in the City Charter, the City operates under the “Council-Mayor-City Manager”
form of government. The City Council has the authority to make and enforce all laws and
regulations with respect to municipal affairs, subject only to the limitations of the City Charter
and the State Constitution. There are four Council members, who are elected at-large and
serve overlapping, four-year terms. The Mayor is also elected at-large for a two-year term and
serves as an equal member of the Council. The City Council appoints the City Manager and
City Attorney. All other department heads are appointed by the City Manager.
City Services
The City provides a wide range of municipal services, including police and fire protection,
water and sewer utilities, street and parks maintenance, public transportation, parking, parks
and recreation, planning, building and safety, and other general government services.
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Financial data for all funds through which services are provided by the City have been
included in this report.
Several municipal services are provided through other governmental agencies or private utility
companies, including:
Service Agency
Health and Social Services County of San Luis Obispo
Courts State of California
Elementary and Secondary Schools San Luis Coastal Unified School District
Community College San Luis Obispo County Community College
District
Solid Waste Collection and Disposal San Luis Garbage Company
Gas, Electric and Telephone Private Utility Companies
The City is also a member of a Joint Powers Authority called Central Coast Community
Energy (3CE) which sources clean and renewable electricity at competitive prices for the
community and is delivered through the grid by Pacific Gas & Electric (PG&E). 3CE follows
a Community Choice Aggregator or “CCA” model, which is a community-focused, “not-for-
profit” model that allows for greater commitment to clean and renewable energy while
supporting community reinvestment for affordable and fair rates and equitable access to clean-
energy resources. It is locally controlled and governed by board members who represent the
communities served by 3CE. Becoming a member of 3CE was an integral part of the City’s
fiscal year 2019-20 Major City Goal for Climate Action. For more information visit:
www.3cenergy.org
Budgetary Policy and Control
Though the City adopts a two-year Financial Plan, annual budgets are legally appropriated by
the City Council by resolution and are prepared for each fund in accordance with its basis of
accounting. As provided under the City Charter, the City Manager is responsible for preparing
the budget and for its implementation after adoption. Financial reports are presented to the
City Council and posted online on a quarterly basis. At mid-year, staff prepares a more in-
depth status report for the City Council for the first six months of the fiscal year in addition to
any fund balance information and long-term forecast based on the audited annual
comprehensive financial report.
Since the City uses a two-year Financial Plan, operating appropriations not expended during
the first year may be carried forward into the second year for specific purposes with the
approval of the City Manager. When applicable, these amounts are shown as assigned for
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subsequent year expenditures in the financial statements. At the end of the second year of the
two-year plan, operating appropriations lapse unless they are committed by contract or
purchase order. Multi-year budgets are adopted for capital projects as necessary but revert to
fund balance after three years of non-activity.
The City Council has the legal authority to amend the budget at any time during the fiscal
year. The City Manager has the authority to make administrative adjustments to the
appropriated budget if those changes will have neither a significant policy impact nor affect
budgeted year-end fund balances. Legal budgetary control, meaning the level at which
management cannot overspend the budget without the City Council’s approval, is at the Fund
level. The City's budgetary policies are more fully described in Note 1 of the financial
statements.
Expenditure and budgeting details are maintained by the City for each fund and department
by program area at the line-item level. Budgetary control is exercised through a computerized
Enterprise Resource Planning (ERP) system, which interfaces with the City's general ledger.
The system maintains an ongoing record of budget balances and any authorized adjustments
throughout the year based on actual expenditures and purchase order obligations. Open
purchase orders at year-end are reported as assigned fund balance. The ERP system also
maintains the City’s list of capital assets.
It is the City's policy to maintain an operating reserve in the General Fund of at least 20% of
operating expenditures which is reflected in the committed fund balance. The City maintains
a similar policy for working capital balances in the water, sewer, and parking enterprise funds.
The Fleet Replacement Fund reserve policy is $500,000 and the Information Technology (IT)
Replacement Fund reserve policy is $400,000 which have also been met for the year. With
the 2021-22 fiscal year, the City also adopted a capital reserve in its Capital Outlay Fund of
20% of budgeted capital investments from the Local Revenue Measure for the fiscal year.
This reserve is adjusted with each budget adoption, funded from the local transactions tax,
and is reflected in the Capital Outlay Fund.
FACTORS AFFECTING FINANCIAL CONDITION AND MAJOR INITIATIVES
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the City
operated in fiscal year 2024-25.
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Building on Current Efforts to Move into the Future
The City Council adopted its two-year Financial Plan for 2025-27 in June 2025, amidst a time
of transition with revenue growth that is slowing, lingering inflationary pressures, and
growing uncertainly resulting from a rapid shift in national economic policy via tariffs, and
potential significant state and federal budget cuts. Despite this, the Financial Plan continues
progress on long standing Major City Goals, and aligns with the community’s values of
responsibility, equity, and sustainability. The City continues to monitor economic trends,
revenue performance, and workload demands and has activated a Fiscal Health Contingency
Plan to increase flexibility to address forecasted deficits of $3.0 million in fiscal year 2027-
28 and $1.9 million in fiscal year 2028-29, driven largely by the requirement to bring a fifth
fire station online to serve new development in the southern portion of the city.
The four Major City Goals guide continuation of workplans initiated over the last several
years. Years ago, Major City Goals were focused on specific programs and projects, but the
consistency of higher-level Major City Goals in recent years has supported a long-term focus
on initiatives that bring about sustained systemic change. As such, the Major City Goals drive
the City’s strategic direction while maintaining the established core services the community
expects and to which the community is accustomed. For additional information on the City’s
strategic initiatives go to 2025-27 Financial Plan.
Economic Resiliency, Cultural Vitality and Fiscal Sustainability
In collaboration with local partners, implement initiatives that reinforce a
thriving and sustainable local economy, support a diverse, inclusive, and vibrant
community, preserve arts and culture, and ensure fiscally responsible and
sustainable city operations.
Housing and Homelessness
Support the expansion of housing options for all, and continue to facilitate the
production of housing, including the necessary supporting infrastructure, with
an emphasis on affordable and workforce housing as well as accessibly
connected development. Collaborate with local non-profit partners, non-
governmental agencies, the county, the state, and federal governments to
advocate for increased funding and implementation of comprehensive and
effective strategies to prevent and reduce homelessness.
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Diversity, Equity, Inclusion (DEI)
Further our commitment to making San Luis Obispo a welcoming and inclusive
city for all by continuing to incorporate diversity, equity, and inclusion into all
programs and policies and advancing the recommendations of the DEI Task
Force.
Climate Action, Open Space, and Sustainable Transportation
Proactively address the climate crisis and increase resiliency through the
implementation of the Climate Action Plan. Use resources to reduce greenhouse
gas emissions and reach carbon neutrality by 2035, with a focus on the
preservation and enhancement of convenient and equitable alternative and
sustainable transportation, the preservation of open space, and equitable access
to parks and open space.
Significant Storms in January and March 2023
In January and March 2023, the City and region experienced severe winter storms that resulted
in two separate major disaster declarations at the Federal and State level, as well as emergency
proclamations at the local level. The City qualified for and is seeking reimbursement from
Federal and State resources for eligible costs related to the storms. The Federal Emergency
Management Agency (FEMA) reimbursement process continues to move slowly, but as of the
end of the fiscal year, the City had received $1.02 million in reimbursement and FEMA had
obligated an additional $920 thousand in project costs to the City. The City has submitted all
storm projects to FEMA and continues to respond to requests for information.
Overall Financial Condition
The following factors played into the City’s financial condition at the end of the 2024-25 fiscal
year:
1. Flattening sales tax revenues, including Local Revenue Measure (LRM) receipts,
which were previously expected to grow more significantly but are now trending
below what was forecasted last year by approximately $2.4 million annually.
2. Declining development-related revenue. As noted in prior budget reports, due to a
slowing of development activity, the City is seeing a decrease in development services
revenue of approximately $600,000 in fiscal year 2024-25 and is forecasting a
continuation of this decrease into the two years of the 2025-27 Financial Plan.
3. Rising personnel and project delivery costs. Increases in the cost of construction
materials, insurance, utilities, and employee compensation to recruit and retain a
talented workforce.
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4. Ongoing inflationary pressures continue to influence consumer behavior, project
costs, labor market dynamics, as well as the local economy.
5. Favorable Interest Earnings Fair Value Adjustment. The Fair Value (FV)
adjustment is essentially an accounting practice that reassesses the value of the City’s
investments when there is a difference between the fair market value and the value
recorded on the City’s books. Interest earnings and FV adjustments have been volatile
the past few years and higher investment income driven largely by market interest
rates is not expected to persist.
Economic Indicators for San Luis Obispo in General
Local Economic Environment. Historically, the City has experienced a relatively stable
economy, largely insulated from economic downturns in other parts of the State or the nation
due to major State and federal employers such as the California Polytechnic State University
(Cal Poly), California Men’s Colony, California Department of Transportation (Cal Trans)
District 5 offices, the Regional Water Control Board, and Camp San Luis Army base. San
Luis Obispo is also the County seat with significant county administrative offices and the
regional courts. The continued operation of the Diablo Canyon Nuclear Power Plant also
contributes to a stable economy as it generates approximately 10% of the State’s electricity.
PG&E continues to operate the plant and is funding plant improvements with a federal grant
that will not generate unitary tax on the portion of plant valuation that is federally funded.
This loss of unitary tax does not have a large direct impact to the City, however, it will have
a significant impact for the local school district and other government agencies that could
impact the local economic environment. This situation will be closely monitored by City staff.
Employment. Due to the local economic environment and a large government presence and
diversity, employment in the San Luis Obispo County region has historically been relatively
stable. As noted above, the State has a major university, correctional facility, and other
regional offices located in the community. The County government and school districts are
also major employers. Other major employers include two major hospital facilities, several
engineering and software companies, and PG&E. The announcement to prolong the use of the
Diablo Canyon Nuclear Power Plant presents an opportunity to continue jobs for trained
professionals in the region.
Key Revenue Sources. As the commercial, governmental, and cultural hub of San Luis
Obispo County, the City is fortunate to attract a diverse array of strong revenue sources. The
top three revenue sources are Sales & Use Tax, Property Tax, and Transient Occupancy Tax
(TOT). The 2020 voter-approved local transaction tax of one-and-a-half cent (Local Revenue
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Measure) went into effect in April 2021 to provide for a variety of City services including
infrastructure. This Local Revenue Measure has become the largest single tax revenue source
to the City, growing to over $30 million per year.
Long-Term Financial Planning. The City engages in several activities focused on long-term
financial planning to gauge and adjust to current economic conditions and trends. Various
scenarios are developed considering a multitude of information and resources. This effort was
very rigorous in fiscal year 2024-25 due to the uncertainties surrounding the economic
environment, increasing demand for City services, and ongoing storm-related project costs.
With adoption of the 2025-27 Financial Plan, the City Council adopted a set of Budget
Balancing Strategies to guide staff in developing balanced budgets both in times of financial
difficulty and growth.
Long-Term Fiscal Forecast. Before the two-year Financial Plan and budget process begins,
the City Council reviews long-term fiscal forecasts for the General and the Enterprise Funds
to help set the stage for sustainable decision-making. The purpose of the forecast is to consider
long-term fiscal health and to identify the funds’ ability, on an order of magnitude basis, to
maintain current services and existing assets and look at the opportunity to fund new
initiatives. As reported to the City Council, the General Fund forecast indicates a structural
deficit of $3 million for fiscal year 2027-28. The City is taking action to identify targeted
reductions to close the forecasted deficit but continues to preserve service levels and remain
nimble in the face of economic change and uncertainty, all while upholding the City’s values
and strategic commitments.
CalPERS and the City’s Unfunded Liability. To address its unfunded pension liabilities, the
City Council adopted a Fiscal Health Response Plan (FHRP), which outlines a strategy to pay
down the pension liability over a 20-year period – shortening the duration of required
payments and saving an estimated $19 million. A key component of the FHRP is making
Additional Discretionary Payments (ADPs) to CalPERS. To date, the City has made $22.3
million in ADPs to reduce its pension liability.
In March 2023, the City utilized an independent actuarial consulting firm to review its
progress on reducing its unfunded pension liabilities. The review confirmed that the City’s
ADPs had improved the plans’ funded status and that the City was taking appropriate steps to
address its pension debt. It was recommended that the City continue required payments and
ADPs. The City Council therefore adopted fiscal policies to prioritize APDs of at least the
first $2 million of unassigned fund balance annually.
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FINANCIAL CONDITION OVERVIEW
Despite the background of economic uncertainty the City ended the 2024-25 fiscal year in a
better fiscal position than originally anticipated. General Fund revenues exceeded budgetary
estimates by less than 1% and expenditures were 7% under budget. On June 30, 2025, the
total General Fund balance was $51.8 million; an increase of $6.5 million over fiscal year
2024-25, despite the ongoing storm related costs. Enterprise Funds similarly experienced
increases in net position. Overall, the City’s total net position increased by $60 million from
the prior year.
The table below shows the General Fund levels of fund balance in accordance with GASB
54 and the City’s policy pertaining to fund balance assignments. Fund Balance & Reserve
Policy
Continue to Focus on Sustainability and Long-term Fiscal Health
General Fund - Fund Balance as of June 30, 2025
Nonspendable:5,533,017$
Restricted:
Risk Management 594,469$
594,469$
Committed:
General government programs 848,111$
Risk management 4,437,620
Contingency fund 14,607,203
19,892,934$
Assigned:
CalPERS pension payment 2,000,000$
Solid Waste AB939 270,825
Establishment of Section 115 Trust 2,000,000
Revenue stabilization 2,000,000
Development services 145,136
SLO Repertory Theater Grant 6,700,000
Economic Development Tenant Improvement 608,000
Storm Related Costs 5,125,068
Storm Related Reimbursements 909,090
Subsequent year expenditures 2,559,825
22,317,944$
Unassigned:3,468,954$
Total Fund Balance 51,807,318$
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With its Major City Goal for Economic Recovery, Resiliency & Fiscal Sustainability, the City
continues its commitment to long-term fiscal health. The goal program aims to, in
collaboration with local partners, continue to assist with economic recovery for all from the
pandemic and sustain a thriving local economy by supporting local businesses, arts and
culture, and downtown vitality. It commits to practicing fiscal responsibility, paying down
unfunded pension liabilities, and investing in critical infrastructure.
Revenue Base Growth. The pandemic and the economic recovery that followed led to drastic
shifts in consumer spending and markets that provided strong tailwinds to the City’s revenue
growth. Social distancing led consumers to spend more on goods from hobby supplies to
luxury items, boosting sales tax revenue. Supply chain disruptions drove up new and used car
prices, providing additional benefit to sales tax. As pandemic restrictions eased, local trips
were favored over international travel and San Luis Obispo’s convenient location between the
San Francisco Bay Area and the Los Angeles Metropolitan Area made it a popular destination,
benefiting transient occupancy tax.
This rapid revenue growth, which began in the 2020-21 fiscal year, has begun to slow. Several
years of rapid inflation have impacted household finances. Interest rates remain elevated,
providing a dampening effect on car sales and building activity. After years of quick growth,
the City’s revenue streams are at very high levels and drivers for near-term growth are difficult
to identify.
Staff now expect that cyclical revenue streams like sales tax will grow at below inflationary
rates, making cost of living adjustments for employees and inflationary increases in other
spending difficult to fund. Property tax, once a slow grower, has become a leading source of
growth for the General Fund.
Containment of Operating Costs. The City’s efforts to control costs are ongoing while also
addressing the need to remain an attractive employer and provide the services the community
expects. The City has an extensive policy framework that allows immediate and nimble action
to address adverse changes in economic and fiscal condition and will continue to activate these
policies as needed. The City’s implementation of a 2nd and 3rd tier retirement benefit program
continues to change the City’s annual retirement contributions as 72% of the City’s workforce
is now enrolled in those retirement plan tiers. These actions have been instrumental in helping
the City contain current costs and long-term liabilities related to retirement benefit programs;
furthermore, two of the City’s bargaining units as well as the Management & Confidential
group pay additional contributions toward the City’s pension obligation.
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Infrastructure and Facilities Maintenance. As a growing city, San Luis Obispo has seen
capital expenditures grow steadily over the past decade. The need to maintain, repair or
replace its current infrastructure is met with the need to build amenities for the community at
large and the City’s Local Revenue Measure plays a vital part in providing funding for these
needs. The City has allocated approximately 75% of the revenue in any given year for
infrastructure improvements and enhancements, which the Public Works and Utilities
departments work to deliver within an overall plan that has increased in project number, scope,
and complexity. For a list of projects delivered in fiscal year 2024-25 see page 53 in the
Management Discussion and Analysis.
The City’s Capital Improvement Plan Review Committee evaluates projects for funding based
on established criteria and funding is allocated to projects in coordination with a number of
adopted plans including the General Plan, Active Transportation Plan, Downtown Concept
Plan, and Parks and Recreation Blueprint. Each plan represents hours of community input and
a vision to maintain and improve San Luis Obispo now and into the future.
Ongoing Commitment to Local Transaction Tax Measure Priorities (Local Revenue
Measure)
The City remains committed to the priorities for the use of the local transaction tax measure
as identified by the community. They include public safety, youth and senior services, code
enforcement, economic development, neighborhood street paving, open space preservation,
traffic congestion relief and flood protection. The following table summarizes how the local
transaction tax measure funds were used during fiscal year 2024-25.
Total uses of the funding during fiscal year 2024-25 amounted to $31.9 million, with an
additional $8.3 million encumbered through purchase orders or contracts; the remaining
balances of these resources are designated for future year expenditures. A more detailed
schedule of local transaction tax measure sources and uses is provided in the Other
Supplementary Information section of this report beginning on page 151.
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RELEVANT FINANCIAL POLICIES
The City of San Luis Obispo has adopted a comprehensive set of budget and financial policies
to provide guidance for all fiscal matters and resource allocations. The policies are reviewed,
amended, and updated with each Financial Plan adoption and as needed throughout the year.
The policies cover virtually every aspect of financial management but several of these policies
are particularly relevant to the understanding of the City’s financial performance in fiscal year
2024-25. As noted previously, the Council adopted a new set of Budget Balancing Strategies
with adoption of the 2025-27 Financial Plan in June 2025. That document is intended to
provide guidance to staff in developing a balanced budget both in times of financial difficulty
and growth, and demonstrates staff and the City Council’s commitment to ongoing assessment
of policy and procedure guidance to ensure an appropriate framework to meet the needs of the
organization.
Debt Administration Policies
The City’s Capital Financing and Debt Management policies contain general guidelines for
refinancing of outstanding debt. These guidelines call for periodic review of all outstanding
debt to determine refinancing opportunities, particularly to create economic benefit such as
lower debt service payment or reduction of principal. The City evaluates various options when
considering the issuance of debt to benefit from the best long-term terms and conditions.
Revenues:
Sales and use tax - Measure G add-on tax 30,926,285$
Total Revenues 30,926,285$
Uses:
Operating Programs 11,018,737$
Capital Projects 20,836,263
Total Uses 31,855,000$
Changes in Fund Balance (928,715)$
Prior Sales Tax Measure Balance 1,776,826$
Net Available for future year appropriations 848,111$
Local Sales Tax Measure Revenue & uses Summary
FY 2024-25
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Information on the City’s outstanding debt issues and other long-term liabilities is provided
in Note 7 in the notes to the financial statements.
In February 2025, Fitch Ratings, a nationally recognized statistical rating organization,
reviewed the City’s financials, its fiscal outlook, and the current rating. On February 3, 2025,
Fitch Ratings subsequently concluded that there should be no change to the existing rating at
AA+ with a stable rating outlook. Fitch Ratings’ long term credit ratings are assigned on an
alphabetic scale from AAA to D. The City’s AA+ bond rating means that the City’s
investment grade is “quality.” Specifically, current lease revenue bonds (LRBs) issued by the
San Luis Obispo Public Financing Authority remain at an 'AA’ rating and the LRBs issued by
the City of San Luis Obispo Capital Improvement Board at an 'AA' rating. In addition, in April
2023, Standard & Poor’s Global Ratings upgraded the City’s Water Revenue bonds from ‘AA-
’ to ‘AA.’ At this time, the City of San Luis Obispo has no general obligation debt.
Fitch Ratings’ analysts had previously commended the City’s ability to respond to the
economic impacts of the COVID-19 pandemic, remarking “budget management at times of
recovery is very strong, leaving the city well prepared to manage the current period of
economic stress. The city engages in thorough and conservative long-term financial planning
with a focus on maintaining structural budget balance, maintaining the city's capital assets
with minimal debt reliance, and proactive efforts to pay down its unfunded retirement
liabilities above actuarially determined levels.”
Budgetary Policies
The City of San Luis Obispo has a policy that requires the adoption of a balanced budget over
the two-year period of the Financial Plan. This means that operating revenues must fully cover
operating expenditures, including debt service. Additionally, ending fund balance (or working
capital in the enterprise funds) must meet minimum policy reserve levels. Under this policy it
is allowable for total expenditures to exceed revenues in any given year but only when fund
balance is used to pay for capital improvement plan projects or other “one-time,” non-
recurring expenditures.
Fund Balance and Reserve Policies
The City’s policies recognize the importance of long-range planning in managing the City’s
fiscal affairs in order to provide for stable operations, promote more orderly spending patterns,
and assure the City’s long-term fiscal health. The reserves contained in the General Fund and
Enterprise Funds play a pivotal role in this strategy. The reserve policies call for a minimum
fund balance of at least 20% of operating expenditures in the General Fund and a working
capital level of 20% of operating expenses in the Water, Sewer, and Parking Enterprise Funds.
The policies also require the Fleet Management and Information Technology (IT)
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Replacement Funds to provide for the timely replacement of vehicles and equipment as well
as IT equipment and software and a reserve is retained in these funds to safeguard against
unforeseen and unfunded issues. All reserve policies continue to be met as of fiscal year 2024-
25, reflecting replenishment of the General Fund reserve that was used in responding to the
2023 winter storms.
To further strengthen the Water and Sewer fund against revenue fluctuations, both funds carry
a Rate Stabilization reserve of 10% of sales revenue for Water and 5% of sales revenue for
Sewer.
Long-Term Liabilities and Maintenance of Infrastructure
With the 2017-19 Financial Plan, the City began to incorporate into the City’s fiscal policies
the use of one-time funds above policy reserve to unfunded pension liabilities and
infrastructure. Additionally, the City began addressing the long-term needs of its capital assets
and categorizing asset maintenance, asset replacement, and new assets driven by new
development. The City Council received a first presentation of the long-term needs of its
infrastructure in early 2018 and the assessment continued into fiscal year 2019-20,
culminating in the City Council’s decision to place a measure on the November 2020 ballot
for a 1.5 cent local transaction tax measure to supplant and add to the 2006 enacted half-cent
measure. The measure was successfully approved by 58% of the voters and the new local
transaction tax went into effect on April 1, 2021.
This Local Revenue Measure has now become the City’s largest tax revenue source, and the
City remains committed to the majority of the funds being used to maintain, replace, and
renew its growing infrastructure needs.
Pension and Other Post-Employment Benefits
The City contributes to the California Public Employees’ Retirement System (CalPERS), an
agent multiple-employer public employee defined benefit pension plan. CalPERS provides
retirement and disability benefits, annual cost-of-living adjustments and death benefits to plan
members and beneficiaries. CalPERS acts as a common investment and administrative agent
for participating public entities within the State of California. Benefit provision and all other
requirements are established by State statute and City ordinance. The amount of the City’s
required annual contribution is determined actuarially and is reported to the City via the
Annual Valuation Reports provided by CalPERS for each retirement plan.
It is the policy of the City to fully fund the annual contribution to ensure that the plan will
fully meet its obligation to retired employees on a timely basis. Prepaying the City’s unfunded
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liability will also reduce overall annual cost depending on whether approved actuarial
assumptions are realized and are not adjusted by the CalPERS Board.
As part of its cost reduction strategy, the City has implemented 2nd Tier and the state mandated
3rd Tier retirement benefit programs for new hires while also requiring all employees to pay
at least the full amount of the member-share of the annual retirement contribution. Beginning
in 2018-19, and increasing in 2019-20, the City negotiated further cost sharing with employee
groups to pay into CalPERS which will help lessen pension impacts to the City’s budget. The
City continues to monitor legal developments and legislation that could positively or
negatively impact the City’s finances and plans to counteract any adverse investment results
with additional payments to CalPERS.
The City has also established a Section 115 Trust fund with the California Employer’s Pension
Prefunding Trust (CEPPT) and had planned to make its first contribution of $2.4 million using
unassigned fund balance at the end of fiscal year 2022-23. Instead, the unassigned fund
balance was allocated to infrastructure projects which had increased in cost due to inflationary
factors. Deferral of contributions to the Section 115 Trust continue in the current fiscal year.
Despite not having contributed funding to the Section 115 Trust, the City has made $22.3
million in Additional Discretionary Payments to date.
All employees currently pay the full employee contribution. Total contribution rates as a
percent of salary, including any additional percentages agreed upon are listed in the table
below:
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Other Post-Employment Benefits (OPEB). The City’s primary OPEB cost obligation is for
retiree health benefits under its election to participate in the CalPERS Health Benefit Program
under the “unequal contribution option.”
When the City joined the CalPERS health plan in 1993, it immediately experienced an
increase in the plan choices available along with a significant reduction in rates. Due to
CalPERS purchasing power, the City continues to experience competitive health care rates.
However, as a condition of joining the CalPERS health program, the City agreed to contribute
the minimum monthly amount required by law towards retiree health care coverage for both
active and retired employees. This allows retired employees to purchase health insurance at
the same rate offered to active employees.
Additionally, the City had established certain post-retirement health care benefits available to
executive management employees appointed prior to August 2000. There is only one
employee remaining who receives one-half of the retiree health insurance premiums paid by
the City through the City's group health plan. This provision ceases upon the death of the
retired employee. These OPEB benefits were financed on a pay-as-you-go basis in the past.
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TRANSMITTAL MEMORANDUM
As directed by Council in May 2008, the City began fully pre-funding the OPEB obligation
via an irrevocable trust in fiscal year 2008-09.
Additional information on the City’s retirement and post-employment benefits can be found
in Note 9 in the notes to the financial statements.
GASB Pronouncements for fiscal year 2024-25
GASB Statement No. 102 – Certain Risk Disclosures – The primary objective of this
Statement is to provide users of government financial statements with essential information
about risks related to a government’s vulnerabilities due to certain concentrations or
constraints. The City has implemented this statement in the current fiscal year .
AWARD FOR EXCELLENCE IN FINANCIAL REPORTING
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of
San Luis Obispo for its annual comprehensive financial report for the fiscal year ended June
30, 2024.
The Award Program
The Certificate of Achievement is a prestigious national award recognizing conformance with
the highest standards for preparation of State and local government financial reports.
In order to be awarded a Certificate of Achievement, a government unit must publish an easily
readable and efficiently organized annual comprehensive financial report whose contents
conform to program standards. This report must satisfy both U.S. generally accepted
accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. The City has received a
Certificate of Achievement each year since 1984. Staff believe that the City’s current ACFR
continues to conform to the Certificate of Achievement program requirements and will submit
it to GFOA to determine its eligibility for another certificate.
Value of Program Participation. There are benefits to participating in these programs beyond
simply receiving recognition for the City’s efforts. For example, by striving to meet program
standards and goals, the City produces better reports. Additionally, as part of the review
process, comments for improvement from other municipal finance professionals who review
the reports from a “fresh” perspective are received. Staff believes that this results in
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TRANSMITTAL MEMORANDUM
continuous improvements in reporting the City’s financial results to elected officials, staff,
and other interested parties such as bondholders, credit agencies, and the public at-large.
ACKNOWLEDGMENTS
The preparation and development of this report would not have been possible without the
year-round dedication of the Finance Department staff and their special efforts, working in
conjunction with the City's independent auditors, to produce this document.
We would like to take this opportunity to compliment all those staff members within each
City department, as well as our independent auditors who were associated with the preparation
of this report. We would also like to thank the City Council for the continued support and
dedication in planning and conducting the financial operations of the City in a fiscally
responsible and progressive manner.
Whitney McDonald, City Manager
Emily Jackson, Finance Director
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DIRECTORY OF OFFICIALS AND ADVISORY BODIES
CITY COUNCIL
Erica A. Stewart Mayor
Emily Francis Vice Mayor
Mike Boswell Council Member
Jan Marx Council Member
Michelle Shoresman Council Member
ADVISORY BODIES
Active Transportation Committee
Administrative Review Board
Architectural Review Commission
Construction Board of Appeals
Council Compensation Committee
Cultural Heritage Committee
Housing Authority
Human Relations Commission
Investment Oversight Committee
Mass Transportation Committee
Parks and Recreation Commission
Personnel Board
Planning Commission
Promotional Coordinating Committee
Revenue Enhancement Oversight Commission
Tourism Business Improvement District Board
Tree Committee
APPOINTED OFFICIALS AND DEPARTMENT HEADS
Appointed Officials
Whitney McDonald City Manager
J. Christine Dietrick City Attorney
Department Heads
Scott Collins Assistant City Manager
Greg Hermann Deputy City Manager
Timmi Tway Director of Community Development
Emily Jackson Director of Finance
Todd Tuggle Fire Chief
Nickole Domini Director of Human Resources
Richard Scott Police Chief
Aaron Floyd Director of Public Works and Utilities
Greg Avakian Director of Parks & Recreation
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MISSION STATEMENT
SAN LUIS OBISPO STYLE
Quality with Vision WHO ARE WE?
People Serving People
A team that puts high value on each citizen it serves.
Providers of programs that meet basic service needs of each citizen.
Enhancers of the quality of life for the community as a whole.
WHAT DO WE STAND FOR?
Quality in all Endeavors –Pride in Results
Service to the community –the best –at all times.
Respect –for each other and for those we serve.
Value –ensuring delivery of service with value for cost.
Community involvement –the opportunity to participate in attaining the goals of the City.
WHERE ARE WE GOING?
Into the Future with a Design
Planning and managing for levels of service consistent with the needs of the citizens.
Offering skills development and organizational direction for employees in order to improve the delivery of
municipal services.
Developing sources of funding and establishing a sound financial management program which will result in
fiscal independence and flexibility in the delivery of City services.
Providing the residents of the City with accurate and timely information on issues which affect them, and
encouraging the full utilization of City services.
Promoting the City as a regional trade, recreational and tourist center and improving the quality of life for
residents and visitor.
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ORGANIZATIONAL VALUES
We, as an organization, embrace opportunities to improve our services and the quality and effectiveness of our
relationships with the community and our teams. The following values guide and inspire our efforts.
Shared Vision, Mission and Goals
We have a sense of common purpose and direction pursued with passion and translated into concrete actions.
Service
We are dedicated to the best use of resources to fulfill identified community goals and needs.
Leadership and Support
We recognize that the ability to lead can be found at all levels and that to create an environment to succeed requires
leading by example.
Communication
We foster open and clear discussion that encourages the willingness to speak up and to listen, within a framework of
respect and understanding.
Team Players
We encourage effective working relationships within and between departments and the public to address issues and
achieve valuable results.
Honesty, Respect and Trust
We honor commitments, acknowledge legitimate differences of opinion and accept decisions reached with integrity.
Initiative and Accountability
We take personal responsibility to do what needs to be done and report the results in a straightforward manner.
Innovation and Flexibility
We are open to change and willing to try new ways to fulfill the organization’s vision, mission, and goals more
effectively.
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Employee Development and Recognition
We encourage and support each employee to improve relevant job skills and celebrate personal and team
accomplishments.
Stewardship and Ethics
We promote public trust by using City resources wisely, and through consistent fulfillment of these values.
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Patrol Fire, Medical & Haz Mat Natural Resources Recruitment Community Services Administration
Traffic Safety Emergency Response Economic Development Labor Relations
Investigations Hazard Prevention Cultural Activities Fair Employment
Neighborhood Services Fire Inspections City Clerk Services Risk Management
Animal Regulation Disaster Planning General Administration Human Relations
Information Technology
GIS Management
Budget Recreation Programs Water Engineering Long Range Planning
Purchasing Ranger Services Sewer Transportation Development Review
Accounting & Revenue Park Planning Utilities Resource Creek & Flood Protection Building & Safety
Support Services Golf Course Conservation Maintenance Services:CDBG Administration
Finance Administration Public Art Whale Rock Reservoir Streets, Parks, Bldgs Housing
* All Department Heads are appointed by the City Manager
RESIDENTS
ADVISORY
BODIES
CITY
MANAGER
MAYOR &
CITY COUNCIL
DeptAppointed by the City Council Reporting to the City Manager
CITY
ATTORNEY
Police Fire
Finance Community
Development
Administration
Dept Reporting to the Assistant City Manager
Utilities
Human
Resources
Parks &
Recreation
Public
Works
Community Services
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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of San Luis Obispo
California
For its Annual Comprehensive
Financial Report
For the Fiscal Year Ended
June 30, 2024
Executive Director/CEO
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FINANCIAL SECTION
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INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the governmental activities, the business-
type activities, each major fund, and the aggregate remaining fund information of the City of San Luis
Obispo, California (City) as of and for the year ended June 30, 2025, and the related notes to the
financial statements, which collectively comprise the City’s basic financial statements as listed in the
table of contents.
In our opinion, the accompanying financial statements present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major
fund, and the aggregate remaining fund information of the City, as of June 30, 2025, and the respective
changes in financial position and, where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States
of America (GAAS) and the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are required to be independent of the City and to meet our other
ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in
accordance with accounting principles generally accepted in the United States of America, and for the
design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Page 233 of 525
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 2
In preparing the financial statements, management is required to evaluate whether there are conditions
or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue
as a going concern for twelve months beyond the financial statement date, including any currently
known information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance
and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a
material misstatement when it exists. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control. Misstatements are considered
material if there is a substantial likelihood that, individually or in the aggregate, they would influence
the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, and design and perform audit procedures responsive to those risks. Such
procedures include examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is
expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate,
that raise substantial doubt about the City’s ability to continue as a going concern for a
reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit, significant audit findings, and certain internal control–
related matters that we identified during the audit.
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis, budgetary comparison information, pension plan and OPEB
plan information on pages 33-59 and 137-147 be presented to supplement the basic financial statements.
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To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 3
Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of America,
which consisted of inquiries of management about the methods of preparing the information and
comparing the information for consistency with management’s responses to our inquiries, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial
statements. We do not express an opinion or provide any assurance on the information because the
limited procedures do not provide us with sufficient evidence to express an opinion or provide any
assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the City’s basic financial statements. The local sales tax measure funding schedule,
combining and individual nonmajor fund financial statements and budgetary comparison schedules,
are presented for purposes of additional analysis and are not a required part of the basic financial
statements.
The local sales tax measure funding schedule, the combining and individual nonmajor fund financial
statements and budgetary comparison schedules on pages 151-205 are the responsibility of
management and were derived from and relate directly to the underlying accounting and other records
used to prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional procedures,
including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the basic financial statements or to the basic financial statements themselves,
and other additional procedures in accordance with auditing standards generally accepted in the
United States of America. In our opinion, the local sales tax measure funding schedule, the combining
and individual nonmajor fund financial statements and budgetary comparison schedules are fairly
stated in all material respects in relation to the basic financial statements as a whole.
Other Information
Management is responsible for the other information included in the annual comprehensive financial
report. The other information comprises the introductory and statistical sections but does not include
the basic financial statements and our auditor's report thereon. Our opinions on the basic financial
statements do not cover the other information, and we do not express an opinion or any form of
assurance thereon. In connection with our audit of the basic financial statements, our responsibility is
to read the other information and consider whether a material inconsistency exists between the other
information and the basic financial statements, or the other information otherwise appears to be
materially misstated. If, based on the work performed, we conclude that an uncorrected material
misstatement of the other information exists, we are required to describe it in our report.
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To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 4
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 16,
2025, on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance.
Badawi & Associates, CPAs
Emeryville, California
December 16, 2025
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Management’s Discussion and Analysis
Overview of the Financial Statements
The discussion and incorporated analysis in this document are intended to serve as an introduction
to the City’s basic financial statements, which include the following components: (1) government-
wide financial statements, (2) fund financial statements and (3) notes to financial statements. This
report also contains required supplementary information (RSI) as well as other supplemental
financial information.
Government-wide Financial Statements. This set of statements is designed to provide readers
with a broad overview of the City’s finances, in a manner similar to private-sector business
reporting.
The Statement of Net Position presents financial information on all the City’s assets/deferred
outflows of sources and liabilities/deferred inflows of sources, with the difference reported as net
position. In the private sector, it is similar to a balance sheet.
Over time, increases or decreases in net financial position may serve as a useful indicator of
whether the financial position of the City is improving or declining. In conformance with GASB
68, the Statement of Net Position reported for fiscal year 2024-25 considers the City’s long-term
pension liabilities, effectively decreasing the City’s net financial position.
The Statement of Activities presents changes in the government’s net position during the most
recent fiscal year. All changes in net position are reported during the period when the underlying
events giving rise to the change occur, regardless of the timing of the related cash flow. Thus,
revenues and expenses are reported in this statement for some items that will only result in cash
flows in future fiscal periods such as revenue pertaining to uncollected taxes.
The City’s government-wide financial statements distinguish the functions of the City that are
principally supported by taxes and intergovernmental revenues (governmental activities) from
functions that are intended to recover all or a significant portion of their cost through user fees or
that are required by grantor agencies or City policies to be accounted for in this fashion (business-
type activities).
The governmental activities include: (1) public safety, (2) transportation, (3) leisure, cultural and
social services, (4) community development and (5) general government support services such as
legal services, elections, human resources, risk management, finance, and information technology.
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Management’s Discussion and Analysis
The business-type activities of the City include: (1) water, (2) sewer, (3) parking operations and
the (4) transit program.
As required by U.S. Generally Accepted Accounting Principles (GAAP), these financial
statements present the City (the primary government) and its component units (entities for which
the government is considered to be financially accountable). Blended component units, although
legally separate entities, are in substance, part of the government's operations and data from these
units are combined with data of the primary government.
The San Luis Obispo Capital Improvement Board, the San Luis Obispo Public Financing Authority
and the San Luis Obispo Parking Authority are reported as blended component units in these
statements. All provide financing for the construction and acquisition of City facilities and consist
of members of the City Council. Activities of these units are accounted for in the applicable City
governmental funds. Separate financial statements are not prepared for the San Luis Obispo
Capital Improvement Board, San Luis Obispo Public Financing Authority, or San Luis Obispo
Parking Authority. The City has no component units that require discrete presentation in
accordance with Governmental Accounting Standards Board (GASB) standards.
Pension Obligation. Pursuant to GASB Statement No. 68 (GASB 68), Accounting and Financial
Reporting for Pensions, the City reports on the unfunded pension liability on the full accrual basis
of accounting in the government-wide financial statements. The reports also include disclosure
requirements and supplementary schedules as required by GASB 68. The measurement date for
fiscal year 2024-25 pension liabilities is as of the fiscal year ended June 30, 2024. This date lags
by a year, reflecting the time it takes for the pension system to prepare reports, which is common
for all member agencies, and was used so that these financial statements could be issued in an
expedient manner. Activity (i.e., contributions made by the City) occurring during fiscal year
2024-25 are reported as deferred outflows of resources in accordance with GASB Statement No.
71.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated for specific activities or objectives. The City, like
other state and local governments, uses fund accounting to ensure and demonstrate compliance
with finance-related legal requirements. All of the funds of the City can be divided into three
categories: (1) governmental funds, (2) proprietary funds, and (3) fiduciary funds.
Governmental Funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements. However, unlike
the government-wide financial statements, governmental fund financial statements focus on near-
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Management’s Discussion and Analysis
term inflows and outflows of spendable resources, as well as on balances of spendable resources
available at the end of the fiscal year. Such information reflects financial resources available in the
near future to finance the City’s programs.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements.
By doing so, readers may better understand the long-term impact of the government’s near-term
financial decisions. Both the governmental funds balance sheet and the governmental funds
statement of revenues, expenditures and changes in fund balances provide a reconciliation to
facilitate this comparison between governmental funds and governmental activities.
The City maintains several individual governmental funds organized according to their purpose
(general, special revenue, debt services, and capital projects). Information is presented in the
governmental funds balance sheet and in the governmental funds statement of revenues,
expenditures, and changes in fund balances. The General Fund and Capital Outlay Fund are both
considered major funds1. Data from the non-major governmental funds are combined into one
aggregated presentation. Individual fund data for each of the non-major governmental funds is
provided in the form of combining statements in the supplementary information section in this
report.
Of the major funds, the City adopts an annual appropriated budget for the General Fund. A
budgetary comparison statement has been provided as required supplementary information to
demonstrate compliance with the budget. Budgetary information for non-major governmental
funds with annual budgets has been provided with the fund financial statements in the
supplementary information section in this report.
Proprietary Funds. Proprietary funds are generally used to account for services for which the City
charges customers; either outside customers or internal units/divisions of the City. Proprietary
funds provide the same type of information as shown in the government-wide financial statements,
only in more detail.
The only type of proprietary funds the City maintains is enterprise funds. The Water, Sewer,
Parking, and Transit Funds are presented as business-type activities in the government-wide
financial statements. The City considers all four of its enterprise funds to be major funds.
1 See Note 1 Summary of Significant Accounting Polices for a detailed explanation of fund types including major
funds.
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Management’s Discussion and Analysis
Fiduciary Funds. Custodial funds are the only type of fiduciary funds maintained by the City.
These are used to account for resources held for the benefit of parties outside the primary
government. Fiduciary funds are not reflected in the government-wide financial statements
because the resources of those funds are not available to support the City’s own programs. An
example of a custodial fund may include donations provided to the City to be utilized for specific
purposes (i.e. open space, environmental mitigation funds, etc.) as well as other funds held in trust
of another entity to be utilized for a specific purpose. A specific example is the Hazardous
Materials Task Force Fund, created to provide special fire services around the county, which is
funded by multiple county and city agencies.
The accounting used for fiduciary funds is much like that used for proprietary funds. The Custodial
Funds are presented with the fund financial statements in the supplementary information section.
Notes to the Financial Statements. The notes provide additional information that is essential to
the reader for a full understanding of the data provided in the government-wide and fund financial
statements.
Other Information. In addition to the basic financial statements and accompanying notes, this
report also presents required supplementary information including budgetary comparison
schedules, reporting of the local transaction tax measure (Measure G and G-20) and more detailed
information concerning the City’s net pension liability, schedule of contributions to the pension
plan and progress in funding its obligation to provide other post-employment benefits (OPEB).
Statistical Information. The statistical section presents detailed information as a context for
understanding what the information in the financial statements, notes disclosures, and required
supplementary information indicates about the City’s overall financial health. This information
has been adjusted over time to also serve as required bond disclosure information.
Financial Highlights
The following information provides a narrative overview and analysis of the financial activities of
the City of San Luis Obispo (City) for the fiscal year that ended June 30, 2025. It should be read
in conjunction with the transmittal memorandum, the basic financial statements, and the
accompanying notes.
In fiscal year 2024-25 the City Manager activated the Fiscal Health Contingency Plan (FHCP) in
April 2025 in order to address the economic uncertainty and forecasted future budget deficits. Due
to its activation towards the end of the fiscal year, the FHCP did not contribute significantly toward
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Management’s Discussion and Analysis
expenditure savings at year end, but did help to preserve some flexibility to address the forecasted
deficits. Total revenue for the General Fund finished approximately $1.0 million below budget due
to lower sales tax receipts, a decline in fee revenues, and delays in reimbursement for the winter
storms that occurred during 2023. While some individual revenue streams underperformed, the
broader categories of tax revenue, user fees, and general government revenue all exceeded budget.
Winter Storm update
In January and March 2023, the city and region experienced severe winter storms that resulted in
two separate emergency declarations at the Federal and State level, as well as emergency
proclamations at the local level. The City is eligible for reimbursement for a majority of the storm
related costs through the Federal Emergency Management Agency (FEMA) and the California
Disaster Assistance Act (CDAA). Although, all storm related expenditures have been submitted
for reimbursement as of fiscal year 2024-25, the reimbursement process continues to move slowly
due to turnover in the FEMA Program Delivery Managers assigned to assist local agencies in
submitting projects for reimbursement and a lack of clarity about the information required in order
to submit projects. Based upon staff delivery capacity and FEMA reimbursement timeframes, staff
continues to prioritize storm damage projects founded upon the need to mitigate previously
completed projects, protect existing infrastructure, and/or represent projects that must be
completed. As of the end of fiscal year 2024-25, the City had received $1.02 million in storm
project reimbursement and another $920,000 in project expenses had been obligated by FEMA for
reimbursement not yet provided to the City.
Compensated Absences The City implemented the GASB 100 pronouncement during fiscal year
2023-24, a year earlier than required. The aim of the new guidance was to more accurately portray
the liability associated with employee leave balances by taking into account the likelihood that
these leave balances will be used or converted to cash for employees. For fiscal year 2024-25, this
results in an increase to overall leave liability of $179,000.
Housing Loans and Fee Deferrals The City administers an extensive housing program for
workforce and low-income housing. Through the program, the City has extended loans and impact
fee deferrals to low-income housing developers such as the Housing Authority of San Luis Obispo,
Transitions Mental Health, and People’s Self-Help Housing (to name a few). The loans are long-
term in nature, include a modest interest rate, and will become due in future years. The loans are
disclosed in the City’s financial statements under the respective governmental funds as loans
receivable and restricted within fund balance. The loans are reflected in the financial statements
net of an allowance for any that are forgivable at the end of the term if certain affordability
provisions are maintained. Detailed information can be found in Note 4 – Loans Receivables.
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Management’s Discussion and Analysis
Fair Value Adjustments The City follows the practice of pooling cash and investments for all
funds under its direct daily control. Interest earned on pooled cash and investments is allocated
quarterly to the various funds based on the respective funds’ average quarterly cash balance.
Investments are stated at fair value, based on quoted market prices in accordance with GASB
standards and are adjusted to reflect any unrealized gains and losses resulting from the fair value
adjustment annually. The City’s investments and effects of the fair value adjustment are reflected
in the Financial Statements under “Use of money and property” in all funds based on the City’s
mentioned practices. More information on the City’s investments can be found in Note 2 – Cash
& Investments.
The following outlines financial highlights for the year which are detailed in the table on page 9
of the Management Discussion and Analysis.
Per the Statement of Net Position, total City-wide assets increased by approximately $75
million to $1,020 million representing an increase of 8%. The assets and deferred outflows of
resources of the City exceeded liabilities and deferred inflows at June 30, 2025 by $585 million
(net position). Cash and investment and receivable balances remained consistent with the prior
year ending at $251 million and $54.2 million citywide, respectively. Capital assets increased
from $591 million to $649 million as a result of major investments in large projects including
construction on the new Cultural Arts District Parking Structure, upgrades to the Water
Resource Recovery Facility, and the purchase of 6 new transit buses. Meanwhile, overall
liabilities increased slightly from $436.9 million to $445 million due to increases to long-term
debt offset by decreases to OPEB and pension liabilities.
The City’s net pension liability, comprised of a one agent multiple-employer plan for its
miscellaneous employees and one cost-sharing multiple-employer plan for its safety
employees amounted to $178 million by the end of fiscal year 2024-25. The City’s
Miscellaneous plan decreased by $989,000 to end the year at $93.8 million. Meanwhile, the
City’s Safety plan also decreased by $2.1 million to end the year at $84.2 million. Together
this represents an overall decrease of 1.7% for overall net pension liability year over year.
In governmental activities, cash and investments increased by $20.4 million to $124.7 million
due to delays in design and construction of capital projects as well as grant reimbursements for
expenditures incurred in prior years. Meanwhile, prepaid items, representing cash outflows
occurring in the current year for next year’s expenditures, increased from $182,000 to
$712,520 due to prepaid health insurance premiums of $684,000 recorded at June 30, 2025.
Receivables from various sources increase by just over $4.4 million to $40.9 million due to the
timing of certain receivables owed to the City as of June 30, 2025 including outstanding
receivables from the San Luis Obispo County of Governments for $1.6 million, the County of
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Management’s Discussion and Analysis
San Luis Obispo for $1.4 million, the State Department of Water and Resources for $480,000,
and Cal Fire SLO for $450,000.
In business-type activities, total assets increased from $557 million to 595 million. This was
mainly attributable to increases in construction in progress and depreciable capitalized assets
in fiscal year 2024-25.
The City’s governmental funds reported combined ending fund balances of $148.6 million as
of June 30, 2025 representing a 21% increase from the prior year. Approximately $44.2 million
of this total is either nonspendable or restricted for transportation projects or specific programs
such as affordable housing, parkland development, public art, tourism, public safety, or
infrastructure improvement programs. Another $20.4 million is committed for purposes such
as general government programs, risk management, general contingency reserves, and public
safety programs. Committed fund balances represent the amount of money that is subject to
constraints imposed by the City Council. It takes formal action by the City Council to utilize
these funds for their specific purposes.
A further $80.6 million is assigned for total governmental funds and intended to be used for
specific purposes discussed in more detail later, and unspent appropriations that have been
rolled over into the 2025-26 fiscal year in accordance with the City’s budget policies. Assigned
fund balances represent the amount of money that the City Council or management has
identified for specific future purposes, but do not meet the criteria to be restricted or committed.
Any appropriation of these amounts would require City Council approval. The remaining $3.4
million remains unassigned for governmental funds as of June 30, 2025.
The total General Fund balance increased by 14% from $45.3 million to $51.8 million. After
taking into account non-spendable amounts of $5.5 million, committed funds of $19.9 million
including the current operating reserve, assigned fund balance of $22.3 million, and $3.4
million remains as unassigned balance on June 30, 2025, for the General Fund.
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Management’s Discussion and Analysis
Government-wide Overall Financial Analysis
Statement of Net Position Net position may serve over time as useful indicator of a
government’s financial position.
The following is the condensed statement of net position for the fiscal years ended June 30, 2024
and 2025.
For the fiscal year ending on June 30, 2025, the City’s combined total assets and deferred outflows
of resources were greater than its liabilities and deferred inflows of resources by $585.3 million.
The largest portion of the City’s net position reflects its investment in capital assets in the amount
of $441.7 million (e.g., land, buildings, infrastructure, machinery, and equipment), less any related
outstanding debt used to acquire those assets. The City uses these capital assets to provide services
to citizens; consequently, these assets are not available for future spending. Although the City’s
investment in its capital assets is reported net of related debt, it should be noted that the resources
needed to repay this debt must be provided from other sources, since the capital assets themselves
cannot be used to liquidate these liabilities.
Approximately $45.4 million of the City’s net position is subject to restrictions imposed by
external parties and its use is determined by those restrictions and contractual obligations. The
governmental and business-type activities each contributed $34.0 million and $26.0 million
respectively to the combined net position increase of $60.0 million resulting in a total net position
of $585.3 million on June 30, 2025.
2024-25 2023-24 2024-25 2023-24 2024-25 2023-24
Current and other assets 167,584,241$ 141,746,727$ 203,574,019$ 210,942,153$ 371,158,260$ 352,688,880$
Capital assets 256,946,258 245,583,137 391,653,070 345,734,319 648,599,328 591,317,456
Total assets 424,530,499 387,329,864 595,227,089 556,676,472 1,019,757,588 944,006,336
Total Deferred
Outflows of Resources 45,607,769 55,962,004 8,340,424 9,049,028 53,948,193 65,011,032
Current liabilities 15,809,183 15,670,923 26,800,043 25,540,111 42,609,226 41,211,034
Noncurrent liabilities 163,680,034 168,325,263 238,744,246 227,365,761 402,424,280 395,691,024
Total liabilities 179,489,217 183,996,186 265,544,289 252,905,872 445,033,506 436,902,058
Total Deferred
Inflows of Resources 6,869,661 9,499,175 36,501,859 37,289,442 43,371,520 46,788,617
Net position:
Net investment in
capital assets 241,392,407 228,447,288 200,340,066 183,458,877 441,732,473 411,906,165
Restricted 38,939,635 36,650,877 6,470,313 10,976,119 45,409,948 47,626,996
Unrestricted 3,447,348 (15,301,658) 94,710,986 81,095,190 98,158,334 65,793,532
Total Net Position 283,779,390$ 249,796,507$ 301,521,365$ 275,530,186$ 585,300,755$ 525,326,693$
CONDENSED STATEMENT OF NET POSITION
Governmental Activities Business-Type Activities Total
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Information about changes in net position for fiscal years 2024-25 and 2023-24 is summarized
below. Reasons for the changes are discussed in the following sections for governmental
activities and business-type activities.
Governmental Activities
The City’s net position in Governmental activities increased by $34 million to $283.8 million on
June 30, 2025 which is similar to FY 2023-24 in which it increased by $30.7 million. Most sources
of taxes remained consistent with the prior year, increasing just $261,000 versus the prior year as
a result of macroeconomic conditions that have slowed revenue growth. However, despite this
slowing of revenues, they still covered the overall program expenses which came in at $114.6
million representing a $2.1 million decrease over the prior year. The main reasons for this in part
were the deliberate reductions in spending in response to changes in forecasted revenue trends that
prompted the activation of the Fiscal Health Contingency Plan (FHCP) in April 2025 and salary
savings due to vacancies, though the activation of the FHCP occurred late into the fiscal year and
had minimal impact.
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Governmental Revenues. Revenues are divided into charges for services and general revenues
including applicable taxes as listed in the table below. General revenues are used to pay costs of
providing program services such as public safety, parks and open space, streetlights and traffic
signals, recreation opportunities, as well as economic development, and environmental
sustainability. Charges for services are revenues directly related to service activity while operating
and capital grants and contributions, and related investment earnings are a mechanism of cost
recovery.
As mentioned previously, total governmental revenues were consistent with the prior year,
increasing by just $261,000 and reflecting an overall slowing of recent revenue growth. Almost all
sources of tax revenues such as sales taxes, property taxes, and TOT were within 7% of prior year
totals with the exception of Utility User taxes which exceeded year over year amounts by 19% or
$1.2 million. This is mainly due to the volatility in this revenue stream that is based on both market
price and consumer utilization of utilities. Overall, these increases outpaced the decrease in
operating grant revenue which was higher in the prior year versus historic trends due to the timing
of awarded funding including American Rescue Plan Act (ARPA) funding received in the prior
year as well as funding for several affordable housing projects, and several community
development block grants received from the US Department of Housing and Urban Development.
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Top Governmental Activity Revenue Sources. As shown in the chart below, the City’s top five
tax revenues accounted for 67% or $97.3 million of total revenues, with service charges accounting
for another 14% or $20.1 million and remaining revenue including grant revenue, investment
income, and other miscellaneous revenues accounted for 19% or $27.7 million. Despite economic
volatility, most of the City’s main revenue sources performed well and above initial expectations.
The following chart compares program fee revenues and expenses which is useful when reviewing
the costs of various governmental activities:
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Management’s Discussion and Analysis
Financial Analysis of Governmental Funds
The focus of the City’s governmental funds is on near-term inflows, outflows and balances of
spendable resources. Such information is useful in assessing the City’s financing requirements and
meeting finance-related legal requirements. In particular, unassigned fund balance serves as a
useful measure of a government’s net resources available for spending at the end of the fiscal year.
Major Governmental Funds. In fiscal year 2024-25 the City maintained two major governmental
funds: the General Fund and the Capital Outlay Fund. The City’s General Fund is the principal
operating fund and reports all revenue and expenditures not required to be in a separate fund,
including Local Revenue Measure funding. It finances the day-to-day activities of the City. The
Capital Outlay Fund is used to account for the acquisition or construction of major capital facilities.
Changes in both are highlighted in the Financial Highlights section below.
Non-Major Governmental Funds. The City has numerous non-major governmental funds
including the Debt Service Fund and various Special Revenue Funds or Capital Projects Funds.
These funds are presented in the basic financial statements in the aggregate. A significant number
of these funds represent activity for capital projects. On June 30, 2025, these funds had an
aggregate fund balance of $64.1 million. Of this total, $38.6 million is restricted or committed for
payment of debt service or specific governmental programs such as transportation, affordable
housing, and impact fee or parkland development programs.
Governmental Fund Highlights
As of June 30, 2025, the City’s governmental funds reported combined ending balances of $148.6
million or an increase of 21% compared to the prior fiscal year. This was largely driven by stability
in tax revenue streams, despite slowing growth trends and macroeconomic conditions, as well as
very favorable investment income. This was further supported by department expenditures which
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all finished the year under budget as well as staffing vacancies that occurred throughout the year.
The total fund balance of the governmental funds consists of the following:
o Non-spendable fund balance represents prepaid items or items that by their nature
are not in a spendable form. $5,533,017 was held in non-spendable at fiscal year-
end in the General Fund including an interfund loan between the General Fund and
the Parking Fund in the amount of $4.7 million to finance the purchase of property
located at 1166 Higuera Street and prepaid insurance premiums.
o Restricted fund balance of $38.7 million, including $10.4 million for affordable
housing programs, $7.9 million for transportation related projects, $1.6 million for
tourism programs, and $1.6 million for public art programs. These restricted fund
balances were held entirely within non-major governmental funds.
o Committed fund balance amounted to $20.4 million accounting for the City’s
reserve funds as prescribed by its Fund Balance and Reserve policies with $19.9
million held by the General fund and $509,000 held by non-major governmental
funds.
o Assigned fund balance of $80.6 million includes the amounts to be used for specific
purposes of the City but do not meet the criteria to be classified as restricted or
committed. Funds in this category include funds to be used for Development
Services, purchase orders and encumbrances that have been rolled over into fiscal
year 2025-26 in accordance with the City’s budget policies, an additional
discretionary payment to CalPERS, the section 115 Trust Fund, and solid waste
funds collected through AB939. The City also established a Revenue Stabilization
Reserve in fiscal year 2021-22 of $2 million to help insulate or smooth out budget
impacts from large fluctuations in tax revenue. The largest portion of the assigned
fund balance, approximately $59.9 million represents outstanding encumbrances
and capital projects at year end to be carried forward into the next fiscal year.
o Unassigned fund balance at year end was $3.4 million for the General fund and
($46,000) for the non-major governmental funds. The City’s capital outlay fund did
not have any unassigned amounts at June 30, 2025. The use of the unassigned fund
balance will be prioritized based on City Council direction and City policy.
More information about the aggregated non-major funds can be found in the combining and
individual fund statements and schedules immediately following the required supplementary
information.
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Financial Analysis of Enterprise Funds
The City’s business-type activities are financed through rates for services and should be self-
sufficient in covering their expenses with their sales and services revenue. Also called proprietary
funds, the City has four such entities: Water, Sewer, Parking, and Transit.
Water Fund
The City’s Water Fund is a business-type activity and is funded predominately through rates to
provide service. The City treats and delivers water to the public from three surface reservoirs as
well as recycled water for landscape irrigation. The water service is provided to all property owners
in the City including parks and sports fields.
The net position of the Water Fund rose by over $8.8 million during fiscal year 2024-25 ending
the year at $118.8 million, an increase of 8% over the prior year. Supporting the upward trend
were operating revenues that came in $3 million higher and represent an increase of 9% over the
2024-25 2023-24 2024-25 2023-24 2024-25 2023-24 2024-25 2023-24
Operating revenues 34,356,427$ 31,394,962$ 24,096,372$ 23,302,912$ 8,307,559$ 9,663,683$ 990,738$ 1,003,116$
Operating expenses 27,485,998 25,043,587 14,252,243 17,754,034 6,373,905 6,615,881 6,358,316 5,352,380
Operating income (loss)6,870,429$ 6,351,375$ 9,844,129$ 5,548,878$ 1,933,654$ 3,047,802$ (5,367,578)$ (4,349,264)$
Nonoperating revenues 3,395,754$ 2,122,301$ 1,175,449$ (1,549,560)$ 232,820$ 1,237,070$ 6,499,829$ 5,471,995$
Capital Contributions - (1,387,992) (1,075,110) (1,451,616) (1,192,689) (375,212) (368,233) 4,712,879 -
Changes in net position 8,878,191$ 7,398,566$ 9,567,962$ 2,806,629$ 1,791,262$ 3,916,639$ 5,845,130$ 1,122,731$
Net position - beginning of year 109,961,981$ 102,563,415$ 122,333,448$ 119,526,819$ 34,133,265$ 30,216,626$ 9,101,492$ 7,978,761$
Prior year restatement (5,032) (5,561) (80,773) -
Net position - end of year 118,835,140$ 109,961,981$ 131,895,849$ 122,333,448$ 35,843,754$ 34,133,265$ 14,946,622$ 9,101,492$
Summary of Revenues, Expenses, and Changes in Enterprise Fund Net Position
Water Sewer TransitParking
2024-25 2023-24
Operating revenues 34,356,427$ 31,394,962$
Operating expenses 27,485,998 25,043,587
Operating income (loss)6,870,429$ 6,351,375$
erating revenues (expenses) 3,395,754$ 2,122,301$
Contributions - Transfers out (1,387,992) (1,075,110)
Changes in net position 8,878,191$ 7,398,566$
Net position - beginning of year 109,961,981$ 102,563,415$
Prior year restatement (5,032)
Net position - end of year 118,835,140$ 109,961,981$
Water Fund
Summary of Revenues, Expenses, and Changes in
Enterprise Fund Net Position
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prior year. This was mainly due to the increases in demand as well as increases in Council adopted
water rates for fiscal year 2024-25. Meanwhile, impact fee revenues and other operating revenues
deviated little from the prior year amounts coming in at $4.8 million and $227,000 respectively.
Non-operating revenues, however, increased significantly more than the prior year, and amounted
to $3.4 million. This represents an increase of $1.3 million or 60% and was mainly the result of a
$762,000 increase in grant revenue over the prior year primarily from Proposition 1 and CalOES
programs. In addition, the Fund benefited from more favorable investment income which came in
$693,000 higher in fiscal year 2024-25. The increases in revenue outpaced the $2.4 million
increase in year over year operating expenses which are comprised of salaries and benefits,
supplies and maintenance, contract services, administration, and depreciation. Of these, contract
services was the main driver in the overall increase in operating expenses and included the City’s
contribution to repairing the Nacimiento reservoir because of the 2023 winter storms.
Sewer Fund
The City’s Sewer Fund is also a business-type activity that funds, operates, and maintains the
City’s sanitary sewer system and the Water Resource Recovery Facility (WRRF). An efficient
sanitary sewer system that collects and treats wastewater provides a foundation for public health
and community well-being. Rates and charges are the primary source of revenue for this fund.
The Sewer Fund’s net position rose by $9.6 million, ending fiscal year 2024-25 at $131.9 million,
an increase of 8% over the prior fiscal year. By comparison, the previous year’s change in net
position was just $2.8 million. The overall increase was driven by the net effect of a $4.3 million
more favorable operating income and positive net nonoperating revenues and expenses. Within
2024-25 2023-24
Operating revenues 24,096,372$ 23,302,912$
Operating expenses 14,252,243 17,754,034
Operating income (loss)9,844,129$ 5,548,878$
Nonoperating revenues (expenses) 1,175,449$ (1,549,560)$
Capital Contributions - Transfers out (1,451,616) (1,192,689)
Changes in net position 9,567,962$ 2,806,629$
Net position - beginning of year 122,333,448$ 119,526,819$
Prior year restatement (5,561)
Net position - end of year 131,895,849$ 122,333,448$
Summary of Revenues, Expenses, and Changes in
Enterprise Fund Net Position
Sewer Fund
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operating revenues, modest growth in charges for sales and services, up $1 million, or 5%, was
partly offset by minor decreases in total impact fee revenues. Other sources of operating income
remained consistent with the prior fiscal year.
Operating expenses were significantly lower in fiscal year 2024-25, decreasing by $3.5 million or
20% compared to the prior year. The primary driver of this reduction was lower contract services
costs, while other major expense categories remained relatively stable. Contract services totaled
$1.8 million in fiscal year 2024-25, compared to $4.7 million in the prior year, making them the
main contributor to the more favorable operating income. This decrease was largely due to the
timing of costs associated with major construction projects, including upgrades to the WRRF.
Nonoperating revenues were also positive due to stronger investment earnings and significantly
lower interest expense, $2.5 million in fiscal year 2024-25, down from $5.1 million in the prior
year. The reduction in interest expense resulted from the City having recorded capitalized interest
in the prior year related to the 2018 Clean Water State Revolving Fund loan used for the
construction of the WRRF.
Parking Fund
The Parking Services program operates and maintains the City’s surface parking lots, on-street
metered spaces, parking structures, residential permit parking districts, and timed parking areas
throughout the city with a focus on the downtown area and residential neighborhoods.
Parking Fund operating revenues decreased from $9.7 million in the prior year to $8.3 million in
fiscal year 2024-25 as a result of several factors including: reduced parking rates, unexpected
failures in parking structure technology systems that affected revenue collection in the first half of
the year, and a decrease in citation revenue due to issues with the previous citation management
vendor.
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Operating expenses were consistent with the prior year coming in at $6.4 million compared with
$6.6 million in fiscal year 2023-24. This small decrease was driven by salary savings due to several
vacancies throughout the year as well as some savings in consulting services due to operational
adjustments, and efficiencies gained with digital communication and permit management.
Nonoperating revenues were down year over year and came in at $232,800 as the result of a
correction to lease revenue accounting and less investment related earnings realized as a result of
cash needed to fund ongoing investment in capital projects such as the new Cultural Arts District
parking structure. As a result, the Parking Fund’s net position increased by 5% or $1.7 million to
end the fiscal year at $35.8 million.
Transit Fund
SLO Transit provides reliable transit service for more than 660,000 passenger trips across eight
fixed routes, one tripper service, and one trolley service, supported by a fleet of 19 vehicles. In
fiscal year 2024-25, six new buses were added to the fleet and are expected to enter service by
Spring 2026.
During fiscal year 2024-25 the Transit Fund’s net position increased from $9.1 million to $14.9
million. While the Fund’s operating performance was consistent with the previous year, the
increase in overall fund balance was due to the timing of federal grant revenues recognized to fund
the replacement of diesel-powered buses with zero-emission models and to fund the expansion
buses needed to implement service enhancements identified as the highest priority
recommendation of the recent Transit Innovation Study. Grant revenue also included part of $12.1
2024-25 2023-24
Operating revenues 8,307,559$ 9,663,683$
Operating expenses 6,373,905 6,615,881
Operating income (loss)1,933,654$ 3,047,802$
erating revenues (expenses) 232,820$ 1,237,070$
Contributions - Transfers out (375,212) (368,233)
Changes in net position 1,791,262$ 3,916,639$
Net position - beginning of year 34,133,265$ 30,216,626$
Prior year restatement (80,773)
Net position - end of year 35,843,754$ 34,133,265$
Summary of Revenues, Expenses, and Changes in
Enterprise Fund Net Position
Parking Fund
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million awarded via the American Rescue Plan Act (ARPA) and allocated in fiscal years 2022-23
through 2024-25.
Operating revenue was consistent with the prior year totaling $991,000 and within $12,000 of the
prior year. Operating expenses were $1 million more than the prior year primarily as a result of
increases in contract services as well as increases in fuel, and electricity used for the expanding
electric bus fleet. Favorable investment earnings of $494,000 also boosted the performance of the
Fund and contributed to the ending net position of $14.9 million.
Combined Program Expenses and Revenue: Business-Type Activities. In fiscal year 2024-25,
the combined total revenues for business-type activities increased from $80.7 million to $89.2
million led by increases in service charges for fiscal year 2024-25 that were up by nearly $2.4
million from the prior year and making up $67.8 million of total revenues. This increase was
primarily driven by increases in the Water and Sewer Funds which saw increases of $3 million
and $793,000 respectively. Similar to the prior year, all enterprise funds experienced strong
investment income totaling $8.3 million and a favorable fair value adjustment at the end of fiscal
year 2024-25 totaling $1.7 million. Furthermore, overall grant revenues for business-type activities
was significantly higher in fiscal year 2024-25 versus the prior year, up from $6.8 million to $12.8
million. These factors contributed to all enterprise fund program revenues exceeding program
expenditures.
2024-25 2023-24
Operating revenues 990,738$ 1,003,116$
Operating expenses 6,358,316 5,352,380
Operating income (loss)(5,367,578)$ (4,349,264)$
erating revenues (expenses) 10,465,066$ 5,471,995$
Contributions - Transfers out 747,642 -
Changes in net position 5,845,130$ 1,122,731$
Net position - beginning of year 9,101,492$ 7,978,761$
Net position - end of year 14,946,622$ 9,101,492$
Transit Fund
Summary of Revenues, Expenses, and Changes in
Enterprise Fund Net Position
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As seen below, program revenue exceeded program expenses for all of the City’s Enterprise Funds
with the Water and Sewer Funds performing the strongest. This was largely driven by investment
earnings, which remained strong during the fiscal year. These earnings are unpredictable and
outside of the City’s control and should not be relied upon as an ongoing source of funding for the
programs.
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General Fund Budgetary Highlights
A detailed budgetary comparison schedule for the year ended June 30, 2025, is presented as
required supplementary information following the notes to the financial statements. The final
budget amounts include changes that were approved by the City Council through June 30, 2025.
The following summarizes the original General Fund budget compared with the adjusted final
budget for fiscal year 2024-25. The adjusted final budget includes Council approved adjustments
as well as administrative budget adjustments in accordance with the City’s adopted fiscal policies
and procedures.
As discussed below, differences between the original budget and the final amended budget reflect
the following key changes:
Revenue budgets were increased by $9 million from $118.6 million to $127.7 million and
reflect the addition of FEMA reimbursements which were initially forecasted but not
budgeted.
Overall expenditure budgets were also increased by approximately $5.4 million for the
General Fund due to carryover of funding for contracts and commitments from the prior
fiscal year. Significant differences between the original and final expenditure budgets
include increases in anticipated Public Safety and General Government programs.
Net Other sources (uses) are comprised of transfers in or out and were originally budgeted
at $22.6 million and revised to $28.5 million in the final budget. Transfers may be used to
provide resources from the General Fund to other funds such as the Capital Outlay Fund
or other non-major governmental funds.
General Fund 2024-25
Ori ginal Budget
2024-25
Final Budget
Positive (Negative)
Variance
Revenues 118,611,840$ 127,728,819$ 9,116,979$
Expenditures 93,826,330 99,228,674 (5,402,344)$
Other sources (uses)(22,612,412) (28,487,384) (5,874,972)$
Beginning fund balance 45,329,766 45,329,766 -$
Ending fund balance 47,502,864$ 45,342,527$ (2,160,337)$
General Fund Budgetary Highlights
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The following table compares the actual results for revenues, expenditures, and fund balance with
the final budget for the General Fund. As the table shows, revenues were within $814,000 of their
budget amounts. While there was some variability between budgeted revenue streams and actual
results for the fiscal year 2024-25, overall tax revenues were within 1% of budget and user fees
were within 2%, transient occupancy tax of 8%. Furthermore, favorable investment earnings
counter balanced the shortcomings with budgeted 2023 storm reimbursements as the City received
just $909,090 versus $8.7 million.
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Detail for the Local Revenue Measure
The City’s Local Revenue Measure (one and a half percent transaction tax) is a component of the
General Fund. The activities reflected in the Financial Statements of this report are provided for
information regarding the use of the Measure’s revenue according to the community’s priorities
and the recommendation of the Revenue Enhancement Oversight Commission, a City Council
advisory body, overseeing the allocations. For fiscal year 2024-25, the following revenues and
expenditures were recorded:
Capital Assets and Debt Administration
Capital Assets. Capital assets, including infrastructure, are those assets that are used in the
performance of the City’s functions. As of June 30, 2025, the City’s investment in capital assets
for its governmental and business type activities increased to $648.6 million (net of accumulated
depreciation). The investment in capital assets includes things such as open space, park
improvements, buildings and associated improvements, vehicles and equipment, streets, bikeways,
water, wastewater, and storm drain systems.
Revenues
Local Transaction and Use Tax 30,926,285$
30,926,285$
Expenditure Allocations by Priority
Address Homelessness 907,987$
Community Safety and Emergency Preparedness 6,625,118
Creek and Flood Protection 1,718,128
Economic Development and Business Retention 200,000
Open Space/Natural Areas Preservation and Maintenance 1,555,889
Other Services and Projects 3,342,390
Protect Financial Stability 1,178,100
Safe and Clean Public Areas 1,889,662
Street Maintenance and Transportation (incl bike and ped improvements) 9,150,627
Youth/Senior Services and Recreation Facilities 5,287,099
31,855,000$
Net Change in Fund Balance (928,715)$
Fund Balance Beginning of Year 1,776,826
Fund Balance End of Year 848,111$
For the Fiscal Year Ended June 30, 2025
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Major capital asset2 expenditures during the fiscal year included the following:
$25.6 million for continued work on the Cultural Arts District Parking Structure
$9.7 million for continued work on the Water Resource Recovery Facility upgrade projects
$6.1 million for purchase of 6 new electric buses
$5.8 million for continued work on the Mid-Higuera Bypass
$3.1 million for continued work on the Johnson Waterline Replacement project
$2.8 million for roadway sealing throughout the City
$1.8 million for the completion of the Laguna Lake Dog Park
$1.7 million for new water distribution meters and boxes
$1.6 million for continued work on the Sierra Way Sewer Replacement project
Long-Term Debt. As of June 30, 2025, the City’s long-term debt increased by $11.1 million
to $224.9 million outstanding. The modest increase reflects additional draw downs on the 2018
Clean Water State Revolving Fund loan used to finance improvements at the Water Resource
Recovery Facility, offset by routine principal payments on other outstanding debt. In addition,
the City recognized a total of $75,000 in subscription-based IT arrangements (SBITAs) in
accordance with the implementation of GASB 96 and $276,000 in leases in accordance with
GASB 87.
The California Government Code provides for a limit on debt secured by real property of 3.75%
based on market value. The City’s debt management policy, however, sets a lower debt limit of
2% of assessed valuation. As of June 30, 2025, 2% of the assessed valuation was $260 million3.
2 Additional information on the City’s capital assets can be found in Note 5 on page 103 to the basic
financial statements.
3 Based on the San Luis Obispo County Assessor’s 2024-25 Annual Valuation report
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Management’s Discussion and Analysis
As of June 30, 2025, the City did not have any general obligation debt subject to the limit.
Additional information about the City’s long-term debt can be found in Note 7 to the basic financial
statements.
Economic Factors and Next Year’s Budget and Rates
The City’s 2025-27 Financial Plan reflects the current economic realities, and significant input
from the community, advisory bodies, and the City Council. The two-year budget reflects a time
of transition with revenue growth projected to slow amidst rising costs of goods and services.
There is also growing uncertainty resulting from a rapid shift in national economic policy via
tariffs, and potential significant state and federal budget cuts.
In recent years, the City experienced strong revenue growth in recent years due to post-COVID
economic recovery, voter approval of the Local Revenue Measure (LRM) in 2020, and a surge in
development activity. These factors boosted sales tax, transient occupancy tax (TOT), and
development-related revenues, allowing the City to fund capital projects and expand services.
However, this growth has slowed significantly. Inflation and high interest rates have cooled
consumer spending and reduced development activity. As a result, the City now faces:
Flattening sales tax revenues – including LRM receipts trending at least $2.4 million below
last year’s forecast
Falling development revenues – down about $600,000 in fiscal year 2024-25, which is
expected to persist in future years due to a decrease in the high volume of development
activity compared to prior years
Rising costs -- for personnel, construction materials, insurance, utilities, and labor
Ongoing inflationary pressures – affecting spending and project costs
To manage these challenges, the City activated its Fiscal Health Contingency Plan (FHCP) in April
of 2025, instituting a hiring and travel chill to control expenditures while maintaining flexibility
to address a structural deficit projected in fiscal year 2025-26 as well a future budget years.
Although the two-year Financial Plan is balanced, long term projections show structural deficits
to continue with a $3 million deficit in fiscal year 2027-28 and $2 million in fiscal year 2028-29
primarily due to the cost of opening a fifth fire station and continued slow revenue growth.
The City adopted the fiscal year 2025-27 Financial Plan in June of 2025 which included a budget
of approximately $217.6 million for fiscal year 2025-26. The new plan will guide the City through
June 2027 and focuses on key priorities identified through community engagement, such as
addressing homelessness, housing insecurity, public safety, sustainable transportation, and climate
action.
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Management’s Discussion and Analysis
Water Rates. The Council adopted 5.5% increases to the current rates each fiscal year on July 1,
2025, and on July 1, 2026. These changes are driven primarily by the rising costs of operating and
maintaining the City’s water system, as well as critical capital improvement projects. These
updates also reflect regulatory compliance expenses, including ongoing water quality and
environmental standards, and inflationary impacts that have raised the cost of essential supplies
and services. Additionally, the water rate adjustments help fund ongoing improvements to the
water treatment system, the implementation of Advanced Metering Infrastructure (AMI), and
projects to maintain reliable, resilient service for the community’s current and future needs.
Sewer Rates. The Council adopted 6.5% increases to the current rates each fiscal year on July 1,
2025, and on July 1, 2026. These changes are needed to address growing costs of operations and
maintenance, capital renewal, and stringent environmental regulations. These rates support the
City’s efforts to meet evolving regulatory requirements, maintain critical infrastructure, and
replace aging facilities to ensure the continued safe and reliable treatment of wastewater. The
adjustments are essential to fund key upgrades, while also reducing reliance on debt for future
infrastructure needs.
The City adopts its water and sewer rates with the two-year Financial Plan and in accordance with
Proposition 218 requirements.
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Management’s Discussion and Analysis
2025-27 Water Rates
2025-27 Sewer Rates
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Management’s Discussion and Analysis
Parking Rates. Parking rate studies are typically conducted every two to five years to evaluate
parking operations and to address changing needs in the community. Following community
response to the rate increases that went into effect in July of 2023, the City began working closely
with a consultant in January of 2024 on a Parking Rate Study. The rate study recommended parking
rates and policy changes based on updated revenue forecast modeling and extensive community
feedback. This effort culminated in May 2024 with the City Council approving changes to make
parking more affordable for locals and visitors alike, while still enabling the Parking Fund to
remain financially sustainable. This included a 33% decrease in parking structure rates, 25%-31%
decreases for on-street parking rates, and a 47% decrease in monthly parking structure permit rates.
On-street downtown core parking time limits were also increased from 2 hours to 3 hours and there
was a 50% reduction in parking validation costs for businesses. The rate and policy changes went
into effect in July 2024. No future rate changes are planned at this time.
Requests for Additional Information
This financial report is designed to provide a general overview of the City’s finances for all those
interested. The City also prepares a Popular Annual Financial Report that can be found on the
City’s website under the Finance Department’s online documents. Questions concerning any of
the information provided in this report should be addressed to the Department of Finance, 990
Palm Street, San Luis Obispo, CA 93401.
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BASIC FINANCIAL STATEMENTS
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City of San Luis Obispo, California
Government-Wide Financial Statements
For the Fiscal Year Ended June 30, 2025
The government-wide financial statements are designed to provide readers with a broad overview of the City’s
finances, in a manner similar to a private-sector business.
The statement of net position presents information on all the City’s assets and deferred outflows,as well as
liabilities and deferred inflows, with the difference reported as net position.Over time,increases or decreases in net
position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the City’s net position changed during the current
fiscal year.All changes in net position are reported as soon as the underlying event giving rise to the change occurs,
regardless of the timing of related cash flows.Thus,all the current fiscal year’s revenues and expenses are
considered regardless of when cash is received or paid (e.g.,earned but unused vacation leave or uncollected taxes).
Government-wide financial statements distinguish City governmental activities that are principally supported by
taxes and intergovernmental revenues from other business-type activities that are intended to recover all or a
significant portion of their costs through user fees and charges.Governmental activities include public safety,
transportation,community development,leisure,cultural and social services,and general government.Business-
type activities include water, wastewater, parking, and transit.
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Governmental
Activities
Business-Type
Activities Total
Assets
Current assets:
Cash and investments 124,667,748$ 126,788,389$ 251,456,137$
Taxes receivable 12,887,286 - 12,887,286
Accounts receivable 5,517,510 14,320,683 19,838,193
Accrued interest receivable 4,751,965 1,447,357 6,199,322
Internal balances 4,845,000 (4,845,000) -
Prepaid items and other assets 712,520 - 712,520
Lease receivables 110,528 122,794 233,322
Total current assets 153,492,557 137,834,223 291,326,780
Noncurrent assets:
Cash and investments held by fiscal agent 594,469 22,180,922 22,775,391
Investment in joint venture - 3,990,064 3,990,064
Lease receivables 741,527 37,293,723 38,035,250
Loans receivable 12,755,688 2,275,087 15,030,775
Nondepreciable capital assets 57,133,759 231,759,572 288,893,331
Depreciable capital assets (net of accumulated
depreciation) 199,812,499 159,893,498 359,705,997
Total noncurrent assets 271,037,942 457,392,866 713,400,033
Total assets 424,530,499 595,227,089 1,004,726,813
Deferred Outflows of Resources
Other post-employment benefits related 1,656,166 840,675 2,496,841
Pension related 43,788,115 7,368,672 51,156,787
Unamortized loss on refunding of debt 163,488 131,077 294,565
Total deferred outflows of resources 45,607,769 8,340,424 53,948,193
Liabilities
Current liabilities:
Accounts payable 6,153,646 7,264,713 13,418,359
Accrued salaries 2,140,573 425,323 2,565,896
Unearned revenue 2,838,476 10,058,588 12,897,064
Interest payable 68,632 1,495,526 1,564,158
Other liabilities 103 - 103
Compensated absence - due within one year 3,269,019 612,256 3,881,275
Long-term debt - due within one year 1,338,734 6,943,637 8,282,371
Total current liabilities 15,809,183 26,800,043 42,609,226
Noncurrent liabilities:
Compensated absence - due in more than on year 1,401,008 262,395 1,663,403
Long-term debt - due in more than one year 14,378,605 206,681,366 221,059,971
Net OPEB liability 923,913 781,794 1,705,707
Net pension liability 146,976,508 31,018,691 177,995,199
Total noncurrent liabilities 163,680,034 238,744,246 402,424,280
Total liabilities 179,489,217 265,544,289 445,033,506
Deferred Inflows of Resources
Other post-employment benefits related 1,757,000 757,748 2,514,748
Pension related 4,357,953 - 4,357,953
Lease related 754,708 35,744,111 36,498,819
Total deferred inflows of resources 6,869,661 36,501,859 43,371,520
Net Position
Net investment in capital assets 241,392,407 200,340,066 441,732,473
Restricted
Debt service - 4,956,584 4,956,584
Risk management 594,469 - 594,469
Transportation projects 7,885,873 1,513,729 9,399,602
Affordable housing programs 10,394,877 - 10,394,877
Impact fee programs 14,891,812 - 14,891,812
Parkland development programs 599,240 - 599,240
Public art programs 1,557,871 - 1,557,871
Tourism programs 1,631,304 - 1,631,304
Public safety programs 671,669 - 671,669
Claims 712,520 - 712,520
Unrestricted 3,447,348 94,710,986 83,127,559
Total net position 283,779,390$ 301,521,365$ 570,269,980$
City of San Luis Obispo, California
Statement of Net Position
June 30, 2025
The accompanying notes are an integral part of these financial statements.
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City of San Luis Obispo, California
Statement of Activities
For the Fiscal Year Ended June 30, 2025
Functions/Programs Expenses
Charges for
Services
Operating
Grants and
Contributions
Capital Grants
and
Contributions
Governmental
Activities
Business-type
Activities Total
Governmental activities:
Public safety 47,552,699$ 4,272,202$ 850,914$ -$ (42,429,583)$ -$(42,429,583)$
Transportation 12,159,073 438,239 2,824,709 4,900,942 (3,995,183) -(3,995,183)
Leisure, culture and social services 13,669,496 5,298,964 103,402 - (8,267,130)-(8,267,130)
Community development 16,190,977 9,135,208 205,922 - (6,849,847)-(6,849,847)
General government 20,980,453 930,439 2,378,189 685,867 (16,985,958) -(16,985,958)
Interest on long-term debt 569,642 --- (569,642)-(569,642)
Total governmental activities 114,551,739 20,075,052 6,363,136 5,586,809 (82,526,742) -(82,526,742)
Business-type activities:
Water 28,092,545 34,356,427 1,514,125 - - 7,778,007 7,778,007
Sewer 16,792,057 24,096,372 530,085 - - 7,834,400 7,834,400
Parking 8,617,493 8,307,559 5,000 - - (304,934) (304,934)
Transit 6,358,316 990,738 6,005,376 4,712,879 - 5,350,677 5,350,677
Total business-type activities 59,860,411 67,751,096 8,054,586 4,712,879 - 20,658,150 20,658,150
Total primary government 174,412,150$ 87,826,148$ 14,417,722$ 10,299,688$ (82,526,742) 20,658,150 (61,868,592)
General revenues and transfers:
General sales and use taxes 22,911,086 -22,911,086
Transaction and use tax - Local Revenue Measure 30,926,285 -30,926,285
Property tax (including real property transfer tax)17,240,694 -17,240,694
Transient occupancy tax (TOT)11,417,888 -11,417,888
Utility users tax 7,501,436 -7,501,436
Property tax-in-lieu of vehicle license fees 7,273,431 -7,273,431
Franchise taxes 2,622,351 -2,622,351
Business tax 3,138,272 -3,138,272
Cannabis Tax 814,502 - 814,502
Other taxes 1,025,936 -1,025,936
Total taxes 104,871,881 - 104,871,881
Unrestricted investment earnings 6,691,998 8,639,215 15,331,213
Other revenue 1,439,962 -1,439,962
Transfers 3,214,820 (3,214,820) -
Total general revenues and transfers 116,218,661 5,424,395 121,643,056
Change in net position 33,691,919 26,082,545 59,774,464
Net position, beginning of year 249,796,507 275,530,186 525,326,693
Restatements 290,964 (91,366) 199,598
Net position, beginning of year, as restated 250,087,471 275,438,820 525,526,291
Net position, end of year 283,779,390$ 301,521,365$ 585,300,755$
Program Revenues
Net Revenues (Expenses) and
Changes in Net Position
The accompanying notes are an integral part of these financial statements.66
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City of San Luis Obispo, California
Governmental Funds Financial Statements
For the Fiscal Year Ended June 30, 2025
Governmental funds are used to account for essentially the same functions reported as governmental activities in the
government-wide financial statements.However,unlike the government-wide financial statements,governmental
fund financial statements focus on near-term inflows and outflows of spendable resources,as well as on balances of
spendable resources available at the end of the fiscal year.Such information reflects financial resources available in
the near future to finance the City’s programs.
Major governmental funds are defined generally as having significant activities or balances in the current year.The
funds described below were determined to be Major Governmental Funds by the City for the current fiscal year.
Individual nonmajor funds may be found in the Supplementary section.
General Fund
The General Fund is used for all the general revenues of the City not specifically levied or collected for other City
funds,and the related expenditures.The major revenue sources for this Fund are property taxes,sales taxes,
franchise fees,business licenses,unrestricted revenues from the state,fines and forfeitures and interest income.
Expenditures are made for community development, public safety, public works, and other services.
Capital Outlay Fund
This fund was established to account for all of the City’s construction projects and capital purchases in excess of
$25,000 with the exception of those funded through non-major capital project funds and Enterprise Funds.Financing
is provided primarily through transfers in from the General Fund, and from State and Federal Grants.
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General
Capital Outlay
Fund
Other
Governmental
Funds
Total
Governmental
Funds
Assets
Cash and investment 36,237,450$ 34,180,695$ 54,249,603$ 124,667,748$
Taxes receivable 12,653,169 -234,117 12,887,286
Accounts receivable 3,125,189 2,022,667 312,969 5,460,825
Other receivables 56,685 --56,685
Due from other funds 43,089 -67,478 110,567
Accrued interest receivable 521,124 -4,230,841 4,751,965
Prepaid items 688,017 --688,017
Cash and investments held by fiscal agent 594,469 --594,469
Advances to other funds 4,845,000 --4,845,000
Loans receivable 261,715 -12,493,973 12,755,688
Lease receivable 852,055 --852,055
Total assets 59,877,962$ 36,203,362$ 71,588,981$ 167,670,305$
Liabilities, Deferred Inflows of Resources
and Fund Balance
Liabilities:
Accounts payable 2,229,479$ 3,490,304$ 433,863$6,153,646$
Accrued liabilities 2,134,384 -6,189 2,140,573
Due to other funds --110,567 110,567
Unearned revenue 2,479,303 -359,173 2,838,476
Other liabilities 103 --103
Total liabilities 6,843,269 3,490,304 909,792 11,243,365
Deferred Inflows of Resources:
Lease related 754,708 --754,708
Unavailable revenue 472,667 -6,564,666 7,037,333
Total deferred inflows of resources 1,227,375 -6,564,666 7,792,041
Fund balance:
Nonspendable 5,533,017 --5,533,017
Restricted for:
Risk management 594,469 --594,469
Transportation projects --7,885,873 7,885,873
Affordable housing programs --10,394,877 10,394,877
Impact fee programs --14,891,812 14,891,812
Parkland development programs --599,240 599,240
Public art programs --1,557,871 1,557,871
Tourism programs --1,631,304 1,631,304
Public safety program --671,669 671,669
Infrastructure improvement --491,596 491,596
Committed to:
General government programs 848,111 --848,111
Risk management 4,437,620 --4,437,620
Contingency fund 14,607,203 --14,607,203
Public safety program --508,976 508,976
Assigned to:
CalPERS pension payment 2,000,000 --2,000,000
Solid Waste AB939 270,825 --270,825
Establishment of Section 115 Trust 2,000,000 --2,000,000
Revenue stabilization 2,000,000 --2,000,000
Development services 145,136 --145,136
SLO Repertory Theater Grant 6,700,000 --6,700,000
608,000 --608,000
Storm Related costs 5,125,068 --5,125,068
Storm Related Reimbursements 909,090 --909,090
Contingency fund --900,000 900,000
Subsequent year expenditures 2,559,825 32,713,058 24,626,846 59,899,729
Unassigned 3,468,954 -(45,541)3,423,413
Total fund balance 51,807,318 32,713,058 64,114,523 148,634,899
Total liabilities, deferred inflows of resources
and fund balance 59,877,962$ 36,203,362$ 71,588,981$ 167,670,305$
City of San Luis Obispo, California
Balance Sheet
Governmental Funds
June 30, 2025
Tenant Improvement program/Economic
The accompanying notes are an integral part of these financial statements.
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Total fund balance - governmental funds 148,634,899$
Capital assets at estimated historical cost $ 395,590,521
Accumulated depreciation (138,644,263)
256,946,258
7,037,333
1,656,166
24,503
Lease revenue bonds 15,366,185$
Lease liabilities 276,445
SBITA liabilities 74,709
Compensated absences 4,670,027
Accrued interest payable 68,632
(20,455,998)
Net pension liability is not a current financial obligation and, therefore, is not reported
in the governmental funds. (146,976,508)
Net OPEB liability is not a current financial obligation and, therefore, is not reported
in the governmental funds. (923,913)
(1,757,000)
(4,357,953)
Total net position - governmental activities 283,779,390$
Long-term liabilities, including related interest payable, are not due and payable in the current period and
therefore are not reported in the funds.
Deferred inflow of resources, pension related, are not current assets or resources; and they are not due in the
current period and therefore are not reported in the governmental funds.
Deferred inflow of resources, OPEB related, are not current assets or resources; and they are not due in the
current period and therefore are not reported in the governmental funds.
City of San Luis Obispo, California
Reconciliation of the Governmental Funds Balance Sheet
to the Government-wide Statement of Net Position
June 30, 2025
Capital assets used in governmental activities are not financial resources and therefore are not reported in the
funds.
Other long-term assets are not available to pay for current period expenditures and therefore are not reported
in the governmental funds.
Deferred outflows of resources, pension related, are not current asset or resources; and they are not due in the
current period and therefore are not reported in the governmental funds.
Deferred outflows of resources, OPEB related, are not current asset or resources; and they are not due in the
current period and therefore are not reported in the governmental funds.
Deferred amounts related to the refunding of long-term debt were not current financial resources. Therefore,
they were not reported in the Governmental Funds Balance Sheet.
Unavailable revenue recorded in the fund financial statements resulting from activities in which revenues
were earned but funds were not available are reclassified as revenues in the Government-Wide Financial
Statements.
43,788,115
163,488
The accompanying notes are an integral part of these financial statements.
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General
Capital Outlay
Fund
Other
Governmental
Funds
Total
Governmental
Funds
Revenues:
22,911,086$ -$-$22,911,086$
30,926,285 --30,926,285
17,242,485 -539,453 17,781,938
11,417,888 --11,417,888
7,501,436 --7,501,436
7,196,670 --7,196,670
2,622,351 --2,622,351
3,138,272 --3,138,272
814,502 --814,502
484,692 --484,692
340,172 --340,172
4,892,409 -1,371,611 6,264,020
4,686,036 5,705,815 3,498,471 13,890,322
12,530,009 -5,800,980 18,330,989
210,336 3,949 758,651 972,936
Total revenues 126,914,629 5,709,764 11,969,166 144,593,559
Expenditures:
Current:
General government 17,533,059 79,705 -17,612,764
Public safety 43,444,267 69,859 463,337 43,977,463
Transportation 5,837,166 2,419,954 566,788 8,823,908
Leisure, cultural and social services 11,913,798 859,882 -12,773,680
Community development 13,097,593 -2,485,698 15,583,291
Debt service:
Principal 360,260 -1,098,975 1,459,235
Interest and fiscal charges 22,321 -634,814 657,135
Capital outlay:
Public safety -483,540 -483,540
Transportation -11,562,043 1,977,423 13,539,466
Leisure, cultural and social services -2,151,507 2,481,703 4,633,210
Community development -120,721 990,520 1,111,241
General government -1,034,588 615,364 1,649,952
Total expenditures 92,208,464 18,781,799 11,314,622 122,304,885
Revenues over (under) expenditures 34,706,165 (13,072,035) 654,544 22,288,674
(Continued)
City of San Luis Obispo, California
Statements of Revenues, Expenditures, and
Changes in Fund Balances
Governmental Funds
For the Fiscal Year Ended June 30, 2025
Sales and use tax - general
Transaction and use tax - Local
Revenue Measure
Property tax (including real property
transfer tax)
Transient occupancy tax
Utility users tax
Property tax in lieu of VLF
Franchise taxes
Business tax
Cannabis Tax
Miscellaneous
Real property transfer tax
Fines, forfeitures and penalties
Use of money and property
Subventions and grants
Charges for services
The accompanying notes are an integral part of these financial statements.
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Page 2
General
Capital Outlay
Fund
Other
Governmental
Funds
Total
Governmental
Funds
Other Financing Sources (Uses):
Transfers in 5,829,430$ 24,043,451$ 10,359,699$ 40,232,580$
Transfers out (34,058,043) -(2,959,717)(37,017,760)
Total other financing sources (uses)(28,228,613) 24,043,451 7,399,982 3,214,820
Net change in fund balance 6,477,552 10,971,416 8,054,526 25,503,494
Fund balance, beginning of year 45,329,766 21,741,642 55,769,033 122,840,441
Restatements --290,964 290,964
Fund balance, beginning of year, as restated 45,329,766 21,741,642 56,059,997 123,131,405
Fund balance, end of year 51,807,318$ 32,713,058$ 64,114,523$ 148,634,899$
City of San Luis Obispo, California
Statements of Revenues, Expenditures, and
Changes in Fund Balances
Governmental Funds
For the Fiscal Year Ended June 30, 2025
The accompanying notes are an integral part of these financial statements.
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Total net change in fund balance - governmental funds 25,503,494$
Expenditures for capital outlay - governmental funds $ 19,653,776
Depreciation expense (8,253,546)
11,400,230
loss on disposal of capital asset (37,109)
Repayments of long-term debt are recognized as expenditures in the governmental funds. In
the government-wide statements, repayments of long-term liabilities are reported as reductions
of liabilities. Expenditures for repayment of the principal portion of long-term debt were:1,498,337
The issuance of long-term debt provides current financial resources to governmental funds.
This transaction, however, has no effect on net position. Proceeds from the issuance of
bonds was:
(11,678)
Bond premiums are reported in the governmental funds when the bonds are issued, and are
capitalized and amortized in the statement of net position. The amount of bond premiums
capitalized during the current period was: 95,339
it is due. In the statement of activities, interest expense is recognized as the interest accrues,
regardless of when it is due. The difference between interest expense paid and interest
accrued was:4,073
Changes in actuarially determined claim liabilities for uninsured claims do not provide current
financial resources and are not reported in the governmental funds. (133,858)
governmental funds. In the statement of activities, compensated absences are measured
by the amounts earned. The difference between compensated absences paid and
compensated absences earned was:(220,079)
435,040
19,723,915
1,975,082
Pension expenses reported in the statement of activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds (25,830,941)
OPEB expenses reported in the statement of activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in governmental funds (709,926)
Total change in net position - governmental activities 33,691,919$
Current year employer pension contributions are recorded as expenditures in the
governmental funds, however, these amounts are reported as a deferred outflow of
resources in the Government-Wide Statement of Net Position
Current year employer OPEB contributions are recorded as expenditures in the
governmental funds, however, these amounts are reported as a deferred outflow of
resources in the Government-Wide Statement of Net Position
Compensated absences are measured by the amounts paid during the period in the
Capital outlay net of depreciation expense and disposal.
Interest on long-term debt is recognized as an expenditure in the governmental funds when
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances of
Governmental Funds to the Statement of Activities
For the Fiscal Year Ended June 30, 2025
Deferred amounts related to the refunding of long-term debt were not current financial
resources. Therefore, they were not reported in the Governmental Funds Balance Sheet.
This amount is to be amortized over the life of the long-term debt. This amount is the
current year net amortization expense.
Revenues that are not considered to be available are reported as unavailable revenues in
the governmental funds, however, these amounts are recognized in the Government-Wide
Statement of Activities. This amount represents the change in unavailable revenues.
City of San Luis Obispo, California
The accompanying notes are an integral part of these financial statements.
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City of San Luis Obispo, California
Proprietary Funds Financial Statements
For the Fiscal Year Ended June 30, 2025
Proprietary funds account for City operations financed and operated in a manner like a private business enterprise.
The intent of the City is that the cost of providing goods and services be financed primarily through user charges.
Proprietary funds are generally used to account for services for which the City charges customers;either outside
customers or internal units/divisions of the City.Proprietary funds provide the same type of information as shown in
the government-wide financial statements,only in more detail.The only type of proprietary fund the City maintains
is enterprise funds.The Water,Sewer,Parking,and Transit Funds are presented as business-type activities in the
government-wide financial statements. The City considers all four of its enterprise funds to be major funds.
Water Fund
This fund accounts for the provision of water services to the residents of the City as well as some customers in the
County.All activities necessary to provide such services are accounted for in this fund,including,but not limited to,
administration, operations, maintenance, capital improvements and debt service.
Sewer Fund
This accounts for the provision of wastewater collection and treatment services to the residents of the City as well as
some customers in the County.All activities necessary to provide such services are accounted for in this fund,
including, but not limited to, administration, operations, maintenance, capital improvements and debt service.
Parking Fund
This fund accounts for activities related to the implementation of the Access and Parking Management Plan,
including the operation of municipal parking lots,parking structures,parking meters and residential parking districts.
All activities necessary to provide such services are accounted for in this fund,including,but not limited to,
administration, operations, maintenance, capital improvements and debt service.
Transit Fund
This fund accounts for the operation and maintenance of the City's transit system.Although user fees are not the
primary funding source for the operation of the system,the State of California and the Federal government,which
provide the major funding sources for the system,require that local transit systems be accounted for on an enterprise
fund basis.
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Water Sewer Parking Transit Totals
Assets
Current assets:
Cash and investment 43,651,887$ 71,130,287$ 4,397,096$ 7,609,119$ 126,788,389$
Accounts receivable 4,574,393 3,137,051 212,271 6,396,968 14,320,683
Lease Receivables - - 122,794 - 122,794
Accrued interest receivable 485,064 519,881 395,727 46,685 1,447,357
Total current assets 48,711,344 74,787,219 5,127,888 14,052,772 142,679,223
Noncurrent assets:
- 278 22,180,644 - 22,180,922
Investment in joint venture 3,990,064 - - - 3,990,064
Loan Receivables 1,476,342 798,745 - - 2,275,087
Lease Receivables - - 37,293,723 - 37,293,723
Capital assets:
Land 945,926 2,176,114 10,692,838 - 13,814,878
Infrastructure 123,669,277 104,623,921 29,448,102 110,972 257,852,272
Buildings and improvements 19,233,993 5,162,135 1,300,234 5,212,278 30,908,640
Equipment 7,675,457 7,686,278 2,247,057 13,205,125 30,813,917
Construction in progress 16,245,185 151,606,202 43,903,407 6,189,900 217,944,694
Total capital assets 167,769,838 271,254,650 87,591,638 24,718,275 551,334,401
Less accumulated depreciation (72,789,556) (58,626,291) (16,980,102) (11,285,382) (159,681,331)
Capital assets, net of
accumulated depreciation 94,980,282 212,628,359 70,611,536 13,432,893 391,653,070
Total noncurrent assets 100,446,688 213,427,382 130,085,903 13,432,893 457,392,866
Total assets 149,158,032 288,214,601 135,213,791 27,485,665 600,072,089
Deferred Outflows of Resources
Pension related 3,255,407 3,123,943 799,925 189,397 7,368,672
349,848 374,145 93,119 23,563 840,675
26,458 6,739 97,880 - 131,077
3,631,713 3,504,827 990,924 212,960 8,340,424
(Continued)
City of San Luis Obispo
Statement of Net Position
Business-Type Activities - Enterprise Funds
June 30, 2025
Total deferred outflow of
resources
Cash and investments held by
fiscal agent
Other post-employment benefits
related
Unamortized loss on refunding of
debt
Enterprise Funds
The accompanying notes are an integral part of these financial statements.
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Page 2
Water Sewer Parking Transit Totals
Liabilities
Current liabilities:
Accounts payable 352,945$ 1,917,054$ 3,215,340$ 1,779,374$ 7,264,713$
Accrued liabilities 170,096 153,050 67,362 34,815 425,323
Compensated absences 299,517 222,227 61,173 29,339 612,256
Unearned revenue ---10,058,588 10,058,588
Interest payable 52,888 1,196,800 245,838 -1,495,526
Current portion of long-term debt 1,178,367 4,413,319 1,351,951 -6,943,637
Total current liabilities 2,053,813 7,902,450 4,941,664 11,902,116 26,800,043
Noncurrent liabilities:
Compensated absences 128,365 95,239 26,217 12,574 262,395
Advances from other funds --4,845,000 -4,845,000
Lease revenue bonds 7,823,297 243,030 49,083,650 -57,149,977
Installment sale agreement -1,770,696 --1,770,696
State loan/note payable 9,551,515 136,002,520 2,206,658 -147,760,693
Net pension liability 13,703,752 13,150,349 3,367,315 797,275 31,018,691
369,792 338,045 52,002 21,955 781,794
Total noncurrent liabilities 31,576,721 151,599,879 59,580,842 831,804 243,589,246
Total liabilities 33,630,534 159,502,329 64,522,506 12,733,920 270,389,289
Deferred Inflows of Resources
324,071 321,250 94,344 18,083 757,748
Lease related --35,744,111 -35,744,111
324,071 321,250 35,838,455 18,083 36,501,859
Net Position
Net investment in capital assets 76,453,561 70,205,811 40,247,801 13,432,893 200,340,066
Restricted:
Debt service -4,956,584 --4,956,584
Transportation projects ---1,513,729 1,513,729
Unrestricted 42,381,579 56,733,454 (4,404,047)-94,710,986
Total net position 118,835,140$ 131,895,849$ 35,843,754$ 14,946,622$ 301,521,365$
Other post-employment benefits
related
Total deferred inflow of
resources
City of San Luis Obispo
Statement of Net Position
Business-Type Activities - Enterprise Funds
June 30, 2025
Enterprise Funds
Net other post-employment benefits
liability
The accompanying notes are an integral part of these financial statements.
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Water Sewer Parking Transit Total
Operating revenues:
Charges for sales and service 29,285,188$ 21,326,853$ 7,060,852$ 984,855$ 58,657,748$
Impact fees 4,843,919 2,729,023 --7,572,942
Fines and forfeitures --1,113,016 -1,113,016
Other revenues 227,320 40,496 133,691 5,883 407,390
Total operating revenues 34,356,427 24,096,372 8,307,559 990,738 67,751,096
Operating expenses:
Salaries and benefits 5,411,641 5,504,571 1,979,310 419,464 13,314,986
Supplies and maintenance 1,938,251 2,512,434 926,862 506,595 5,884,142
Contract services 15,207,402 1,759,643 1,478,877 4,496,486 22,942,408
General government 1,559,425 1,838,634 1,256,841 460,609 5,115,509
Depreciation 3,369,279 2,636,961 732,015 475,162 7,213,417
Total operating expenses 27,485,998 14,252,243 6,373,905 6,358,316 54,470,462
Operating income (loss)6,870,429 9,844,129 1,933,654 (5,367,578) 13,280,634
Nonoperating revenues (expenses)
Use of money and property 2,488,176 3,185,178 2,471,408 494,453 8,639,215
Grants 1,514,125 530,085 5,000 6,005,376 8,054,586
Interest expense and fiscal charges (606,547) (2,539,814) (2,243,588) -(5,389,949)
Total nonoperating revenues
(expenses)3,395,754 1,175,449 232,820 6,499,829 11,303,852
Income (loss) before transfers
and capital contributions 10,266,183 11,019,578 2,166,474 1,132,251 24,584,486
Capital Contributions 4,712,879 4,712,879
Transfers out (1,387,992) (1,451,616) (375,212) -(3,214,820)
Total transfers and capital contribution (1,387,992) (1,451,616) (375,212) 4,712,879 1,498,059
Change in net position 8,878,191 9,567,962 1,791,262 5,845,130 26,082,545
Net position, beginning of year 109,961,981 122,333,448 34,133,265 9,101,492 275,530,186
Restatements (5,032) (5,561) (80,773) -(91,366)
Net position, beginning of year,
as restated 109,956,949 122,327,887 34,052,492 9,101,492 275,438,820
Net position, end of year 118,835,140$131,895,849$35,843,754$ 14,946,622$ 301,521,365$
Enterprise Funds
City of San Luis Obispo, California
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Business-Type Activities - Enterprise Funds
For the Fiscal Year Ended June 30, 2025
The accompanying notes are an integral part of these financial statements.
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Water Sewer Parking Transit Total
Cash flows from operating activities:
Cash received from customers 34,287,980$ 24,145,044$ 8,187,898$ 990,738$ 67,611,660$
(18,318,092) (6,097,402) (1,455,882) (3,863,241) (29,734,617)
(1,559,425) (1,838,634) (1,256,841) (460,609) (5,115,509)
(5,493,340) (5,563,157) (2,093,780) (392,618) (13,542,895)
Net cash provided by (used in)
operating activities 8,917,123 10,645,851 3,381,395 (3,725,730) 19,218,639
Operating grants received 1,514,125 530,085 5,000 3,597,791 5,647,001
Transfers to other funds (1,387,992) (1,451,616) (375,212) - (3,214,820)
126,133 (921,531) (370,212) 3,597,791 2,432,181
Cash flows from capital and related
financing activities:
(6,715,303) (13,648,663) (26,453,490) (6,314,708) (53,132,164)
Capital grants received - - - 4,712,879 4,712,879
SBITA payment paid (12,835) (12,835) - - (25,670)
Principal paid on debt financing (1,155,874) (4,286,106) (1,248,785) - (6,690,765)
Interest paid on debt financing (718,329) (2,397,661) (2,499,597) - (5,615,587)
Proceeds from issuance of debt - 19,479,561 - - 19,479,561
Net cash used in capital and
related financing activities (8,602,341) (865,704) (30,201,872) (1,601,829) (41,271,746)
Cash flows from investing activities:
Use of money and property 1,880,880 3,076,074 2,332,201 488,348 7,777,503
Net cash provided by
investing activities 1,880,880 3,076,074 2,332,201 488,348 7,777,503
2,321,795 11,934,690 (24,858,488) (1,241,420) (11,843,423)
41,330,092 59,195,875 51,436,228 8,850,539 160,812,734
43,651,887$ 71,130,565$ 26,577,740$ 7,609,119$ 148,969,311$
(Continued)
City of San Luis Obispo, California
Statement of Cash Flows
Business-Type Activities - Enterprise Funds
For the Fiscal Year Ended June 30, 2025
Cash payments to suppliers for goods
and services
Cash payments to General Fund for
interfund services
Cash payments to employees for
services
Acquisition and construction of
capital assets
Cash flows from noncapital
financing activities:
Net change in cash and cash
equivalents
Cash and cash equivalents,
beginning of year
Cash and cash equivalents, end of
year
Net cash provided by (used in)
noncapital financing activities
Enterprise Funds
The accompanying notes are an integral part of these financial statements.
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City of San Luis Obispo, California
Statement of Cash Flows
Business-Type Activities - Enterprise Funds
For the Fiscal Year Ended June 30, 2025
Page 2
Water Sewer Parking Transit Total
Operating income (loss) 6,870,429$ 9,844,129$ 1,933,654$ (5,367,578)$ 13,280,634$
Depreciation 3,369,279 2,636,961 732,015 475,162 7,213,417
Accounts receivable (68,447) 48,672 (119,661) - (139,436)
Accounts payable (1,172,439) (1,825,325) 949,857 1,139,840 (908,067)
2,657 (10,921) 15,695 814 8,245
111,313 132,214 (66,315) 37,875 215,087
(195,669) (179,879) (63,850) (11,843) (451,241)
Net cash provided by (used in)
operating activities 8,917,123$ 10,645,851$ 3,381,395$ (3,725,730)$ 19,218,639$
Reconciliation of cash and investments to the balance sheet:
Cash and cash equivalents 43,651,887$ 71,130,287$ 4,397,096$ 7,609,119$ 126,788,389$
- 278 22,180,644 - 22,180,922
Total cash and investments 43,651,887$ 71,130,565$ 26,577,740$ 7,609,119$ 148,969,311$
Noncash investing, capital, and financing activities:
None
Enterprise Funds
Deferred OPEB and net OPEB
liability
Cash and investments held by fiscal
agent
Reconciliation of operating income
(loss) to net cash provided by (used
in) operating activities:
Adjustments to reconcile operating
income (loss) to net cash provided by
(used in) operating activities:
Change in assets, deferred outflows
of resources, liabilities, and deferred
inflows of resources:
Accrued salaries and
compensated absences
Deferred pensions and net
pension liability
The accompanying notes are an integral part of these financial statements.
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City of San Luis Obispo, California
Fiduciary Funds Financial Statements
For the Fiscal Year Ended June 30, 2025
Custodial funds are the only type of fiduciary funds maintained by the City.These are used to account for resources
held for the benefit of parties outside the primary government.Fiduciary funds are not reflected in the government-
wide financial statements because the resources of those funds are not available to support the City’s own programs.
An example of a custodial fund may include donations provided to the City to be utilized for specific purposes as
well as other funds held in trust of another entity to be utilized for a specific purpose.A specific example is the
Hazardous Materials Task Force Fund,created to provide special fire services around the County,which is funded
by multiple county and city agencies.The accounting used for fiduciary funds is much like that used for proprietary
funds.The Custodial Funds are presented with the fund financial statements in the supplementary information
section.
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Custodial Funds
Assets
Current assets:
Cash and investment 37,857,521$
Accounts receivable 436,957
Accrued interest receivable 38,700
Capital assets, net of accumulated depreciation 687,561
Total assets 39,020,739
Liabilities
Accounts payable 244,834
Compensated absence 48,661
Accrued Salaries 18,397
Other liabilities 10,713
Total liabilities 322,605
NET POSITION
Restricted for
Individuals, organizations, and other governments 38,698,134
Total Net Position 38,698,134$
City of San Luis Obispo, California
Statement of Fiduciary Net Position
Fiduciary Funds
June 30, 2025
The accompanying notes are an integral part of these financial statements.
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Custodial Funds
ADDITIONS:
Charges for services 1,310,027$
Other revenue 4,416,911
Use of money and property 925,053
Total additions 6,651,991
DEDUCTIONS:
Administration expenses 1,607,113
Contractual services 1,713,973
Materials and supplies 184,997
Use of developer deposits 742,929
Depreciation 63,283
Total deductions 4,312,295
Change in net position 2,339,696
NET POSITION:
Beginning of year 36,487,382
Restatements (128,944)
Beginning of year, as restated 36,358,438
End of year 38,698,134$
City of San Luis Obispo, California
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the year ended June 30, 2025
The accompanying notes are an integral part of these financial statements.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page
Note 1:Summary of Significant Accounting Policies 1
Description of the Reporting Entity 1
Government-wide and Fund Financial Statements 1
Measurement Focus, Basis of Accounting and Basis of Presentation 1
Assets, Liabilities, and Net Position or Fund Balance 3
Reconciliation of Government-wide and Fund Financial Statements 6
Budgets and Budgetary Accounting 6
Fair Value Measurements 8
Note 2:Cash and Investments 8
Funds with Fiscal Agent 8
Investments 9
Note 3:Property Taxes 13
Note 4:Loans Receivable 14
Note 5:Capital Assets 14
Note 6:Leases 16
Note 7:Long Term Debt 18
Summary of Long-Term Debt 18
Governmental Activities Summary:19
Revenue Bonds 19
Subscription Based Information Technology Arrangements 21
Business-Type Activities Summary:22
Revenue Bonds 22
Loans 23
Installment Sale Agreements 24
Special Assessment Debt Without City Commitment 24
Note 8:Pension Plans 25
Agent-Multiple Employer Plan 25
General Information about the Pension Plan 25
Net Pension Liability 26
Changes in the Net Pension Liability 28
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions 29
Cost-Sharing Employer Plan 29
General Information about the Pension Plan 29
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions 31
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City of San Luis Obispo, California
Notes to the Financial Statements
Table of Contents
June 30, 2025
Page 2
Page
Payable to the Pension Plan 33
Note 9:Other Post-Employment Benefits (OPEB)34
General Information about OPEB 34
Net OPEB Liability 35
Changes in the Net OPEB Liability 36
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB 37
Payable to the OPEB Plan 38
Note 10:Deferred Compensation Plan 38
Note 11:Interfund Transactions 39
Note 12:Joint Ventures, Jointly Governed Organizations and Operating Agreements 40
Whale Rock Commission 40
San Luis Obispo Regional Transit Authority 41
San Luis Obispo Council of Governments 41
Nacimiento Water Supply Project 41
Note 13:Risk Management 42
California Joint Powers Insurance Authority 42
Self-Insurance Programs of the Authority 43
Adequacy of Protection 43
Self-Insurance 43
Note 14:Commitments and Contingencies 44
Litigation 44
Grant Awards 44
Note 14:Commitments and Contingencies (Continued)45
Regional Transit Authority Pension Expense 45
Note 15:Construction and Other Significant Commitments 45
Note 16:Fund Balance Deficiency 45
Note 17:New Accounting Standards 45
Accounting Standards Adopted 45
Note 18:Prior Period Adjustments 46
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Note 1:Summary of Significant Accounting Policies
The basic financial statements of the City of San Luis Obispo (City) have been prepared in conformity with U.S. Generally Accepted
Accounting Principles (GAAP), as applied to governmental agencies. The Governmental Accounting Standards Board (GASB) is
the accepted standard setting body for establishing governmental accounting and financial reporting principles.
The following is a summary of the more significant policies:
Description of the Reporting Entity
The City is a California charter city. It was incorporated on February 19, 1856 and chartered on May 1, 1876. It is organized in
accordance with the Council-Mayor-City Manager form of government. With a population of approximately 48,700, the City
provides a broad range of municipal services, including police and fire protection, parks and recreation, water and sewer utilities,
street maintenance, public transportation, parking, planning, and building and safety.
As required by GAAP, these financial statements present the City (the primary government) and its component units, entities for
which the government is considered to be financially accountable. Blended component units, although legally separate entities, are
in substance part of the government's operations which creates the need to include their financial information with that of the primary
government. The City has no component units that require discrete presentation in accordance with GASB standards.
Blended Component Unit. The City has identified The San Luis Obispo Capital Improvement Board (the Board) and the San Luis
Obispo Public Financing Authority (the Authority) as blended component units in accordance with GASB standards. Both provide
financing for the construction and acquisition of City facilities and consist of members of the City Council. Activities of both units
are accounted for in the applicable City governmental funds and consist of the issuance of debt secured by the lease of property.
Separate financial statements are not prepared for the San Luis Obispo Capital Improvement Board or San Luis Obispo Public
Financing Authority.
Government-wide and Fund Financial Statements
The government-wide financial statements (i.e. the statement of net position and the statement of activities) report information on
all of the non-fiduciary activities of the primary government and its component unit. Governmental activities, which normally are
supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely primarily on
fees and charges for services.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program
revenues. Direct expenses are those that are clearly identifiable within a specific function or segment. The indirect expense allocation
transfers general support services to operating programs based on the most current Cost Allocation Plan. Program revenues include
1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given
function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a
particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general
revenues.
Separate fund financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the
latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual
enterprise funds are reported as separate columns in the fund financial statements.
Measurement Focus, Basis of Accounting and Basis of Presentation
The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of
accounting, as are the proprietary funds and fiduciary funds. Revenues are recorded when earned and expenses are recorded when a
liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which
they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider
have been met.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 2
Note 1:Summary of Significant Accounting Policies (Continued)
As a general rule the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to
this general rule are charges between the government’s enterprise funds and various other functions of the government. Elimination
of these charges would distort the direct costs and program revenues reported for the various functions concerned.
Governmental fund financial statements are reported using the current financial resources measurement focus and the modified
accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered
to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period.
For this purpose, the government generally considers revenues to be available if they are collected within 60 days of the end of the
current fiscal period. An exception to this timeframe is made to allow for the recognition of the final property tax distributions
received from the County, if necessary, as well as for sales tax revenues received in September. This later provision is made in order
for the City’s revenue stream to match that recognized by the State of California. Expenditures generally are recorded when a liability
is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated
absences and claims and judgments, are recorded only when payment is due.
Property taxes, sales taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all considered to be
susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered
to be measurable and available only when cash is received by the government.
Major Funds and Other Funds. GASB Standards define major funds and require that the City’s major governmental funds be
identified and presented separately in the fund financial statements. All other funds, called non-major funds, are combined and
reported in a single column, regardless of their fund type.
Major funds are defined as funds that have assets, liabilities, revenues, or expenditures/expenses equal to ten percent of their fund-
type total and at least five percent of the grand total. The General Fund is always a major fund. The City may also select other funds
it believes should be presented as major funds.
The City reports the following major governmental funds:
General Fund. This fund is the government’s primary operating fund. It accounts for all financial resources of the general
government, except those required to be accounted for in another fund.
Capital Outlay Fund. This fund was established to account for all of the City’s construction projects and capital purchases in excess
of $25,000 with the exception of those funded through non-major capital project funds and Enterprise Funds. Financing is provided
primarily through transfers in from the General Fund, and from State and Federal Grants.
The only proprietary funds the City reports are the Enterprise Funds, all of which are major funds. Proprietary funds are accounted
for on the economic resources measurement focus and the accrual basis of accounting. Under this method, revenues are recorded
when earned and expenses are recorded at the time liabilities are incurred. The City reports the following major enterprise funds:
Water Fund. This fund accounts for the provision of water services to the residents of the City as well as some customers in the
County. All activities necessary to provide such services are accounted for in this fund, including, but not limited to, administration,
operations, maintenance, capital improvements and debt service.
Sewer Fund. This accounts for the provision of wastewater collection and treatment services to the residents of the City as well as
some customers in the County. All activities necessary to provide such services are accounted for in this fund, including, but not
limited to, administration, operations, maintenance, capital improvements and debt service.
Parking Fund. This fund accounts for activities related to the implementation of the Access and Parking Management Plan,
including the operation of municipal parking lots, parking structures, parking meters and residential parking districts. All activities
necessary to provide such services are accounted for in this fund, including, but not limited to, administration, operations,
maintenance, capital improvements and debt service.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 3
Note 1:Summary of Significant Accounting Policies (Continued)
Transit Fund. This fund accounts for the operation and maintenance of the City's transit system. Although user fees are not the
primary funding source for the operation of the system, the State of California and the Federal government, which provide the major
funding sources for the system, require that local transit systems be accounted for on an enterprise fund basis.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally
result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing
operations. The principal operating revenues of the enterprise funds are charges to customers for sales and services. Operating
expenses for enterprise funds include the cost of sales and services, administrative expenses, and depreciation on capital assets.All
revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.
The City has established twelve Custodial Funds, which are used to account for funds held by the City as an agent for Whale Rock
Commission, Jack House Committee, County Task Force, individual donations, Boysen Ranch, San Luis Ranch Community
Facilities District and San Luis Coastal Unified School District and San Luis Obispo County Public Access, Inc. Public Access
Television, Avila Ranch Private Reimbursement Agreement, Asset Forfeitures, SWAT Task Force and Police Evidence. Custodial
funds are accounted for using the accrual basis of accounting. See supplementary information for a complete list of Custodial Funds.
Assets, Liabilities, and Net Position or Fund Balance
Cash, Cash Equivalents and Investments. The City pools cash resources of its various funds to facilitate cash management. Cash
in excess of current requirements is invested and reported as investments. It is the City’s intent to hold investments until maturity.
However, the City may, in response to market conditions, sell investments prior to maturity in order to improve the quality, liquidity
or yield of the portfolio.
The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original
maturities of three months or less from the date of acquisition. Cash and investments held by fiscal agents are treated as cash
equivalents for purposes of the statement of cash flows.
Money markets and non-negotiable certificates of deposit are reported at amortized cost. All other investments are stated at fair
value.
Receivables and Payables. Activity between funds that are representative of lending/borrowing arrangements outstanding at the end
of the fiscal year are referred to as “due to/from other funds”.
All receivables are shown net of any allowance for uncollectible accounts if material. Charges for utility services rendered but
unbilled as of June 30 are accrued and are recognized as revenues.
Prepaids and Inventories. The City has no significant inventories. The cost of any inventoriable item has been recorded as an
expenditure or expense at the time of purchase. Certain payments to vendors reflect costs applicable to future accounting periods
and are recorded as prepaid items in both government-wide and fund financial statements. Prepayments in the governmental funds
are accounted for using the consumption method.
Restricted Assets. Certain proceeds of debt financings, as well as resources set aside for their repayment, are classified as restricted
assets on the balance sheet because they are maintained in separate trust bank accounts and their use is limited by applicable debt
covenants. Notes 2 and 5 have additional information on funds held by fiscal agents.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 4
Note 1: Summary of Significant Accounting Policies (Continued)
Capital Assets. Capital assets, which include property, plant, equipment and infrastructure assets (such as streets, sidewalks and
bridges), are reported in the applicable governmental or business-type activities columns in the government-wide financial
statements, and in the proprietary funds statement of net position. Capital assets are defined by the City as assets with an initial,
individual cost of more than $25,000 and an estimated useful life in excess of one year. Such assets are recorded at historical cost or
estimated historical cost if purchased or constructed. Donated capital assets, donated works of art and similar items, and capital
assets received in a service concession arrangement would be reported at acquisition value rather than fair value. The costs of normal
maintenance and repairs that do not add to the value of assets or materially extend assets’ lives are not capitalized. Major outlays for
capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital
assets of the business- type activities is included as part of the capitalized value of the assets constructed. Detailed information on
the City’s capital assets can be found in Note 4.
Property, plant and equipment of the City are depreciated using the straight line method over the following estimated useful lives:
Deferred Outflows and Inflows of Resources. The City recognizes deferred outflows and inflows of resources in the Statement of
Net Position. A deferred outflow of resources is defined as a consumption of net assets by the City that is applicable to a future
reporting period. The City has deferred outflows of resources related to pensions, other post-employment benefits (OPEB), and
unamortized loss on refunding of debt. A deferred inflow of resources is defined as an acquisition of net assets by the City that is
applicable to a future reporting period. The City has deferred inflows of resources related to pensions and OPEB.
Compensated Absences. City employees are granted vacation and sick leave in varying amounts. In the event of termination,
employees are reimbursed for the total value of their accumulated vacation days. Employees are reimbursed for 10% to 30% of the
accumulated sick leave only upon retirement and only after at least 10 years of service. In selected cases, similar accumulated sick
leave reimbursements may be available after 20 years of continuous employment. An employee's estate is reimbursed for 30% of
the employee's accumulated sick leave in the event of death while in the City's employ. A liability for compensated absences is
accrued in the government-wide and proprietary funds financial statements.
In accordance with GASB Statement No. 101, Compensated Absences, the City recognizes a liability for compensated absences for
leave time that (1) has been earned for services previously rendered by employees, (2) accumulates and is allowed to be carried over
to subsequent years, and (3) is more likely than not to be used as time off or settled (for example paid in cash to the employee or
payment to an employee flex spending account) during or upon separation from employment. The liability includes vacation leave
and sick leave expected to be used or paid upon termination, retirement, or death. The City uses the first-in, first-out (FIFO) method
to estimate the amount of compensated absences expected to be used or paid.
Long-Term Obligations. In the government-wide financial statements, and proprietary funds in the fund financial statements, long-
term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities,
or proprietary funds statement of net position. Bond premiums and discounts and deferred amounts on refunding are deferred and
amortized over the life of the bonds. Deferred amounts on refunding are reported separately from assets and liabilities in the
Statement of Net Position. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are
expensed as incurred.
In the fund financial statements, governmental funds recognize bond premiums and discounts, as well as bond issuance costs, during
the period they originate. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances
are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether
or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
Assets Years
Infrastructure 20-100
Buildings and structures 20-50
Improvements other than buildings 10-100
Equipment 3-21
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 5
Note 1:Summary of Significant Accounting Policies (Continued)
Net Pension Liability. The City recognizes a net pension liability, which represents the excess of the total pension liability over the
fiduciary net position of the pension reflected in the actuarial reports provided by the California Public Employees’ Retirement
System (CalPERS) plans (Plans). The net pension liability is measured as of the City’s prior fiscal year-end. Changes in the net
pension liability are recorded, in the period incurred, as pension expense or as deferred inflows of resources or deferred outflows of
resources depending on the nature of the change. The changes in the net pension liability that are recorded as deferred inflows of
resources or deferred outflows of resources (that arise from changes in actuarial assumptions or other inputs and differences between
expected or actual experience) are amortized over the weighted average remaining service life of all participants in the respective
pension plan and are recorded as a component of pension expense beginning with the period in which they are incurred.
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension
expense, information about the fiduciary net position of the City’s CalPERS Plans and additions to/deductions from the Plans’
fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments
(including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms.
Investments are reported at fair value. Projected earnings on pension investments are recognized as a component of pension expense
General fund is the governmental fund used to liquidate the pension liabilities of the governmental activities.
Other Post-Employment Benefits (OPEB) Liability. For purposes of measuring 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 City’s
plan (OPEB Plan), and additions to or deductions from the OPEB Plan’s fiduciary net position, have been determined on the same
basis as they are reported by the California Employer’s Retiree Benefit Trust Program (CERBT). For this purpose, benefit payments
(including refunds of employee contributions) are recognized when currently due and payable in accordance with benefit terms.
Investments are reported at fair value.General fund is the governmental fund used to liquidate the OPEB liabilities of the
governmental activities.
Generally accepted accounting principles require that the reported OPEB results must pertain to liability and asset information within
certain defined timeframes. For this report, the following timeframes are used:
Valuation Date June 30, 2023
Measurement Date June 30, 2024
Measurement Period July 1, 2023 to June 30, 2024
Fund Equity. In the fund financial statements, fund balance for governmental funds is reported in classifications that comprise a
hierarchy based primarily on the extent to which the City is bound to honor constraints on the specific purpose for which amounts
in the funds can be spent. Fund balance is reported in five components in accordance with GASB Statement No. 54 Fund Balance
Reporting and Governmental Fund Type Definitions –nonspendable, restricted, committed, assigned and unassigned. The City
Council may take action via minute order to add, delete or amend a fund balance commitment that is not required as a condition of
a bond covenant or other external, legal requirement.
Nonspendable. This component includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally
or contractually required to be maintained intact.
Restricted. This component consists of amounts that have constraints placed on them either externally by third-parties (creditors,
grantors, contributors, or laws or regulations of other governments) or by law through constitutional provisions or enabling
legislation.Enabling legislation authorizes the City to assess, levy, charge or otherwise mandate payment of resources (from external
resource providers) and includes legally enforceable requirements (compelled by external parties) that those resources be used only
for the specific purposes stipulated in the legislation.
Committed. This component consists of amounts that can only be used for specific purposes pursuant to constraints imposed by
minute order authorized by the City Council. Those committed amounts established by minute order cannot be used for any other
purpose unless the City Council adopts a new minute order so directing. With respect to encumbered amounts, the City may take
steps to cancel the order for goods or services and thereby terminate the obligation.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 6
Note 1:Summary of Significant Accounting Policies (Continued)
Assigned. This component consists of amounts that are constrained by the City’s intent to be used for specific purposes but are
neither restricted nor committed. The City Manager or Director of Finance are authorized by City Council, via formal action at
regular public meetings, to assign amounts to a specific purpose. Constraints imposed on the use of assigned amounts can be removed
with no formal Council actions.
Unassigned. This component is the residual classification for the General Fund and includes all amounts not contained in the other
classifications. Unassigned amounts are technically available for any purpose. The General Fund is the only fund that reports a
positive unassigned fund balance amount. Other governmental funds may report negative unassigned fund balance, which occurs
when a fund has a residual deficit after allocation of fund balance to the nonspendable, restricted, or committed categories.
Fund Balance Spending Practice. The City follows a practice in which restricted, committed, assigned, and unassigned fund
balances are spent when more than one amount is available for a specific purpose. When both restricted and unrestricted resources
are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources (committed, assigned and
unassigned) as they are needed. When unrestricted resources (committed, assigned and unassigned) are available for use, it is the
City’s policy to use committed resources first, then assigned, and then unassigned as they are needed.
Reconciliation of Government-wide and Fund Financial Statements
A reconciliation between total fund balance of the governmental funds and total net position of the governmental activities as reported
in the government-wide statement of net position is presented in the basic financial statements.
A reconciliation between total net change in fund balance of the governmental funds and total change in net position of governmental
activities as reported in the government-wide statement of activities is presented in the basic financial statements.
There are no differences between total net position of the proprietary funds and total net position of the business-type activities as
reported in the government-wide statement of net position.
Budgets and Budgetary Accounting
Overview. The City has received national recognition for its use of a two-year Financial Plan and budgetary process that emphasizes
long-range planning and effective program management. Significant features of the City's two-year Financial Plan include the
integration of Council goal setting into the budgetary process and the extensive use of formal policies and measurable objectives.
The Financial Plan includes operating budgets for two years and a capital improvement plan (CIP) covering five years.
Under this multi-year approach, appropriations continue to be made annually; however, the Financial Plan is the foundation for
preparing the budget for the second year. Additionally, unexpended operating appropriations from the first year may be carried over
for specific purposes into the second year with the approval of the City Manager.
Management Policies. The overall goal of the City's Financial Plan is to link what the City wants to accomplish over the next two
years with the resources required to do so. Formal statements of budgetary policies and major objectives provide the foundation for
achieving this goal. Key budget principles include: maintaining fund balances at levels which will protect the City from future
uncertainties; estimating revenues at realistic levels; making current expenditures with current revenues; maintaining the City's
traditional commitment to a strong General Fund; and complying with provisions of the State constitution, City charter, municipal
code, and sound fiscal policy. Key revenue policies include: maintaining a diversified and stable revenue base; setting enterprise
fund rates at levels that fully recover the total cost of providing services in the Water, Sewer and Parking Funds; and at policy levels
for cost recovery in the Transit Fund; charging fees for General Fund programs in accordance with adopted user fee cost recovery
goals; and ensuring that new development pays its fair share of the cost of constructing necessary community facilities.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 7
Note 1:Summary of Significant Accounting Policies (Continued)
Budget Process. The City Manager is responsible for preparing the budget and submitting it to the Council for approval.
Although specific steps will vary from year to year, the following is an overview of the general approach used under the
City's two-year budgetary process:
First Year.The Financial Plan process begins with City Council goal setting to determine major objectives to be
accomplished over the next two years. As part of this process, community groups, interested individuals, and
Council advisory bodies present their recommendations to the Council. Goals approved by the City Council are
incorporated into the budget instructions issued to the operating departments, who are responsible for submitting
initial budget proposals. After these proposals are comprehensively reviewed and a detailed financial forecast is
prepared, the City Manager issues the Preliminary Financial Plan for public comment. A series of study sessions
and public hearings are then held leading to Council adoption of the Financial Plan and Budget prior to the start
of the fiscal year.
Second Year. Before the beginning of the second year of the two-year cycle, the Council reviews the progress
during the first year, adjusts as necessary and approves appropriations for the second fiscal year. Unspent operating
appropriations from the first year may be carried over for specific purposes into the second year with the approval
of the City Manager. Unspent and unencumbered operating appropriations lapse at the end of the second year. The
fiscal year which ended June 30, 2025 was the second year of the 2023-25 two-year cycle.
Mid-Year Reviews. The Council formally reviews the City's financial condition and amends appropriations, if
necessary, each February.
Status Reports. Financial reports are prepared monthly to monitor the City's fiscal condition; more formal reports
are posted to the City's website on a quarterly basis. Additionally, more focused reports are issued on key revenues,
such as sales tax, transient occupancy tax and quarterly reports on investments. The status of major goals and
program objectives, including Capital Improvement Plan (CIP) projects, are also formally reported to the Council
on an ongoing basis.
Accounting and Budget Administration. Budgets are prepared for each fund in accordance with its respective basis of accounting
consistent with U.S. Generally Accepted Accounting Principles (GAAP). All governmental funds have legally adopted budgets
annually. While budgets are prepared for the City's capital projects funds, the capital projects generally span more than one year and
are effectively controlled at the project level; accordingly, budgetary comparisons are not presented for capital projects funds in the
accompanying other supplementary information following the basic financial statements.
As provided under the City Charter, the Council may amend or supplement the budget at any time after its adoption by majority vote
of the Council members. The legal level of budgetary control –the level at which expenditures are not to exceed appropriations –is
the fund level.
For management control purposes, the City Manager has the authority to make or approve administrative adjustments to the budget
provided those changes will not have a significant policy impact nor affect budgeted year-end fund balances. Department heads have
the authority to transfer line-item budgets within the department within a fund. Both the original and final amended budgets of the
General Fund are presented as required supplementary information following the notes to the financial statements. Budget
information for non-major governmental funds with annual budgets is presented in other supplementary information following the
notes to the financial statements.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 8
Note 1:Summary of Significant Accounting Policies (Continued)
Encumbrances. The City uses an encumbrance system as an extension of normal budgetary accounting for the other governmental
funds. Under this system, purchase orders, contracts, and other commitments for the expenditure of monies are recorded in order to
reserve that portion of applicable appropriations. Encumbrances outstanding at year-end are recorded as restricted, committed, or
assigned fund balances since they do not constitute expenditures or liabilities. Unencumbered appropriations lapse at year-end.
Encumbered appropriations are carried forward in the ensuing year’s budget.
Indirect Cost Reimbursement. All of the City's general government and engineering programs are accounted and budgeted for in
the General Fund. However, some of these support service programs also benefit the City's enterprise and custodial fund operations,
and accordingly, payments are made from these funds to reimburse the General Fund for these services. The payments are based on
a Central Service Cost Allocation Plan prepared for this purpose, which distributes these shared costs in a uniform, consistent manner
in accordance with GAAP.
Fair Value Measurements
As defined in GASB Statements, fair value is 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 City uses valuation techniques that are appropriate
under the circumstances and for which sufficient data are available to measure fair value. Valuation techniques maximize the use of
relevant observable inputs and minimize the use of unobservable inputs.
GASB Statements establish a hierarchy of inputs to valuation techniques used to measure fair value. That hierarchy has three levels:
Level 1 —Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 —Observable inputs, other than Level 1 prices, for the asset or liability, either directly or indirectly.
Level 3 —Unobservable inputs for the asset or liability.
For fiscal year ended June 30, 2025, the application of valuation techniques applied to the City’s financial statements has been
consistent.
Note 2:Cash and Investments
The City follows the practice of pooling cash and investments for all funds under its direct daily control. Funds held by outside fiscal
agents under provisions of bond indentures are maintained separately.
Interest earned on pooled cash and investments is allocated quarterly to the various funds based on the respective fund's average
quarterly cash balance. Interest earned from cash and investments with fiscal agents is credited directly to such funds.
Funds with Fiscal Agent
The City has monies held by trustees or fiscal agents pledged to the payment or security of certain bonds. The California Government
Code provides that these funds, in the absence of specific statutory provisions governing the issuance of bonds, may be invested in
accordance with the ordinance, resolutions, or indentures specifying the types of investments its trustees or fiscal agents may make.
These ordinances, resolutions, or indentures are generally more restrictive than the City's general investment policy. In no instance
have additional types of investments been authorized which are not permitted by the City's investment policy.
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 9
Note 2:Cash and Investments (Continued)
Investments
The City is authorized by its investment policy, in accordance with Section 53601 of the California Government Code, to invest in
the following instruments:
Treasury bills and notes
Government Sponsored Enterprises
Commercial paper
Repurchase agreements
Bankers' acceptances
Corporate medium-term notes
Negotiable certificates of deposit
Collateralized bank deposits
Money market mutual funds
State Local Agency Investment Fund (LAIF)
Investments are stated at fair value, based on quoted market prices, in accordance with GASB standards. Investment income has
been adjusted to reflect any unrealized gains and losses resulting from the fair value adjustment annually. While U.S. generally
accepted accounting principles require recording any increases or decreases in the fair value of the City’s investments, it is the City’s
policy to make all investment decisions based on holding them through maturity, and therefore the City may not realize the gains or
losses resulting from the fair value adjustment. As such, changes in fair value generally do not affect the long-term results of the
portfolio, but they can result in significant fluctuations from year-to-year.
The fair value of the City’s position in the State LAIF pool is the same as the value of the pool shares. The State LAIF pool credit
quality is unrated. LAIF is overseen by the Local Agency Investment Advisory Board, which consists of five members, in accordance
with State statute. The State Treasurer’s Office audits the fund annually.
At June 30, 2025, cash and investments consisted of the following:
Fa ir
Value
Pe rcent of
Portfolio
Cas h and cash equivalents 64,478,686$ 20.66%
Inv estments:
Sta te Local Agency Investme nt Fund 49,234,734 15.78%
U.S. Treasury Bond / Note 70,706,736 22.66%
Federal Agency Bond / Note 4,960,922 1.59%
Cor porate Note 22,911,999 7.34%
Muni cipal Bond/Note 211,680 0.07%
Bank Note 668,088 0.21%
Asset-Backed Securities 10,622,789 3.40%
Nego ti able Certificates of Deposit 1,013,896 0.32%
No n-Ne go ti able Certificates of Deposit 2,107,965 0.68%
Mo ney Market Funds 85,171,554 27.29%
Total inv estments 247,610,363 79.34%
Total cash and inve stments 312,089,049$ 100.00%
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 10
Note 2:Cash and Investments (Continued)
At June 30, 2025, cash and investments are reflected in the financial statements as following:
Investment Fair Value Measurements. The City categorizes its fair value measurements within the fair value hierarchy established
by generally accepted accounting principles. Investment securities classified in Level 1 of the fair value hierarchy are valued using
prices quoted in active markets for those securities. Investment securities classified in Level 2 of the fair value hierarchy are valued
using matrix pricing or market corroborated pricing. Matrix pricing is used to value securities based on the securities’ relationship
to benchmark quoted prices.
The following is a summary of the fair value measurements as of June 30, 2025:
Custodial Credit Risk –Deposits with Financial Institutions. The custodial credit risk for deposits is the risk that, in the event of
the failure of a depository financial institution, the City will not be able to recover deposits. Deposits with financial institutions,
including non-negotiable certificates of deposit, totaled $65,105,763 at June 30, 2025 and were insured or collateralized with
securities held by the pledging financial institution's trust department or agent in the City's name.
Gove rnme ntal
Fu nds
Business-Type
Fu nds
Fi du ciary
Fu nds Total
Ca sh and in vestme nts 124,667,748$ 126,788,389$ 37,857,521$ 289,313,658$
Ca sh and in vestme nts h eld by fis cal ag ents 594,469 22,180,922 - 22,775,391
Total cas h and i nves tments 125,262,217$ 148,969,311$ 37,857,521$ 312,089,049$
Gove rnme nt-Wi de S tate me nt of Ne t
Positi on
Fa ir Va lue
Investme nts by fair value hierarchy
U.S. Treasury Bond / Note 70,706,736$ -$ 70,706,736$ -$
Federal Age nc y Bond / Note 4,960,922 - 4,960,922 -
Corporate Note 22,911,999 - 22,911,999 -
Muni cipal Bond/Note 211,680 - 211,680 -
Bank Note 668,088 - 668,088 -
Asset-Backed Securities 10,622,789 - 10,622,789 -
Nego ti able Certificates of Deposit 1,013,896 - 1,013,896 -
Total investme nts by fair value hierarchy 111,096,110 -$ 111,096,110$ -$
Investme nts not subject to fair value hierarchy
State Local Agency Inv estme nt Fund 49,234,734
Non-Negotiable Certificates of Deposit 2,107,965
Money Market Fund s 85,171,554
Total investme nts not subject to fair value hierarchy 136,514,253
Total investme nts measured at fair value 247,610,363$
Fa ir Value Me asure me nt s Using
Quote d Pric es in
Active Marke ts
for Ident ic al
As se ts (Level 1)
Significant
Other
Obse rvable
Input s
(Level 2)
Signific ant
Unobse rv able
Input s
(Level 3)
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 11
Note 2:Cash and Investments (Continued)
The California Government Code requires California financial institutions to secure the City's deposits by pledging government
securities as collateral. The fair value of the pledged securities must equal 110% of the City's deposits. California law also allows
financial institutions to secure City deposits by pledging first trust deed mortgage notes equal to 150% of the City's deposits or letters
of credit issued by the Federal Home Loan Bank of San Francisco having a value of 105% in excess of the total amount of deposits.
Custodial Credit Risk -Investments. This is the risk that in the event of the failure of a counterparty, the City will not be able to
recover the value of its investments that are in the possession of an outside party. All of the City’s investments in securities are
insured or registered and held by a counterparty in the City’s name in accordance with the City’s policies.
Interest Rate Risk. This is the risk that the fair value of securities in the portfolio will fall due to changes in general interest rates. In
accordance with its policies in the Investment Management Plan, the City mitigates interest rate risk by:
Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby
avoiding the need to sell securities on the open market before maturity.
Investing operating funds primarily in shorter-term securities.
The City’s investment policy also includes portfolio maturity targets. A minimum of 20% of the portfolio will be invested in
securities maturing in one year or less. Up to 80% of the portfolio can be invested in securities with a maturity over one year, with
no more than 10% of the portfolio invested in securities with a maturity over five years.
Maturities using the segmented time distribution method for those investments requiring this disclosure are as follows:
Investments held by fiscal agents are structured with maturity dates that correspond to the payment of final debt service of the
respective bond indenture.
Credit Risk. This is the risk of loss due to the failure of the security issuer or backer. The City’s policies to mitigate credit risk
include:
Limiting investments to the safest types of securities. As noted above, the California Government Code limits the investment
vehicles available to local agencies. The credit risk of these securities is measured by the assignment of a rating by a
nationally recognized statistical rating organization. The table below presents the rating for each investment type as
provided by Standard & Poor’s except as noted.
Pre-qualifying the financial institutions, broker/dealers, intermediaries and advisors with which the City will do business.
Fa ir Value
Le ss Than One
Mont h
One Mo nt h to
One Ye ar One to Fiv e Ye ars Ove r Fi ve Years
State Local Agency Investment Fund 49,234,734$ -$ 49,234,734$ -$ -$
U.S. Treasury Bond / Note 70,706,736 - 22,083,062 48,623,674 -
Federal Agency Bond / Note 4,960,922 - 3,816,445 1,144,477 -
Corporate Note 22,911,999 - 3,450,288 19,461,711 -
Muni cipal Bond/Note 211,680 - 211,680 - -
Bank Note 668,088 - - 668,088 -
Asset-Backed Securities 10,622,789 - - 10,622,789 -
Negotiable Certificates of Deposit 1,013,896 - - 1,013,896 -
Non-Negotiable Certificates of Deposit 2,107,965 - 2,107,965 - -
Mo ney Ma rket Funds 85,171,554 85,171,554 - - -
Total maturities 247,610,363$ 85,171,554$ 80,904,174$ 81,534,635$ -$
Cash in banks and on hand 64,478,686
312,089,049$
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 12
Note 2:Cash and Investments (Continued)
The following table identifies the Standard & Poor’s credit quality ratings for those investments requiring this disclosure as of June
30, 2025:
Concentration Credit Risk. The City’s policies contained in the Investment Policy and Management Plan provide guidelines (by
type of investment that limits either the dollar amount, the percent of the portfolio or the maturity term) for diversifying the
investment portfolio so that potential losses on individual securities will be minimized.
The City’s Investment Management Plan outlines the following criteria related to portfolio diversification:
No more than 5% of the City’s portfolio (exclusive of government agency issues or LAIF) shall be placed with any financial
institution.
No more than 25% of the City’s portfolio shall be invested in collateralized certificates of deposit issued by financial
institutions.
Certificates of deposit (negotiable and collateralized) placed by the City shall not constitute more than 15% of the total
assets of the institution; and negotiable certificates of deposit will only be placed with institutions with total assets in excess
of $200 million and that maintain a ratio of equity to total assets of at least 5%.
Foreign Currency Risk. The City does not hold any investment that is based on foreign currency exchange rates.
Type of Inve stment Rating Total
Federal Agency Bonds / Notes AA+4,960,922$
Corporate Notes AAA 1,617,924
AA 318,488
AA-6,338,531
A+8,183,504
A 5,443,148
A-1,010,404
Total Cor porate Notes 22,911,999
Muni cipal Bond/Note AA-211,680
Bank Note A 668,088
As set-Backed Securities AAA 7,489,200
NR 3,133,589
Ne go ti able Certificates of Deposit A+1,013,896
U.S. Treasury Bonds / Notes AA+70,706,736
Not Rated:
State Local Agency Inv estme nt Fund 49,234,734
Non-Negotiable Certificates of Deposit 2,107,965
Mo ney Ma rket Mutua l Fund s 85,171,554
Total Inv estme nts 247,610,363$
100
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 13
Note 3:Property Taxes
Property taxes in the State of California (State) are administered for all local agencies at the county level, and consist of secured,
unsecured and utility tax rolls. The following is a summary of major policies and practices relating to property taxes:
Property Valuation. Valuations are established by the Assessor of the County of San Luis Obispo (County) for the secured
and unsecured property tax rolls; the utility property tax roll is valued by the State Board of Equalization. Under the
provisions of Article XIIIA of the State Constitution (Proposition 13 adopted by the voters on June 6, 1978), properties are
assessed at 100% of full value. Proposition 13 also modified the value of taxable real property for fiscal 1979 by rolling
back values to fiscal 1976 levels. From this base of assessment, subsequent annual increases in valuation are limited to a
maximum of 2%. However, increases to full value are allowed for property improvements or upon change in ownership.
Personal property is excluded from these limitations and is subject to annual reappraisal.
Tax Levies. Under the provisions of Proposition 13, the countywide tax levy for general revenue purposes is limited to 1%
of full market value, which results in a tax rate of $1.00 per $100 assessed valuation. Tax rates for voter approved
indebtedness are excluded from this limitation.
Tax Levy Dates. All lien dates attach annually on January 1 preceding the fiscal year for which the taxes are levied. The
fiscal year begins July 1 and ends June 30 of the following year. Taxes are levied on both real and unsecured personal
property as it exists at that time. The lien against real estate as well as the tax on personal property is not relieved by
subsequent renewal or change in ownership.
Tax Collections. The County Treasurer/Tax Collector is responsible for all property tax collections. Taxes and assessments
on the secured and utility rolls, which constitute a lien against the property, may be paid in two installments: the first
installment is due on November 1 of the fiscal year and is delinquent if not paid by December 10; and the second installment
is due on March 1 of the fiscal year and is delinquent if not paid by April 10. Unsecured personal property taxes do not
constitute a lien against real property. However, if the taxes become delinquent the lien is attached against anything the
individual owns, which could include real property. Payment must be made in one installment, which is delinquent if not
paid by August 31 of the fiscal year. Significant penalties are imposed by the County for late payments.
Teeter Plan. In 1993-94 the City elected to receive property tax revenue in accordance with the alternative method of
distribution prescribed by Sections 4701-4717 of the California Revenue and Taxation Code, which is commonly known
as the “Teeter Plan” whereby the County remits 100% of taxes levied without regard to delinquencies. The County then
pursues collection, retaining any delinquent taxes and related penalties and interest.
Tax Levy Apportionments. Due to the nature of the countywide maximum levy, it is not possible to identify general purpose
tax rates for specific entities. Under State legislation adopted after the passage of Proposition 13, apportionments to local
agencies are made by the County Auditor Controller based primarily on two factors: the ratio that each agency represented
of the total County wide levy for the three years prior to fiscal 1979; and subsequent adjustments to these apportionments
and transfers to the “Educational Revenue Augmentation Fund” (ERAF) as determined by the State.
City Property Tax Distribution Policy. Property taxes are recorded in the General Fund as general-purpose revenue.
Transfers are made from the General Fund as needed to support expenditures in the Capital Outlay, Open Space Protection,
Fleet Replacement, Information Technology Replacement, Major Facility Replacement and Debt Service Funds. Property
taxes receivable at June 30, 2025 have been accrued since they will be collected within 60 days subsequent to year-end.
101
Page 305 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 14
Note 4:Loans Receivable
Loans receivable, including accrued interest comprised balances from the following programs, all of which are discussed on the
following pages.These loans are non-compounding, meaning they accrue interest on only the original principal. No interest or
principal is due until the end of the term. Some developments may have more than one type of loan with the City.
A.Affordable Housing Loans -The City’s Affordable Housing Fund provides grants and loans to certain development
projects that meet the City’s affordability criteria. As of June 30, 2025, the Fund has 17 loans for affordable housing
developments with interest rates ranging from 0% to 4% on the original principal and repayment terms of 30 to 57 years.
Outstanding loans had a remaining principal balance of $9.2 million; 4 loans for $669,063 are forgivable if certain criteria
are met netting $8.5 million in loans. The Fund has secured more than 450 affordable housing units for City residents.
B.BEGIN Homeownership Loan -The City has provided deferred payment loans utilizing funding from the State of
California under the BEGIN program. On June 30, 2025, the Fund had two outstanding loans utilizing this program with a
principal balance of $130,000. These loans are provided for a term of 30 years with an annual interest rate of 3% on the
original principal.
C.Down Payment Assistance - The Fund has provided down payment assistance loans to individuals purchasing affordable
housing units. As of June 30, 2025, the Affordable Housing Fund had seven outstanding down payment assistance loans
with a principal balance of $292,995. These loans are provided for a term of 30 years with an annual interest rate of 3%on
the original principal.
D.Impact Fee Deferral Loan –The City has provided certain affordable housing developments with loans equal to the
amount of certain impact fees. These loans are reflected in the respective impact fee funds. As of June 30, 2025, the total
principal outstanding was $5,004,148. These loans are provided for a term of 55 years with an annual interest rate of 3%
on the original principal.
E.Community Development Block Grant (CDBG) Fund Loans –The City has provided loans from the City’s allocation
of CDBG funding for certain affordable housing developments. As of June 30, 2025, the CDBG Fund had $1,556,161
principal outstanding on the loans with $443,217 forgivable if certain conditions are met. The loans have terms of 30 years
and annual interest rates of 3% to 4% on the original principal.
Note 5:Capital Assets
GASB standards require that the City report in the government-wide statements the value of all capital assets net of accumulated
depreciation, including infrastructure assets, in accordance with GAAP. Infrastructure assets are defined as long-lived capital assets
that are stationary in nature and normally can be preserved for a significantly greater number of years than most capital assets.
Total Balance
Des crip tion Lo ans Receivable In teres t Re ceivable Ju ne 30, 2025
Go vern me ntal Fu nds:
Afford able Ho us in g Lo ans 8,490,688$ 2,850,875$ 11,341,563$
BEGIN Ho me owners hip Lo ans 130,000 60,475 190,475
Down Pay me nt Assistances 292,995 79,866 372,861
CDBG Loans 1,112,944 744,699 1,857,643
Impact Fe e Lo ans 2,729,061 798,485 3,527,546
Total Governmental Fu nds 12,755,688 4,534,400 17,290,088
En terpris e Fu nds:
Impact Fe e Lo ans 2,275,087 477,106 2,752,193
Total En terpris e Fu nds 2,275,087 477,106 2,752,193
Total Primary Go vernment 15,030,775$ 5,011,506$ 20,042,281$
102
Page 306 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 15
Note 5:Capital Assets (Continued)
The minimum requirement for compliance with GASB standards is to provide infrastructure valuations for all assets constructed,
acquired, or placed into service on or after July 1, 1980. Relevant assets for the City were valued at one of two dates: 1) the original
date of construction, if available, or 2) the incorporation date of the City. Each asset was reviewed to determine the adequacy of the
data to value the asset prior to July 1, 1980 using historical cost or estimated historical cost.
Capital assets activity for the fiscal year ended June 30, 2025 was as follows:
Balance Balance
June 30, 2024 Addit ions De le tions Transfe rs June 30, 2025
Gove rnmental activities:
Capital assets not being depreciated:
La nd 34,263,736$ -$ -$ -$ 34,263,736$
Construction in progress 29,750,174 19,654,898 (1,122) (27,180,557) 22,223,393
Public art 646,630 - - - 646,630
Total capital assets not
being depreciated 64,660,540 19,654,898 (1,122) (27,180,557) 57,133,759
Capital assets being depreciated:
Infr astructur e 214,889,288 - - 20,412,914 235,302,202
Ac cumulated Depreciation (82,293,168) (3,628,183) - (1,677,819) (87,599,170)
Buildings and improvements 59,159,418 - (16,000) 5,793,182 64,936,600
Ac cumulated Depreciation (25,338,081) (1,931,009) 16,000 1,716,192 (25,536,898)
Equipment 36,006,043 - (241,818) 974,461 36,738,686
Ac cumulated Depreciation (22,285,375) (2,282,966) 241,818 (38,373) (24,364,896)
Capital assets being amortized:
Right of use - Lease asset 736,731 - - - 736,731
Ac cumulated Amortization (342,353) (152,403) - - (494,756)
Subscription based I.T. agreements 897,624 - (155,082) - 742,542
Ac cumulated Amortization (507,530) (258,985) 117,973 - (648,542)
Total capital assets being
depreciated/amortized, net 180,922,597 (8,253,546) (37,109) 27,180,557 199,812,499
Governme nt al activities,
capital assets, net 245,583,137$ 11,401,352$ (38,231)$ -$ 256,946,258$
Business-type activities:
Capital assets not being depreciated:
La nd 13,814,878$ -$ -$ -$ 13,814,878$
Construction in progress 181,987,785 53,169,805 (37,637) (17,175,259) 217,944,694
Total capital assets not
being depreciated 195,802,663 53,169,805 (37,637) (17,175,259) 231,759,572
Capital assets being depreciated:
Infr astructur e 245,965,945 - - 11,886,327 257,852,272
Ac cumulated Depreciation (117,924,287) (5,054,114) - (801,210) (123,779,611)
Buildings and improvements 30,527,376 - - 381,264 30,908,640
Ac cumulated Depreciation (17,158,306) (592,430) - 7,521 (17,743,215)
Equipment 26,278,687 - (372,433) 4,907,663 30,813,917
Ac cumulated Depreciation (17,783,442) (1,541,190) 372,433 793,694 (18,158,505)
Capital assets being amortized:
Subscription based I.T. agreements 77,026 - - - 77,026
Ac cumulated Amortization (51,343) (25,683) - - (77,026)
Total capital assets being
depreciated, net 149,931,656 (7,213,417) - 17,175,259 159,893,498
Business-type activities,
capital assets, net 345,734,319 45,956,388 (37,637) - 391,653,070
Total Gove rnment-wide 591,317,456$ 57,357,740$ (75,868)$ -$ 648,599,328$
103
Page 307 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 16
Note 5:Capital Assets (Continued)
Depreciation and amortization expense was charged to functions/programs as follows:
Note 6:Leases
Pursuant to GASB 87, the City has the following lease receivables:
James Town
On 11/5/2013, the City entered into a lease with James Town Premier SL Retail, L.P. or commercial retail space located at the Marsh
Street parking structure. Under the lease, the lessee pays the City $11,310 per month from 2/1/2014 –1/31/2015 and with 3% increase
each year from 2/1/2015 –1/31/2024. City renewed the lease for 5 years. The lease receivable is measured as the present value of
the future minimum rent payments expected to be received during the lease term at a discount rate of 3.99%, which was the 5-year
US Treasury rate in effect when the lease was entered into. In fiscal year 2025, the City recognized $133,858 of lease revenue and
$19,007 of interest revenue under the lease.
Crown Castle
On 9/19/2017, the City entered into a lease with Crown Castle NG West LLC to utilize City utility poles for communications
equipment. Under the lease, the initial annual pole fee shall consist of $1,000 for each city pole which Crown Castle’s facilities are
to be installed pursuant to this agreement and is payable to city upon execution and delivery of this agreement and prior to Crown
Castle installing any portion of the network or any facilities. The term ends on 9/1/2047 with 3% increase annually. The lease
receivable is measured as the present value of the future minimum rent payments expected to be received during the lease term at a
discount rate of 3.5%, which was the 5-year US Treasury rate in effect when the lease was entered into. In fiscal year 2025, the City
recognized $6,491 of lease revenue and $5,661 of interest revenue under the lease.
Garden Street
On 8/1/2015, the City entered into a lease with Garden Street SLO Partners, L.P for the right to use land formerly a surface parking
lot in order to build a hotel.Under the lease,the lessee pays the City $171,600 or the “Base Annual Rent Floor”, which is the amount
of Landlord’s annual net revenue from the operation of Parking Lot 2 on the premises in the period of twelve months ended on the
last day of the last full calendar month ended two months prior to the rent commencement date.The amount of base rent shall be
increased as of the first day of each rent adjustment period commencing with the rent adjustment period that begins on the first day
of the third lease year and on the first day of each subsequent rent adjustment period. The lease receivable is measured as the present
value of the future minimum rent payments expected to be received during the lease term at a discount rate of 1%, which is the 5-
year US Treasury rate in effect when the lease was entered into. In fiscal year 2025, the City recognized $391,827 of lease revenue
and $368,219 of interest revenue under the lease.
Governme nt al activities:
Public safety 973,615$
Transportation 4,387,129
Cultur e and recreation 928,459
Commu ni ty development 155,245
Ge ne ral government 1,809,098
Total depreciation - governme ntal activities 8,253,546
Busine ss-type activities:
Wa ter 3,369,279
Sew er 2,636,961
Parking 732,015
Transit 475,162
Total depreciation - business-type activities 7,213,417
Total Gove rnment-wide 15,466,963$
104
Page 308 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 17
Note 6: Leases (Continued)
Laguna AT&T
On 9/16/2009, the City entered into a lease with New Cingular Wireless PCS, LLC to locate a cellular communication site at the
Laguna Lake Golf Course. Under the lease, the lessee pays the City $26,000 annually and thereafter, be multiplied by the CPI
Adjuster or 3%, whichever is greater that ends on 9/30/2029. The lease receivable is measured as the present value of the future
minimum rent payments expected to be received during the lease term at a discount rate of 2%, which is the 5-year US Treasury rate
in effect when the lease was entered into. In fiscal year 2025, the City recognized $43,195 of lease revenue and $5,023 of interest
revenue under the lease.
Laguna SBA
On 2/1/2005, the City entered into a lease with SBA 2012 TC Assets, LLC to locate a cellular communication site at the Laguna
Lake Golf Course. Under the lease, the lessee pays the City $25,000 annually and thereafter, be multiplied by the CPI Adjuster or
3%, whichever is greater, that ends in 2025. The lease receivable is measured as the present value of the future minimum rent
payments expected to be received during the lease term at a discount rate of 3%, which is the 5-year US Treasury rate in effect when
the lease was entered into.In fiscal year 2025, the City recognized $19,588 of lease revenue under the lease.
Santa Rosa St
On 5/13/2011, the City entered into a lease with New Cingular Wireless PCS, LLC to locate a cellular communication site at the
Santa Rosa Park. Under the lease,the lessee pays the City $26,000 annually and thereafter, be multiplied by the CPI Adjuster or 3%,
whichever is greater, that ends on 5/13/2031. The lease receivable is measured as the present value of the future minimum rent
payments expected to be received during the lease term at a discount rate of 2%, which is the 5-year US Treasury rate in effect when
the lease was entered into. In fiscal year 2025, the City recognized $73,350 of lease revenue and $10,876 of interest revenue under
the lease.
The future revenue payments as of June 30, 2025 are as follows:
Year Ending
June 30,Principal Intere st Principal Interest Principal Interest Principal Interest Principal Interest Principal Interest
2026 2,000$ 5,601$ -$ 369,364$ 38,836$ 4,286$ 69,693$ 9,555$ 122,794$ 14,866$ 233,322$ 403,671$
2027 2,298 5,531 - 370,367 40,906 3,509 73,464 8,161 131,357 10,432 248,025 398,000
2028 2,613 5,451 - 371,380 43,057 2,691 77,382 6,692 140,351 5,692 263,403 391,905
2029 2,946 5,359 - 372,403 45,291 1,830 81,452 5,144 85,662 1,002 215,350 385,739
2030 3,298 5,256 - 373,275 46,196 924 85,679 3,515 - - 135,173 382,970
2031-2035 22,502 24,278 - 1,878,734 - - 90,068 1,801 - - 112,571 1,904,813
2036-2040 34,701 19,530 - 1,894,309 - - - - - - 34,701 1,913,839
2041-2045 50,458 12,410 116,100 1,902,630 - - - - - - 166,558 1,915,040
2046-2050 39,216 2,791 117,782 1,902,301 - - - - - - 156,998 1,905,092
2051-2055 - - 318,486 1,891,932 - - - - - - 318,486 1,891,932
2056-2060 - - 576,982 1,870,265 - - - - - - 576,982 1,870,265
2061-2065 - - 844,561 1,835,348 - - - - - - 844,561 1,835,348
2066-2070 - - 1,148,189 1,785,236 - - - - - - 1,148,189 1,785,236
2071-2075 - - 1,530,943 1,718,156 - - - - - - 1,530,943 1,718,156
2076-2080 - - 1,927,732 1,631,402 - - - - - - 1,927,732 1,631,402
2081-2085 - - 2,374,735 1,522,274 - - - - - - 2,374,735 1,522,274
2086-2090 - - 2,929,704 1,388,291 - - - - - - 2,929,704 1,388,291
2091-20295 - - 3,505,635 1,225,726 - - - - - - 3,505,635 1,225,726
2096-2100 - - 4,151,056 1,030,847 - - - - - - 4,151,056 1,030,847
2101-2105 - - 4,943,368 800,216 - - - - - - 4,943,368 800,216
2106-2110 - - 5,766,264 528,717 - - - - - - 5,766,264 528,717
2111-2115 - - 6,684,816 211,224 - - - - - 6,684,816 211,224
Total 160,032$ 86,207$ 36,936,353$ 26,874,397$ 214,286$ 13,239$ 477,737$ 34,867$ 480,164$ 31,991$ 38,268,572$ 27,040,702$
TotalCrown Castle Garden St Laguna ATT Santa Rosa St Marsh St
105
Page 309 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 20
Note 7:Long Term Debt (Continued)
Lease Liability (Cuesta Peak)
On October 23, 2003, the City entered into a 22-year Lease Agreement as lessee of a site for City radio equipment. The City pays
the landlord $16,857.96 annually with a 4% increase. An initial lease liability was recorded in the amount of $157,527. As of June
30, 2025, the value of the lease liability is $20,148. The City is required to make monthly payments of $670 and increase annually
by 4% in October of each year. The lease has an interest rate of 3.04%. The value of the right to use asset as of June 30, 2025 of
$157,442 with accumulated amortization of $110,633 is included in the intangible assets on the capital assets activities table found
in Note 5 above.
Lease Liability (994 Mill Street)
On June 9, 2022, the City entered into a 3-year Lease Agreement as lessee of a site for the use of 11 parking spaces. The term of this
lease commenced on July 1, 2022. The City pays the landlord $10,038 annually with a 3% increase. An initial lease liability was
recorded in the amount of $579,204. As of June 30, 2025, the value of the lease liability is $256,298. The lease has an interest rate
of 4%. The value of the right to use asset as of June 30, 2025 of $579,204 with accumulated amortization of $231,700 is included
in the intangible assets on the capital assets activities table found in Note 5 above.
At June 30, 2025, the aggregate maturities of the aforementioned governmental activities revenue bonds were as follows:
At June 30, 2025, the aggregate maturities of the aforementioned governmental lease liabilities were as follows:
Fo r the Ye ar Ending June 30,Principa l Int erest Total
2026 1,143,450$ 581,515$ 1,724,965$
2027 986,775 525,693 1,512,468
2028 1,036,425 478,929 1,515,354
2029 1,082,625 431,158 1,513,783
2030 1,138,825 380,977 1,519,802
2031/2035 4,359,025 1,339,293 5,698,318
2036/2040 2,752,100 537,175 3,289,275
2041/2045 1,900,000 196,000 2,096,000
Subtotal 14,399,225 4,470,740 18,869,965
Una mo rtized bond Premium 966,956 - 966,956
Total 15,366,181$ 4,470,740$ 19,836,921$
Fo r the Year En di ng J une 3 0,Principal In te res t Total
2026 143,768$ 8,365$ 152,133$
2027 132,678 2,892 135,570
276,446$ 11,257$ 287,703$
106
Page 310 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 18
Note 7:Long Term Debt
Summary of Long-Term Debt
The following is a summary of the City's long-term debt transactions for the year ended June 30, 2025:
Compensated absences in the governmental funds are generally liquidated by the General Fund on a pay as you go basis. For detail
of estimated claims and liabilities, see Note 11.
The San Luis Obispo Capital Improvement Board (Board) and the San Luis Obispo Public Financing Authority (Authority) have
entered into a number of lease agreements with the City of San Luis Obispo wherein the City is obligated to make all debt service
payments. The transactions between the Board/Authority have been eliminated from these financial statements.
Balanc e Balance Due Within
June 30, 2 024 Addi ti on s De du ctions June 3 0, 2025 One Year
Gove rnmental ac tivi ties:
2014 Leas e revenue bonds 6,085,000$ -$ (200,000)$ 5,885,000$ 205,000$
2018 Leas e revenue refu nding bonds 7,493,200 - (618,975) 6,874,225 648,450
2023 Leas e revenue refu nding bonds 1,920,000 - (280,000) 1,640,000 290,000
Add: Un amortize d bond premiu m 1,062,295 - (95,339) 966,956 -
Total revenue bonds 16,560,495 - (1,194,314) 15,366,181 1,143,450
Le ase lia bilit y 429,171 - (152,725) 276,446 143,768
Su bscrip tion based I.T. agreeemnts 321,349 - (246,637) 74,712 51,516
Total lo ng-term debt,
governmental activities 17,311,015$ -$ (1,593,676)$ 15,717,339$ 1,338,734$
Co mp ensated abs ences 4,449,948$ 5,479,971$ (5,259,892)$ 4,670,027$ 3,269,019$
Business-type acti vi ties :
2018 Leas e revenue refu nding bonds 3,946,800$ -$ (326,025)$ 3,620,775$ 341,550$
2018 W ater revenue refu nding bonds 7,365,000 - (520,000) 6,845,000 545,000
2023 Leas e revenue refu nding bonds 43,860,000 - (640,000) 43,220,000 680,000
Add: Un amortize d bond premiu m 4,965,712 - (234,959) 4,730,753 -
Total revenue bonds 60,137,512 - (1,720,984) 58,416,528 1,566,550
Su bscrip tion based I.T. agreeemnts 25,637 - (25,637) - -
Lo ans 138,064,103 19,479,561 (4,663,165) 152,880,499 4,819,807
In stallme nt sale a greements 2,869,551 - (541,575) 2,327,976 557,280
Total lo ng-term debt,
busin ess-type activities 201,096,803 19,479,561 (6,951,361) 213,625,003 6,943,637
Co mp ensated abs ences 915,977 978,808 (1,020,134) 874,651 612,256
Total Governme nt-wide 223,773,743$ 25,938,340$ (14,825,063)$ 234,887,020$ 12,163,646$
107
Page 311 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 19
Note 7:Long Term Debt (Continued)
Governmental Activities Summary:
Revenue Bonds
2014 Lease Revenue Bonds. In 2014, the Authority issued lease revenue bonds in the amount of $7,580,000 to finance the expansion
of the Los Osos Valley Road interchange at U.S. 101. The bonds bear interest from 3.00% to 4.00% and are due in annual installments
on November 1 through November 1, 2044 that range from $145,000 to $410,000. At June 30, 2025, the principal amount outstanding
on the bonds was $5,885,000.
In the Statement of Net Position, the 2014 bonds include the related unamortized premium which is being amortized and charged to
expense over the term of the 2014 bonds. At June 30, 2025, the unamortized premium was $157,567.
2018 Lease Revenue Refunding Bonds. In 2018, the Authority issued lease revenue bonds in the amount of $16,905,000 to advance
refund the outstanding 2005 revenue refunding bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to
construct several high priority capital improvement projects and to finance the costs of acquisition and construction of public parking
facilities, and the public safety communications and emergency operations center project. Of the original bond issuance, $11,072,775
was used for financing governmental activities related to the original bonds and the remainder was used for business-type activities.
The bonds bear interest from 3.00% to 5.00% and are due in annual installments on June 1, through June 1, 2039 that range from
$255,000 to $1,250,000. At June 30, 2025, the principal amount outstanding that pertains to governmental activities was $6,874,225
of the total $11,440,000 outstanding.
In the Statement of Net Position, the 2018 bonds include the related unamortized premium which is being amortized and charged to
expense over the term of the 2018 bonds. At June 30, 2025, the unamortized premium for governmental activities was $706,886.
The refunding resulted in a difference of $374,404 between the reacquisition price and the net carrying value of the old debt and is
being amortized to expense through 2039. The City completed the refunding to reduce its total debt service payments over the
following 21 years by $3,838,338 and to obtain an economic gain of $2,960,278 (difference between the present values of the old
and the new debt service payments).
2023 Lease Revenue Refunding Bonds.On September 13, 2023, the San Luis Obispo Public Financing Authority issued
$45,780,000 in Lease Revenue Bonds with premium of $3,707,639 for the construction of the Cultural Arts District Parking Structure
and to refund the 2012 Lease Revenue Bonds. Debt service payments of approximately $2.8 million per year are expected to be
paid from revenues generated by the City’s Parking Fund through December 2053.Of the original bond issuance, $1,920,000 was
used for financing governmental activities related to the original bonds and the remainder was used for business-type activities. The
refunding of 2012 lease revenue bond reduced its total debt service payments over 7 years by $484,439 and to obtain an economic
gain of $56,492.
The bonds bear 5% interest and are due in annual installments on December 1 through December 1, 2053.In the Statement of Net
Position, the 2023 bonds include the related unamortized premium which is being amortized and charged to expense over the term
of the 2023 bonds. At June 30, 2025, the unamortized premium in the governmental activities was $99,503.
108
Page 312 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 21
Note 7:Long Term Debt (Continued)
Subscription Based Information Technology Arrangements
Application Software Technology (AST). AST arrangement is a five-year agreement, initiated on September 1, 2021 with an annual
payment of $20,400. The city has used a 2.88% for this arrangement based on similar debt during the same fiscal year. There are no
options to extend the arrangement or purchase the software.The agreement was paid off during fiscal year 2025.
eScribe. eScribe arrangement is a three-year arrangement, initiated on February 17, 2021. The city pays the vendor $18,110 annually
with 2.5% increase. The city has used a 2.85% for this arrangement based on similar debt during the same fiscal year. The
arrangement will automatically renew for an additional Term unless notice of cancellation is received 60 days prior to the expiration
of the Term.
ESRI ArcGIS Online. ESRI ArcGIS Online arrangement is a three-year arrangement, initiated on July 8, 2020. The payment amount
on the city is based on the price of quote. The city has used a 2.85% for this arrangement based on similar debt during the same fiscal
year.The city decided to sign another three-year renewal for the arrangement until July 6, 2026.
Office 365. Office 365 arrangement is a three-year agreement, initiated on July 1, 2022 with an annual payment of $189,126. The
city has used a 2.85% for this arrangement based on similar debt during the same fiscal year. An extended term feature that allows
Online Services to continue month-to-month is available.The city allocates this arrangement for both governmental and business
entity funds. The agreement was paid off during fiscal year 2025.
At June 30, 2025, the aggregate maturities of the aforementioned subscription based I.T. agreements were as follows:
Fo r the Ye ar Ending June 30,Principa l Inte re st Total
2026 51,516$ 1,912$ 53,428$
2027 13,681 456 14,137
2028 9,515 96 9,611
74,712$ 2,464$ 77,176$
109
Page 313 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 22
Note 7:Long Term Debt (Continued)
Business-Type Activities Summary:
Revenue Bonds
2018 Lease Revenue Refunding Bonds. In 2018, the Authority issued lease revenue bonds in the amount of $16,905,000 to advance
refund the outstanding 2005 revenue refunding bonds and the 2006 and 2009 lease revenue bonds, which were originally issued to
construct several high priority capital improvement projects and to finance the costs of acquisition and construction of public parking
facilities, and the public safety communications and emergency operations center project. Of the original bond issuance, $5,832,225
was used for financing business-type activities related to the original bonds and the remainder was used for governmental activities.
The bonds bear interest from 3.00% to 5.00% and are due in annual installments on June 1, through June 1, 2039 that range from
$255,000 to $1,250,000. At June 30, 2025, the principal amount outstanding that pertains to business-type activities was $3,620,775
of the total $11,440,000 outstanding.
In the Statement of Net Position, the 2018 bonds include the related unamortized premium which is being amortized and charged to
expense over the term of the 2018 bonds. At June 30, 2025, the unamortized premium that pertains to business-type activities was
$372,330.
The refunding resulted in a difference of $374,404 between the reacquisition price and the net carrying value of the old debt and is
being amortized to expense through 2039. The City completed the refunding to reduce its total debt service payments over the next
21 years by $3,838,338 and to obtain an economic gain of $2,960,278 (difference between the present values of the old and the new
debt service payments).
2018 Water Revenue Refunding Bonds. In 2018, the City issued water revenue refunding bonds the in the amount of $10,095,000
to refund the 2006 water revenue bonds, which were originally issued to fund improvements to the water treatment plant. The bonds
bear interest from 4% to 5% and are due in annual installments on June 1 through June 1, 2035 that range from $455,000 to $845,000.
At June 30, 2025, the principal amount outstanding on the bonds was $6.845.000.
The City has pledged future water system revenues, net of specific operating expenses, to repay the bonds on parity with a pledge
that services all parity obligations. The bonds are payable solely from water customer net revenues and any moneys in the bond
service fund and the reserve fund. For the year ended June 30, 2025, principal and interest paid, and total customer net revenues
were $886,500 and $6,173,810, respectively. In the Statement of Net Position, the bonds include the related unamortized premium
which is being amortized and charged to expense over the term of the bonds. At June 30, 2025, the unamortized premium was
$1,005,391.
2023 Lease Revenue Refunding Bonds. On September 13, 2023, the San Luis Obispo Public Financing Authority issued
$45,780,000 in Lease Revenue Bonds with premium of $3,707,639 for the construction of the Cultural Arts District Parking Structure
and to refund the 2012 Lease Revenue Bonds. Debt service payments of approximately $2.8 million per year are expected to be
paid from revenues generated by the City’s Parking Fund through December 2053. Of the original bond issuance, $43,860,000 was
used for financing the construction of the Cultural Arts District Parking Structure and the remainder was used for governmental-type
activities.
At June 30, 2025, the principal amount outstanding on the bonds was $43,220,000 with unamortized premium of $3,355,032.
110
Page 314 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 23
Note 7:Long Term Debt (Continued)
At June 30, 2025, the aggregate maturities of the business-type revenue bonds were as follows:
Loans
2001 CIEDB State Loan. In 2001, the City obtained a note in the amount of $7,765,900 to go towards expanding the Marsh Street
parking structure. The note bears an interest rate of 3.37% due in semi-annual installments on February 1 and August 1 through
August 31, 2031 that range from $169,000 to $396,000. At June 30, 2025, the principal amount outstanding on the loan was
$2,537,058.
2009 Infrastructure and Economic Development Bank Loan–Tank Farm Lift Station. In 2009, the City obtained a note in the
amount of $10,000,000 to go towards the Tank Farm lift station and main sewer project. The note bears an interest rate of 3.25%
due in annual installments on December 1 through December 1, 2037 that range from $212,600 to $520,744. At June 30, 2025, the
principal amount outstanding on the loan was $5,627,721.
The City has pledged future sewer system revenues, net of specific operating expenses, to repay the loan. The loan is payable solely
from sewer customer net revenues. For the year ended June 30, 2025, principal and interest paid, and total customer net revenues
were $549,999 and $14,744,737, respectively.
2018 Clean Water State Revolving Fund Loan.In 2018, the City Council approved the Clean Water State Revolving Fund loan
agreement between the City of San Luis Obispo and the California State Water Resources Control Board for a $140 million loan for
the Water Resource Recovery Facility Project. The City will receive $4 million in principal forgiveness and the remaining $136
million will be repaid over 30 years. The applicable interest rate was set at 1.8%. As of June 30, 2025, the City had fully drawn down
the loan and had an outstanding principal balance of $134,230,838.The loan requires a $4.9 million reserve, which is reflected in
the Sewer Fund.
2020 CIEDB State Loan. In 2020, the City obtained a note in the amount of $14,300,000 for improvements to the City’s Water
Treatment Plant to provide enhanced reliability and energy and operational efficiencies. The note bears an interest rate of 2.5% and
a term of 20 years. At June 30, 2025, the City had partially drawn down the loan and had an outstanding principal balance of
$10,484,882.
Fo r the Ye ar Ending June 30,Principa l Int erest Total
2026 1,566,550$ 2,640,122$ 4,206,672$
2027 1,528,225 2,560,920 4,089,145
2028 1,603,575 2,483,633 4,087,208
2029 1,687,375 2,402,455 4,089,830
2030 1,786,175 2,317,086 4,103,261
2031-2035 10,260,975 10,161,916 20,422,891
2036-2040 6,827,900 7,952,613 14,780,513
2041-2045 7,965,000 6,150,125 14,115,125
2046-2050 10,225,000 3,888,125 14,113,125
2051-2054 10,235,000 1,055,625 11,290,625
Subtotal 53,685,775 41,612,620 95,298,395
Una mo rtized bond Premium 4,730,753 - 4,730,753
Total 58,416,528$ 41,612,620$ 100,029,148$
111
Page 315 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 24
Note 7:Long Term Debt (Continued)
At June 30, 2025, the aggregate maturities of the aforementioned business-type loans were as follows:
Installment Sale Agreements
US Bancorp 2014 Wastewater Lease. In 2013, the Board entered into an installment sale contract financing $7,479,000 to finance
the acquisition and installation of improvements to its water reclamation facility. The note bears an interest rate of 2.8994% due in
annual installments on June 1 and December 1 through December 1, 2028 that range from $372,900 to $607,200. At June 30, 2025,
the principal amount outstanding on the loan was $2,327,976.
At June 30, 2025, the aggregate maturities of the aforementioned business-type installment sale agreements were as follows:
There are a number of limitations and restrictions contained in the various bond indentures. City management believes that the City
has complied with the indenture requirements. Security for revenue bonds is paid from receipts or net income and amounts in funds
or accounts established under bond indentures.
Special Assessment Debt Without City Commitment
Special assessment districts have been established in various parts of the City to provide improvements to properties located in those
districts. Properties in these districts are assessed for the cost of improvements; these assessments are payable solely by property
owners over the term of the debt issued to finance these improvements. The City is not legally or morally obligated to pay these
debts or be the purchaser of last resort of any foreclosed properties in these special assessment districts, nor is it obligated to advance
City funds to repay these debts in the event of default by any of these districts. At June 30, 2025, the balances of these Districts’
outstanding debt were as follows:
City of San Luis Obispo Community Facilities District No.2019-1 Special Tax Bonds, Series 2021 $19,380,000
Fo r the Ye ar Ending June 30,Principa l Int erest Total
2026 4,819,807$ 2,834,415$ 7,654,222$
2027 4,876,710 2,777,171 7,653,881
2028 4,978,670 2,674,856 7,653,526
2029 5,082,886 2,570,275 7,653,161
2030 5,189,409 2,463,375 7,652,784
2031-2035 26,366,685 10,685,671 37,052,356
2036-2040 26,329,470 7,981,846 34,311,315
2041-2045 23,425,966 5,583,026 29,008,992
2046-2050 25,611,581 3,397,410 29,008,992
2051-2054 26,199,315 1,007,879 27,207,194
152,880,499$ 41,975,923$ 154,009,201$
Fo r the Year En di ng J une 30,Principal In te res t Total
2026 557,280$ 59,431$ 616,711$
2027 573,441 43,035 616,476
2028 590,071 26,164 616,235
2029 607,184 8,804 615,988
2,327,976$ 137,434$ 2,465,410$
112
Page 316 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 25
Note 8:Pension Plans
The City contributes to the California Public Employees’ Retirement System (CalPERS) for its employees. The City participates in
one agent multiple-employer plan for its miscellaneous employees (Miscellaneous Plan) and one cost-sharing multiple-employer
plan for its safety employees (Safety Plan). The Miscellaneous Plan is described in the first section of the footnote under Agent-
Multiple Employer Plan and the Safety Plan follows and is described in the second section of the footnote under Cost-Sharing
Employer Plan. A summary of the government-wide balances for all Plans at June 30, 2025 are as follows:
Agent-Multiple Employer Plan
General Information about the Pension Plan
Plan Descriptions. As noted above, the City contributes to CalPERS for a defined benefit pension plan for all qualified permanent
and probationary employees. CalPERS acts as a common investment and administrative agent for its participating member
employers. Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available
reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information
that can be found on the CalPERS website.
Benefits Provided. CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits
to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year
of full-time employment for Tier 1 employees. Tier 2 and PEPRA employees are based on a three-year average of full time
employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All members
are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death
Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost of living adjustments for the plan are
applied as specified by the Public Employees’ Retirement Law.
The Miscellaneous Plan’s provisions and benefits by tier in effect at June 30, 2025, are summarized as follows:
Ne t Pe ns io n De ferre d Outflows De fe rre d Inflows Pe ns ion
Liabilit y of Re sourc es of Re sourc es Expense
Mi scellaneous Plan 93,797,071$ 22,282,043$ -$ 15,424,028$
Safety Plan 84,198,128 28,874,744 4,357,953 14,946,585
Total Government-Wide 177,995,199$ 51,156,787$ 4,357,953$ 30,370,613$
Pri or to On o r aft er On o r aft er
Hire dat e Decembe r 6, 2 012 De cembe r 6, 2 012 Januar y 1 , 2 013
Be ne fit formul a 2.7% @ 5 5 2% @ 6 0 2% @ 6 2
Be ne fit ve sting s chedul e 5 ye ar s service 5 ye ar s service 5 ye ar s service
Be ne fit payme nt s mo nthl y f or life mo nthl y f or life mo nthl y f or life
Re tirement age 50 - 55 50 - 63 52 - 67
Mo nthl y be ne fits, as a % o f
e ligible compens at ion 2.0% to 2.7% 1.092% t o 2.418% 1.0% to 2.5%
Re qui red e mpl oyee contribut ion rat es 7.520%7.520%7.00%
Re qui red e mpl oyer contribut ion rat es 10.530%10.530%10.530%
Re qui red unf unde d ac crued l iabi lity payme nt - (1)- (1)6,938,929$
(1) -Combine d with o n o r af ter Januar y 1 , 2 013
Tiers within the Mi scel lane ous Plan
113
Page 317 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 26
Note 8:Pension Plans (Continued)
While the City's Miscellaneous Plan is not closed to new entrants, the component option of 2.7% @ 55 is closed to new entrants.
Classic Members as defined by CalPERS entering the City's Miscellaneous Plan would enter the 2% @ 60 option while New
Members as defined by CalPERS entering the City Miscellaneous Plan would enter the 2% @ 62 option.
Employees Covered. As of the measurement date June 30, 2024, the following employees were covered by the benefit terms for the
Miscellaneous Plan:
Contributions. Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates
for all public employers be determined on an annual basis by the actuary and shall be effective on July 1 following notice of a change
in the rate. Funding contributions for the Plan are determined annually on an actuarial basis as of June 30 by CalPERS. The actuarially
determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an
additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between the actuarially
determined rate and the contribution rate of employees. Employees that are classified as unrepresented management or unrepresented
confidential contribute 1.5% of pay toward the cost of the City’s share of the annual required contribution.During the measurement
period, the City contributions totaled $12,983,364.
Net Pension Liability
The City’s net pension liability for the Miscellaneous Plan is measured as the total pension liability, less the pension plan’s fiduciary
net position. The net pension liability of the Plan is measured as of June 30, 2024, using an annual actuarial valuation as of June 30,
2023 using standard update procedures. A summary of principal assumptions and methods used to determine the net pension liability
is shown below.
Actuarial Assumptions. The total pension liability in the June 30, 2023 actuarial valuation was determined using the following
actuarial assumptions:
Mi scel lane ous Pl an
Inac tive empl oyees or bene ficiaries
c ur rently r eceiving be ne fits 505
Inac tive empl oyees entitled t o but
no t ye t receiving be ne fits 475
Ac tive empl oyees 351
Total 1,331
Va luat ion Date
Meas ur ement Date
Ac tuar ial Co st Method
Ac tuar ial As sumptions:
Di scount Rat e
Inf lation
Sal ar y Inc rease
Mortality (1)
Post Re tirement Be ne fit Inc rease
(1) The mortalit y table used was developed ba sed on CalPERS-specific data. The probabilitie s of mor talit y are based on the 2021
CalPERS Expe rience Study and revie w of Acturial Assumptions . Mortalit y rate inc orporate full gene rationa l morta lit y improve me nt using
80% of Scale MP-2020 publis hed by the Soc ie ty of Actua ries. For more details on this table , please refer to the 2021 CalPERS
Experience Study report from Nove mvbe r 2021 tha t can be found on the CalPERS website.
Th e lesser of contract COLA o r 2.30% unt il Purchas ing P ower
Protection Allowanc e Fl oor on P ur chas ing P ower appl ies, 2.3 0%
De rived us ing Cal PERS' Me mbe rship Data f or al l Funds
Varies by Ent ry Age and Se rvice
2.30%
6.90%
Entry-Age No rmal Co st Me thod
June 3 0, 2 024
Mi scel lane ous Pl an
June 3 0, 2 023
114
Page 318 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 27
Note 8:Pension Plans (Continued)
Discount Rate. The discount rate used to measure the total pension liability for the Plan was 6.90%. The projection of cash flows
used to determine the discount rate for each Plan assumed that contributions from all plan members in the Public Employees
Retirement Fund (PERF) will be made at the current member contribution rates that contributions from employers will be made at
statutorily required rates, actuarially determined. Based on those assumptions, each Plan's fiduciary net position was projected to be
available to make all projected future benefit payments of current plan members for all plans in the PERF. Therefore, the long-term
expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension
liability for the Plan.
The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-
estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are
developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the
expected pension fund cash flows. Projected returns for all asset classes are estimated and, combined with risk estimates, are used
to project compound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-
term projected portfolio return.
The table below reflects the long-term expected real rate of return by asset class.
As sume d
As se t
Asse t Class Allocation Re al Return (1) (2)
Gl obal Equity - Cap-weighted 30.0%4.54%
Gl obal Equity - Non-Cap-weighted 12.0%3.84%
Private Equity 13.0%7.28%
Treasury 5.0%0.27%
Mortgage -backed Securities 5.0%0.50%
Inv estme nt Grade Corporates 10.0%1.56%
Hi gh Yi eld 5.0%2.27%
Emergi ng Market Debt 5.0%2.48%
Private Debt 5.0%3.57%
Real Assets 15.0%3.21%
Le verage -5.0%-0.59%
Misce llaneous Plan
115
Page 319 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 28
Note 8:Pension Plans (Continued)
Changes in the Net Pension Liability
The changes in the Net Pension Liability for the Miscellaneous Plan follows:
Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following presents the net pension liability of the
City for the Plan, calculated using the discount rate for each Plan, as well as what the City’s net pension liability would be if it were
calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate:
Pension Plan Fiduciary Net Position. Detailed information about the pension plan’s fiduciary net position is available in the
separately issued CalPERS financial reports.
Plan Net
Tot al Fi du ciary Pens ion
Pension Ne t Li ability/
Li ability Position (As set)
Balance at June 3 0, 2 023(me as ur ement date)271,720,540$ 176,934,611$ 94,785,929$
Service cost 5,225,836 - 5,225,836
In teres t on the total p ens io n lia bilit y 18,772,636 - 18,772,636
Differences b etween expected and
actual exp erie nce 5,864,043 - 5,864,043
Co ntrib ution - emp lo yer - 11,026,090 (11,026,090)
Co ntrib ution - emp lo yee - 2,974,063 (2,974,063)
Net in ves tment in come - 16,995,192 (16,995,192)
Be nefit p ayme nts , including re funds
o f emp lo yee contrib utions (16,260,601) (16,260,601) -
Adminis trative expense - (143,972) 143,972
Ne t changes 13,601,914 14,590,772 (988,858)
Balanc e at June 3 0, 2 024 (measurement date)285,322,454$ 191,525,383$ 93,797,071$
Mi scel lane ous Pl an
1% De crease 5.90%
Ne t Pension Li abi lity 130,213,879$
Cur rent Di scount Rate 6.90%
Ne t Pension Li abi lity 93,797,071$
1% Inc rease 7.90%
Ne t Pension Li abi lity 63,685,031$
116
Page 320 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 29
Note 8:Pension Plans (Continued)
Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
For the year ended June 30, 2025, the City’s pension expense for the Miscellaneous Plan was $15,424,028. At June 30, 2025, the
City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
The deferred outflows of resources related to contributions subsequent to the measurement date of $12,983,365 will be recognized
as a reduction of the net pension liability in the year ended June 30,2026. Other amounts reported as deferred outflows of resources
and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Payable to the Pension Plan
At June 30, 2025, the City reported a payable of $0 for the outstanding amount of contributions to the pension plan required for the
year ended June 30, 2025.
Cost-Sharing Employer Plan
General Information about the Pension Plan
Plan Descriptions. As noted above, the City contributes to CalPERS for a defined benefit pension plan for all qualified permanent
and probationary employees. CalPERS acts as a common investment and administrative agent for its participating member
employers. Benefit provisions under the Plan are established by State statute and City resolution. CalPERS issues publicly available
reports that include a full description of the pension plans regarding benefit provisions, assumptions and membership information
that can be found on the CalPERS website.
De fe rre d Outflows De ferre d Inflows
of Resourc es of Re sourc es
Pension contr ibuti ons subsequent to
measurement date 12,983,365$ -$
Change s in assump ti ons 738,515 -
Di fferenc es between expected and
actua l experiences 5,948,958 -
Ne t diffe rences between projected and
actua l earnings on plan i nv estme nts 2,611,205 -
Total 22,282,043$ -$
Mis ce llaneous Plan
Me as ur ement Period
En ded June 3 0 Amount
2025 3,898,053$
2026 6,610,849
2027 (233,640)
2028 (976,584)
2029 -
9,298,678$
Mi scellaneous Plan
117
Page 321 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 30
Note 8:Pension Plans (Continued)
The City participates in five tiers of the safety cost-sharing multiple-employer plan. The Safety Plan tiers consist of Safety Tier 1
(police and fire), Police Tier 2, Fire Tier 2, Police PEPRA and Fire PEPRA.
Benefits Provided. CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits
to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year
of full-time employment. Members with five years of total service are eligible to retire at age 50 with statutorily reduced benefits.
All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: The
Basic Death Benefit, the 1957 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost-of-living adjustments for
each plan are applied as specified by the Public Employees’ Retirement Law.
The Plan’s provisions and benefits within each tier in effect at June 30, 2025, are summarized as follows:
The Safety Tier 1 is closed to new entrants.
Contributions. Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates
for all public employers be determined on an annual basis by the actuary and shall be effective on July 1st following notice of a
change in the rate. Funding contributions for both Plans are determined annually on an actuarial basis as of June 30th by CalPERS.
The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the
year, with an additional amount to finance any unfunded accrued liability. The City is required to contribute the difference between
the actuarially determined rate and the contribution rate of employees. Members of the Police Officers Association contribute 3% of
pay toward the cost of the City's share of the annual required contribution. Members of the International Association of Firefighters,
Local 3523 contribute 3% of pay toward the cost of the City’s share of the annual required contribution.
For the year ended June 30, 2025, the contributions recognized as part of net pension liabilities were $10,004,005.
Pol ice Fi re Police Fire
Pri or to Prior to On o r aft er On o r aft er
Hire dat e De cembe r 6, 2 012 Au gust 30, 2012 Decembe r 6, 2 012 Au gust 30, 2 012
Bene fit formula 3.0% @ 5 0 3.0% @ 5 0 2.0% @ 5 0 3.0% @ 5 5
Bene fit vesting s chedul e 5 ye ar s service 5 ye ar s service 5 ye ars service 5 ye ar s service
Bene fit payments mont hly f or life mo nthly for life monthly fo r life monthly fo r life
Re tirement age 50 - 55 50 - 55 50-55 50 - 55
Monthl y bene fits, as a % of eligible compe ns at ion 3.00%3.00%2.0% to 2.7 %2.4% to 3%
Requi red e mpl oyee contribut ion rates 8.990%8.990%8.950%8.990%
Requi red e mpl oyer contribut ion rat es 25.640%29.090%21.780%24.790%
Requi red unfunde d accrued l iabi lity payme nt 6,359,352$ -$ (1)-$ -$
Pol ice PEPRA Fi re PEPRA
On o r aft er On o r aft er
Hire dat e Januar y 1 , 2013 Januar y 1 , 2 013
Bene fit formula 2.7% @ 5 7 2.7% @ 5 7
Bene fit vesting s chedul e 5 ye ar s service 5 ye ar s service
Bene fit payments mo nt hly f or life monthly for life
Retirement age 50-57 50-57
Monthl y bene fits, as a % of eligible compe ns at ion 2.0% to 2.7%2.0% t o 2.7%
Requi red e mpl oyee contribut ion rates 13.750%13.750%
Requi red e mpl oyer contribut ion rat es 14.500%14.500%
Requi red unfunde d accrued l iabi lity payme nt -$ -$
(1) - Co mb in ed wit h Police Tier 1
Safe ty Tier 1 Safe ty Tier 2
118
Page 322 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 31
Note 8: Pension Plans (Continued)
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
As of June 30, 2025, the City reported a net pension liability for its proportionate share of the Plan’s net pension liability of
$84,198,128.
The City’s net pension 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 June 30, 2024, and the total pension liability for the Plan used to calculate the net pension
liability was determined by an actuarial valuation as of June 30, 2023 using standard update procedures. The City’s proportion of
the net pension liability was based on a projection of the City’s long-term share of contributions to the pension plans relative to the
projected contributions of all participating employers, actuarially determined. The City’s proportionate share of the net pension
liability as of the measurement dates of June 30, 2023 and 2024 was as follows:
For the year ended June 30, 2025, the City recognized pension expense of $14,946,585 for the Safety Plan. At June 30, 2025, the
City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
Proportionate Share
Percentage share at 6/30/2023 0.69198%
Percentage share at 6/30/2024 0.69428%
Change - Increase/(Decrease) 0.00229%
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date 11,061,415$ -$
Changes in assumptions 2,074,469 -
Differences between expected and actual experiences 6,871,316 223,416
4,069,754 -
Net Difference between employer's contributions and
proprtionate chare of contributions 4,797,790 -
Change in employer's proportion -4,134,537
Total 28,874,744$ 4,357,953$
Differences between projected and actual investment earnings
Safety Plan
119
Page 323 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 32
Note 8:Pension Plans (Continued)
Pension contributions subsequent to the measurement date of $11,061,415 are reported as deferred outflows of resources and will
be recognized as a reduction of the net pension liability in the year ended June 30,2026. Other amounts reported as deferred outflows
of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows:
Actuarial Assumptions. The total pension liabilities in the June 30, 2023,actuarial valuations for the Safety Plan was determined
using the following actuarial assumptions:
Discount Rate. The discount rate used to measure the total pension liability for the Plan was 6.90%. The projection of cash flows
used to determine the discount rate for the Plan assumed that contributions from all plan members in the Public Employees
Retirement Fund (PERF) will be made at the current member contribution rates that contributions from employers will be made at
statutorily required rates, actuarially determined. Based on those assumptions, each Plan's fiduciary net position was projected to be
available to make all projected future benefit payments of current plan members for all plans in the PERF. Therefore, the long-term
expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension
liability for each Plan.
The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-
estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are
developed for each major asset class.
Me asure me nt Pe riod
Ende d June 30 Amount
2025 4,592,464$
2026 10,073,241
2027 182,156
2028 (1,392,485)
13,455,376$
Safe ty Plan
Valuat ion Dat e
Measurement Dat e
Ac tuar ial Co st Method
Ac tuar ial As sumptions:
Discount Rate
Inf lation
Salar y Inc reases
Post Re tirement Bene fit Inc rease
Mortality (1)
Va ries by Ent ry Age and Se rvice
Co nt ract COLA up t o 2.30% unt il Purchas ing P ower Protection
Al lowanc e Fl oor on P ur chas ing P ower applies
Derived using CalPERS' membe rship dat a for all funds
(1) The mo rtatily tabl e us ed was de ve lope d based o n Cal PERS-specific dat a. The rates incorporate Ge ne rational
Mortality to capt ur e ongo ing mo rtality improvement us ing 8 0% o f Sc ale MP 2 020 publ ished by t he So ciety o f
Ac tuar ies. Fo r mo re de tails on thi s tabl e, please refer to the 2021 expe rience study report that c an be found o n the
Ent ry-Age No rmal Co st Me thod
6.90%
2.30%
Safe ty P lan
June 3 0, 2 023
June 3 0, 2 024
120
Page 324 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 33
Note 8:Pension Plans (Continued)
In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the
expected pension fund cash flows. Projected returns for all asset classes are estimated and, combined with risk estimates, are used
to project compound (geometric) returns over the long term. The discount rate used to discount liabilities was informed by the long-
term projected portfolio return.
The table below reflects the long-term expected real rate of return by asset class. The rate of return was calculated using the capital
market assumptions applied to determine the discount rate and asset allocation. These rates of return are net of administrative
expenses.
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate. The following presents the City’s
proportionate share of the net pension liability, calculated using the discount rate for the Plans as well as what the City’s proportionate
share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage
point higher than the current rate:
Pension Plan Fiduciary Net Position. Detailed information about each safety plan’s fiduciary net position is available in the
separately issued CalPERS financial reports.
Payable to the Pension Plan
At June 30, 2025, the City reported a payable of $0 for the outstanding amount of contributions to the pension plan required for the
year ended June 30, 2025
As sume d
Asse t
Asset Class Allocation Re al Re turn (1) (2)
Global Equity - Cap-weighted 30.0%4.54%
Global Equity - Non-Cap-weighted 12.0%3.84%
Private Equity 13.0%7.28%
Treasury 5.0%0.27%
Mortgage-backed Securities 5.0%0.50%
Investme nt Grade Corporates 10.0%1.56%
High Yi eld 5.0%2.27%
Emerging Market Debt 5.0%2.48%
Private Debt 5.0%3.57%
Real Assets 15.0%3.21%
Le verage -5.0%-0.59%
(1) An expected inflation of 2.30% used for thi s period
(2) Figur es are based on the 2021-22 Asset Liability Ma nage me nt Study
Safety Plan
1% Decrease 5.90%
Ne t Pension Liabi lity 119,717,528$
Current Discount Rate 6.90%
Ne t Pension Liabi lity 84,198,128$
1% Inc rease 7.90%
Ne t Pension Liabi lity 55,148,252$
121
Page 325 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 34
Note 8:Pension Plans (Continued)
Defined Contribution Pension Plan
The City makes bi-weekly contributions to a 401a retirement plan (Plan) for each department head. The current contribution on
behalf of each Participant equals 1% of base earnings up to the maximum allowable by law. In addition, each Participant may
contribute up to 14% of earnings to the Plan. Prior to August 2018, non-department head management employees also participated
in the Plan and received a 1% employer contribution.
Employees are fully vested in the City’s contributions (and interest allocated to the employee’s account) at all times. The Plan is
administered by Public Agency Retirement Services (PARS). The Plan assets are held in trust for the exclusive benefit of the
Participants or their Beneficiaries. The City has the right at any time to terminate the Plan by resolution of the City Council.
During the fiscal year, the City contributed $22,462 to the Plan and Participants contributed $79,309. T here were no Plan forfeitures.
As of June 30, 2023, the City had $0 payable to the Plan.
The City makes bi-weekly contributions to 401a retirement plans (Appointed Officials Plans) for the City Manager and City
Attorney.
Employees are fully vested in the City’s contributions (and interest allocated to the employee’s account) at all times. The Appointed
Officials Plans are administered by Mission Square Retirement. The Plan assets are held in trust for the exclusive benefit of the
Participants or their Beneficiaries. The City has the right at any time to terminate the Plan by resolution of the City Council.
During the fiscal year, the City contributed $22,348 to the Appointed Officials Plans. There were no Plan forfeitures. As of June 30,
2023, the City had $0 payable to the Plan.
In the year 2022, The City evaluated the requirements of GASB Statement No. 97, Certain Component Unit Criteria, and Accounting
and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans and determined that plan didn’t meet
the criteria to be reported as a fiduciary activity, as required by the above mentioned GASB Statements.
Note 9:Other Post-Employment Benefits (OPEB)
General Information about OPEB
Plan Description. The City’s primary other post-employment benefits (OPEB) cost obligation is for retiree health benefits under its
election to participate in the CalPERS Health Benefit Program, an agent multiple-employer defined benefit OPEB plan, under the
“unequal contribution option.” The City entered the CalPERS medical insurance program in 1993 under the Public Employees’
Medical and Hospital Care Act (PEMHCA). During the fiscal year ended June 30, 2009, the City entered into an agreement to
participate in an irrevocable trust to provide a funding mechanism for retiree health benefits. The Trust, California Employers’
Retiree Benefit Trust (CERBT), is administered by CalPERS and managed by a separately appointed board, which is not under
control of the City Council. This Trust is not considered a component unit of the City.
Benefits Provided. The City provides post-employment heath care insurance, in accordance with Memorandums of Understanding,
to all employees who retire from the City upon or after attaining age 50 with at least 5 years of service or disability retirement.
Miscellaneous retires who are PEPRA new hires are eligible at age 52. For each retiree enrolled in a CalPERS medical plan, the
employer will pay the required statutory PEMHCA minimum, which is $157 per month per retiree in calendar year 2024 and $158
per month per retiree in calendar year 2025. This amount will increase with the health care component of CPI, as announced by the
CalPERS Board each year. The retiree must pay the difference between the premium amount, which depends upon the medical plan
benefits selected, and the employer-paid minimum. In addition, the City pays 50% of the premium up to the retiree’s age of 65 for
one grandfathered executive management retiree hired prior to August 2000.
There is no OPEB provided to terminated vested employees. The employer-paid amount will continue to a surviving spouse if the
retiree elects a CalPERS survivor annuity. There are no required employee contributions, although the retiree must pay the difference
between the premium and the employer-paid amount. The employer is contributing the full Actuarially Determined Contribution.
122
Page 326 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 35
Note 9:Other Post-Employment Benefits (OPEB) (Continued)
Employees Covered. At June 30, 2024, the measurement date, the following number of employees were covered by the benefit terms:
Contributions. The contribution requirements of the plan members and the City are established and may be amended by the City.
The City prefunds the plan through CERBT by contributing at least 100% of the annual required contribution. For the measurement
period, the City’s contributions totaled $740,550.
Net OPEB Liability
The City’s net OPEB liability was measured as of June 30, 2024 and the total OPEB liability used to the calculate the net OPEB
liability was determined by an actuarial valuation dated June 30, 2023,based on the following actuarial methods and assumptions:
Discount Rate. The discount rate used to measure the total OPEB liability was 6.25%. The projection of cash flows used to determine
the discount rate assumed that City contributions will be made at rates equal to the actuarially determined contribution rates. Based
on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments
for current active and inactive employees and beneficiaries. Therefore, the long-term expected rate of return on OPEB plan
investments was applied to all periods of projected benefit payments to determine the total OPEB liability.
OP EB P lan
Inac tive empl oyees or bene ficiaries
cur rently receiving be ne fits 184
Inac tive empl oyees entitled to but
no t ye t receiving be ne fit payme nt s 255
Ac tive empl oyees 477
Total 916
Ac tuar ial Valuation Dat e June 30, 2023
Measurement Dat e June 30, 2024
Contribut ion P olicy Co nt ributes full AD C
Ac tuar ial Assumpt ions:
Dis count Rate and 6.25% at June 3 0, 2 024 and 6.2 5% at June 30, 2 023
expe cted Long-Te rm Rat e of Expe cted City contributions pr ojected to ke ep
Re turn o n Assets s uf ficient pl an as sets to pay al l bene fits from t rust
Gene ral Inf lation 2.50% annually
Mo rtality, Retirement, Disability,Rates from CalPERS 2 000-2019 Expe rience St udy
Te rmination
Mo rtality Impr ovement Post-retirement mo rtality pr ojected fully ge nerational with
Sc ale MP-2021
Salary Inc reases Ag gr egate - 2.75%
Me rit - CalPERS 2000-2019 Experience Study
Medical Tr end No n-Me di care - 8.5% for 2025, decreasing t o an ultimate rate of 3.45%
in 2 076 and lat er years.
Me di care - 7.50% (no n-Kaiser) for 2025, decreasing to an ul timate rate
of 3.45% in 2076 and later ye ar s
Me di care - 6.25% (Kaiser) for 2025, de creasing to an ul timate rate
o f 3.45% in 2 076 and l at er ye ar s
P EMHCA Minimum Inc reases 3.50% annually
P articipat ion at Re tirement Cur rently c overed: 70% Currently wai ve d: 1 5%
OPEB P lan
123
Page 327 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 36
Note 9:Other Post-Employment Benefits (OPEB) (Continued)
Investments. 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 geometric real rates of return for each major asset class are summarized below:
Changes in the Net OPEB Liability
The changes in the net OPEB liability for the June 30, 2024 measurement date are as follows:
Curre nt Expecte d
Targe t Re al Rate
Asse t Class Alloc atio n of Return
Gl obal Equity 49%4.56%
Fixe d Inc ome 23%1.56%
TIPS 5%-0.08%
Commo di ti es 3%1.22%
REITs 20%4.06%
Assume d Long-Term Rate of Infl ation 2.50%
Expected Long-Term Net Rate of Retur n, Round ed 6.25%
The long-te rm expected real rates of return are presented as geometric means.
OPEB Plan
Total Plan Fiduciary Ne t
OPEB Li ability Ne t Pos ition OPEB Li ability
Balance at J une 3 0, 2 024 13,239,129$ 10,954,815$ 2,284,314$
Ch anges d urin g the year:
Serv ic e cos t 518,085 - 518,085
In teres t on the total OPEB lia bilit y 836,877 - 836,877
Co ntrib ution - emp lo yer - 740,550 (740,550)
Net in ves tment in come - 1,202,776 (1,202,776)
Be nefit p ayme nts , in cluding refu nds
o f emp lo yee contrib utions (734,364) - -
Admin is trative e xp ense (9,757) 9,757
Net changes 620,598 1,933,569 (578,607)
Balance at J une 3 0, 2 025 13,859,727$ 12,888,384$ 1,705,707$
124
Page 328 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 37
Note 9:Other Post-Employment Benefits (OPEB) (Continued)
Sensitivity of Net OPEB Liability to Changes in the Discount Rate. The following presents the net OPEB liability at the current
discount rate, as well as what the net OPEB liability would be if it were calculated using a hypothetical discount rate that is one
percentage point lower or one percentage point higher than the current rate.
Sensitivity of Net OPEB Liability to Changes in Healthcare Cost Trend Rates. The following presents the net OPEB liability at
current healthcare cost trend rates, as well as what the net OPEB liability would be if it were calculated using hypothetical healthcare
cost trend rates that are one percentage point lower or one percentage point higher than the current rate.
OPEB Plan Fiduciary Net Position. Detailed information about the OPEB Plan’s fiduciary net position is available in the separately
issued CalPERS financial reports on the CERBT.
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB
For the year ended June 30, 2025, the City’s OPEB expense was $258,685. At June 30, 2025, the City reported deferred outflows of
resources and deferred inflows of resources related to OPEB from the following sources:
OP EB P lan
1% De crease 5.25%
Ne t OP EB Li abi lity 3,459,727$
Cur rent Discount Rat e 6.25%
Ne t OP EB Li abi lity 1,705,707$
1% Inc rease 7.25%
Ne t OP EB Li abi lity 241,939$
OP EB P lan
1% De crease
Net OP EB Li abi lity (65,207)$
Cur rent Tr end
Net OP EB Li abi lity 1,705,707$
1% Inc rease
Net OP EB Li abi lity 3,893,194$
De fe rred Outfl ows Defe rred Infl ows
of Re sources of Resources
OPEB contrib utions s ubsequent to
measurement date 1,975,082$ -$
Ch anges in assump tions 274,338 307,434
Diffe re nces b etween expected an d
a ctual exp erie nces 185,237 2,207,314
Ne t differe nces b etween projected an d
a ctual earnings o n plan investments 62,184 -
Total 2,496,841$ 2,514,748$
125
Page 329 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 38
Note 9:Other Post-Employment Benefits (OPEB) (Continued)
OPEB contributions subsequent to the measurement date of $1,975,082 are reported as deferred outflows of resources and will be
recognized as a reduction of the net OPEB liability in the year ended June 30, 2026. Other amounts reported as deferred outflows of
resources and deferred inflows of resources related to OPEB will be recognized as OPEB expense as follows:
Payable to the OPEB Plan
At June 30, 2025, the City reported a payable of $0 for the outstanding amount of contributions to the OPEB plan required for the
year ended June 30, 2025.
Note 10:Deferred Compensation Plan
All employees of the City are eligible to participate in a City sponsored deferred compensation plan (457 Plan). The 457 Plan
provides for the deferral of a portion of the employees’ compensation until retirement, termination, or certain other covered events.
The assets of the 457 Plan are held in trust for the exclusive benefit of Plan Participants or Beneficiaries.
Deferred contribution(s) by a participant in any taxable year will not exceed the lessor of (1) the applicable dollar amount provided
under Section 457(b)(2) of the Internal Revenue Code (adjusted for cost of living under Section 457(e)(15) of the Internal Revenue
Code), or (2) 100% of the participant’s includible compensation. A participant who has attained age 50 before the close of the
calendar year may elect Age 50 Plus Catch-up Contributions and commence making such contributions to his/her Participant Deferral
Account.
The City has the right at any time to terminate the 457 Plan by resolution of the City Council.
In the year 2022, The City evaluated the requirements of GASB Statement No. 97, Certain Component Unit Criteria, and Accounting
and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans and determined that plan didn’t meet
the criteria to be reported as a fiduciary activity, as required by the above mentioned GASB Statements.
Fis cal Year
Ended June 30 Amount
2026 (465,480)$
2027 (133,995)
2028 (341,973)
2029 (268,296)
2030 (210,109)
Thereafte r (573,136)
(1,992,989)$
126
Page 330 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 39
Note 11:Interfund Transactions
City had the following short-term interfund receivable and payable balances as of June 30, 2025:
City had the following long-term interfund receivable and payable balances as of June 30, 2025:
Interfund transfers for the year ended June 30,2025 consist of the following:
Short-term interfund receivables and payables include temporary negative cash balances that result from the timing of cash flows at
year end and the time lag between the dates that transactions are recorded in the accounting system and payment between funds are
made. Liquidation of interfund receivables and payables typically occurs in the first quarter of the subsequent fiscal year. Interfund
balances between governmental funds are not included in the government-wide Statement of Net Position.
Advances in the amount of $4,845,000 from the General Fund to the Parking Fund was a loan provided by the General Fund to the
Parking Fund for the acquisition of the property located at 1166 Higuera Street. The general fund will be reimbursed by the Parking
Fund at a rate of 2.88% and a repayment term of 30 years, with deferral of principal payments for three years and interest payments
starting immediately.
Interfund transfers are used to move revenues from the fund with collection authorization to the debt service fund as debt service
principal and interest payments become due or to move unrestricted revenues to finance various programs that the government must
account for in other funds in accordance with budgetary authorizations. This may include amounts provided as matching funds for
various grant programs.
Due from Other
Funds
Due to Other
Funds
Ge ne ral Fund 43,089$ -$
Nonmajor Governme nta l Fund s 67,478 110,567
Total 110,567$ 110,567$
Advance s from
Other Funds
Advances to
Other Funds
Ge ne ral Fund -$ 4,845,000$
Parking Fund 4,845,000 -
Total 4,845,000$ 4,845,000$
Non-Ma jor
Gene ral Capital Out lay Go vernme nta l
Transfe r Out Fund Fund Fund s Total
Ge ne ral Fund -$ 23,698,344$ 10,359,699$ 34,058,043$
Non-Ma jor Governme ntal Fund 2,614,610 345,107 - 2,959,717
Wa ter Fund 1,387,992 - - 1,387,992
Sewer Fund 1,451,616 - - 1,451,616
Parking Fund 375,212 - - 375,212
Total 5,829,430$ 24,043,451$ 10,359,699$ 40,232,580$
Transfer In
127
Page 331 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 40
Note 12:Joint Ventures, Jointly Governed Organizations and Operating Agreements
The City participates in three multi-governmental organizations: the Whale Rock Commission, the San Luis Obispo Regional Transit
Authority, and the San Luis Obispo Council of Governments. The City also has an operating agreement related to Nacimiento Water
Supply Project. The following provides a general description of each of these agencies and operating agreements along with a
summary of financial information and indebtedness:
Whale Rock Commission
General Description. The Whale Rock Commission (Commission) was established on December 12, 1960 to govern the operations
of the Whale Rock Reservoir. The Commission is composed of six voting members and two non-voting members: three voting
members are appointed by the City;one is appointed by California Polytechnic State University; one by California Men's Colony;
and one by the Director of Finance, State of California. The two non-voting members are position appointments: the Director of
Water Resources,State of California; and the Water Superintendent, City of San Luis Obispo. The Commission is authorized by its
respective agencies to establish policies for the operation of the Reservoir, to contract for the sale of excess water, and to approve
the annual budget.
The City, in accordance with established policies of the Commission, operates and maintains the Reservoir; prepares and
recommends the annual budget; and maintains the fiscal records and funds of the Commission. The Whale Rock Custodial Fund is
used to account for the Commission's ongoing operating activities. Ownership in the Reservoir is as follows: 55.05%, City of San
Luis Obispo; 33.71%, California Polytechnic State University; and 11.24%, California Men's Colony. The City's share of the
Commission's expenses is recorded as expenses of the Water Fund. All receipts and disbursements of the Commission are included
in an Custodial Fund.
Financial Information and Indebtedness. In 1959, the City issued general obligation bonds to secure a future water supply to City
residents. Some of the proceeds from the bonds were used to participate with the State of California in the development of the
Reservoir. Participation, which is in proportion to the original investment, includes continued operation and maintenance of the
facilities. Such indebtedness was directly attributable to provision of water service, and as such, all related indebtedness was recorded
in the City's Water Enterprise Fund. These bonds matured in August 1999.
The City's original investment in the Reservoir project aggregates $3,900,000 and was amortized on a straight-line basis over thirty-
five years. Separate financial statements are available from the Whale Rock Commission, 879 Morro Street, San Luis Obispo, CA
93401.
The following segment financial information for the Whale Rock Commission and the Water Fund’s related investment in the joint
venture is presented as of and for the year ended June 30, 2025:
Cit y's Inv estment
Joint Venture in Joint Venture
Total assets 7,411,147$ 4,079,835$
Total liabilities 163,072 89,771
Fund balance 7,248,075$ 3,990,064$
Total revenue s 3,130,087$ 1,723,113$
Total expenditur es 2,097,440 1,154,641
Excess of revenue s over expenditur es 1,032,647$ 568,472$
128
Page 332 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 41
Note 12:Joint Ventures, Jointly Governed Organizations and Operating Agreements (Continued)
San Luis Obispo Regional Transit Authority
General Description. The City is a member of the San Luis Obispo Regional Transit Authority (Authority), which was established
on February 27, 1990, to operate a joint public transportation system. The Authority is composed of the Cities of Arroyo Grande,
Atascadero, Grover Beach, Morro Bay, Paso Robles, Pismo Beach, and San Luis Obispo, as well as the County of San Luis Obispo.
The Authority is governed by a Board of Directors comprised of representatives of each of the seven cities, in addition to the five
members of the Board of Supervisors. Each member of the Board has one vote. The Board has the authority to establish policies for
the operation of the transit system and to adopt an annual budget. Each member makes an annual contribution to the agency for
funding the adopted budget.
Financial Information. The City allocates a portion of its Transportation Development Act funds directly to the Authority. During
2024-25 the City contributed approximately $1,237,660 of these funds to the Authority. The City's share of assets, liabilities, and
fund equity has not been calculated by the Authority and therefore is not known to the City; however, based on the City's limited
financial participation in the Authority, any such assets, liabilities, or equity are not believed to be significant to the basic financial
statements taken as a whole. Separate financial statements are available from the Authority, 179 Cross Street, Suite A, San Luis
Obispo, CA 93401.
San Luis Obispo Council of Governments
General Description. The San Luis Obispo Council of Governments (SLOCOG) was formed in 1968 through a joint powers
agreement among the incorporated cities and the County of San Luis Obispo. It acts as the regional transportation planning agency
for the county and is the metropolitan planning organization and the congestion management agency for the region. The governing
board consists of twelve delegates, each with one vote that includes the five members of the County Board of Supervisors and one
representative from each of the seven cities in the County.
Financial Information. A portion of the City's Transportation Development Act funds are directly allocated to the SLOCOG. The
City's share of assets, liabilities, and fund equity has not been calculated by SLOCOG and therefore is not known to the City;
however, based on the City's limited financial participation in SLOCOG, any such assets, liabilities, or equity are not believed to be
significant to the basic financial statements taken as a whole. Separate financial statements are available from SLOCOG, 1114 Marsh
Street, San Luis Obispo, CA 93401.
Nacimiento Water Supply Project
General Description. In 2004, the Council adopted a resolution approving an agreement with the San Luis Obispo County Flood
Control and Water Conservation District (District) for the design, construction, and operations of the facilities required for the
delivery of 5,482 acre-feet of water per year to the City of San Luis Obispo from the Nacimiento Water Supply Project (Project).
The agreement includes conditions relative to the costs associated with the project and how these costs will be shared and paid by
the participants in the project.
Each project participant, including the City, has entered into an agreement to provide for the development, financing, construction,
operation and maintenance of the Project. The agreement is a “take-or-pay” obligation: the City is obligated to pay amounts specified
in the agreement whether or not water is delivered. The City is required to pay an amount equal to its share of various capital expenses
relating to the funding of design costs, engineering, planning, environmental mitigation, equipping new facilities and/or construction
efforts, accounting services, project administration and management, installation, grading, razing and building the Project. The City
is also required to pay for its share of operating and maintenance costs. The City records these payments as operating expenses in its
water enterprise fund.
129
Page 333 of 525
City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 42
Note 12:Joint Ventures, Jointly Governed Organizations and Operating Agreements (Continued)
The City is required to make payments under its agreement solely from the revenues of its water system. The City agreed to establish
and collect rates and charges from the customers of the City’s water enterprise fund at levels sufficient to produce revenues equal
to: (1) the costs of operating and maintaining the City’s water enterprise; plus (2) the contract payments, calculated in accordance
with the delivery contract including the amounts allocated as the City’s share of capital projects installment debt service; plus (3)
the coverage factor for the amounts allocated as the City’s share of capital projects installment debt service; and (4) under certain
circumstances, that the City understands and agrees that the delivery contract may impose a surcharge following the occurrence of
any payment default.
Financial Information. In September 2007, the District sold water revenue bonds in the amount of $196 million for the construction
of the Project. In addition, the District sold water revenue bonds in the amount of $182 million. These bonds were refinanced in
May 2018. Based on the City’s share of construction costs, debt service and operating and maintenance, the following summarizes
the City’s Project obligations for 2023-24 and five-year projections for the 2018 bonds that will remaining outstanding following
the refunding.
Separate financial statements are available from the San Luis Obispo County Flood Control and Water Conservation District, 1050
Monterey Street, San Luis Obispo, CA 93401.
Note 13:Risk Management
California Joint Powers Insurance Authority
The City is a member of the California Joint Powers Insurance Authority (Authority). The Authority is composed of 119 California
public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et seq. The purpose
of the Authority is to arrange and administer programs for the pooling of self-insured losses, to purchase excess insurance or
reinsurance, and to arrange for group purchased insurance for property and other lines of coverage. The California JPIA began
covering claims of its members in 1978. Each member government has an elected official as its representative on the Board of
Directors. The Board operates through a nine-member Executive Committee.
Each member pays an annual contribution to cover estimated losses for the coverage period. This initial funding is paid at the
beginning of the coverage period. After the close of the coverage period, outstanding claims are valued. A retrospective deposit
computation is then conducted annually thereafter until all claims incurred during the coverage period are closed on a pool-wide
basis. This subsequent cost reallocation among members based on actual claim development can result in adjustments of either
refunds or additional deposits required.
The total funding requirement for self-insurance programs is estimated using actuarial models and prefunded through the annual
contribution. Costs are allocated to individual agencies based on exposure (payroll) and experience (claims) relative to other
members of the risk-sharing pool. Additional information regarding the cost allocation methodology is provided below.
Actual 2025 4,621,210$
Pro je cted:
2026 4,622,040
2027 4,615,840
2028 4,621,896
2029 4,622,732
2030-34 23,093,901
2035-39 23,104,565
2040-41 4,697,841
Nac imiento Wate r Suppl y Obl igati ons
130
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 43
Note 13:Risk Management (Continued)
Self-Insurance Programs of the Authority
General Liability and Workers’ Compensation. The City is a member of the California Joint Powers Insurance Authority (CJPIA),
which provides joint protection programs and group purchased insurance for public entities covering liability, errors and omission
losses, auto liability, employment practices liability, crime, pollution, workers’ compensation injuries and coverage for city-owned
property. The City has a retained limit of $500,000 per occurrence for liability and no retained limit for workers’ compensation.
Liabilities of the City are reported when it is probable that a loss has occurred, and the amount of the loss can be reasonable estimated.
Liabilities include an amount for claims that have been incurred but not reported (IBNR). The result of the process to estimate the
claims liability is not an exact amount as it depends on many complex factors, such as inflation, changes in legal doctrines and
damage awards. Accordingly, claims are re-evaluated periodically to consider the effects of economic and social factors. The
estimate of the claims liability also includes amounts for incremental claim adjustment expenses related to specific claims and other
claim adjustment expenses regardless of whether or not they are attributable to specific claims. Estimated recoveries, for example
from salvage or subrogation, are another component of the claim’s liability estimate.
During the past three fiscal years, none of the protection programs experienced settlements or judgments that exceeded pooled or
insured coverage. There were also no significant reductions in pooled or insured coverage in 2024-25. CJPIA covers workers’
compensation claims up to a pooled limit of $1 million per occurrence and provides excess coverage to statutory limits with a group
purchased commercial insurance policy. The City pays an annual contribution to CJPIA and may share in any member refunds in
the event that pooled funding exceeds the cost of pooled claims and claim-related expenses, or the City may be required to pay
additional contributions based upon CJPIA’s operating results.
Financial statements of CJPIA may be obtained from its administrative office located at 8081 Moody Street, La Palma, California
90623, or by calling (562) 467-8700.
Additional claims and lawsuits have been filed against the City in the normal course of business. It is reasonably possible that the
City may be liable for claims not to exceed $500,000. In the opinion of management, the resolution of these matters will not have a
material adverse effect on the financial condition of the City.
Adequacy of Protection
During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded
pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage from coverage in 2024-
25.
Self-Insurance
The City retains the risk for workers’ compensation losses incurred prior to joining the California Joint Powers Insurance Authority.
Several member agencies of the now dissolved Central Coast Cities Self-Insurance Fund continue to participate in a non-risk sharing
arrangement for claims management and the purchase of excess insurance. The participating agencies share a set of common
guidelines and annually set aside premiums to pay their individual losses within their self-insured retentions. Losses are debited and
investment income is credited to specific member accounts. The City has not incurred any losses in excess of insurance coverage.
Claims liabilities in the governmental funds are generally liquidated by the General Fund.
131
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 44
Note 13:Risk Management (Continued)
The last actuarial study to determine the undiscounted outstanding claims liability was completed for the year ended June 30,2025.
The liability was estimated based on the actuarial study and considered claims asserted and paid, and the time limitations for filing
claims. There are no estimates for claims incurred but not reported because the time limit for filing claims has elapsed. The estimated
asset at June 30, 2025 is calculated as follows:
Note 14:Commitments and Contingencies
Litigation
The City is presently involved in certain matters of litigation that have arisen in the normal course of conducting City business. City
management believes, based upon consultation with the City Attorney, that these cases, in the aggregate, are adequately covered by
insurance and not expected to result in a material adverse financial impact on the City.
Grant Awards
Under the terms of Federal and State grants, audits may be required, and certain costs may be questioned as not being appropriate
expenditures under the terms of the grants. Such audits could lead to requests for reimbursement to the grantor agencies. City
management believes disallowances, if any, will be immaterial.
Self-i nsurance ac ti vi ty as of and for the year e nded J une 3 0, 2 025
is s umma rized i s as fol lows :
In teres t earnings 12,010$
Cla ims expense 23,067
Es tima ted lia bilit y fo r re ported claims a nd settlement expenses (510,635)
Assets o n deposit 535,138
Es tima ted unpaid c laims as set 24,503$
Chang es i n the bal ances of claim assets dur ing the pas t two fi scal years
ar e as fol lows :
Es tima ted unpaid c laims as set Ju ne 30, 2023 256,718$
Cla im p ayments a nd re la ted expenditures re imburseme nt (164,804)
Ch ange in estimated claims a sset Ju ne 30, 2024 52,030
In teres t earnings 14,417
Es tima ted unpaid c laims as set Ju ne 30, 2024 158,361
Cla im p ayments a nd re la ted expenditures re imburseme nt (176,862)
Ch ange in estimated claims a sset Ju ne 30, 2025 30,994
In teres t earnings 12,010
Es tima ted unpaid c laims as set Ju ne 30, 2025 24,503$
132
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 45
Note 14:Commitments and Contingencies (Continued)
Regional Transit Authority Pension Expense
The City is presently a member agency of the San Luis Obispo Regional Transit Authority (SLORTA) (see Note 14), a duly
established Joint Powers Authority (JPA) comprised of all local cities and the County of San Luis Obispo. The City’s contractual
contribution to that entity is approximately 18% of the total expense. The City was advised that the Regional Transit Authority was
working with CalPERS to determine whether it is required to enroll certain previously unenrolled transit employees in the CalPERS
pension system and whether the entity may be liable for obligations related to the failure to enroll those employees and make
contributions on their behalf. On December 10, 2019 the County Board of Supervisors approved a contract for participation of the
JPA in the San Luis Obispo County Pension Trust and the Employees Retirement Plan. The current amount of potential CalPERS
unfunded liability for the JPA may reach as high as $4 million. It is not anticipated that the City’s annual payment to the JPA will
increase to satisfy this unfunded liability.
Note 15:Construction and Other Significant Commitments
Construction and other significant commitments as of June 30, 2025, including encumbrances outstanding at year-end, are as follows:
Long-term construction contracts are billed and paid on a percentage completion basis by construction phase.
Note 16:Fund Balance Deficiency
As of June 30, 2025, the City had fund with negative fund balance for LOVR Sub-Area Fee Fund and Debt Service fund as below.
Note 17:New Accounting Standards
Accounting Standards Adopted
GASB Statement No. 102 –Certain Risk Disclosures –The primary objective of this Statement is to provide users of
government financial statements with essential information about risks related to a government’s vulnerabilities due to
certain concentrations or constraints.
Ge nera l Fu nd 2,559,825$
Sp ecial Revenue Fu nds 168,914
Ca pital Pro je ct Fu nds 22,947,269
En terpris e Fu nds:
Water 2,573,113
Sewe r 9,466,165
Parking 15,574,977
Transit 3,347,354
Total 56,637,617$
Funds De ficiency
LO VR Sub-Area Fee (2,452)$
De bt Service (43,089)
Total (45,541)$
133
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City of San Luis Obispo, California
Notes to the Financial Statements
June 30, 2025
Page 46
Note 17:New Accounting Standards (Continued)
New Accounting Standards
The city is currently analyzing its accounting practices to determine the potential impact on the financial statements for the following
GASB Statements:
GASB Statement No. 103 –Financial Reporting Model Improvements -The primary objective of this Statement is to
improve key components of the financial reporting model to enhance its effectiveness in providing information that is
essential for decision making and assessing a government’s accountability. This Statement also addresses certain
application issues.
GASB Statement No. 104 –Disclosure of Certain Capital Assets –The primary objective of this Statement is to provide
users of governmental financial statements with essential information about certain types of capital assets.
Note 18:Prior Period Adjustments
During 2025, the City recorded the following prior period adjustments:
(1)Error correction to Debt Service Fund, Water Fund, Sewer Fund and Parking Fund -Beginning fund balance of the Debt
Service Fund, Water Fund, Sewer Fund and Parking fund were restated due to the reclassification of prior year debt services interest
payments to correct funds. The City recorded the debt services payments in wrong funds last year. An adjustment was necessary to
properly restate the cash and investment held by fiscal agent account. Therefore, cash and investment held by fiscal agent, were
overstated by $91,366 total in Water Fund, Sewer Fund and Parking Fund, and net position was overstated by $91,366 in total for
the fiscal year ended June 30, 2024. Cash and investment held by fiscal agent were understated by $91,366 in Debt Service Fund,
and fund balance was understated by $91,366 in Debt Service Fund for the fiscal year ended June 30, 2024.
(2)Error correction to Affordable Housing Fund –Unavailable revenue and fund balances were restated to record the interest
revenue in the Affordable Housing Fund. The interest revenue was not recorded correctly in the past and adjustment was necessary
to properly restate the unavailable revenue balance. Therefore, unavailable revenue in the Affordable Housing fund was overstated
by $70,654, and fund balance was understated by $70,654 for the fiscal year ended June 30, 2024.
(3) Error correction to General Agency Fund, Asset Forfeiture Available Fund and Police Evidence Available Fund –Cash and
fund balances were restated to move the available funds in General Agency Fund for the City to use to the Asset Forfeiture Available
Fund and Police Evidence Available Fund. The available funds in the custodial funds for the City to use were not recorded correctly
into the City’s special revenue funds.Therefore, cash in the General Agency Fund was overstated by $128,944, net position was
overstated by $128,944 for the fiscal year ended June 30, 2024.Cash in the Asset Forfeiture Available Fund and Police Evidence
Available Fund in total were understated by $128,944,and fund balance was understated by $128,944 for the fiscal year ended June
30, 2024.
6/30/2024
As Previously
Reported
Er ror Correction
(1)
Error Correction
(2)
Error Correction
(3)
6/30/2024
As Resta ted
Governme nta l Activities 249,796,507$ 91,366$ 70,654$ 128,944$ 250,087,471$
Business-typ e Activities 275,530,186 (91,366) - - 275,438,820
Nonma jor Funds 55,769,033 91,366 70,654 128,944 56,059,997
Wa ter Fund 109,961,981 (5,032) - - 109,956,949
Sew er Fund 122,333,448 (5,561) - - 122,327,887
Parking Fund 34,133,265 (80,773) - - 34,052,492
Custodial Fund s 36,487,382 - - (128,944) 36,358,438
134
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REQUIRED SUPPLEMENTARY INFORMATION
(UNAUDITED)
135
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136
Page 340 of 525
City of San Luis Obispo, California
Budgetary Comparison Schedule
General Fund
For the Fiscal Year Ended June 30, 2025
Original
Budget
Final
Budget Actual
Variance With
Final Budget
Positive
(Negative)
REVENUES:
Taxes and franchise fees:
Sales and use tax - general 23,962,099$ 23,962,099$ 22,911,086$ (1,051,013)$
Transaction and use tax - Local Revenue Measure 31,855,000 31,855,000 30,926,285 (928,715)
Property tax 16,371,353 16,371,353 17,242,485 871,132
Transient occupancy tax 10,586,256 10,586,256 11,417,888 831,632
Utility users tax 6,622,639 6,622,639 7,501,436 878,797
Property tax in lieu of VLF 6,919,114 6,919,114 7,196,670 277,556
Franchise taxes 2,091,800 2,091,800 2,622,351 530,551
Business tax 4,417,338 4,417,338 3,138,272 (1,279,066)
Cannabis Tax - - 814,502 814,502
Real property transfer tax 155,919 155,919 484,692 328,773
Total taxes 102,981,518 102,981,518 104,255,667 1,274,149
Fines, forfeitures and penalties 203,071 203,071 340,172 137,101
Use of money and property 476,328 476,328 4,892,409 4,416,081
Subventions and grants:
Other State and Federal grants 2,335,624 11,087,624 4,155,356 (6,932,268)
Other subventions and grants 566,500 566,500 530,680 (35,820)
Total subventions and grants 2,902,124 11,654,124 4,686,036 (6,968,088)
Charges for services:
Public safety:
Police 762,105 762,105 719,159 (42,946)
Fire:
Medical emergency recovery 580,136 580,136 726,322 146,186
Fire safety/hazardous materials permits 991,810 991,810 973,336 (18,474)
Other fire revenues 152,861 152,861 177,215 24,354
Community development:
Planning and zoning fees 2,636,482 2,636,482 1,677,398 (959,084)
Construction plan and check inspections 4,008,849 4,008,849 3,470,346 (538,503)
Infrastructure plan check and inspections - - 683,441 683,441
Culture and recreation:
Adult athletic fees 248,840 248,840 208,446 (40,394)
Youth athletic fees 958,618 958,618 1,350,590 391,972
Rental and use fees 400,014 400,014 720,290 320,276
Aquatics 344,120 344,120 393,263 49,143
Golf course 270,000 270,000 375,095 105,095
General government:
Other service charges 733,285 733,285 936,676 203,391
Total charges for services 12,087,120 12,087,120 12,411,577 324,457
Impact Fees - - 118,432 118,432
Other revenues 305,658 326,658 136,217 (190,441)
Total Revenues 118,955,819 127,728,819 126,914,629 (814,190)
(Continued)
137
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City of San Luis Obispo, California
Budgetary Comparison Schedule
General Fund, continued
For the Fiscal Year Ended June 30, 2025
Page 2
Original
Budget
Final
Budget Actual
Variance With
Final Budget
Positive
(Negative)
Expenditures:
Public Safety:
Police protection:
Administration 2,538,303 2,894,638 2,482,077 412,561
Investigations 3,612,738 3,738,359 3,647,834 90,525
Neighborhood services 323,317 331,180 304,657 26,523
Support services 3,533,903 3,660,137 3,672,725 (12,588)
Patrol services 12,536,033 13,186,464 13,627,569 (441,106)
Traffic safety 948,997 977,059 922,256 54,803
Total police protection 23,493,292 24,787,837 24,657,118 130,719
Fire and environmental safety:
Administration 1,343,924 1,514,833 1,538,177 (23,344)
Emergency response 13,311,896 14,921,700 15,169,981 (248,281)
Fire Apparatus Services 638,946 693,307 631,944 61,363
Hazard protection 1,167,937 1,222,332 1,075,918 146,414
Training 113,448 108,668 108,109 559
Disaster preparedness 200,876 208,603 99,079 109,524
Mobile Crisis Unit 195,614 281,066 163,941 117,125
Total fire and environmental safety 16,972,642 18,950,508 18,787,149 163,359
Total public safety 40,465,934 43,738,345 43,444,267 294,078
Transportation:
Transportation planning and engineering 1,178,201 1,179,093 1,139,636 39,457
Street and sidewalk maintenance 2,475,330 2,521,251 2,458,323 62,928
Traffic signals and street lights 594,143 727,439 705,483 21,956
Creek and flood protection 1,596,887 1,627,498 1,533,724 93,774
Total transportation 5,844,561 6,055,281 5,837,166 218,115
Culture and Recreation:
Recreation programs:
Recreation administration 971,535 1,029,304 978,461 50,843
Aquatics/Sinsheimer park facilities 627,884 639,890 706,839 (66,949)
Children's services 1,504,633 1,546,205 1,557,030 (10,825)
Facilities 382,687 403,275 390,589 12,686
Special events 10,500 10,500 1,121 9,379
Recreational sports 740,317 758,875 670,957 87,918
Golf course 835,133 846,164 827,151 19,013
Ranger services 916,900 949,570 882,011 67,559
Maintenance programs:
Swim center maintenance 697,871 729,661 664,404 65,257
Parks and landscape maintenance 4,338,737 4,479,909 4,081,818 398,091
Tree maintenance 290,564 325,865 229,260 96,605
Cultural and social service programs: Human relations
Human relations 619,222 693,587 567,532 126,055
Cultural activities 365,161 365,161 356,625 8,536
Total leisure, cultural and social services 12,301,144 12,777,967 11,913,798 864,169
(Continued)
138
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City of San Luis Obispo, California
Budgetary Comparison Schedule
General Fund, continued
For the Fiscal Year Ended June 30, 2025
Page 3
Original
Budget
Final
Budget Actual
Variance With
Final Budget
Positive
(Negative)
Community Development:
Planning:
Commissions and communities 37,240 37,240 10,187 27,053
Community development administration 1,017,994 1,059,524 972,655 86,869
Long-range planning 1,145,326 1,044,008 899,156 144,852
Development review 2,234,614 2,275,244 1,896,174 379,070
Natural resource protection 973,285 1,313,798 1,247,062 66,736
Construction regulation:
Building and safety 3,194,956 3,652,043 2,886,384 765,659
CIP project engineering 3,029,946 3,151,912 2,819,886 332,026
Economic health:
Community promotion 397,816 352,752 351,412 1,340
Economic development 934,062 860,509 814,416 46,093
Housing 1,197,570 1,260,280 1,200,261 60,019
Total community development 14,162,809 15,007,310 13,097,593 1,909,717
General Government:
Legislation:
Council 240,816 251,446 235,270 16,176
General administration:
City administration 2,318,898 2,435,017 2,147,298 287,719
Public works administration 1,571,031 1,637,305 1,486,040 151,265
Legal services:
City attorney 1,514,049 1,758,600 1,652,744 105,856
City clerk services:
Administration and records 774,801 842,836 778,365 64,471
Organization support services:
Human resource administration 7,890,758 8,064,649 5,842,318 2,222,331
Finance and administration 2,616,190 2,427,346 2,104,693 322,653
Revenue management 483,061 511,787 487,743 24,044
Accounting 1,439,515 1,464,465 1,481,067 (16,602)
Finance non-departmental 893,338 902,030 366,213 535,817
Network services 3,574,551 3,598,745 3,282,048 316,697
Wellness program 55,819 55,819 38,744 17,075
Building and vehicle maintenance:
Buildings 1,558,325 1,535,196 1,526,119 9,077
Vehicle and equipment maintenance 1,488,340 1,532,139 1,472,005 60,134
Total general government before cost
reimbursement 26,419,490 27,017,379 22,900,667 4,116,712
Total general government 21,051,882 21,649,771 17,533,059 4,116,712
Debt Service
Principal - - 360,260 (360,260)
Interest and Fiscal Charges - - 22,321 (22,321)
Total Expenditures 93,826,330 99,228,674 92,208,464 7,020,210
(Continued)
139
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City of San Luis Obispo, California
Budgetary Comparison Schedule
General Fund, continued
For the Fiscal Year Ended June 30, 2025
Page 4
Original
Budget
Final
Budget Actual
Variance With
Final Budget
Positive
(Negative)
Excess of Revenues Over Expenditures 25,129,489 28,500,145 34,706,165 6,206,020
Other Financing Sources (Uses)
Transfers in 5,557,812 5,557,812 5,829,430 271,618
Transfers out (28,155,223) (34,045,195) (34,058,043) (12,848)
Total other financing uses (22,597,411) (28,487,383) (28,228,613) 258,770
Net Change in Fund Balance 2,532,078 12,762 6,477,552 6,464,790$
Fund Balance, Beginning of the Year 45,329,766 45,329,766 45,329,766
Fund Balance, End of Year 47,861,844$ 45,342,528$ 51,807,318$
140
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City of San Luis Obispo, California
Schedule of the Changes in the Net Pension Liability and Related Ratios
Miscellaneous Agent Multiple-Employer Plan
June 30, 2025
Last 10 Years
Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16
Measurement Period 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16 2014-15
Total pension liability:
Service Cost 5,225,836$ 4,695,253$ 4,364,490$ 3,939,785$ 3,681,240$ 4,042,717$ 4,328,129$ 4,124,832$ 3,580,882$ 3,578,172$
Interest on total pension liability 18,772,636 17,884,042 17,090,797 16,589,680 16,160,011 15,531,812 14,778,918 14,197,897 13,688,523 13,193,597
Changes of Benefits Terms - 293,205
Difference between expected and actual
experience 5,864,043 4,537,569 818,065 (755,414) 1,869,474 2,966,923 1,445,049 694,843 (1,160,933) (2,433,791)
Changes in assumptions - - 8,123,651 - - - (1,292,326) 11,219,603 - (3,057,724)
Benefit payments, including refunds
of employee contributions (16,260,601) (15,400,292) (14,509,974) (13,518,666) (12,892,847) (12,061,701) (10,740,816) (10,161,053) (9,476,508) (8,808,668)
Net change in total pension liability 13,601,914 12,009,777 15,887,029 6,255,385 8,817,878 10,479,751 8,518,954 20,076,122 6,631,964 2,471,586
Total pension liability - beginning 271,720,540 259,710,763 243,823,734 237,568,349 228,750,471 218,270,720 209,751,766 189,675,644 183,043,680 180,572,094
Total pension liability - ending (a) $ 285,322,454 $ 271,720,540 $ 259,710,763 $ 243,823,734 237,568,349$ 228,750,471$ 218,270,720$ 209,751,766$ 189,675,644$ 183,043,680$
Plan fiduciary net position:
Contributions - employer 11,026,090$ 11,050,993$ 16,384,823$ 8,246,755$ 7,709,918$ 9,361,882$ 6,693,987$ 6,776,849$ 6,122,173$ 5,027,356$
Contributions - employee 2,974,063 2,606,854 2,269,339 2,056,274 1,889,583 1,775,245 1,820,697 1,841,331 1,666,606 1,509,834
Net investment income 16,995,192 10,485,099 (13,547,758) 32,904,570 7,205,266 9,124,520 10,820,033 13,053,453 677,557 2,673,657
Benefit payments (16,260,601) (15,400,292) (14,509,974) (13,518,666) (12,892,847) (12,061,701) (10,740,816) (10,161,053) (9,476,508) (8,808,668)
Net plan to plan resource movement - - - - - (316) (2,936) - -
Administrative expense (143,972) (123,771) (110,778) (148,132) (203,824) (97,394) (200,184) (172,935) (72,044) (133,042)
Other miscellaneous income/(expense)- - - - 316 (380,153) - - -
Net change in plan fiduciary
net position 14,590,772 8,618,883 (9,514,348) 29,540,801 3,708,096 8,102,868 8,013,248 11,334,709 (1,082,216) 269,137
Plan fiduciary net position - beginning 176,934,611 168,315,728 177,830,076 148,289,275 144,581,179 136,478,311 128,465,063 117,130,354 118,212,570 117,943,433
Plan fiduciary net position - ending (b)191,525,383$ 176,934,611$ 168,315,728$ 177,830,076$ 148,289,275$ 144,581,179$ 136,478,311$ 128,465,063$ 117,130,354$ 118,212,570$
Net pension liability (asset) -
ending (a) - (b)93,797,071$ 94,785,929$ 91,395,035$ 65,993,658$ 89,279,074$ 84,169,292$ 81,792,409$ 81,286,703$ 72,545,290$ 64,831,110$
Plan fiduciary net position as a percentage of the total pension
liability 67.13%65.12%64.81%72.93%62.42%63.20%62.53%61.25%61.75%64.58%
Covered payroll 32,157,208 29,794,206 24,574,829 23,805,348 21,795,380 22,951,725 23,736,588 21,841,841 20,499,668 19,769,997
Net pension liability as percentage of covered
payroll 291.68% 318.14% 371.91% 277.22% 409.62% 366.72% 344.58% 372.16% 353.89% 327.93%
Benefit changes . The figures above include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date. However, offers of Two Years Additional Service Credit (a.k.a. Golden Handshakes)
that occurred after the June 30, 2019 valuation date are not included in the figures above, unless the liability impact is deemed to be material by the plan actuary.
Changes in assumptions .There were no assumption changes in 2023. Effective with the June 30, 2021 valuation date (2022 measurement date), the accounting discount rate was reduced from 7.15% to 6.90%. In determining the long-term expected rate of
return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows. Projected returns for all asset classes are estimated, combined with risk estimates, and are used to project comp ound (geometric)
returns over the long term. The discount rate used to discount liabilities was informed by the long-term projected portfolio return. In addition, demographic assumptions and the inflation rate assumption were changed in accordance with the 2021 CalPERS
Experience Study and Review of Actuarial Assumptions. The accounting discount rate was 7.15% for measurement rate June 30, 2017 through June 30, 2021, 7.65 % for measurement dates June 30, 2015 through June 30, 2016 and 7.50% for measurement
date June 30, 2014.
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City of San Luis Obispo, California
Schedule of the Pension Plan Contributions
Miscellaneous Agent Multiple-Employer Plan
June 30, 2025
Last 10 Years
Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16
Actuarially determined contribution 10,874,068$ 9,588,879$ 9,573,782$ 8,851,802$ 8,246,755$ 7,709,918$ 7,093,882$ 6,693,987$ 6,776,849$ 6,122,173$
Contributions in relation to the actuarially
determined contribution (12,983,365) (11,026,090) (11,050,993) (16,384,823) (8,246,755) (7,709,918) (9,361,882) (6,693,987) (6,776,849) (6,122,173)
Contribution deficiency (excess)(2,109,297)$ (1,437,211)$ (1,477,211)$ (7,533,021)$ -$ -$ (2,268,000)$ -$ -$ -$
Covered payroll 33,984,175$ 32,157,208$ 29,794,206$ 24,574,829$ 23,805,348$ 21,795,380$ 22,951,725$ 23,736,588$ 21,841,841$ 20,499,668$
Contributions as percentage of covered
payroll 38.20% 34.29% 37.09% 66.67% 34.64% 35.37% 40.79% 28.20% 31.03% 30.97%
Actuarial Cost Method
Amortization Method
Amortization Period
Asset Valuation Method
Inflation
Salary Increases
Payroll Growth
Discount Rate
Retirement Age
Mortality
For details, see June 30, 2022 CalPERS Funding Valuation Report
Entry Age Normal
The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2024-25 contributions rates are as follows:
The probabilities of mortality are based on the 2021 CalPERS Experience Study.
The probabilities of retirement are based on the 2021 CalPERS Experience Study.
6.80% Net of Pension Plan Investment and Administrative Expenses; includes inflation
2.800%
Varies by Entry Age and Service
2.30%
For details, see June 30, 2022 CalPERS Funding Valuation Report
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City of San Luis Obispo, California
Schedule of the City's Proportionate Share of the Net Pension Liability
Safety Cost-Sharing Plan
As of June 30, 2025
Last 10 Years
Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16
Measurement Period 2023-2024 2022-2023 2021-2022 2020-2021 2019-2020 2018-2019 2017-18 2016-17 2015-16 2014-15
Proportion of the Collective Net Pension
Liability 0.69428% 0.69198% 0.71733% 1.08299% 0.7225% 0.7212% 1.2261% 1.1943% 1.2510% 1.3654%
Proportionate Share of the Collective Net
Pension Liability 84,198,128$ 86,327,322$ 82,856,965$ 58,571,330$ 78,611,581$ 73,897,967$ 71,940,534$ 71,364,346$ 64,792,760$ 56,260,280$
Covered payroll 12,772,815$ 11,235,984$ 12,207,346$ 10,744,808$ 9,488,971$ 11,197,562$ 11,246,306$ 10,614,437$ 10,643,123$ 10,849,863$
Proportionate share of the net pension
liability as percentage of covered payroll 659.20% 768.31% 678.75% 545.11% 828.45% 659.95% 639.68% 672.33% 608.78% 518.53%
Plan fiduciary net position as a percentage
of the total pension liability 78.08% 76.21% 76.68% 88.29% 75.26% 75.26% 75.26% 73.31% 74.06% 78.40%
The CalPERS mortality assumptions were adjusted in fiscal year 2019.
The CalPERS discount rate was increased from 7.5% to 7.65% in fiscal year 2016, and then decreased from 7.65% to 7.15% in fiscal year 2018, and then decreased from 7.15% to 6.9% in fiscal year 2023.
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Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17 2015-16
Contractually required contribution
(actuarially determined)11,061,415$ 10,004,005$ 10,016,823$ 12,756,585$ 7,631,620$ 7,167,638$ 6,416,780$ 5,910,345$ 5,549,915$ 5,074,217$
Contribution in relation to the actuarially
determined contributions (11,061,415) (10,004,005) (10,016,823) (12,756,585) (7,631,620) (7,167,638) (8,348,780) (5,910,345) (6,299,915) (5,824,217)
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$ (1,932,000)$ -$ (750,000)$ (750,000)$
Covered payroll 13,473,275$ 12,772,815$ 11,235,984$ 12,207,346$ 10,744,808$ 9,488,971$ 11,197,562$ 11,246,306$ 10,614,437$ 10,643,123$
Contributions as a percentage of covered
payroll 82.10% 78.32% 89.15% 104.50% 71.03% 75.54% 74.56% 52.55% 59.35% 54.72%
The Plan’s proportionate share of aggregate contributions may not match the actual contributions made by the employer during the measurement period. The Plan’s proportionate share of aggregate contributions is
based on the Plan’s proportion of fiduciary net position as well as any additional side fund (or unfunded liability) contributions made by the employer during the measurement period.
City of San Luis Obispo, California
Schedule of the City's Pension Contributions
Safety Cost-Sharing Plan
As of June 30, 2025
Last 10 Years
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Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18
Measurement Period 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18 2016-17
Total OPEB liability:
Service Cost 518,085$ 493,787$ 480,571$ 423,364$ 415,244$ 477,538$ 463,629$ 450,125$
Interest on total OPEB liability 836,877 940,850 898,021 867,422 841,590 935,528 891,794 856,436
Difference between expected and
actual experience - (2,105,353) - 349,893 - (2,085,962) - -
Changes in assumptions - (291,401) - 507,115 (203,416) 21,857 - -
Benefit payments, including refunds
of employee contributions (734,364) (717,143) (695,937) (678,789) (678,882) (677,824) (765,000) (827,500)
Net change in total OPEB liability 620,598 (1,679,260) 682,655 1,469,005 374,536 (1,328,863) 590,423 479,061
Total OPEB liability - beginning 13,239,129 14,918,389 14,235,734 12,766,729 12,392,193 13,721,056 13,130,633 12,651,572
Total OPEB liability - ending (a)13,859,727$ 13,239,129$ 14,918,389$ 14,235,734$ 12,766,729$ 12,392,193$ 13,721,056$ 13,130,633$
Plan fiduciary net position:
Contributions - employer 740,550$ 1,427,129$ 1,309,367$ 921,000$ 1,656,882$ 677,824$ 1,221,000$ 1,493,996$
Net investment income 1,202,776 619,941 (1,395,486) 2,196,724 259,704 392,852 439,828 469,883
Benefit payments (734,364) (717,143) (695,937) (678,789) (678,882) (677,824) (765,000) (827,500)
Administrative expense (9,757) (8,784) (7,070) (7,235) (3,472) (1,364) (10,170) (2,387)
Net change in plan fiduciary
net position 1,199,205 1,321,143 (789,126) 2,431,700 1,234,232 391,488 885,658 1,133,992
Plan fiduciary net position
- beginning 10,954,815 9,633,672 10,422,798 7,991,098 6,756,866 6,365,378 5,479,720 4,345,728
Plan fiduciary net position
- ending (b)12,154,020$ 10,954,815$ 9,633,672$ 10,422,798$ 7,991,098$ 6,756,866$ 6,365,378$ 5,479,720$
Plan net OPEB liability
- ending (a) - (b)1,705,707$ 2,284,314$ 5,284,717$ 3,812,936$ 4,775,631$ 5,635,327$ 7,355,678$ 7,650,913$
Plan fiduciary net position as a
percentage of the total OPEB liability 87.69% 82.75% 64.58% 73.22% 62.59% 54.53% 46.39% 41.73%
Covered-employee payroll 43,414,242$ 37,590,668$ 38,691,777$ 40,691,438$ 33,077,056$ 33,429,600$ 33,790,437$ 33,722,592$
Plan net OPEB liability as percentage
of covered payroll 3.93% 6.08% 13.66% 9.37% 14.44% 16.86% 21.77% 22.69%
Changes in assumptions. As of June 30, 2023 measurement, the assumption updated the PEMHCA minimum and medical trend. No changes in June 30, 2022 measurement
date. As of June 30, 2021 measurement date, the assumption adds 1. Discount rate was updated based on newer capital market assumptions 2. Medical plan election at
retirement assumption was updated 3. Inflation rate decreased from 2.75% to 2.50%, which decreased the discount rate, medical trend, and aggregate salary increases by
0.25% 4. Demographic assumptions updated to CalPERS 2000-2019 Experience Study 5. Mortality improvement scale was updated to Scale MP-2021. As of June 30, 2020
measurement date, the assumption removed the ACA excise tax. As of June 30, 2019 measurement date, the mortality improvement scale was updated to Scale MP-2019.
Medical plan at retirement estimated using weighted premium of recent retirees; updated based on retirements during 2015-2019.
* Fiscal year 2018 was the first year of implementation. Information is required only for measurement periods for which GASB 75 is applicable.
Benefit changes . The figures shown do not include any liability impact that may have resulted from plan changes which occurred after the June 30, 2024 measurement date.
Prepared for the City of San Luis Obispo OPEB Plan
an Agent Multiple-Employer Defined Benefit OPEB Plan
As of June 30, 2025
Last 10 Years *
Schedule of Changes in the Net OPEB Liability and Related Ratios
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Fiscal Year 2024-25 2023-24 2022-23 2021-22 2020-21 2019-20 2018-19 2017-18
Actuarially
determined
contribution 906,000$ 1,085,000$ 1,055,000$ 1,309,367$ 921,000$ 1,190,000$ 1,154,000$ 1,221,000$
Contributions in
relation to the
actuarially
determined
contributions (1,975,082) (740,550) (1,427,129) (1,309,367) (921,000) (1,656,882) (677,824) (1,221,000)
Contribution
deficiency (excess)(1,069,082)$ 344,450$ (372,129)$ -$ -$ (466,882)$ 476,176$ -$
Covered-employee
payroll 47,500,670$ 43,414,242$ 37,590,668$ 38,691,777$ 40,691,438$ 33,077,056$ 33,429,600$ 33,790,437$
percentage of
covered payroll 4.16% 1.71% 2.81% 3.38% 2.26% 3.60% 3.45% 3.61%
Contributions paid as of June 30, 2024 are deferred to June 30, 2025.
Valuation date
Actuarial Cost Method
Amortization Method
Amortization Period
Asset Valuation Method
Discount Rate
General Inflation
Medical Trend
Mortality
Mortality Improvement
The actuarial methods and assumptions used to set the actuarially determined contributions for fiscal year 2023-24 are as follows:
* Fiscal year 2018 was the first year of implementation. Information is required only for measurement periods for which GASB 75 is applicable.
Prepared for the City of San Luis Obispo Miscellaneous Plan
an Agent Multiple-Employer Defined Benefit OPEB Plan
As of June 30, 2025
Last 10 Years *
Schedule of Employer OPEB Contributions
June 30, 2023
Entry Age Normal, Level % of pay
Level % of pay
6.1-year average period for FY2024/25
Investment gains and losses spread over 5-year rolling period
6.25%
2.50%
Non-Medicare - 8.50% for 2025, decreasing to an ultimate rate of 3.45% in 2076
Medicare (Non-Kaiser) - 7.5% for 2025, decreasing to an ultimate rate of 3.45% in 2076
Medicare (Kaiser) - 6.25% for 2025, decreasing to an ultimate rate of 3.45% in 2076
CalPERS 2000-2019 experience study
Post-retirement mortality projected fully generational with Scale MP-2021
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City of San Luis Obispo, California
Notes to Required Supplementary Information
June 30, 2025
Budgetary Comparison Schedule
1.The budget is prepared using the modified accrual basis of accounting consistent with U.S. generally accepted accounting
principles.
2.Outstanding encumbrances from the prior fiscal year are not reflected in the original budget column but are included in the
final budget amounts.
3.All the City’s general government and engineering programs are initially accounted and budgeted for in the General Fund.
However, certain of these support service programs also benefit the City’s enterprise and agency fund operations, and
accordingly, transfers are made from these funds to reimburse the General Fund for these services. The transfers are based
on a Cost Allocation Plan prepared for this purpose which distributes the shared costs in a uniform, consistent manner in
accordance with U.S. generally accepted accounting principles.
Excess of Expenditures Over Appropriations
1.At June 30, 2025 expenditures exceeded appropriations in the General Fund as noted below.
Department/Division Budget Variance
Police Protection:
Support Se rvices 12,588$
Patrol services 441,106
Fire and environmental safety:
Adminis tration 23,344
Emergency response 248,281
Culture and Recreation:
Aquatics/Sinshe imer park facilities 66,949
Children's services 10,825
Organization Su pport Services:
Accounting 16,602
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OTHER SUPPLEMENTARY INFORMATION
AND COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
149
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150
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Revenues Actual
Local Transaction and Use Tax 30,926,285$
30,926,285$
Expenditure Allocations by Priority
Address Homelessness 907,987$
Community Safety and Emergency Preparedness 6,625,118
Creek and Flood Protection 1,718,128
Economic Development and Business Retention 200,000
Open Space/Natural Areas Preservation and Maintenance 1,555,889
Other Services and Projects 3,342,390
Protect Financial Stability 1,178,100
Safe and Clean Public Areas 1,889,662
Street Maintenance and Transportation (incl bike and ped improvements) 9,150,627
Youth/Senior Services and Recreation Facilities 5,287,099
31,855,000$
Net Change in Fund Balance (928,715)$
Fund Balance Beginning of Year 1,776,826
Fund Balance End of Year 848,111$
City of San Luis Obispo
Local Transaction Tax Measure Funding Schedule
For the Fiscal Year Ended June 30, 2025
151
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Revenues Budget Actual
Local Transaction and Use Tax 30,926,285$ 30,926,285$
30,926,285$ 30,926,285$
Expenditures
Transfer Out for Operating Programs:
Address Homelessness 907,987$ 907,987$
Community Safety and Emergency Preparedness 2,708,462 2,708,462
Creek and Flood Protection 693,128 693,128
Economic Development and Business Retention 150,000 150,000
Open Space/Natural Areas Preservation and Maint. 695,889 695,889
Other Services and Projects 141,500 141,500
Protect Financial Stability 1,178,100 1,178,100
Safe and Clean Public Areas 408,551 408,551
Street Maintenance and Transportation 679,931 679,931
Youth/Senior Services and Recreation Facilities 546,115 546,115
8,109,663$ 8,109,663$
Transfer Out for 2024-25 Capital Projects
Community Safety and Emergency Preparedness 3,916,656$ 3,916,656$
Creek and Flood Protection 1,025,000 1,025,000
Economic Development and Business Retention 50,000 50,000
Open Space/Natural Areas Preservation and Maintenance 860,000 860,000
Other Services and Projects 3,200,890 3,200,890
Safe and Clean Public Areas 1,481,111 1,481,111
Street Maintenance and Transportation (incl bike and ped improvements) 8,470,696 8,470,696
Youth/Senior Services and Recreation Facilities 4,740,984 4,740,984
23,745,337$ 23,745,337$
Net Change in Fund Balance (928,715)$
Fund Balance Beginning of Year 1,776,826$
Fund Balance End of Year 848,111$
City of San Luis Obispo
Local Transaction Tax Measure Funding Schedule
For the Fiscal Year Ended June 30, 2025
152
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Page 2
Capital Programs:Budget*Actual Encumbrances Carryover
Community Safety and Emergency Preparedness
Fire Station #2 - Parking Lot Maintenance 149,646 2,988 - 146,658
Fire Station #3 & #4 Remodel Space Study and Design 264,739 27,256 105,357 132,126
Fleet Replacement - Admin 9,484 - - 9,484
Fleet Replacement - Fire 776,431 88,554 - 687,877
Fleet Replacement - Police 412,416 273,253 43,275 95,887
Fleet Replacement - Public Works 97,778 - - 97,778
IT Replacements 180,099 25,135 - 154,964
Major Facility Maintenance 255,709 211,205 - 44,503
Major Facility Replacement - Police 341,985 81,701 32,844 227,440
Parking Lot Maintenance - 1016 Walnut 6,164 - - 6,164
Police - Information Technology 1,444,119 16,894 485,222 942,003
Public Safety Center - Police Station Replacement 1,017,377 110,589 686,410 220,378
Righetti Hillside Slide Repair 1,584,745 901,312 10,853 672,580
Storm Response & Recovery 3,436,242 689,082 1,365,701 1,381,459
9,976,934$ 2,427,971$ 2,729,661$ 4,819,302
Creek and Flood Protection
Creek Bank Stabilization Near Pismo and Johnson 106,073 10,000 - 96,073
Fleet Replacement - Public Works 3,989 - - 3,989
Johnson - Iris to Bishop Pipeline Replacement 1,502 1,502 - -
Ruth and Iris Culvert Replacement 30,826 - - 30,826
Storm Drainage Infrastructure Replacement 2,197,379 775,450 7,935 1,413,994
2,339,770$ 786,952$ 7,935$ 1,544,882
Economic Development and Business Retention
Additional Banner Arms, Bench Arm Rests, Signs 133,155 29,609 260 103,286
Annual Public Art Maintenance and Projects 244,506 244,006 500 -
Downtown Renewal 255 - - 255
Downtown Zig-Zag Lighting 223,000 37,474 - 185,526
Mission Plaza Maintenance Improvements 102,553 - - 102,553
Open SLO 60,098 11,747 800 47,551
Public Art Installation 281,036 44,264 29,889 206,884
1,044,603$ 367,099$ 31,449$ 646,055
Open Space/Natural Areas Preservation and Maintenance
Laguna Lake Dog Park 256,229 214,765 8,385 33,079
Laguna Lake Dredging 102,361 34,737 8,677 58,947
Open Space Acquisition 695,616 21,288 19,513 654,815
Open Space Maintenance 279,227 82,554 3,154 193,519
Pismo Street Retaining Wall 198,194 108,352 84,842 5,000
Urban Forest Maintenance 470,674 388,037 - 82,637
2,002,300$ 849,733$ 124,570$ 1,027,997
City of San Luis Obispo
Local Transaction Tax Measure Funding Schedule, continued
Local Revenue Measure Funded Projects
Includes Legacy Projects and projects funded by Capital Reserve
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Page 3
Capital Programs:Budget*Actual Encumbrances Carryover
Other Services and Projects
CIP Project Delivery Augmentation 10 - - 10
Corp Yard Fuel Island Siding 41 - - 41
Electric Vehicle Charging Stations 462,535 21,830 40,801 399,903
Fleet Replacement - Admin 125,000 4,631 - 120,369
Fleet Replacement - Citywide 259,001 156,952 63,259 38,790
Fleet Replacement - Public Works 544,490 98 0 544,392
KVEC Tower 53,610 - - 53,610
Major Facility Maintenance 293,641 203,493 49,906 40,243
Park Major Maintenance 19,561 - - 19,561
1,757,889$ 387,004$ 153,966$ 1,216,920
Safe and Clean Public Areas
Area 6 & 7 Curb Ramps 2,610 - - 2,610
Bob Jones Trail and Railroad Safety Trail Solar Lightning 49,600 - - 49,600
Curb Ramps and Sidewalks Replacements 201,482 101,743 11,810 87,930
IT Replacement 80,543 5,106 - 75,436
Mission Plaza Concept Plan Implementation 2,209,147 1,002,378 356,189 850,580
Park Major Maintenance & Repairs: Mission Plaza Railing 710,932 29,395 - 681,537
Pedestrian Crossing Improvements 501,823 - 32,509 469,314
Pedestrian Crosswalk Beacon on Ramona 13,255 - 13,255 -
Railroad Safety Trail Taft to Pepper 27,150 - - 27,150
Street and Pathway Lighting 170,734 67,006 7,389 96,340
3,967,276$ 1,205,628$ 421,151$ 2,340,497
Local Transaction Tax Measure Funding Schedule, continued
Local Revenue Measure Funded Projects
Includes Legacy Projects and projects funded by Capital Reserve
City of San Luis Obispo
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Page 4
Capital Programs:Budget*Actual Encumbrances Carryover
Street Maintenance and Transportation
2022 Street Reconstruction and Resurfacing 734,309 443,479 17,649 273,181
2023 Streets Reconstruction & Resurfacing - Arterials 1,290,884 1,034,896 61,239 194,749
Active Transportation Plan Implementation 504,354 135,644 41,738 326,972
ATP - Higuera Complete Street Project 781,248 165,090 23,497 592,661
ATP - Foothill Boulevard Complete Street Project 155,085 74,368 22,628 58,090
California Taft Roundabout 514,106 36,155 100,641 377,310
Development Agreements 1,014,556 120,721 725,141 168,694
Fleet Replacement - Public Works 80,000 23,978 - 56,022
Higuera Widening at 50 Higuera 22,600 - - 22,600
Marsh and Santa Rosa Bridge Replacement 2,635 - - 2,635
Mid-Higuera Bypass 5,450,178 1,994,242 1,782,053 1,673,884
Monterey at Santa Rosa Paving and Signal Project 539,158 - - 539,158
Neighborhood Traffic Improvements 120,341 188 49,958 70,196
North Chorro Neighborhood Greenway - Phase 2 2,018,368 545,548 71,169 1,401,651
Orcutt/Tank Farm Roundabout Construction 77,002 7,615 11,195 58,192
Prado Road Bridge & Road Widening 103,472 - 93,394 10,079
Prado Road Interchange 2,396,146 35,687 12,230 2,348,229
Roadway Sealing 2022 343,253 - - 343,253
Roadway Sealing 2024 4,418,775 1,545,078 342,139 2,531,559
Sewer Replacement Chorro & Murray 80,000 - - 80,000
South Street Median Landscaping 6,862 - 3,810 3,052
Traffic Safety Report Improvements 10,139 - - 10,139
Traffic Signs & Striping Maintenance 143,521 15,972 9 127,540
Transportation Safety & Operations 254,058 56,693 16,323 181,042
21,061,050$ 6,235,353$ 3,374,811$ 11,450,887
Youth/Senior Services and Recreation Facilities
Fleet Replacement - Parks and Recreation 274,625 90,011 3,295 181,319
Fleet Replacement - Public Works 194,345 194,345 - -
Golf Course Pro Shop Flood Damage Repairs 40,058 9,000 - 31,058
Laguna Lake Golf Course Maintenance 68,625 21,960 45,000 1,665
Lead by Example (Swim Center Heat Pump)75,000 - - 75,000
Major Facility Maintenance 841,511 228,151 216,951 396,409
North Broad Street Neighborhood Park 103,867 88,470 - 15,396
Orcutt Area - Linear Park Planning and Construction 25,462 6,994 - 18,468
Parking Lot Maintenance 209,307 14,335 - 194,972
Playground Equipment Replacement 95,262 38,982 5,311 50,969
Parks and Recreation Master Plan Implementation 54,280 - - 54,280
Parks Major Maintenance 648,297 224,401 47,569 376,326
Righetti Community Park 5,075,288 90,603 1,177,843 3,806,843
7,705,926$ 1,007,252 1,495,969$ 5,202,706
Total Capital Expenditures 49,855,748$ 13,266,991$ 8,339,511$ 28,249,245$
*This Budget amount also includes carryover from prior years.
Includes Legacy Projects and projects funded by Capital Reserve
City of San Luis Obispo
Local Transaction Tax Measure Funding Schedule, continued
Local Revenue Measure Funded Projects
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City of San Luis Obispo, California
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
The City maintains the following nonmajor governmental funds:
Special Revenue Funds
The City has established the following ten special revenue funds in order to account for the proceeds from revenue
sources that are restricted or committed to expenditures for specified purposes.Budgets are prepared using the
modified accrual basis of accounting consistent with U.S. generally accepted accounting principles.
Downtown Business Improvement District (BID)Fund .This fund has been established to account for the receipt
of a surcharge derived from a supplemental assessment upon businesses within the Downtown Business
Improvement District’s boundaries.Pursuant to the provisions of the Municipal Code,this surcharge is equal to
$150.00 per year.Expenditures from the fund are limited to four basic purposes:decorating public places within the
downtown;promoting public events in the downtown core;promoting trade activities;and improving parking in the
Transportation Development Act (TDA)Fund .The State of California has designated 1/4%of the sales tax levied
statewide for local transportation purposes.Funding for this program was provided during the 1971 legislative
session with the enactment of the Transportation Development Act,which extended the State sales tax to include
purchases of gasoline.Revenues allocated to the City of San Luis Obispo under this program are divided into two
categories:Article 3 funds,which are restricted for the improvement and maintenance of street systems including
pedestrian and bicycle facilities;and Article 4 funds,which are restricted for public transit systems and are recorded
directly in the Transit Fund.Under the City's Financial Plan policies,all TDA Article 3 revenues are allocated for
alternative transportation purposes. The purpose of this fund is to account for these revenues.
Tourism Business Improvement District (BID)Fund .This fund has been established to account for the receipt of a
surcharge derived from assessments upon the lodging establishments within the City.The surcharge is equal to 2%
of gross room rents. Expenditures from the fund are limited to the marketing and promotion of tourism.
Gas Tax Fund .Portions of the tax rate per gallon levied by the State of California on all gasoline purchases are
allocated to cities throughout the State on a population basis.These funds are restricted for expenditures by the State
of California for street-related purposes only.Under the City's Financial Plan policies,all gas tax revenues are
transferred to the General Fund for street maintenance purposes.
Community Development Block Grant (CDBG)Fund.This fund has been established to account for federal funds
received by the City specifically to benefit low and moderate income persons,aid in the elimination of blight,and
meet other community development needs as allowed by block grant regulations.
Law Enforcement Grants Fund . This fund has been established to account for public safety grant funds.
Public Arts Contribution Fund.Public contributions to the public art program are accounted for in this fund along
with the expenditures for public art projects funded by this revenue source.
Avila Ranch Fund.This fund has been established to account for the ongoing funding received as a special property
tax assessment and the associated infrastructure and service improvements of the Avila Ranch Community Facilities
District.
SB1 Road Repair Fund.This fund has been established to account for stable and ongoing funding for maintenance
and improvements to transportation infrastructure as provided through Senate Bill 1 (2017),the Road Repair and
Accountability Act.
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City of San Luis Obispo, California
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
SB1186 CASP Certify Fund .This fund has been established as Senate Bill 1186 (2012)requires local agencies to
collect an additional fee when issuing a permit for the purpose of increasing certified access specialist (CASp)
services and compliance with construction-related accessibility requirements.The first priority is to spend the funds
on the training and retention of CASps in order to meet the needs of the public in the jurisdiction.The funds may
also be spent on activities or programs that facilitate accessibility compliance.
Affordable Housing BEGIN Loan Fund.This fund has been established to account for affordable housing loans
that were provided under the State's BEGIN program.
Avila Ranch DPA Fund.This fund has been established to account for the home buyer down payment assistance
program required by the Avila Ranch development.
Opioid Settlement Fund.This fund has been established to account for money received from national lawsuits
against manufacturers, distributors and other entities responsible for aiding the opioid epicemic and related.
Asset Forfeiture Available Fund.This fund has been established to account for the City's share of resolved asset
forfeiture cases.
SLR PAYGO City ShareFund.This fund has been established to account for the City's share of the San Luis Ranch
CFD property tax assessments that provide pay-as-you-go financing for infrastructure improvements authorized to be
funded by CFD No. 2019-1.
Code Enforcement Abatement Fund.This fund has been established to account for code enforcement abatement
activities and recoveries.
Police Evidence Available Fund.This fund has been established to account for the City's share of resolved criminal
cases where money was seized as evidence.
Capital Projects Funds
The following eleven capital project funds are used by the City to account for the financial resources used in the
construction or acquisition of major capital facilities or equipment (with the exception of those financed primarily
through proprietary funds).Budgets are prepared using the modified accrual basis of accounting consistent with U.S.
generally accepted accounting principles on a multi-year project basis.Accordingly,budgetary comparisons for the
capital projects funds are not presented in the accompanying other supplementary information.
Parkland Development Fund -Quimby .This fund was established to account for parkland in-lieu fees in
accordance with the AB 1191 Act,also known as the Quimby Act;it authorizes the City to require residential
subdivisions to dedicate land for parks or pay fees in lieu of dedication.Impact fees may be collected to pay for park
land (for projects not involving a subdivision),park improvements,community centers,recreation facilities,trails,
open space, etc.
Open Space Protection Fund .This fund was established to account for projects funded as part of the City’s open
space protection program to enhance open space and agricultural conservation on lands within and surrounding the
City,improve passive recreational and nature study opportunities,and restore and enhance wildlife habitat.Projects
in this fund will be financed with General Fund contributions, outside contributions, and State and Federal grants.
Airport Area Impact Fee Fund.This fund was established to account for interim annexation fees collected for the
specific plan and related infrastructure master plans for annexing the airport area to the City.
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City of San Luis Obispo, California
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Los Osos Valley Road (LOVR)Sub-Area Fee Fund .This fund was established to account for the LOVR add-on
impact fee created for the expansion of capacity for the LOVR interchange at US 101 for construction,project
management,and inspection.Though the project has been completed,the City has an existing reimbursement
agreement with Costco Wholesale Corporation for improvements already constructed at the LOVR interchange.
Fleet Replacement Fund .This fund was established to account for the financing and replacement of vehicles for all
General Fund programs of the City.Financing is primarily provided through operating transfers from the General
Fund as well as from interest earnings and sales of surplus property.
Information Technology Replacement Fund .This fund was established in FY 12-13 to account for the financing
and replacement of information technology for all General Fund programs of the City.Financing is primarily
provided through operating transfers from the General Fund as well as from interest earnings.
Major Facility Replacement Fund.This fund accounts for the financing and replacement of major facilities for all
General Fund programs of the City.Financing is primarily provided through operating transfers from the General
Fund as well as from interest earnings.
Affordable Housing Program Fund .This fund accumulates revenues from inclusionary housing fees for capital
projects related to affordable housing programs and projects.
Transportation Impact Fee Fund.This fund was established to account for construction projects related to
transportation facilities and travel lanes within the City that will be financed primarily with transportation impact
fees.
Infrastructure Fund .This fund was established to provide financing to infrastructure projects that have a wide
community benefit. Financing is primarily provided through operating transfers from the General Fund.
Parkland Development Impact Fee –Citywide Fund .This fund was created to account for impact fees that were
established for the purpose of acquisition and improvement of community parks and existing park facilities intended
for access and use by the entire city.
OASP Park Development Fund .This fund was established to account for impact fees created for the purpose of
acquisition and improvement of community parks and existing park facilities intended for access and use by the
entire city but more specifically by the Orcutt Area residents as the location of this park projects are in the Orcutt
MASP Park Development Fund .This fund was established to account for impact fees created for the purpose of
acquisition and improvement of community parks and existing park facilities intended for access and use by the
entire city but more specifically by the Margarita Area residents as the location of this park projects are in the
Margarita Area.
OASP Transportation Impact Fee Fund .This fund was established to account for construction projects that will be
financed primarily with transportation impact fees within the Orcutt Area Specific Plan in accordance with its
Development Agreement.
Fire Impact Fee Fund .This fund was established to account for fire department related construction projects that
will be financed primarily with public safety development impact fees.
Police Impact Fee Fund .This fund was established to account for police department related construction projects
that will be financed primarily with public safety development impact fees.
Park Improvement Impact Fee –Citywide Fund .This fund was established to account for construction projects
related to park improvements that will be financed primarily with park in-lieu fees.
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City of San Luis Obispo, California
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
SLR Transportation Impact Fee .This fund was established to account for construction projects that will be
financed primarily with transportation impact fees within the San Luis Ranch development,in accordance with its
Development Agreement.
Public Safety Equipment Replacement Fund.This fund accounts for the financing and replacement of public
safety equipment.Financing is primarily provided through operating transfers from the General Fund as well as
from interest earnings.
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City of San Luis Obispo, California
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Debt Service Fund
The City has established one debt service fund to account for the payment and accumulation of resources related to
governmental activities long-term debt principal and interest for the following debt issues.Budgets are prepared
using the modified accrual basis of accounting consistent with U.S.generally accepted accounting principles.The
following governmental activity debt issuances are serviced by this fund.
Capital Improvement Board 2012 Refunding Lease Revenue Bonds .In May 2012 the Board issued $5,050,000 of
2012 Lease Revenue Refunding Bonds.These bonds were issued to refinance the outstanding 2001 Lease Revenue
Bonds,Series C,which will be redeemed on December 1, 2029.The 2001 bonds were used to purchase property and
build athletic fields; purchase property for police station expansion; purchase Downtown Plan properties.
The Board has entered into a lease agreement with the City under which the City is responsible for making lease
payments to fund the annual debt service requirements.
Public Financing Authority 2014 Lease Revenue Bonds .In 2014 the Authority issued $7,580,000 of 2014 Lease
Revenue Bonds.These bonds were issued to finance the expansion of the Los Osos Valley Road interchange at U.S.
101. Debt service related to the interchange is recorded in the Debt Service Fund.
The Authority has entered into a lease agreement with the City under which the City is responsible for making lease
payments to fund the annual debt service requirements.
Public Financing Authority 2018 Lease Revenue Bonds .In 2018 the Authority issued $11,072,775 of 2018 Lease
Revenue Refunding Bonds.These bonds were issued to refinance the outstanding 2005 Revenue Bonds,2006 Lease
Revenue Bonds,and 2009 Lease Revenue Bonds.The original bonds were used to accomplish several high priority
capital improvement projects including the headquarters fire station,seismic safety and HVAC improvements to
City Hall,Mission Plaza expansion,and various properties and street lighting system purchases.Further,the bonds
were used to purchase a parking structure and office building and to the finance the construction of the Public Safety
Communications and Emergency Operations Center project.
The Authority has entered into a lease agreement with the City under which the City is responsible for making lease
payments to fund the annual debt service requirements.
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
Downtown BID
Transportation
Development
Act (TDA) Tourism BID Gas Tax
Assets
Cash and investment 222,367$ 10,050$ 1,403,825$ -$
Accounts receivable - - 308,919 -
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable - - 6,066 -
Loans receivable - - - -
Total assets 222,367$ 10,050$ 1,718,810$ -$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable 51,361$ -$ 81,693$ -$
Accrued liabilities - - 6,189 -
Due to other funds - - - -
Unearned revenue 170,630 - - -
Total liabilities 221,991 - 87,882 -
Deferred Inflows of Resources:
Unavailable revenue - - - -
Fund balance:
Restricted for:
Public safety programs - - - -
Transportation projects - 10,050 - -
Affordable housing programs - - - -
Impact fee programs - - - -
Parkland development programs - - - -
Public art programs - - - -
Tourism programs 376 - 1,630,928 -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - - - -
Unassigned - - - -
Total fund balance 376 10,050 1,630,928 -
Total liabilities, deferred inflows of
resources, and fund balance 222,367$ 10,050$ 1,718,810$ -$
(Continued)
June 30, 2025
Special Revenue Funds
162
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
Community
Development Block
Grant (CDBG)
Law Enforcement
Grants
Public Art
Contributions Avila Ranch CFD
Assets
Cash and investment 134,119$ 51,334$ 1,621,067$ 491,881$
Accounts receivable - 2,191 - 1,859
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable 744,700 232 7,567 2,115
Loans receivable 1,112,944 - - -
Total assets 1,991,763$ 53,757$ 1,628,634$ 495,855$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ 2,604$ 70,763$ 4,259$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - 386 - -
Total liabilities - 2,990 70,763 4,259
Deferred Inflows of Resources:
Unavailable revenue 744,700 - - -
Fund balance:
Restricted for:
Public safety programs - 50,767 - -
Transportation projects - - - -
Affordable housing programs 1,247,063 - - -
Impact fee programs - - - -
Parkland development programs - - - -
Public art programs - - 1,557,871 -
Tourism programs - - - -
Infrastructure improvement - - - 491,596
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - - - -
Unassigned - - - -
Total fund balance 1,247,063 50,767 1,557,871 491,596
Total liabilities, deferred inflows of
resources, and fund balance 1,991,763$ 53,757$ 1,628,634$ 495,855$
(Continued)
Special Revenue Funds
163
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
SB1 Road Repair
SB1186 CASP
Certify
Affordable
Housing BEGIN
Loan Fund
Opioid Settlement
Fund
Assets
Cash and investment 96,741$ 231,278$ 22,336$ 313,511$
Accounts receivable - - - -
Tax receivable 234,117 - - -
Due from other funds - - - -
Accrued interest receivable 66 1,059 140,493 1,534
Loans receivable - - 422,995 -
Total assets 330,924$ 232,337$ 585,824$ 315,045$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ -$ -$ 38,817$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - 17,824 - -
Total liabilities - 17,824 - 38,817
Deferred Inflows of Resources:
Unavailable revenue - - 140,341 -
Fund balance:
Restricted for:
Public safety programs - - - 276,228
Transportation projects 330,924 214,513 - -
Affordable housing programs - - 445,483 -
Impact fee programs - - - -
Parkland development programs - - - -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - - - -
Unassigned - - - -
Total fund balance 330,924 214,513 445,483 276,228
Total liabilities, deferred inflows of
resources, and fund balance 330,924$ 232,337$ 585,824$ 315,045$
Special Revenue Funds
164
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
Asset Forfeiture
Available Fund
SLR PAYGO City
Share
Code Enforcement
Abatement Fund
Police Evidence
Available Fund
Assets
Cash and investment 60,822$ 170,059$ 35,837$ 76,702$
Accounts receivable - - - -
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable 285 795 84 90
Loans receivable - - - -
Total assets 61,107$ 170,854$ 35,921$ 76,792$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ -$ -$ -$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - - - -
Total liabilities - - - -
Deferred Inflows of Resources:
Unavailable revenue - - - -
Fund balance:
Restricted for:
Public safety programs 61,107 170,854 35,921 76,792
Transportation projects - - - -
Affordable housing programs - - - -
Impact fee programs - - - -
Parkland development programs - - - -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - - - -
Unassigned - - - -
Total fund balance 61,107 170,854 35,921 76,792
Total liabilities, deferred inflows of
resources, and fund balance 61,107$ 170,854$ 35,921$ 76,792$
(Continued)
Special Revenue Funds
165
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
Parkland
In-Lieu Fee
Open Space
Protection
Airport Area
Impact Fee
LOVR Sub-Area
Fee
Assets
Cash and investment 606,380$ 100,016$ 243,602$ 64,723$
Accounts receivable - - - -
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable 24,247 468 1,139 303
Loans receivable 227,589 - - -
Total assets 858,216$ 100,484$ 244,741$ 65,026$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable 10,017$ -$ 73,798$ -$
Accrued liabilities - - - -
Due to other funds - - - 67,478
Unearned revenue - - - -
Total liabilities 10,017 - 73,798 67,478
Deferred Inflows of Resources:
Unavailable revenue 248,959 - - -
Fund balance:
Restricted for:
Public safety programs - - - -
Transportation projects - - 170,943
Affordable housing programs - - - -
Impact fee programs - - - -
Parkland development programs 599,240 - - -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - 100,484 - -
Unassigned - - - (2,452)
Total fund balance 599,240 100,484 170,943 (2,452)
Total liabilities, deferred inflows of
resources, and fund balance 858,216$ 100,484$ 244,741$ 65,026$
(Continued)
Capital Projects Funds
166
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
Fleet Replacement
Info Tech
Replacement
Affordable
Housing
Transportation
Impact Fee
Assets
Cash and investment 2,514,421$ 4,273,260$ 207,526$ 7,075,738$
Accounts receivable - - - -
Tax receivable - - - -
Due from other funds - - - 67,478
Accrued interest receivable - - 2,854,992 237,094
Loans receivable - - 8,490,688 1,401,928
Total assets 2,514,421$ 4,273,260$ 11,553,206$ 8,782,238$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable 25,374$ 52,939$ -$ 19,331$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - 170,333 - -
Total liabilities 25,374 223,272 - 19,331
Deferred Inflows of Resources:
Unavailable revenue - - 2,850,875 1,603,464
Fund balance:
Restricted for:
Public safety programs - - - -
Transportation projects - - - 7,159,443
Affordable housing programs - - 8,702,331 -
Impact fee programs - - - -
Parkland development programs - - - -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund 500,000 400,000 - -
Subsequent years expenditures 1,989,047 3,649,988 - -
Unassigned - - - -
Total fund balance 2,489,047 4,049,988 8,702,331 7,159,443
Total liabilities, deferred inflows of
resources, and fund balance 2,514,421$ 4,273,260$ 11,553,206$ 8,782,238$
(Continued)
Capital Projects Funds
167
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
Infrastructure
Parkland
Development
Impact Fee-
Citywide OASP Park MASP Park
Assets
Cash and investment 18,887,327$ 1,507,357$ 2,047,143$ 3,438,516$
Accounts receivable - - - -
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable - 105,337 9,643 16,084
Loans receivable - 446,826 - -
Total assets 18,887,327$ 2,059,520$ 2,056,786$ 3,454,600$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ -$ -$ -$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - - - -
Total liabilities - - - -
Deferred Inflows of Resources:
Unavailable revenue - 545,290 - -
Fund balance:
Restricted for:
Public safety programs - - - -
Transportation projects - - - -
Affordable housing programs - - - -
Impact fee programs - 1,514,230 2,056,786 3,454,600
Parkland development programs -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures 18,887,327 - - -
Unassigned - - - -
Total fund balance 18,887,327 1,514,230 2,056,786 3,454,600
Total liabilities, deferred inflows of
resources, and fund balance 18,887,327$ 2,059,520$ 2,056,786$ 3,454,600$
(Continued)
Capital Projects Funds
168
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
OASP
Transportation
Impact Fee Fire Impact Fee Police Impact Fee
Park Improvement
Impact Fee-
Citywide
Assets
Cash and investment 1,856,198$ 508,926$ 636,955$ 2,233,232$
Accounts receivable - - - -
Tax receivable - - - -
Due from other funds - - - -
Accrued interest receivable 8,602 17,284 14,007 24,419
Loans receivable - 102,569 85,280 203,154
Total assets 1,864,800$ 628,779$ 736,242$ 2,460,805$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ -$ -$ -$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenue - - - -
Total liabilities - - - -
Deferred Inflows of Resources:
Unavailable revenue - 117,523 96,415 217,099
Fund balance:
Restricted for:
Public safety programs - -
Transportation projects - - -
Affordable housing programs - - - -
Impact fee programs 1,864,800 511,256 639,827 2,243,706
Parkland development programs - - -
Public art programs - - - -
Tourism programs - - - -
Infrastructure improvement - - - -
Committed to:
Public safety program - - - -
Assigned to:
Contingency fund - - - -
Subsequent years expenditures - - - -
Unassigned - - - -
Total fund balance 1,864,800 511,256 639,827 2,243,706
Total liabilities, deferred inflows of
resources, and fund balance 1,864,800$ 628,779$ 736,242$ 2,460,805$
(Continued)
Capital Projects Funds
169
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City of San Luis Obispo, California
Combining Balance Sheets
Nonmajor Governmental Funds
June 30, 2025
SLR
Transportation
Impact Fee
Public Safety
Equipment
Replacement Fund Debt Service
Total Nonmajor
Governmental
Funds
Assets
Cash and investment 2,594,471$ 511,883$ -$ 54,249,603$
Accounts receivable - - - 312,969
Tax receivable - - - 234,117
Due from other funds - - - 67,478
Accrued interest receivable 12,136 - - 4,230,841
Loans receivable - - - 12,493,973
Total assets 2,606,607$ 511,883$ -$ 71,588,981$
Liabilities, Deferred Inflows of
Resources and Fund Balance
Liabilities:
Accounts payable -$ 2,907$ -$ 433,863$
Accrued liabilities - - - 6,189
Due to other funds - - 43,089 110,567
Unearned revenue - - - 359,173
Total liabilities - 2,907 43,089 909,792
Deferred Inflows of Resources:
Unavailable revenue - - - 6,564,666
Fund balance:
Restricted for:
Public safety programs - - - 671,669
Transportation projects - - 7,885,873
Affordable housing programs - - - 10,394,877
Impact fee programs 2,606,607 - - 14,891,812
Parkland development programs - - - 599,240
Public art programs - - - 1,557,871
Tourism programs - - - 1,631,304
Infrastructure improvement - - - 491,596
Committed to:
Public safety program - 508,976 - 508,976
Assigned to:
Contingency fund - - - 900,000
Subsequent years expenditures - - - 24,626,846
Unassigned - - (43,089) (45,541)
Total fund balance 2,606,607 508,976 (43,089) 64,114,523
Total liabilities, deferred inflows of
resources, and fund balance 2,606,607$ 511,883$ -$ 71,588,981$
Capital Projects Funds
170
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City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Downtown BID
Transportation
Development Act
(TDA) Tourism BID Gas Tax
Revenues:
Use of money and property -$ -$ 56,468$ -$
Subventions and grants - 66,918 - 1,405,863
Charges for services 319,279 - 2,248,296 -
Property tax - - - -
Other revenues - - - -
Total revenues 319,279 66,918 2,304,764 1,405,863
Expenditures:
Current:
Public safety - - - -
Transportation - - - -
Community development 185,341 - 2,152,578 -
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation - - - -
Leisure, cultural and social services - - - -
Community development - - - -
Total expenditures 185,341 - 2,152,578 -
Excess (deficiency) of revenues over
(under) expenditures 133,938 66,918 152,186 1,405,863
Other financing sources (uses):
Transfers in - - - -
Transfers out - (90,000) (44,914) (1,405,863)
Total other financing
sources (uses)- (90,000) (44,914) (1,405,863)
Net change in fund balance 133,938 (23,082) 107,272 -
Fund balance, beginning of year (133,562) 33,132 1,523,656 -
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated (133,562) 33,132 1,523,656 -
Fund balance (deficit),
end of year 376$ 10,050$ 1,630,928$ -$
(Continued)
Special Revenue Funds
171
Page 375 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Community
Development Block
Grant (CDBG)
Law Enforcement
Grants
Public Art
Contributions Avila Ranch CFD
Revenues:
Use of money and property -$ 2,247$ 76,041$ 21,063$
Subventions and grants 33,368 151,957 - -
Charges for services - 288 50,486 -
Property tax - - - 539,453
Other revenues - 1,520 - -
Total revenues 33,368 156,012 126,527 560,516
Expenditures:
Current:
Public safety - 156,008 - -
Transportation - - - -
Community development - - - 50,435
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation - - - -
Leisure, cultural and social services - - 303,142 -
Community development - - - -
Total expenditures - 156,008 303,142 50,435
Excess (deficiency) of revenues over
(under) expenditures 33,368 4 (176,615) 510,081
Other financing sources (uses):
Transfers in - - 312,848 -
Transfers out (33,367) - (104,950) (386,517)
Total other financing
sources (uses)(33,367) - 207,898 (386,517)
Net change in fund balance 1 4 31,283 123,564
Fund balance, beginning of year 1,247,062 50,763 1,526,588 368,032
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated 1,247,062 50,763 1,526,588 368,032
Fund balance (deficit),
end of year 1,247,063$ 50,767$ 1,557,871$ 491,596$
(Continued)
Special Revenue Funds
172
Page 376 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
SB1 Road Repair
SB1186 ASP
Certify
Affordable
Housing BEGIN
Loan Fund
Avila Ranch DPA
Fund
Revenues:
Use of money and property 3,107$ 10,283$ 18,058$ -$
Subventions and grants 1,328,542 - - -
Charges for services - 28,247 - -
Property tax - - - -
Other revenues - - - 40,000
Total revenues 1,331,649 38,530 18,058 40,000
Expenditures:
Current:
Public safety - - - -
Transportation - - - -
Community development - 500 - 40,000
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation 1,283,811 - - -
Leisure, cultural and social services - - - -
Community development - - - -
Total expenditures 1,283,811 500 - 40,000
Excess (deficiency) of revenues over
(under) expenditures 47,838 38,030 18,058 -
Other financing sources (uses):
Transfers in - - - -
Transfers out - - - -
Total other financing
sources (uses)- - - -
Net change in fund balance 47,838 38,030 18,058 -
Fund balance, beginning of year 283,086 176,483 427,425 -
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated 283,086 176,483 427,425 -
Fund balance (deficit),
end of year 330,924$ 214,513$ 445,483$ -$
(Continued)
Special Revenue Funds
173
Page 377 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Opioid
Settlement
Fund
Asset
Forfeiture
Available
Fund
SLR PAYGO
City Share
Code
Enforcement
Abatement
Fund
Police
Evidence
Available
Fund
Revenues:
Use of money and property 9,190$ 8,667$ 3,231$ 270$ 289$
Subventions and grants - - - - -
Charges for services - - - - -
Property tax - - - - -
Other revenues 323,882 - 167,623 35,651 -
Total revenues 333,072 8,667 170,854 35,921 289
Expenditures:
Current:
Public safety - - - - -
Transportation - - - - -
Community development 56,844 - - - -
Debt service:
Principal - - - - -
Interest and fiscal charges - - - - -
Capital:
General Government - - - - -
Transportation - - - - -
Leisure, cultural and social services - - - - -
Community development - - - - -
Total expenditures 56,844 - - - -
Excess (deficiency) of revenues over
(under) expenditures 276,228 8,667 170,854 35,921 289
Other financing sources (uses):
Transfers in - - - - -
Transfers out - - - - -
Total other financing
sources (uses)- - - - -
Net change in fund balance 276,228 8,667 170,854 35,921 289
Fund balance, beginning of year - - - - -
Prior year restatements - 52,440 - - 76,503
Fund balance (deficit),
beginning of year, as restated - 52,440 - - 76,503
Fund balance (deficit),
end of year 276,228$ 61,107$ 170,854$ 35,921$ 76,792$
(Continued)
Special Revenue Funds
174
Page 378 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Parkland
In-Lieu Fee
Open Space
Protection
Airport Area
Impact Fee
LOVR Sub-Area
Fee
Revenues:
Use of money and property 60,969$ 3,086$ 13,592$ 15,027$
Subventions and grants - - - -
Charges for services 56,134 - - (67,478)
Property tax - - - -
Other revenues - 83,700 - -
Total revenues 117,103 86,786 13,592 (52,451)
Expenditures:
Current:
Public safety - - - -
Transportation - - - 566,788
Community development - - - -
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation - - 234,242 -
Leisure, cultural and social services 1,759,460 - - -
Community development - - - -
Total expenditures 1,759,460 - 234,242 566,788
Excess (deficiency) of revenues over
(under) expenditures (1,642,357) 86,786 (220,650) (619,239)
Other financing sources (uses):
Transfers in - - - -
Transfers out - - - -
Total other financing
sources (uses)- - - -
Net change in fund balance (1,642,357) 86,786 (220,650) (619,239)
Fund balance, beginning of year 2,241,597 13,698 391,593 616,787
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated 2,241,597 13,698 391,593 616,787
Fund balance (deficit),
end of year 599,240$ 100,484$ 170,943$ (2,452)$
(Continued)
Capital Projects Funds
175
Page 379 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Fleet Replacement
Info Tech
Replacement
Affordable
Housing
Transportation
Impact Fee
Revenues:
Use of money and property -$ -$ 79,429$ 301,828$
Subventions and grants 15,000 392,317 (600) -
Charges for services - 137,638 219,117 1,496,794
Property tax - - - -
Other revenues 98,173 8,102 - -
Total revenues 113,173 538,057 297,946 1,798,622
Expenditures:
Current:
Public safety - - - -
Transportation - - - -
Community development - - - -
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - 615,364 - -
Transportation - - - 459,342
Leisure, cultural and social services - - - -
Community development 990,520 - - -
Total expenditures 990,520 615,364 - 459,342
Excess (deficiency) of revenues over
(under) expenditures (877,347) (77,307) 297,946 1,339,280
Other financing sources (uses):
Transfers in 783,000 1,446,656 - -
Transfers out - (302,000) (207,000) (280,000)
Total other financing
sources (uses)783,000 1,144,656 (207,000) (280,000)
Net change in fund balance (94,347) 1,067,349 90,946 1,059,280
Fund balance, beginning of year 2,583,394 2,982,639 8,540,730 6,100,163
Prior year restatements - - 70,655 -
Fund balance (deficit),
beginning of year, as restated 2,583,394 2,982,639 8,611,385 6,100,163
Fund balance (deficit),
end of year 2,489,047$ 4,049,988$ 8,702,331$ 7,159,443$
(Continued)
Capital Projects Funds
176
Page 380 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
Infrastructure
Parkland
Development
Impact Fee-
Citywide OASP Park MASP Park
Revenues:
Use of money and property -$ 67,166$ 102,398$ 162,040$
Subventions and grants 105,106 - - -
Charges for services - 200,304 84,355 -
Property tax - - - -
Other revenues - - - -
Total revenues 105,106 267,470 186,753 162,040
Expenditures:
Current:
Public safety - - - -
Transportation - - - -
Community development - - - -
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation 28 - - -
Leisure, cultural and social services - - 245,981 -
Community development - - - -
Total expenditures 28 - 245,981 -
Excess (deficiency) of revenues over
(under) expenditures 105,078 267,470 (59,228) 162,040
Other financing sources (uses):
Transfers in 5,671,972 - - -
Transfers out (105,106) - - -
Total other financing
sources (uses)5,566,866 - - -
Net change in fund balance 5,671,944 267,470 (59,228) 162,040
Fund balance, beginning of year 13,215,383 1,246,760 2,116,014 3,292,560
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated 13,215,383 1,246,760 2,116,014 3,292,560
Fund balance (deficit),
end of year 18,887,327$ 1,514,230$ 2,056,786$ 3,454,600$
(Continued)
Capital Projects Funds
177
Page 381 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
OASP
Transportation
Impact Fee Fire Impact Fee Police Impact Fee
Park Improvement
Impact Fee-
Citywide
Revenues:
Use of money and property 82,225$ 22,402$ 26,296$ 106,955$
Subventions and grants - - - -
Charges for services 309,330 90,290 165,112 133,286
Property tax - - - -
Other revenues - - - -
Total revenues 391,555 112,692 191,408 240,241
Expenditures:
Current:
Public safety - - - -
Transportation - - - -
Community development - - - -
Debt service:
Principal - - - -
Interest and fiscal charges - - - -
Capital:
General Government - - - -
Transportation - - - -
Leisure, cultural and social services - - - 173,120
Community development - - - -
Total expenditures - - - 173,120
Excess (deficiency) of revenues over
(under) expenditures 391,555 112,692 191,408 67,121
Other financing sources (uses):
Transfers in - - - -
Transfers out - - - -
Total other financing
sources (uses)- - - -
Net change in fund balance 391,555 112,692 191,408 67,121
Fund balance, beginning of year 1,473,245 398,564 448,419 2,176,585
Prior year restatements - - - -
Fund balance (deficit),
beginning of year, as restated 1,473,245 398,564 448,419 2,176,585
Fund balance (deficit),
end of year 1,864,800$ 511,256$ 639,827$ 2,243,706$
(Continued)
Capital Projects Funds
178
Page 382 of 525
City of San Luis Obispo, California
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended June 30, 2025
SLR
Transportation
Impact Fee
Public Safety
Equipment
Replacement Fund Debt Service
Total Nonmajor
Governmental
Funds
Revenues:
Use of money and property 119,282$ -$ 2$ 1,371,611$
Subventions and grants - - - 3,498,471
Charges for services 329,502 - - 5,800,980
Property tax - - - 539,453
Other revenues - - - 758,651
Total revenues 448,784 - 2 11,969,166
Expenditures:
Current:
Public safety - 307,329 - 463,337
Transportation - - - 566,788
Community development - - - 2,485,698
Debt service:
Principal - - 1,098,975 1,098,975
Interest and fiscal charges - - 634,814 634,814
Capital:
General Government - - - 615,364
Transportation - - - 1,977,423
Leisure, cultural and social services - - - 2,481,703
Community development - - - 990,520
Total expenditures - 307,329 1,733,789 11,314,622
Excess (deficiency) of revenues over
(under) expenditures 448,784 (307,329) (1,733,787) 654,544
Other financing sources (uses):
Transfers in - 387,334 1,757,889 10,359,699
Transfers out - - - (2,959,717)
Total other financing
sources (uses)- 387,334 1,757,889 7,399,982
Net change in fund balance 448,784 80,005 24,102 8,054,526
Fund balance, beginning of year 2,157,823 428,971 (158,557) 55,769,033
Prior year restatements - - 91,366 290,964
Fund balance (deficit),
beginning of year, as restated 2,157,823 428,971 (67,191) 56,059,997
Fund balance (deficit),
end of year 2,606,607$ 508,976$ (43,089)$ 64,114,523$
Capital Projects Funds
179
Page 383 of 525
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Charges for services
Assessments 280,900$ 280,900$ 319,279$ 38,379$
Total Revenues 280,900 280,900 319,279 38,379
Expenditures:
Current
Community development 280,900 280,900 185,341 95,559
Total Expenditures 280,900 280,900 185,341 95,559
Excess of Revenues Over Expenditures - - 133,938 133,938
Net Change in Fund Balance - - 133,938 133,938
Fund Balance, Beginning of Year (133,562) (133,562) (133,562) -
Fund Balance, End of Year (133,562)$ (133,562)$ 376$ 133,938$
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Downtown Business Improvement District Fund
Budget
180
Page 384 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Subventions and grants 90,000$ 90,000$ 66,918$ (23,082)$
Total Revenues 90,000 90,000 66,918 (23,082)
Excess of Revenues Over Expenditures 90,000 90,000 66,918 (23,082)
Other Financing Uses:
Operating transfers out (90,000) (90,000) (90,000) -
Net Change in Fund Balance - - (23,082) (23,082)
Fund Balance, Beginning of Year 33,132 33,132 33,132 -
Fund Balance, End of Year 33,132$ 33,132$ 10,050$ (23,082)$
Transportation Development Act (TDA)
Budget
181
Page 385 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 56,468$ 56,468$
Assessments 2,117,251 2,117,251 2,248,296 131,045
Total Revenues 2,117,251 2,117,251 2,304,764 187,513
Expenditures:
Current
Community development 2,103,944 2,223,194 2,152,578 70,616
Total Expenditures 2,103,944 2,223,194 2,152,578 70,616
Excess of Revenues Over (Under) Expenditures 13,307 (105,943) 152,186 258,129
Other Financing Uses:
Operating transfers out (43,545) (42,345) (44,914) (2,569)
Net Change in Fund Balance (30,238) (148,288) 107,272 255,560
Fund Balance, Beginning of Year 1,523,656 1,523,656 1,523,656 -
Fund Balance, End of Year 1,493,418$ 1,375,368$ 1,630,928$ 255,560$
Tourism Business Improvement District Fund
Budget
182
Page 386 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Subventions and grants 1,419,353$ 1,419,353$ 1,405,863$ (13,490)$
Total Revenues 1,419,353 1,419,353 1,405,863 (13,490)
Excess of Revenues Over Expenditures 1,419,353 1,419,353 1,405,863 (13,490)
Other Financing Uses:
Operating transfers out (1,419,353) (1,419,353) (1,405,863) 13,490
Net Change in Fund Balance - - - -
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ -$ -$
Gas Tax
Budget
183
Page 387 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Subventions and grants -$ -$ 33,368$ 33,368$
Total Revenues - - 33,368 33,368
Excess of Revenues Over (Under) Expenditures - - 33,368 33,368
Other Financing Uses:
Operating transfers out - - (33,367) (33,367)
Net Change in Fund Balance - - 1 1
Fund Balance, Beginning of Year, as restated 1,247,062 1,247,062 1,247,062 -
Fund Balance, End of Year 1,247,062$ 1,247,062$ 1,247,063$ 1$
Community Development Block Grant (CDBG) Fund
Budget
184
Page 388 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Subventions and grants 129,250$ 129,250$ 151,957$ 22,707$
Charges for services 2,142 2,142 288 (1,854)
Other revenues 1,520 1,520
Total Revenues 131,392 131,392 156,012 24,620
Expenditures:
Public Safety - 16,250 156,008 (139,758)
Total Expenditures - 16,250 156,008 (139,758)
Excess of Revenues Over (Under) Expenditures 131,392 115,142 4 (115,138)
Net Change in Fund Balance 131,392 115,142 4 (115,138)
Fund Balance, Beginning of Year 50,763 50,763 50,763 -
Fund Balance, End of Year 182,155$ 165,905$ 50,767$ (115,138)$
Budget
Law Enforcement Grants Fund
185
Page 389 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 76,041$ 76,041$
Other revenues 15,000 15,000 50,486 35,486
Total Revenues 15,000 15,000 126,527 111,527
Expenditures:
Capital Projects 116,131 742,212 303,142 439,070
Total Expenditures 116,131 742,212 303,142 439,070
Excess of Revenues Over (Under) Expenditures (101,131) (727,212) (176,615) 550,597
Other Financing Uses:
Operating transfers in - 300,000 312,848 12,848
Operating transfers out - (104,950) (104,950) -
Total Other Financing Uses - 195,050 207,898 12,848
Net Change in Fund Balance (101,131) (832,162) 31,283 563,445
Fund Balance, Beginning of Year 1,526,588 1,526,588 1,526,588 -
Fund Balance, End of Year 1,425,457$ 694,426$ 1,557,871$ 563,445$
Budget
Public Art Contributions Fund
186
Page 390 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 21,063$ 21,063$
Property tax - - 539,453 539,453
Other revenues 523,648 523,648 - (523,648)
Total Revenues 523,648 523,648 560,516 36,868
Expenditures:
Community Development 199,000 244,884 50,435 194,449
Total Expenditures 199,000 244,884 50,435 194,449
Excess of Revenues Over (Under) Expenditures 324,648 278,764 510,081 (157,581)
Other Financing Uses:
Operating transfers out (110,814) 110,814 (386,517) (497,331)
Net Change in Fund Balance 213,834 389,578 123,564 (654,912)
Fund Balance, Beginning of Year 368,032 368,032 368,032 -
Fund Balance, End of Year 581,866$ 757,610$ 491,596$ (654,912)$
Budget
Avila Ranch CFD
187
Page 391 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 3,107$ 3,107$
Subventions and grants 1,092,000 1,092,000 1,328,542 236,542
Total Revenues 1,092,000 1,092,000 1,331,649 239,649
Expenditures:
Capital Projects 1,311,791 1,328,176 1,283,811 44,365
Total Expenditures 1,311,791 1,328,176 1,283,811 44,365
Excess of Revenues Over (Under) Expenditures (219,791) (236,176) 47,838 284,014
Net Change in Fund Balance (219,791) (236,176) 47,838 284,014
Fund Balance, Beginning of Year 283,086 283,086 283,086 -
Fund Balance, End of Year 63,295$ 46,910$ 330,924$ 284,014$
Budget
SB1 Road Repair Fund
188
Page 392 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 10,283$ 10,283$
Charges for services - - 28,247 28,247
Total Revenues - - 38,530 38,530
Expenditures:
Community Development 25,000 25,000 500 24,500
Total Expenditures 25,000 25,000 500 24,500
Excess of Revenues Over (Under) Expenditures (25,000) (25,000) 38,030 63,030
Net Change in Fund Balance (25,000) (25,000) 38,030 63,030
Fund Balance, Beginning of Year 176,483 176,483 176,483 -
Fund Balance, End of Year 151,483$ 151,483$ 214,513$ 63,030$
Budget
SB1186 CASP Certify
189
Page 393 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 18,058$ 18,058$
Total Revenues - - 18,058 18,058
Excess of Revenues Over (Under) Expenditures - - 18,058 18,058
Net Change in Fund Balance - - 18,058 18,058
Fund Balance, Beginning of Year 427,425 427,425 427,425 -
Fund Balance, End of Year 427,425$ 427,425$ 445,483$ 18,058$
Affordable Housing BEGIN Loan Fund
Budget
190
Page 394 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Other revenues - - 40,000 40,000
Total Revenues - - 40,000 40,000
Expenditures:
Community Development - - 40,000 (40,000)
Total Expenditures - - 40,000 (40,000)
Excess of Revenues Over (Under) Expenditures - - - -
Net Change in Fund Balance - - - -
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ -$ -$
Avila Ranch DPA Fund
Budget
191
Page 395 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 9,190$ 9,190$
Other revenues - - 323,882 323,882
Total Revenues - - 333,072 333,072
Expenditures:
Community Development - - 56,844 (56,844)
Total Expenditures - - 56,844 (56,844)
Excess of Revenues Over (Under) Expenditures - - 276,228 276,228
Net Change in Fund Balance - - 276,228 276,228
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ 276,228$ 276,228$
Opioid Settlement Fund
Budget
192
Page 396 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 8,667$ 8,667$
Subventions and grants - - - -
Charges for services - - - -
Other revenues - - - -
Total Revenues - - 8,667 8,667
Excess of Revenues Over (Under) Expenditures - - 8,667 8,667
Net Change in Fund Balance - - 8,667 8,667
Fund Balance, Beginning of Year 52,440 52,440 52,440 -
Fund Balance, End of Year 52,440$ 52,440$ 61,107$ 8,667$
Budget
Asset Forfeiture Available Fund
193
Page 397 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 3,231$ 3,231$
Subventions and grants - - - -
Charges for services - - - -
Other revenues - - 167,623 167,623
Total Revenues - - 170,854 170,854
Excess of Revenues Over (Under) Expenditures - - 170,854 170,854
Net Change in Fund Balance - - 170,854 170,854
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ 170,854$ 170,854$
SLR PAYGO City Share
Budget
194
Page 398 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 270$ 270$
Subventions and grants - - - -
Charges for services - - - -
Other revenues - - 35,651 35,651
Total Revenues - - 35,921 35,921
Excess of Revenues Over (Under) Expenditures - - 35,921 35,921
Net Change in Fund Balance - - 35,921 35,921
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ 35,921$ 35,921$
Code Enforcement Abatement Fund
Budget
195
Page 399 of 525
City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 289$ 289$
Total Revenues - - 289 289
Excess of Revenues Over (Under) Expenditures - - 289 289
Net Change in Fund Balance - - 289 289
Fund Balance, Beginning of Year - - - -
Fund Balance, End of Year -$ -$ 289$ 289$
Police Evidence Available Fund
Budget
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City of San Luis Obispo, California
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
For the Fiscal Year Ended June 30, 2025
Variance with
Final Budget
Positive
Original Final Actual (Negative)
Revenues:
Use of money and property -$ -$ 2$ 2$
Total Revenues - - 2 2
Expenditures:
Principal 1,144,989 1,144,989 1,098,975 46,014
Interest and fiscal charges 612,900 612,900 634,814 (21,914)
Total Expenditures 1,757,889 1,757,889 1,733,789 24,100
Excess of Revenues Over (Under) Expenditures (1,757,889) (1,757,889) (1,733,787) 24,102
Other Financing Uses:
Operating transfers in 1,757,889 1,757,889 1,757,889 -
Operating transfers out - - - -
Total other Financing Uses:1,757,889 1,757,889 1,757,889 -
Net Change in Fund Balance - - 24,102 24,102
Fund Balance, Beginning of Year (67,191) (67,191) (67,191) -
Fund Balance, End of Year (67,191)$ (67,191)$ (43,089)$ 24,102$
Budget
Debt Service Fund
197
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198
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City of San Luis Obispo, California
Custodial Funds
For the Fiscal Year Ended June 30, 2025
The City of San Luis Obispo has established the following agency funds,which are used to account for funds held
by the City as an agent for private donations and programs operated jointly with other local agencies:
Whale Rock Fund.This fund was established to account for the financial activities of the Whale Rock Commission,
a joint venture providing water service to the City,the California Polytechnic State University,and the California
Men's Colony.
Jack House Fund .This fund was established to account for the financial activities of the Jack House Committee,
which includes the rehabilitation and use of a use of the historic Jack House property.
Hazardous Materials Task Force Fund .This fund was established to account for the financial activities of the
County task force.
General Agency Fund.This fund was established to account for a broad category of funds,including donations,
provided to the City to be utilized for specific purposes.
Boysen Ranch Conservation Easement Fund .This fund was established to account for contributions toward
obtaining a conservation easement on the Boysen Ranch property.
Cable Television Public,Educational and Government Funds (PEG)for the City of San Luis Obispo,San Luis
Coastal Unified School District (SLCUSD)and San Luis Obispo County Public Access,Inc.Public Access
Television (PAT).These funds account for collections by Charter Communications from its customers for PEG
access equipment and facilities.The City of San Luis Obispo,SLCUSD and PAT annually receive equal shares of
collections, restricted for approved uses as stipulated in the cable franchise agreement.
San Luis Ranch CFD Fund .This fund was established to account for the financial activities of the San Luis Ranch
Community Facilities District (CFD).The CFD is the City's first Mello-Roos district.Property taxes collected on
properties within the CFD will be used to pay for debt service on the related infrastructure constructed within the
district.
Avila Ranch Private Reimbursement Agreement Fund .This fund has been established to account for activities
related to reimbursements between private property owners/developers.The City facilitates payment between the
private parties.
Asset Forfeiture Pending Fund .This fund has been established to account for cash related to unresolved asset
forfeiture cases.
SWAT Task Force Fund .This fund has been established to account for activities related to the Regional SWAT
Task Force. The City provides accounting services for the Task Force.
Police Evidence Pending Fund .This fund has been established to account for cash seized as evidence while
awaiting criminal case resolution.
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City of San Luis Obispo
Combining Statement of Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
Hazardous General Boysen Ranch
Whale Jack Materials Task Agency Conservation
Rock Fund House Fund Force Fund Fund Easement
ASSETS
Cash and investments 6,284,413$ 21,618$ 171,286$ 16,619,026$ 425,769$
Receivables:
Accounts 409,558 - - - -
Interest 29,615 101 805 - 1,992
Capital assets 687,561 - - - -
Total assets 7,411,147 21,719 172,091 16,619,026 427,761
LIABILITIES
Accounts payable 94,014 - - 141,162 -
Compensated absence 48,661 - - - -
Accrued Salaries 18,397 - - - -
Other liabilities 2,000 - - - -
Total liabilities 163,072 - - 141,162 -
NET POSITION
Restricted for
Individuals, organizations, and
other governments 7,248,075 21,719 172,091 16,477,864 427,761
Total net position 7,248,075$ 21,719$ 172,091$ 16,477,864$ 427,761$
(Continued)
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City of San Luis Obispo
Combining Statement of Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
PEG City of PEG San Luis Ranch Avila Ranch Private
San Luis Obispo SLCUSD CFD Reimbursement Agreement
ASSETS
Cash and investments 181,366$ 82,644$ 13,469,834$ 479,549$
Receivables:
Accounts 15,758 4 11,637 -
Interest 984 232 4,651 -
Capital assets - - - -
Total assets 198,108 82,880 13,486,122 479,549
LIABILITIES
Accounts payable 8,713 - 945 -
Compensated absence - - - -
Accrued Salaries - - - -
Other liabilities - 8,713 - -
Total liabilities 8,713 8,713 945 -
NET POSITION
Restricted for
Individuals, organizations, and other
governments 189,395 74,167 13,485,177 479,549
Total net position 189,395$ 74,167$ 13,485,177$ 479,549$
(Continued)
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City of San Luis Obispo
Combining Statement of Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
Total
Asset SWAT Task Police Evidence Custodial
Forfeiture Pending Force Fund Pending Fund Funds
ASSETS
Cash and investments 18,827$ 30,583$ 72,606$ 37,857,521$
Receivables:
Accounts - - - 436,957
Interest 90 144 86 38,700
Capital assets - - - 687,561
Total assets 18,917 30,727 72,692 39,020,739
LIABILITIES
Accounts payable - - - 244,834
Compensated absence - - - 48,661
Accrued Salaries - - - 18,397
Other liabilities - - - 10,713
Total liabilities - - - 322,605
NET POSITION
Restricted for
Individuals, organizations, and other
governments 18,917 30,727 72,692 38,698,134
Total net position 18,917$ 30,727$ 72,692$ 38,698,134$
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Hazardous General Boysen Ranch
Whale Jack Materials Task Agency Conservation
Rock Fund House Fund Force Fund Fund Easement
ADDITIONS:
Charges for services 1,310,027$ -$ -$ -$ -$
Other revenue 1,505,202 5 69,745 896,926 -
Use of money and property 314,858 1,019 9,920 - 20,157
Total additions 3,130,087 1,024 79,665 896,926 20,157
DEDUCTIONS:
Administration expenses 252,099 - - -
Contractual services 1,695,310 - - 5,023
Materials and supplies 86,748 - 98,249 - -
Use of developer deposits - - - 742,929 -
Depreciation 63,283 - - - -
Total deductions 2,097,440 - 98,249 742,929 5,023
Net increase (decrease) in
fiduciary net position 1,032,647 1,024 (18,584) 153,997 15,134
NET POSITION:
Beginning of year 6,215,428 20,695 190,675 16,533,673 412,627
Prior Period Adjustment - - - (209,806) -
Beginning of year, as restated 6,215,428 20,695 190,675 16,323,867 412,627
End of year 7,248,075$ 21,719$ 172,091$ 16,477,864$ 427,761$
(Continued)
City of San Luis Obispo
Combining Statement of Changes in Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
203
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City of San Luis Obispo
Combining Statement of Changes in Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
PEG City of PEG San Luis Ranch Avila Ranch Private
San Luis Obispo SLCUSD CFD Reimbursement Agreement
ADDITIONS:
Charges for services -$ -$ -$ -$
Other revenue 33,003 33,003 1,345,180 479,549
Use of money and property 8,729 2,223 566,744 -
Total additions 41,732 35,226 1,911,924 479,549
DEDUCTIONS:
Administration expenses - - 1,354,427 -
Contractual services - - - -
Materials and supplies - - - -
Use of developer deposits - - - -
Depreciation - - - -
Total deductions - - 1,354,427 -
Net increase (decrease) in fiduciary net
position 41,732 35,226 557,497 479,549
NET POSITION:
Beginning of year, 147,663 38,941 12,927,680 -
Prior Period Adjustment - - - -
Beginning of year, as restated 147,663 38,941 12,927,680 -
End of year 189,395$ 74,167$ 13,485,177$ 479,549$
(Continued)
204
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City of San Luis Obispo
Combining Statement of Changes in Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2025
Total
Asset SWAT Task Police Evidence Custodial
Forfeiture Pending Force Fund Pending Fund Funds
ADDITIONS:
Charges for services -$ -$ -$ 1,310,027$
Other revenue 23,673 30,625 - 4,416,911
Use of money and property 440 689 274 925,053
Total additions 24,113 31,314 274 6,651,991
DEDUCTIONS:
Administration expenses - 587 - 1,607,113
Contractual services 13,640 - - 1,713,973
Materials and supplies - - - 184,997
Use of developer deposits - - - 742,929
Depreciation - - - 63,283
Total deductions 13,640 587 - 4,312,295
Net increase (decrease) in fiduciary net
position 10,473 30,727 274 2,339,696
NET POSITION:
Beginning of year, - - - 36,487,382
Prior Period Adjustment 8,444 - 72,418 (128,944)
Beginning of year, as restated 8,444 - 72,418 36,358,438
End of year 18,917$ 30,727$ 72,692$ 38,698,134$
205
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STATISTICAL SECTION (UNAUDITED)
207
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208
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City of San Luis Obispo, California
Statistical Section Overview
For the Fiscal Year Ended June 30, 2025
This part of the City of San Luis Obispo’s annual comprehensive financial report presents detailed information as a
context for understanding what the information in the financial statements, note disclosures, and required
supplementary information says about the government’s overall financial health.
Contents
Financial Trends – Schedules 1-6 . These schedules contain trend information to help the reader understand how
the City’s financial performance and well-being have changed over time.
Revenue Capacity – Schedules 7-13 . These schedules contain information to help the reader assess the
government’s most significant local revenue sources, sales and property taxes.
Debt Capacity – Schedules 14-19 . These schedules present information to help the reader assess the affordability of
the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future.
Demographic and Economic Information – Schedules 20-22 . These schedules offer demographic and economic
indicators to help the reader understand the environment within which the government’s financial activities take
place.
Operating Information – Schedules 23-26 . These schedules contain service and infrastructure data to help the
reader understand how the information in the City’s financial report relates to the services the government provides
209
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Governmental activities:
Net investment in capital assets 163,449,992$ 165,100,426$ 171,472,251$ 174,431,254$ 177,335,648$ 184,387,289$ 193,984,593$ 205,324,234$ 228,447,288$ 241,392,407$
Restricted 2,762,387 2,268,499 421,954 20,458,677 29,901,136 35,603,121 41,770,187 43,626,006 35,753,131 38,939,635
Unrestricted (49,031,893) (41,496,841) (49,909,657) (72,041,172) (73,806,116) (62,369,688) (57,458,111) (29,876,424) (14,403,912) 3,447,348
Total governmental activities net position 117,180,486$ 125,872,084$ 121,984,548$ 122,848,759$ 133,430,668$ 157,620,722$ 178,296,669$ 219,073,816$ 249,796,507$ 283,779,390$
Business-type activities:
Net investment in capital assets 128,390,611$ 131,149,516$ 136,694,402$ 139,659,544$ 149,617,018$ 160,750,886$ 157,728,990$ 170,471,787$ 183,458,877$ 200,340,066$
Restricted 2,278,392 2,276,526 1,558,795 500,645 4,037,611 2,493,859 2,684,781 1,653,225 10,976,119 6,470,313
Unrestricted 49,495,220 53,421,102 50,866,147 57,379,689 53,983,005 53,159,080 79,970,715 88,160,609 81,095,190 94,710,986
Total business-type activities net position 180,164,223$ 186,847,144$ 189,119,344$ 197,539,878$ 207,637,634$ 216,403,825$ 240,384,486$ 260,285,621$ 275,530,186$ 301,521,365$
Primary government (City wide totals):
Net investment in capital assets 291,840,603$ 296,249,942$ 308,166,653$ 314,090,798$ 326,952,666$ 345,138,175$ 351,713,583$ 375,796,021$ 411,906,165$ 441,732,473$
Restricted 5,040,779 4,545,025 1,980,749 20,959,322 33,938,747 38,096,980 44,454,968 45,279,231 46,729,250 45,409,948
Unrestricted 463,327 11,924,261 956,490 (14,661,483) (19,823,111) (9,210,608) 22,512,604 58,284,185 66,691,278 98,158,334
Total primary government net position 297,344,709$ 312,719,228$ 311,103,892$ 320,388,637$ 341,068,302$ 374,024,547$ 418,681,155$ 479,359,437$ 525,326,693$ 585,300,755$
Schedule 1
City of San Luis Obispo, California
Net Assets by Component
Last Ten Fiscal Years
(Accrual basis of accounting)
$-
$100,000,000
$200,000,000
$300,000,000
$400,000,000
$500,000,000
Governmental vs Business-type Net Position
Total business-type activities net position
Total governmental activities net position
$(100,000,000)
$-
$100,000,000
$200,000,000
$300,000,000
$400,000,000
$500,000,000
Net Position by Component
Net investment in capital assets
Restricted
Unrestricted
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Expenses:
Governmental activities:
Public safety 29,318,821$ 31,806,692$ 42,097,557$ 34,320,108$ 34,670,383$ 35,226,779$ 41,132,177$ 26,828,837$ 43,148,712$ 47,552,699$
Transportation 8,792,028 9,668,840 9,229,042 7,546,278 7,416,335 8,137,479 10,395,516 10,052,069 17,740,407 12,159,073
Culture and recreation 9,808,545 9,824,262 11,125,792 9,469,520 10,063,304 11,122,003 12,407,720 11,552,865 12,871,004 13,669,496
Community development 12,900,275 14,656,604 13,457,993 12,573,953 11,882,018 11,918,019 15,506,092 14,768,484 19,527,448 16,190,977
General Government - - - 22,429,785 22,058,724 17,276,491 20,982,321 25,628,303 22,777,642 20,980,453
Capital Outlay - - - - - - - - - 3,429,399
Interest on long-term debt 1,351,468 1,170,984 1,488,183 702,885 839,661 731,045 699,284 681,023 615,966 569,642
Total governmental activities expenses 62,171,137 67,127,382 77,398,567 87,042,529 86,930,425 84,411,816 101,123,110 89,511,581 116,681,179 114,551,739
Business-type activities:
Water 18,136,120 19,069,967 19,523,736 20,986,430 22,914,013 21,469,967 20,892,863 22,152,285 25,666,319 28,092,545
Sewer 10,842,451 11,683,262 14,158,612 13,967,717 13,100,905 15,064,551 12,576,058 13,417,264 22,831,476 16,792,057
Parking 3,900,052 3,791,493 4,098,840 4,088,681 4,145,364 4,057,242 4,517,125 5,063,501 8,962,908 8,617,493
Transit 4,088,423 4,076,871 4,355,103 4,320,976 4,384,344 4,023,536 3,851,264 4,482,763 5,352,380 6,358,316
Total business-type activities expenses 36,967,046 38,621,593 42,136,291 43,363,804 44,544,626 44,615,296 41,837,310 45,115,813 62,813,083 59,860,411
Total primary government expenses 99,138,183$ 105,748,975$ 119,534,858$ 130,406,333$ 131,475,051$ 129,027,112$ 142,960,420$ 134,627,394$ 179,494,262$ 174,412,150$
Program Revenues:
Governmental activities:
Charges for services:
Public safety 1,673,800$ 1,771,383$ 1,881,725$ 1,633,223$ 3,045,294$ 3,991,193$ 3,197,692$ 2,847,705$ 3,378,182$ 4,272,202$
Transportation 1,691,757 1,793,010 1,669,563 2,399,692 531,424 91,509 636,874 955,012 1,157,342 438,239
Culture and recreation 2,048,780 3,501,837 3,487,225 4,078,539 2,508,565 3,430,224 4,046,439 4,234,538 4,761,048 5,298,964
Community development 7,974,880 8,144,128 7,355,831 9,941,951 11,812,417 15,929,420 10,509,106 10,164,525 9,717,278 9,135,208
General Government - - - 1,391,940 760,606 654,039 530,775 734,991 801,522 930,439
Operating grants and contributions 2,667,058 2,488,706 4,015,502 2,990,211 4,828,837 3,601,973 3,647,813 5,331,657 15,156,040 6,363,136
Capital grants and contributions 9,355,707 40,531 39,781 47,234 2,504,722 5,688,200 1,531,157 200,933 1,299,231 5,586,809
Total governmental activities program revenues 25,411,982 17,739,595 18,449,627 22,482,790 25,991,865 33,386,558 24,099,856 24,469,361 36,270,643 32,024,997
Business-type activities:
Charges for services:
Water 19,884,850$ 20,180,931$ 22,202,069$ 24,026,385$ 25,666,777$ 28,340,076$ 29,894,129$ 27,720,676$ 31,394,962$ 34,356,427$
Sewer 16,460,140 16,272,533 16,753,094 18,674,547 19,042,384 21,501,546 23,642,048 22,341,314 23,302,912 24,096,372
Parking 7,408,729 4,666,970 5,226,780 5,443,038 3,293,941 2,567,908 4,890,317 6,022,372 9,663,683 8,307,559
Transit 659,471 666,296 703,451 776,808 633,566 331,352 713,777 809,969 1,003,116 990,738
Operating grants and contributions 2,888,820 4,180,386 3,099,618 3,259,975 4,712,832 3,742,594 5,156,782 7,355,896 6,762,934 8,054,586
Capital grants and contributions - - - - - - - - - 4,712,879
Total business-type activities programs revenues 47,302,010 45,967,116 47,985,012 52,180,753 53,349,500 56,483,476 64,297,053 64,250,227 72,127,607 80,518,561
Total primary government program revenues 72,713,992$ 63,706,711$ 66,434,639$ 74,663,543$ 79,341,365$ 89,870,034$ 88,396,909$ 88,719,588$ 108,398,250$ 112,543,558$
Net Revenues (Expenses):
Governmental activities (36,759,155)$ (49,387,787)$ (58,948,940)$ (64,559,739)$ (60,938,560)$ (51,025,258)$ (77,023,254)$ (65,042,220)$ (80,410,536)$ (82,526,742)$
Business-type activities 10,334,964 7,345,523 5,848,721 8,816,949 8,804,874 11,868,180 22,459,743 19,134,414 9,314,524 20,658,150
Total primary government (26,424,191)$ (42,042,264)$ (53,100,219)$ (55,742,790)$ (52,133,686)$ (39,157,078)$ (54,563,511)$ (45,907,806)$ (71,096,012)$ (61,868,592)$
Continued
Schedule 2
City of San Luis Obispo, California
Changes in Net Position, Last Ten Fiscal Years
(Accrual Basis of Accounting)
211
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
General Revenues and Other Changes in Net Position:
Governmental activities:
Sales and use taxes 24,676,377$ 24,068,665$ 24,559,570$ 26,444,775$ 24,125,439$ 32,847,453$ 51,419,561$ 52,374,199$ 52,883,260$ 53,837,371$
Property taxes 10,186,858 10,756,477 11,425,510 12,238,357 13,301,736 14,197,869 14,716,412 15,635,545 16,381,159 17,240,694
Transient occupancy tax 7,127,756 7,381,989 7,514,289 8,061,087 6,325,841 6,960,035 10,650,762 11,037,037 11,063,012 11,417,888
Utility users tax 5,413,720 5,539,407 5,627,356 4,919,892 5,439,144 5,225,979 5,338,325 6,904,194 6,301,505 7,501,436
Property tax in-lieu of vehicle license fees 4,113,244 4,353,912 4,637,253 4,961,080 5,290,215 5,660,661 5,994,592 6,283,397 6,815,975 7,273,431
Other taxes and fees 4,800,592 3,929,377 5,006,594 4,332,557 4,883,677 5,578,944 5,800,333 7,216,335 7,209,793 7,601,061
Investment earnings 825,760 997,995 164,434 1,618,354 3,368,951 435,818 (1,638,993) 2,350,922 6,473,385 6,691,998
Miscellaneous and other - - - 146,579 1,001,369 1,019,626 1,213,401 1,774,126 1,369,106 1,439,962
Prior period adjustment - - - - - 745,285 - - -
Transfers 1,436,048 1,051,563 1,198,027 2,456,035 1,889,900 1,992,911 1,685,314 2,243,612 2,636,032 3,214,820
Total governmental activities 58,580,355 58,079,385 60,133,033 65,178,716 65,626,272 74,664,581 95,179,707 105,819,367 111,133,227 116,218,661
Business-type activities
Investment earnings 845,906$ 182,261$ 320,471$ 2,516,216$ 2,880,634$ 577,250$ (1,207,118)$ 2,618,340$ 8,367,903$ 8,639,215$
Income from investment in joint venture 239,200 206,700 209,300 (25,469) 153,949 519,677 585,101 391,993 198,170 -
Prior period adjustment - - - - - (907,350) - - -
Transfers (1,436,048) (1,051,563) (1,198,027) (2,456,035) (1,889,900) (1,992,911) (1,685,314) (2,243,612) (2,636,032) (3,214,820)
Total business-type activities (350,942) (662,602) (668,256) 34,712 1,144,683 (1,803,334) (2,307,331) 766,721 5,930,041 5,424,395
Total primary government 58,229,413$ 57,416,783$ 59,464,777$ 65,213,428$ 66,770,955$ 72,861,247$ 92,872,376$ 106,586,088$ 117,063,268$ 121,643,056$
Change in net position:
Governmental activities 21,821,200$ 8,691,598$ 1,184,093$ 618,977$ 4,687,712$ 23,639,323$ 18,156,453$ 40,777,147$ 30,722,691$ 33,691,919$
Business-type activities 9,984,022 6,682,921 5,180,465 8,851,661 9,949,557 10,064,846 20,152,412 19,901,135 15,244,565 26,082,545
Total primary government 31,805,222$ 15,374,519$ 6,364,558$ 9,470,638$ 14,637,269$ 33,704,169$ 38,308,865$ 60,678,282$ 45,967,256$ 59,774,464$
Changes in Net Position, Last Ten Fiscal Years
(Accrual Basis of Accounting)
Continued
Schedule 2
City of San Luis Obispo, California
212
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Fiscal Sales Local Property Transient Utility Property Franchise Business Other
Year and Use Sales (Note 2)(Note 1)Occupancy Users in-lieu of VLF Fees Tax Taxes Total
2015-16 17,498,218 7,178,159 10,186,858 7,127,756 5,413,720 4,113,244 1,537,922 2,491,516 771,154 56,318,547
2016-17 16,737,005 7,331,660 10,756,477 7,381,989 5,539,407 4,353,912 1,557,128 2,372,249 737,826 56,767,653
2017-18 17,055,085 7,504,485 11,425,510 7,514,289 5,627,356 4,637,253 1,597,655 2,663,686 745,253 58,770,572
2018-19 18,119,545 8,325,230 12,238,357 8,061,087 4,919,892 4,961,080 1,428,296 2,630,499 273,762 60,957,748
2019-20 16,571,064 7,554,375 12,913,661 6,325,841 5,439,144 5,290,215 1,888,414 2,995,263 388,075 59,366,052
2020-21 20,067,740 12,779,713 14,197,869 6,960,035 5,225,979 5,660,661 1,796,829 3,782,115 425,136 70,896,077
2021-22 22,247,303 29,172,258 14,716,412 10,650,762 5,338,325 5,994,592 1,978,295 2,823,163 998,875 93,919,985
2022-23 21,865,468 30,508,731 15,635,545 11,037,037 6,904,194 6,283,397 2,349,603 3,281,010 1,585,722 99,450,707
2023-24 22,285,972 30,597,288 16,381,159 11,063,012 6,301,505 6,815,975 2,366,286 2,942,425 1,901,082 100,654,704
2024-25 22,911,086 30,926,285 17,240,694 11,417,888 7,501,436 7,273,431 2,622,351 3,138,272 1,840,438 104,871,881
Notes:
1)Property tax revenues are presented net of SB2557 County administrative fees (approximately 3% of total property tax revenues).
The City has elected to receive its property tax revenues based on the Teeter Plan method of collection whereby the
County remits 100% of taxes levied, pursues collection and retains any delinquent taxes and related penalties and interest.
2)In November 2014 voters in San Luis Obispo reauthorized the local half-percent sales and use tax measure (Measure G) .
In November 2020 voters in San Luis Obispo replaced the local half-percent sales and use tax with a 1.5% local sales and use tax (Measure G-20).
(Accrual Basis of Accounting)
Schedule 3
City of San Luis Obispo, California
Governmental Activities Tax and Franchise Revenues by Source
Last Ten Fiscal Years
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Revenue Trends
Sales and Use Local Sales Property Transient Occupancy Utility Users
Property in-lieu of VLF Franchise Fees Business Tax Other Taxes
213
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
General fund:
Nonspendable:
Prepaid items 56,020 3,173,248 3,520,473 51,636 - 41,155 90,797 101,462 23,481 5,533,017
Restricted for:
Debt service 489,056 128,102 159,724 - - - - - - -
Risk management - - - - - - - - - 594,469
Committed to:
General government programs 4,468,863 9,428,034 8,693,113 - - 9,299,971 5,696,864 5,307,988 1,776,826 848,111
Contingency Fund - - - - - 11,830,380 12,014,000 13,727,000 10,826,500 14,607,203
Risk management - - - - - 1,955,966 1,845,935 585,456 585,456 4,437,620
Assigned to:
CalPERS pension payment - - - - - 10,200,000 2,000,000 2,000,000 2,000,000 2,000,000
Contingency Fund 11,092,782 10,902,368 10,171,464 13,418,400 10,251,000 - - - - -
Solid Waste AB939 - - - - - - - 281,000 237,147 270,825
Establishment of Section 115 Trust - - - - 1,400,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000
Revenue stabilization - - - - 1,000,000 - - 2,000,000 2,000,000 2,000,000
Development Services 382,396 41,110 596,796 531,000 899,277 710,657 530,657 464,136 214,136 145,136
SLO Repertory Theater Grant - - - - - - 3,940,000 3,940,000 3,940,000 6,700,000
Tenant Improvement program/Economic Development - - - - - - - 1,400,000 1,400,000 608,000
Storm Related Costs - - - - - - - - 5,125,068 6,034,158
General government programs - - - - - - 4,270,529 - - -
Public Safety - - - - 1,096,215 929,344 - - - -
Risk management - - - - 1,498,078 - - - - -
City Attorney - 100,000 100,000 - 100,000 100,000 - - - -
Subsequent years expenditures 2,716,534 - - 9,908,932 10,284,119 4,738,806 - 2,455,573 6,009,831 2,559,825
Unassigned 10,419,881 2,723,292 6,334,870 6,185,574 7,122,607 5,311,792 8,356,724 8,275,453 9,191,321 3,468,954
Total general fund 29,625,532 26,496,154 29,576,440 30,095,542 33,651,296 47,118,071 40,745,506 42,538,068 45,329,766 51,807,318
Continued
Schedule 4
City of San Luis Obispo, California
Fund Balances, Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
For the Fiscal Year Ended June 30
214
Page 418 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
All other governmental funds:
Nonspendable - 5,642 (71,687) 292,641 - - 8,681 - - -
Restricted for:
Debt service 2,119,724 2,119,611 1,653,109 1,791,026 2,226,898 2,575,367 2,540,255 2,141,431 - -
Public safety programs 23,492 20,786 3,073 - 32,332 63,418 864,848 68,456 897,746 671,669
Transportation projects - - - 8,151,487 9,371,824 10,519,994 8,051,050 7,567,001 11,232,312 7,885,873
Affordable housing programs - - - 2,944,549 8,698,494 9,292,304 9,893,314 11,023,649 10,215,217 10,394,877
Impact fee programs - - - 1,870,656 3,126,925 7,466,378 8,935,786 10,519,226 - 14,891,812
Parkland development programs - - - 3,528,662 4,709,560 3,405,468 3,107,198 3,205,116 11,073,516 599,240
Public art programs - - - 620,934 591,097 568,401 798,038 1,269,844 1,526,588 1,557,871
Tourism programs - - - 456,023 322,975 678,554 1,147,881 1,426,625 1,523,656 1,631,304
Infrastructure improvements - - - - - - - 157,805 368,032 491,596
Committed to:
Affordable housing programs 2,562,825 5,054,332 3,974,629 - - - - - - -
Capital outlay 2,954,223 - - - - - - - - -
General government programs 7,463,605 - 8,092,594 - - - - - - -
Impact Fees Programs 549,349 8,795,074 595,256 - - - - - - -
Open space programs 1,265,620 588,743 2,363,347 - - - - - - -
Parkland development programs - 2,728,883 - - - - - - - -
Contingency fund - - 519,885 - - - - - - -
Public safety programs - - - - - - - 641,538 428,971 508,976
Assigned to:
Contingency fund - 900,000 900,000 900,000 900,000 900,000 900,000 900,000 900,000 900,000
Subsequent years expenditures 3,559,851 5,846,873 5,861,455 6,382,294 8,521,320 8,826,420 23,533,631 29,776,252 39,636,756 57,339,904
Unassigned - - - (318,422) (149,162) (5,782) - (2,424) (292,119) (45,541)
Total all other governmental
funds 20,498,689 26,059,944 23,891,661 26,619,850 38,352,263 44,290,522 59,780,682 68,694,519 77,510,675 96,827,581
Total all governmental funds 50,124,221$ 52,556,098$ 53,468,101$ 56,715,392$ 72,003,559$ 91,408,593$ 100,526,188$ 111,232,587$ 122,840,441$ 148,634,899$
(Modified Accrual Basis of Accounting)
For the Fiscal Year Ended June 30
Continued
Schedule 4
City of San Luis Obispo, California
Fund Balances, Governmental Funds
Last Ten Fiscal Years
215
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Revenues:
Sales and use - general 17,498,218$ 16,737,005$ 17,055,085$ 17,805,482$ 16,571,064$ 20,067,740$ 22,247,303$ 21,865,468$ 22,285,972$ 22,911,086$
Sales and Use - local transaction tax 7,178,159 7,331,660 7,504,485 8,325,230 7,554,375 12,779,713 29,172,258 30,508,731 30,597,288 30,926,285
Prop. 172 Public Safety tax 405,066 405,512 397,488 314,063 416,459 425,136 529,299 544,521 520,952 519,740
Property tax 10,186,858 10,756,477 11,425,510 12,238,357 12,913,661 13,727,986 14,166,259 15,635,545 16,637,657 17,781,938
Transient Occupancy 7,127,756 7,381,989 7,514,289 8,061,087 6,325,841 6,960,035 10,650,762 11,037,037 11,063,012 11,417,888
Utility users tax 5,413,720 5,539,407 5,627,356 4,919,892 5,439,144 5,225,979 5,338,325 6,904,194 6,301,505 7,501,436
Property tax in-lieu of VLF 4,113,244 4,353,912 4,637,253 4,961,080 5,290,215 5,660,661 5,994,592 6,283,397 6,815,975 7,196,670
Franchise fees 1,537,922 1,557,128 1,597,655 1,428,296 1,888,414 1,796,829 1,978,295 2,349,603 2,366,286 2,622,351
Business tax 2,491,516 2,372,249 2,663,686 2,630,499 2,995,263 3,782,115 2,823,163 3,281,010 2,941,928 3,138,272
Cannabis tax - - - - - - 998,875 1,127,744 1,116,495 814,502
Real property transfer 366,088 332,314 347,765 273,762 388,075 469,883 550,153 457,978 528,088 484,692
Fines, forfeitures and penalties 172,353 139,534 199,374 155,269 239,048 223,882 173,915 195,991 266,103 340,172
Use of money and property 825,760 260,169 164,434 1,996,382 2,005,968 219,507 (2,151,227) 1,999,872 5,329,747 6,264,020
Subventions and grants 11,771,980 2,624,753 4,156,333 3,110,689 7,538,893 10,719,698 6,446,192 6,364,704 17,387,665 13,890,322
Charges for services 13,622,945 15,173,707 14,672,746 18,394,586 17,828,561 22,090,479 17,657,128 18,418,552 19,108,699 18,330,989
Other revenues 242,744 446,456 634,391 590,796 708,579 717,440 506,722 719,724 215,095 453,196
Total revenues 82,954,329 75,412,272 78,597,850 85,205,470 88,103,560 104,867,083 117,082,014 127,694,071 143,482,467 144,593,559
Continued
Schedule 5
City of San Luis Obispo, California
Revenues, Expenditures and Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified accrual basis of accounting)
-
50,000,000
100,000,000
150,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Total Revenue
216
Page 420 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Expenditures:
Current:
General Government 12,409,567$ 11,824,360$ 12,709,324$ 13,769,778$ 14,503,410$ 13,041,242$ 17,197,912$ 23,646,307$ 17,570,930$ 17,612,764$
Public safety 26,468,454 28,091,747 28,862,906 31,714,220 30,216,995 31,714,578 39,921,208 37,425,928 39,889,845 43,977,463
Transportation 3,317,177 3,780,804 3,565,022 3,495,909 3,710,943 4,450,572 5,131,132 5,408,704 5,557,957 8,823,908
Culture and recreation 7,428,198 7,712,834 8,571,184 8,636,582 8,416,687 9,458,448 10,440,543 11,015,177 11,088,967 12,773,680
Community development 10,770,827 10,300,894 10,815,667 10,677,334 10,477,062 11,101,465 15,067,518 14,867,023 15,345,346 15,583,291
Debt service:
Principal 1,792,849 2,101,296 15,665,904 1,974,050 1,605,239 1,602,039 1,467,402 1,859,782 1,230,724 1,459,235
Interest 1,349,216 1,215,504 1,524,180 809,977 993,697 808,586 774,747 745,735 721,853 657,135
Capital:
Public safety 1,220,759 1,772,454 506,491 706,918 182,235 107,965 248,613 1,577,415 445,716 483,540
Transportation 15,038,306 4,161,966 6,419,137 6,441,229 6,412,541 11,452,720 13,653,849 9,364,910 2,267,633 13,539,466
Leisure, cultural and social services 1,463,269 1,499,704 981,768 597,187 1,213,682 537,118 3,933,463 1,226,800 2,760,876 4,633,210
Community development (Note 1)149,537 2,078,181 525,105 1,568,147 785,517 105,142 601,315 10,202,665 36,767,232 1,111,241
General government 590,263 633,682 1,192,424 4,695,978 2,081,482 2,492,435 1,619,793 2,365,432 1,726,059 1,649,952
Total expenditures 81,998,422 75,173,426 91,339,112 85,087,309 80,599,490 86,872,310 110,057,495 119,705,878 135,373,138 122,304,885
Excess of revenues
over(under)
expenditures 955,907 238,846 (12,741,262) 118,161 7,504,070 17,994,773 7,024,519 7,988,193 8,109,329 22,288,674
Continued
Schedule 5
City of San Luis Obispo, California
Revenues, Expenditures and Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified accrual basis of accounting)
Continued
-
50,000,000
100,000,000
150,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Total Expenditures
217
Page 421 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Other Financing
Sources(Uses):
Issuance of debt/refunding debt 688,500$ 1,141,468$ 12,472,698$ 673,095$ -$ -$ -$ -$ (387,684)$ -$
Transfers in 12,747,578 15,739,036 19,815,144 9,064,256 9,455,785 15,460,955 35,273,279 39,735,789 53,605,957 40,232,580
Transfers out (11,311,530) (14,687,473) (18,617,117) (6,608,221) (7,565,885) (13,468,044) (33,587,965) (37,492,177) (50,969,925) (37,017,760)
Other financing source - SBITA - - - - - - - 474,594 137,233 -
Total other financing sources(uses)2,124,548 2,193,031 13,670,725 3,129,130 1,889,900 1,992,911 1,685,314 2,718,206 2,385,581 3,214,820
Net change in fund balance 3,080,455$ 2,431,877$ 929,463$ 3,247,291$ 9,393,970$ 19,987,684$ 8,709,833$ 10,706,399$ 10,494,910$ 25,503,494$
Debt service as a
percentage of noncapital
expenditures 5.20%5.37%26.64%4.08%3.86%3.46%2.55%2.82%2.18%2.14%
Notes:
1. Community Development Block Grant (CDBG) expenditures are included in the Community Development total for purposes of this schedule.
2. Prior to 2021-22, cannabis tax was included in business tax
Revenues, Expenditures and Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified accrual basis of accounting)
Continued
Schedule 5
City of San Luis Obispo, California
-
50,000,000
100,000,000
150,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Revenue, Expenditures, and Other
Revenue Expenditures Other Financing Sources
218
Page 422 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Staffing:
Salaries and wages:
Regular salaries 24,790,947$ 26,944,188$ 26,666,447$ 27,520,149$ 28,601,004$ 29,014,941$ 31,822,988$ 35,422,024$ 38,125,168$ 40,660,998$
Temporary salaries 1,964,521 1,793,360 1,711,755 1,898,331 1,882,307 2,294,603 1,855,690 1,942,485 2,237,584 2,335,656
Overtime 3,473,489 3,604,336 4,420,756 4,241,294 3,292,469 4,527,789 4,412,287 4,504,561 4,443,880 5,623,060
Benefits:
Retirement 9,323,782 10,394,523 10,570,883 15,150,755 12,593,753 13,344,252 24,665,892 17,908,383 17,782,639 20,327,231
Group health/disability insurance 3,828,238 4,129,004 4,638,471 4,193,021 4,291,139 4,040,575 4,327,121 5,130,991 5,487,733 5,806,160
Medicare 418,704 455,966 469,688 477,925 481,571 505,450 537,516 593,725 631,755 682,664
Unemployment Reimbursements 5,159 150,929 61,972 - 61,240 101,575 17,484 41,464 40,438 53,758
Total staffing 43,804,840 47,472,306 48,539,972 53,481,475 51,203,483 53,829,185 67,638,979 65,543,634 68,749,198 75,489,526
Contract services 6,271,607 6,962,949 6,940,018 6,557,939 6,444,957 7,190,499 9,067,321 10,328,784 9,710,231 9,090,684
Other operating expenditures
Communications & utilities 2,192,384 2,023,057 2,190,695 2,444,564 2,115,821 3,348,001 3,780,633 3,867,295 3,905,223 4,024,401
Rents & leases 164,729 170,288 171,909 180,478 160,045 88,615 133,521 133,649 173,957 316,292
Insurance:
General liability & property 1,847,422 1,273,133 1,658,319 1,600,962 2,196,462 1,323,824 2,071,193 2,874,417 3,163,588 3,031,752
Workers compensation 2,019,722 1,627,423 2,145,046 2,422,843 2,611,827 2,037,611 2,181,044 2,844,913 1,605,230 774,732
Other operating expenditures 3,079,347 3,345,191 3,017,537 3,575,930 4,902,050 4,256,574 4,363,206 8,063,807 4,597,752 4,848,685
Total operating expenditures 9,303,604 8,439,092 9,183,506 10,224,777 11,986,205 11,054,625 12,529,597 17,784,081 13,445,749 12,995,862
Minor capital 92,853 203,098 90,346 - - 1,070 10,510 - - -
Total program expenditures 59,472,903 63,077,445 64,753,842 70,264,191 69,634,645 72,075,379 89,246,406 93,656,498 91,905,178 97,576,072
Reimbursed expenditures (4,008,992) (4,164,747) (4,264,633) (3,981,789) (4,277,664) (4,578,402) (4,717,442) (4,461,578) (5,511,628) (5,367,608)
Total general fund operating expenditures 55,463,911$ 58,912,698$ 60,489,209$ 66,282,402$ 65,356,981$ 67,496,977$ 84,528,964$ 89,194,920$ 86,393,550$ 92,208,464$
Schedule 6
City of San Luis Obispo, California
General Fund Operating Expenditures by Type
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
219
Page 423 of 525
Fiscal Year Homeowners Secured Roll Nonunitary Unsecured Total Direct Market Value of Market
Exemptions Gross Value Utilities Roll TOTAL Tax Rate (Note 1)Value
2015-16 41,518,400 7,166,010,320 4,883,115 317,266,793 7,488,160,228 1.00%7,488,160,228 100%
2016-17 42,109,709 7,615,940,988 5,269,573 316,965,453 7,938,176,014 1.00%7,702,282,828 100%
2017-18 42,702,377 7,844,131,236 4,369,188 331,183,030 8,179,683,454 1.00%8,179,683,454 100%
2018-19 43,352,906 8,688,541,007 4,231,993 359,588,899 9,052,361,899 1.00%9,052,361,899 100%
2019-20 43,335,854 9,156,811,458 3,990,145 360,372,662 9,521,174,265 1.00%9,521,174,265 100%
2020-21 43,445,185 9,872,892,242 4,194,503 371,969,399 10,249,056,144 1.00%10,249,056,144 100%
2021-22 43,644,354 10,449,275,830 4,154,621 369,153,263 10,822,583,714 1.00%10,822,583,714 100%
2022-23 44,681,189 11,352,719,604 3,840,493 414,262,072 11,770,822,169 1.00%11,770,822,169 100%
2023-24 45,448,900 11,765,407,582 3,768,692 414,282,418 12,183,458,692 1.00%12,183,458,692 100%
2024-25 46,290,669 12,510,668,163 3,681,976 495,255,596 13,009,605,735 1.00%13,009,605,735 100%
Notes:1)Valuations are established by the County Assessor of the County of San Luis Obispo, except for property owned by private utility companies,
which is valued by the State of California. The City assumes that Market Values are equal to total Assessed Valuation.
2)For comparison purposes, gross assessed valuations include homeowners' exemptions. Although these exemptions reduce property tax
collections, the revenue loss is reimbursed by the State of California. As such, gross assessed valuation is the revenue base used in
establishing property tax-related revenues.
Source: HdL, Coren & Cone ACFR 2024-25 report - 2024/25 Roll Summary table.
Gross Assessed Valuation (Notes 1 and 2)
Schedule 7
City of San Luis Obispo, California
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
-
2,000,000,000
4,000,000,000
6,000,000,000
8,000,000,000
10,000,000,000
12,000,000,000
14,000,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Total Assessed Value
Secured Roll Gross Value Nonunitary Utilities Unsecured Rolls
220
Page 424 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Proposition 13 maximum tax rate (Note 2)1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000
Voter approved indebtedness:
State Water Bond 0.00374 0.00400 0.00400 0.00400 0.00400 0.00400 0.00400 0.00400 0.00363 0.00365
Cuesta Community College 2014 A & A1 0.01925 0.01925 0.01925 0.01925 0.01925 0.01925 0.01925 0.01925 0.01925 0.01750
San Luis Coastal Usd 2014 Series A & B 0.04900 0.04900 0.04900 0.04900 0.04900 0.03900 0.03900 0.03500 0.08400 0.08400
Total (Notes 1 and 3)1.07199 1.07225 1.07225 1.07225 1.07225 1.06225 1.06225 1.05825 1.10688 1.10515
Notes:
1. Property tax rates are levied per $100 of assessed valuation. The tax rate information provided is for Tax Rate Area 003-000, which is the
largest tax rate area in the City.
2. The passage of Proposition 13 on June 6, 1978 established a maximum County-wide levy for general revenue purposes of 1% of market value.
Voter-approved tax rates for the retirement of long-term liabilities were excluded from this limit.
3. It is not possible to identify tax rates for individual agencies however, the following is a summary of derived property tax
allocations within Tax Rate Area 003-000 for Fiscal Year 2022-23
Source: HdL, Coren & Cone ACFR 2024-25 report - Direct & Overlapping Property Tax Rates table
Base ERAF Net
Rate Allocation Apportionment
San Luis Coastal Unified School District 36.10 0.00 36.10
San Luis Obispo County - General Fund 21.86 (8.08)13.78
City of San Luis Obispo 14.83 *(3.48)11.35
San Luis Obispo Community College District 6.42 0.00 6.42
County School Services 3.81 0.00 3.81
City/County Library 1.98 (0.32)1.66
Port San Luis Harbor 1.63 (0.44)1.19
Other Agencies 1.38 (0.32)1.06
Education Revenue Augmentation Fund (ERAF)12.01 12.64 24.65
Total 100%0% 100%
*The County further adjusts the 18.4% base rate for revenue shifts to school districts as directed by the State as part of their cuts to local agencies,
resulting in an effective rate for the City of approximately 14.9%.
Source: HdL, Coren & Cone ACFR 2024-25 report - Property Tax Dollar Breakdown, San Luis Obispo County Assessor 2024-25 Post ERAF TRA Allocation Factors
Schedule 8
City of San Luis Obispo, California
Property Tax Rates
Last Ten Fiscal Years
221
Page 425 of 525
Number of Secured Percent of Total Number of Secured Percent of Total
Owner Parcels Assessed Value Rank City Assessed Value Parcels Assessed Value Rank City Assessed Value
CAP VIII - Mustang Village LLC 5 104,238,003 1 0.83%4 78,358,102 2 1.12%
Sierra Vista Hospital Inc.8 85,481,569 2 0.68%8 77,979,526 3 1.12%
Jamestown Premier San Luis Obispo Retail 9 82,595,523 3 0.66%9 105,432,430 1 1.51%
Charles Pasquini Jr Trust Et Al 8 77,074,813 4 0.62%9 61,066,537 4 0.88%
San Luis Obispo Promenade DE LLC 10 73,061,091 5 0.58%
Irish Hills Plaza East LLC 5 55,353,405 6 0.44%
Vintage at San Luis Obispo Alderwood 2 53,060,400 7 0.42%
Quaglino Properties LLC 27 47,314,188 8 0.38%
Costco Wholesale Corporation 2 42,697,281 9 0.34%1 34,284,730 7 0.49%
JCC Mission LLC Et Al 1 41,120,027 10 0.33%
SLO Promenade Limited Partnership 10 50,419,038 5 0.72%
Irish Hills Plaza West II LLC 6 46,963,546 6 0.67%
Marigold Center LLC 9 29,923,245 8 0.43%
Bre Atlas Property Owner LLC 1 27,900,000 9 0.40%
Target Corporation 1 26,413,114 10 0.38%
Total 77 661,996,300$ 5.28%58 538,740,268$ 7.72%
Source: HdL, Coren & Cone ACFR 2024-25 report - Top Ten Property Taxpayers table.
2015-16 data is from the City's ACFR.
Schedule 9
2024-25 2015-16
Current Year and Nine Years Ago
Principal Property Tax Payers
City of San Luis Obispo, California
94.72%
5.28%
Property Tax Payers for 2024-25
Remaining Property Tax Payers Top 10 Property Tax Payers
92.28%
7.72%
Property Tax Payers for 2015-16
Remaining Property Tax Payers Top 10 Property Tax Payers
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Total Secured Current Year Percent
Fiscal Tax Levy Current Year Percent Delinquencies Delinquent
Year (Notes 1 and 2)Collections Collected (Note 3)(Note 3)
2015-16 9,707,340 9,707,340 100%0 0
2016-17 10,250,205 10,250,205 100%0 0
2017-18 10,868,920 10,868,920 100%0 0
2018-19 11,648,706 11,648,706 100%0 0
2019-20 12,180,662 12,180,662 100%0 0
2020-21 12,957,910 12,957,910 100%0 0
2021-22 13,628,729 13,628,729 100%0 0
2022-23 14,458,958 14,458,958 100%0 0
2023-24 15,407,147 15,407,147 100%0 0
2024-25 16,316,087 16,316,087 100%0 0
Notes:
1. The secured property tax roll is composed of ad valorem taxes as well as special assessments, and is calculated by the San Luis Obispo County Auditor-Controller.
Auditor-Controller. The San Luis Obispo County Tax Collector is responsible for all property tax roll collections within the City of San Luis Obispo. The amount
reported is before the SB2557 County administrative fees of approximately 3% of total property tax revenues.
2. The secured levy does not include supplemental assessments, unsecured tax revenues, or prior year adjustments, which can be significant. For example, in 2012-13
revenue to the City from supplemental assessments was $99,500 and $215,100 from unsecured. A one-time refund was received from the County Auditor-
Controller, refunding $632,800 representing prior overcharges for the SB2557 fee. Property tax revenues totaled $8,740,762.
3. The City has elected the Teeter Plan method of property tax collection, whereby the County remits 100% of taxes levied and pursues collection and retains any
delinquent taxes and related penalties and interest.
Source: San Luis Obispo County Auditor-Controller - 2024-25 Property Tax Estimates and Delinquencies Report
Schedule 10
City of San Luis Obispo, California
Secured Property Tax Roll Levies and Collections
Last Ten Fiscal Years
223
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2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Sales
In Thousands of Dollars
Apparel stores 74,946 72,394 74,048 73,158 71,378 51,094 73,222 72,632 72,811 73,384
General merchandise stores 183,397 181,260 182,975 180,609 182,170 173,784 203,468 234,669 238,900 244,879
Food and drug stores 43,798 43,486 46,085 47,337 49,158 50,038 49,500 52,204 54,559 55,552
Eating & drinking palces 171,620 177,675 185,156 187,369 193,107 141,413 200,076 226,944 238,243 239,039
Building materials & farm tools 140,259 142,498 160,259 165,839 162,778 165,955 182,925 194,063 188,003 176,409
Auto dealers & supplies 305,248 307,369 320,794 322,503 322,235 324,523 402,683 392,900 403,769 441,636
Service stations 89,447 77,840 85,157 95,860 96,870 71,638 100,914 125,345 115,065 108,958
Other retail stores 276,311 281,280 279,946 280,799 261,681 245,366 301,138 306,870 291,574 285,120
Total retail stores 1,285,026 1,283,802 1,334,420 1,353,474 1,339,377 1,223,811 1,513,926 1,605,627 1,602,924 1,624,977
All other outlets 359,995 364,901 379,808 415,830 430,535 489,112 576,301 652,869 647,968 658,839
Total 1,645,021 1,648,703 1,714,228 1,769,304 1,769,912 1,712,923 2,090,227 2,258,496 2,250,892 2,283,816
Source: HdL, Coren & Cone ACFR 2024-25 report - Taxable Sales by Category table
Schedule 11
City of San Luis Obispo, California
Schedule of Taxable Sales and Permits by Category
Last Ten Calendar Years
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Taxable Sales by Category
(In Thousands of Dollars)
Apparel stores General merchandise stores Food and drug stores
Eating & drinking palces Building materials & farm tools Auto dealers & supplies
Service stations Other retail stores All other outlets
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Effective End State Local City LRM Combined
Date Date Jurisdiction Transportation Fund Rate (Note 4 & 6)Rate
8/1/1933 6/30/1935 (Note 2)2.50%2.50%
7/1/1935 6/30/1943 3.00%3.00%
7/1/1943 6/30/1949 2.50%2.50%
7/1/1949 12/31/1961 3.00%3.00%
1/1/1962 7/31/1967 3.00%1.00%4.00%
8/1/1967 6/30/1972 4.00%1.00%5.00%
7/1/1972 6/30/1973 3.75%0.25% 1.00%5.00%
7/1/1973 9/30/1973 4.75%0.25% 1.00%6.00%
10/1/1973 3/31/1974 3.75%0.25% 1.00%5.00%
4/1/1974 11/30/1989 4.75%0.25% 1.00%6.00%
12/1/1989 12/31/1990 5.00%0.25% 1.00%6.25%
1/1/1991 7/14/1991 4.75%0.25% 1.00%6.00%
7/15/1991 12/31/2000 6.00%0.25% 1.00%7.25%
1/1/2001 12/31/2001 5.75%0.25% 1.00%7.00%
1/1/2002 6/30/2004 6.00%0.25% 1.00%7.25%
7/1/2004 3/31/2007 (Note 3)6.25%0.25% 0.75%(Note 3)7.25%
4/1/2007 3/31/2009 6.25%0.25% 0.75%0.50% 7.75%
4/1/2009 6/30/2011 7.25%0.25% 0.75%0.50% 8.75%
7/1/2011 12/31/2012 6.25%0.25% 0.75%0.50% 7.75%
1/1/2013 12/31/2016 6.50%0.25% 0.75%(Note 5)0.50% 8.00%
1/1/2017 3/31/2021 6.00%0.25% 1.00%0.50% 7.75%
4/1/2021 current 6.00%0.25% 1.00%(Note 6)1.50% 8.75%
Notes:
1. The Bradley-Burns Uniform Local Sales and Use Tax Law was enacted in 1955. The law authorizes cities and counties to impose a sales and use tax.
Effective January 1, 1962, all cities and counties have adopted ordinances for the State Board of Equalization to collect the local tax.
2. Sales tax only. The use tax was enacted effective July 1, 1935.
3. In March 2004, a State ballot measure was passed issuing deficit reduction bonds for State purposes. Funding was provided effective July 1, 2004 by
repealing 25% of the local 1% sales tax and then adopting a new 1/4-cent sales tax dedicated to repayment of the deficit reduction bonds. Cities and
counties would then be "made whole" by the State from increased property tax allocations via reduced contributions to ERAF. This "triple flip" is
theoretically revenue-neutral, and as such, the effective rate for revenue purposes remains at 1%.
4. In November 2006, voters in San Luis Obispo approved a local revenue measure (LRM) increasing the City tax rate by 1/2%, which became effective
April 1, 2007. The sales tax measure has a sunset provision of 8 years. The local Sales Tax was extended as Measure G in the November 2014
election for 8 years.
5. Proposition 30, The Schools and Local Public Safety Protection Act of 2012 , was approved by California voters in November 2012 to temporarily
increase the sales and use tax by 0.25%. The sales and use tax imposed by Proposition 30 expired December 31, 2016.
6. In November 2020, voters in San Luis Obispo approved a local revenue measure (LRM) increasing the local sales tax to 1.5% with an effective date
of April 1, 2021. The local sales tax measure has no sunset provision and replaced the 2014 Measure G.
Source: State Board of Equalization, State of California
Schedule 12
City of San Luis Obispo, California
Historical Sales and Use Tax Rates
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No. of No. of
Certificates Percent Certificates Percent
Construction 1,046 11.8% 1,070 11.8%
Manufacturing 128 1.4%133 1.5%
Transportation/Utilities 41 0.5%76 0.8%
Wholesale 123 1.4%124 1.4%
Retail 1,208 13.7% 1,307 14.5%
Professional 1,185 13.4% 1,148 12.7%
Residential Rental 2,714 30.7% 2,699 29.8%
Commercial Rental 288 3.3%292 3.2%
Services 2,111 23.9% 2,195 24.3%
Total business certificates issued 8,844 100%9,044 100%
Home occupations 694 7.8%712 7.9%
Located outside City limits 2,065 23.3% 2,257 25.0%
Located in Downtown Business Improvement District 552 6.2%572 6.3%
Source: City of San Luis Obispo Finance Department - Revenue Division
Fiscal Years Ended June 30, 2025 and 2024
Schedule of Business Tax Certificates Issued
City of San Luis Obispo, California
Schedule 13
20242025
11.8%
1.4%
0.5%1.4%
13.7%
13.4%
30.7%
3.3%
23.9%
Business Tax Types for Fiscal Year End 2025
Construction
Manufacturing
Transportation/Utilities
Wholesale
Retail
Professional
Residential Rental
Commercial Rental
Services
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Percentage of
Fiscal Lease Purchase Lease SBITA Installment SBITA Total Primary Per Gross Assessed
Year Bonds Financing Loans Liability Liability Bonds Sales Agreement Loans Liability Government Capita Value
2015-16 27,762,893 1,374,773 679,314 - - 25,323,405 7,932,327 17,647,622 - 80,720,334 1,741 1.16%
2016-17 26,328,540 1,898,652 591,647 - - 24,072,708 7,366,468 16,709,160 - 76,967,175 1,660 0.99%
2017-18 23,484,450 1,599,769 503,101 - - 21,815,204 6,783,114 15,743,808 - 69,929,446 1,497 0.88%
2018-19 22,171,441 1,413,937 413,667 - - 19,542,657 6,181,902 14,750,783 - 64,474,387 1,385 0.79%
2019-20 21,084,777 1,381,486 323,380 - - 18,185,089 5,562,462 26,133,837 - 72,671,031 1,583 0.76%
2020-21 20,038,779 734,673 232,111 - - 16,772,171 4,919,407 56,229,546 - 98,926,687 2,102 0.97%
2021-22 18,954,856 390,420 139,961 125,003 172,229 15,307,178 4,257,343 99,918,648 - 139,265,638 2,922 1.29%
2022-23 17,829,558 36,245 46,887 570,922 407,465 13,795,824 3,575,863 120,213,508 50,596 156,526,868 3,275 1.33%
2023-24 16,560,495 - - 429,171 321,349 60,137,512 2,869,551 138,064,103 25,637 218,407,818 4,486 1.79%
2024-25 15,366,181 - - 276,446 74,712 58,416,528 2,327,976 152,880,499 - 229,342,342 4,630 1.76%
Source: City of San Luis Obispo Finance Department
Schedule 14
City of San Luis Obispo, California
Per Capita Outstanding Debt By Type
Last Ten Fiscal Years
Governmental Activities Business-Type Activities
$-
$40,000,000
$80,000,000
$120,000,000
$160,000,000
$200,000,000
$240,000,000
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Outstanding Debt Per Capita
Governmental Activities Business-Type Activities
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Service Ratio of Net
Total Taxable General Payable from Net Bonded Debt Net Bonded
Assessed Bonded Enterprise Bonded to Assessed Debt per
Fiscal Year Population Value Debt Revenues Debt Value Capita
2015-16 46,117 7,488,160,228 0 0 0 0.0%0
2016-17 46,724 7,938,176,014 0 0 0 0.0%0
2017-18 46,548 8,179,683,454 0 0 0 0.0%0
2018-19 46,802 9,052,361,899 0 0 0 0.0%0
2019-20 45,920 9,521,174,265 0 0 0 0.0%0
2020-21 47,063 10,249,056,144 0 0 0 0.0%0
2021-22 47,653 10,822,583,714 0 0 0 0.0%0
2022-23 47,788 11,770,822,169 0 0 0 0.0%0
2023-24 48,684 12,183,458,692 0 0 0 0.0%0
2024-25 49,534 13,009,605,735 0 0 0 0.0%0
Notes:
1. Valuations are established by the County Assessor of the County of San Luis Obispo, except for property owned by private utility companies,
which is valued by the State of California.
2. See Schedule of Demographic and Economic Statistics for population data.
3. Personal income information is not available. Net Bonded Debt is expressed as a ratio to Assessed Value.
Source: HdL, Coren & Cone ACFR 2024-25 report - Demographic and Economic Statistics table
Demographics changed from FY to Calendar Year
Schedule 15
City of San Luis Obispo, California
Ratio of Net General Bonded Debt to Assessed Value and Net Bonded Debt per Capital
Last Ten Fiscal Years
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Amount Applicable
Percent Applicable to the City of
to the City of San Luis Obispo
San Luis Obispo as of June 30, 2025
Overlapping tax and assessment debt:
San Luis Obispo Community College District 192,585,000$ 17.05%33,373,055$
San Luis Coastal Unified School District 310,676,000 53.28%165,531,280
City of San Luis Obispo Community Facilities District No. 2019-1 19,380,000 100.00%19,380,000
California Statewide Communities Development Authority
Community Facilities District No. 2024-07 2,835,000 100.00%2,835,000
California Statewide Communities Development Authority
Assessment District No. 2024-1 1,205,000 100.00%1,205,000
Total overlapping tax and assessment debt 222,324,335
Overlapping General Fund long-term debt:
San Luis Obispo County General Fund Obligations 77,618,932$ 17.40%13,501,813$
San Luis Obispo County Pension Obligations 19,244,051 17.40%3,347,503
16,849,316
Direct long-term debt:
City of San Luis Obispo 2001 IBank Loan - Parking 100.00%2,537,059$
City of San Luis Obispo 2009 IBank Loan - Sewer 100.00%5,627,721
City of San Luis Obispo 2014 LOVR Lease Revenue Bonds 100.00%5,885,000
City of San Luis Obispo 2018 Clean Water State Revolving - Sewer 100.00%134,230,838
City of San Luis Obispo 2018 Lease Revenue Bonds 100.00%10,495,000
City of San Luis Obispo 2018 Water Revenue Refunding Bonds 100.00%6,845,000
City of San Luis Obispo 2020 IBank Loan - Water 100.00%10,484,882
City of San Luis Obispo 2023 Lease Revenue Refunding Bonds 100.00%44,860,000
City of San Luis Obispo Lease Liability 100.00%276,446
City of San Luis Obispo Subscription based IT agreements liability 100.00%74,712
City of San Luis Obispo Unamortized bond premium Governmental Activities 100.00%966,956
City of San Luis Obispo Unamortized bond premium Business-Type Activities 100.00%4,730,753
Less self-supporting issues:
City of San Luis Obispo obligations supported by enterprise revenues (211,297,027)
Total direct debt 15,717,339
Total direct and overlapping long-term debt 254,890,990$
Ratio of long-term debt to assessed valuation and population
Gross Assessed Valuation 13,009,605,735$
Population 49,534
Percent of Gross Per Capita
Amount Assessed Valuation Long-Term Debt
Direct and Overlapping Debt:
Gross 466,188,017$ 3.6%$9,411.48
Net 254,890,990 2.0%5,146
Direct Debt:
Gross 227,014,366$ 1.7%$4,583.00
Net 15,717,339 0.1%317
Source: California Municipal Statistics, Inc., HdL, Coren & Cone ACFR 2024-25 report - Demographic and Economic Statistics table
Schedule 16
City of San Luis Obispo, California
Direct and Overlapping Long-Term Debt
Fiscal Year Ended June 30, 2025
The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable percentages were estimated by
determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided by the district's total taxable assessed value.
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2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Legal debt limit 272,833$ 288,836$ 306,738$ 339,464$ 357,044$ 384,339$ 405,847$ 441,406$ 456,880$ 487,860$
Total debt applicable to limit
Legal debt margin 272,833 288,836 306,738 339,464 357,044 384,339 405,847 441,406 456,880 487,860
Total debt applicable to the limit
as a percentage of debt limit 0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%
Legal Debt Margin Calculation for Fiscal Year 2023-24
Gross Assessed Valuation 13,009,605,735$
Legal Debt Limit - 3.75% of Gross Assessed Valuation 487,860,215$
Long-term Debt:
Revenue Bonds Secured by Capital Leases 61,240,000$
Water Revenue Bonds 6,845,000
68,085,000
Less deductions allowed by law:
Revenue Bonds Secured by Capital Leases 61,240,000
Water Revenue Bonds 6,845,000
68,085,000
Total debt applicable to computed limit $0
Legal debt margin 487,860,215$
Note: The California Government Code provides for a legal debt limit of 15% of gross assessed valuation based on 25% of market value, or a legal debt limit of 3.75%.
The City's debt management policy, however, sets a more restrictive debt limit of 2% of assessed valuation.
Schedule 17
City of San Luis Obispo, California
Computation of Legal Debt Margin
Last Ten Fiscal Years
(Amounts Expressed in Thousands)
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Less Operating &Net Revenue Coverage
Fiscal Operating Development Other Maintenance Available for With
Year Revenues Impact Fees Revenues Expenses Bond Debt Service Principal Interest Total Coverage Impact Fees
2015-16 20,137,422 (1,543,268)53,731 (14,056,603)4,591,282 1,245,486 881,318 2,126,804 216% 288%
2016-17 19,873,517 (1,266,674)410,484 (14,754,114)4,263,213 1,290,748 837,657 2,128,405 200% 260%
2017-18 21,997,054 (2,131,345)325,268 (16,250,751)3,940,226 1,336,267 792,337 2,128,604 185% 285%
2018-19 23,992,758 (3,745,666)948,324 (15,995,459)5,199,957 2,281,739 858,471 3,140,210 166% 285%
2019-20 25,666,777 (3,723,460)663,838 (19,485,472)3,121,683 1,367,920 637,348 2,005,268 156% 341%
2020-21 28,340,076 (4,744,361)65,386 (17,765,625)5,895,476 960,390 527,682 1,488,072 396% 715%
2021-22 29,671,678 (5,160,020)222,451 (17,296,355)7,437,754 1,001,055 489,266 1,490,321 499% 845%
2022-23 27,472,542 (3,616,307)248,134 (18,530,525)5,573,844 1,036,530 449,224 1,485,754 375% 619%
2023-24 31,141,045 (4,686,719)253,917 (21,703,368)5,004,875 512,290 403,063 915,353 547% 1059%
2024-25 34,129,107 (4,843,919)227,320 (24,116,719)5,395,789 537,955 377,622 915,577 589% 1118%
Notes:
1. Operating revenues exclude depreciation and amortization.
2. Net revenues available for debt service exclude development impact fees.
3. The City refinanced its 2005 Refunding Lease Revenue Bonds, 2006 Lease Revenue Bonds, and 2009 Lease Revenue Bonds into the 2018 Lease Revenue Bonds.
4. Starting in 2021, principal and interest amounts do not include 2004 state revolving loan as it was retired.
5. The City refinanced its 2012 Lease Revenue Bonds into the 2023 Lease Revenue Bonds which was allocated to the Parking Fund.
6. Current year debt service requirements include 2018 Lease Refunding Revenue Bonds and 2018 Water Refunding Revenue Bonds.
Source: City of San Luis Obispo Utilities Department
FY 2024-25 Debt Schedule for 2025-27 Financial Plan
Schedule 18
City of San Luis Obispo, California
Revenue Bond Coverage - Water Fund
Last Ten Fiscal Years
Bonded Debt Service Requirements
231
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Net Revenue
Fiscal Gross Operating Available for
Year Revenues Expenses Bond Debt Service Principal Interest Total Coverage
2015-16 4,606,249 (2,757,299) 1,848,950 466,185 501,631 967,816 191%
2016-17 4,659,562 (2,671,028) 1,988,534 481,981 487,407 969,388 205%
2017-18 6,651,038 (2,998,555) 3,652,483 498,058 469,314 967,372 378%
2018-19 5,443,038 (3,100,113) 2,342,925 381,250 226,931 608,181 385%
2019-20 3,840,059 (3,080,588) 759,471 237,900 201,866 439,766 173%
2020-21 2,768,419 (3,093,183) (324,764) 247,050 192,350 439,400 (74%)
2021-22 4,890,317 (3,552,603) 1,337,714 257,725 182,468 440,193 304%
2022-23 6,022,372 (4,148,805) 1,873,567 265,350 172,159 437,509 428%
2023-24 9,663,683 (5,937,228) 3,726,455 277,550 161,545 439,095 849%
2024-25 8,307,559 (5,641,890) 2,665,669 928,225 1,246,943 2,175,168 123%
Notes:
1. Operating expenses exclude depreciation.
2. In 1994 the Capital Improvement Lease Revenue Bonds were refinanced resulting in new debt of $11,780,000, of which $7,421,400
is designated for the Parking Fund. In 2004 the 1994 bonds were refinanced with a maturity date of 2014. In 2006 Lease Revenue
Bonds were issued resulting in new debt of $16,160,000, of which $8,726,400 is allocated to the Parking Fund.
4. The City refinanced its 2012 Refunding Revenue Bond into the 2023 Lease Revenue Bond. Resulting in new debt of $45,780,000, of
which $1,920,000 is allocated to the Parking Fund.
Source: City of San Luis Obispo Finance Department.
FY 2024-25 Debt Schedule for 2025-27 Financial Plan
Schedule 19
City of San Luis Obispo, California
Revenue Bond Coverage - Parking Fund
Last Ten Fiscal Years
3. The City refinanced its 2005 Refunding Lease Revenue Bonds, 2006 Lease Revenue Bonds, and 2009 Lease Revenue Bonds into the
2018 Lease Revenue Bonds. Resulting in new debt of $16,905,000, of which $5,156,025 is allocated to the Parking Fund.
Bonded Debt Service Requirements
232
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Personal Public Elementary and Cuesta College
Calendar Income Median Secondary School Full Time Enrollment Unemployment
Year Population (1)in 000's (1)Age (1)Enrollment (2)SLO Campus (3)Rate (1)
2015 46,117 1,211 25.0 7,638 5,401 4.9%
2016 46,724 1,270 25.4 7,718 4,757 4.5%
2017 46,548 1,300 26.1 7,755 4,987 3.2%
2018 46,802 1,398 26.5 7,813 4,515 2.5%
2019 45,920 1,505 26.2 7,801 4,687 2.4%
2020 47,063 1,625 26.7 7,491 1,114 7.7%
2021 47,653 1,717 26.7 7,537 2,173 5.0%
2022 47,788 1,865 26.0 7,717 3,011 2.6%
2023 48,684 1,984 25.2 7,741 3,240 3.1%
2024 49,534 2,183 26.2 7,800 3,298 3.5%
Sources:
1. HdL, Coren & Cone ACFR 2024-25 report - Demographic and Economic Statistics table
3. https://www.cuesta.edu/about/depts/research/Enrollment_Management.html
Post Term FTES Dashboard, 320 Year Reported by academic year start date
Schedule 20
City of San Luis Obispo, California
Demographic and Economic Statistics
For The Last Ten Calendar Years
2. CA Dept of Education DataQuest: Enrollment Reports for San Luis Coastal Unified, by Academic Year start date;
https://www.cde.ca.gov/sdprofile/details.aspx?cds=40688090000000
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Percentage Percentage
Number of Total City Number of Total City
Employer Employees Rank Employment Employees Rank Employment
*Cal Poly State University 3,177 11.85%3,055 1 10.70%
*County of San Luis Obispo 2,956 11.03%2,800 2 8.80%
Cal Poly Corporation (Foundation)2,787 10.40%1,400 5 4.90%
Pacific Gas & Electric Company 1,824 6.81%1,900 3 6.70%
*California Men's Colony 1,350 5.04%1,540 4 5.40%
San Luis Coastal Unified School District 1,070 3.99%902 6 3.20%
Sierra Vista Regional Medical Center 779 2.91%700 7
*Cuesta Community College 773 2.88%440 10 1.50%
French Hospital Medical Center 688 2.57%
City of San Luis Obispo 654 2.44%
Mindbody 650 8 2.30%
California Department of Transportation 544 9 1.90%
Total 16,058 59.92%13,931 45.40%
San Luis Obispo City - Labor Force at 6/30/2025 26,800
*Although not directly in City limits, these are still major employers within the City
Source for the 2024-25 employers information is the Major Employers in San Luis Obispo County from State of California
Employment Development Department's website;
https://labormarketinfo.edd.ca.gov/majorer/countymajorer.asp?CountyCode=000079.
2015-16 data is from the City's ACFR.
2015-162024-25
Schedule 21
City of San Luis Obispo, California
Principal Employers
Current Year and Nine Years Ago
59.92%
40.08%
City Wide Employers for 2024-25
Top 10 Employers All Other Employers
11.85%
11.03%
10.40%
6.81%
5.04%
3.99%
2.91%
2.88%
2.57%
2.44%
Top Ten Employers for 2024-25
*Cal Poly State University *County of San Luis Obispo
Cal Poly Corporation (Foundation)Pacific Gas & Electric Company
*California Men's Colony San Luis Coastal Unified School District
Sierra Vista Regional Medical Center *Cuesta Community College
French Hospital Medical Center City of San Luis Obispo
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Function 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Public Safety
Police
Sworn 61.0 61.0 61.5 61.5 64.5 65.0 64.0 64.0 67.0 70.0
Non-sworn 25.5 25.5 24.0 24.0 24.0 25.5 27.0 27.0 28.0 27.0
Fire
Sworn 50.0 47.0 47.0 47.0 47.0 47.0 47.0 47.0 48.0 49.0
Non-sworn 4.0 10.0 10.0 10.0 10.0 9.5 10.5 10.5 12.5 12.0
Public Utilities 67.1 69.1 69.1 69.1 69.1 69.9 70.6 70.6 80.1 80.0
Transportation 36.8 36.8 36.8 36.8 36.8 37.1 43.3 44.3 40.2 42.7
Culture and recreation 35.0 35.0 35.0 35.0 34.0 33.0 43.0 43.0 47.0 48.0
Community Development 51.0 51.0 47.4 47.9 47.5 47.5 54.5 54.5 58.0 61.3
General Government 57.0 61.0 61.0 62.3 64.8 72.3 87.8 87.8 92.7 99.5
Total 387.4 396.4 391.8 393.6 397.7 406.8 447.7 448.7 473.5 489.5
Ratio of Sworn Police Personnel per 1,000 Population:* 1.33 1.31 1.44 1.31 1.34 1.44 1.34 1.34 1.38 1.44
Ratio of Sworn Fire Personnel per 1,000 Population:*1.06 1.01 1.01 1.00 1.02 1.01 0.99 0.98 0.99 1.01
*Population numbers may not include Cal Poly students or faculty that live on campus and are served by City personnel.
Note: See Schedule of Demographic and Economic Statistics for population data.
Source: City of San Luis Obispo Finance Department
Schedule 22
City of San Luis Obispo, California
Regular Authorized Positions
Last Ten Fiscal Years
235
Page 439 of 525
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Function/Program:
Police:
Calls for police/fire service 38,300 39,620 39,103 37,825 37,335 40,907 44,183 43,104 41,683 35,550
Incident numbers issued 32,542 33,360 32,730 31,471 31,472 35,695 38,290 36,474 35,084 35,952
Police reports written 8,852 8,675 7,735 6,999 6,297 5,852 6,637 6,137 6,708 6,304
Violations cited 7,673 7,649 7,524 5,874 4,020 3,445 3,735 4,851 5,126 8,455
Citations issued 7,038 7,030 6,752 5,287 3,660 3,056 3,349 4,531 4,719 7,907
Collision reports 587 608 609 623 481 419 483 487 533 554
Violent crimes:*173 177 178 191 187 201 225 266 245 210
Willful homicide*- - - 1 - 1 2 - - -
Forcible rape*29 38 44 55 39 37 25 37 31 30
Robbery*13 21 23 33 34 24 33 37 44 41
Aggravated assault*131 118 111 103 114 139 165 192 170 139
Property crimes:*637 731 644 728 728 793 885 985 667 668
Burglary**225 251 172 244 277 284 272 254 183 163
Motor vehicle theft*87 95 94 74 74 117 174 119 90 77
Larceny-theft:*1,335 1,730 1,516 1,493 1,387 1,219 1,398 1,372 1,010 1,126
Over $400*325 385 378 410 377 392 439 612 394 428
$400 and under*1,010 1,345 1,138 1,083 1,010 827 959 760 616 698
Fire:
Medical responses (Note 1)3,540 4,538 4,248 3,715 3,884 3,544 3,857 4,675 4,482 4,494
Fire suppression responses (Note 1)151 143 163 122 127 133 136 146 198 173
Hazardous materials responses (Note 1 and 3)22 21 17 25 29 98 133 153 108 72
Other responses (Note 1)2,158 1,799 1,785 2,100 2,140 1,745 2,097 2,417 2,331 2,575
Total service responses 5,871 6,501 6,213 5,962 6,180 5,520 6,223 7,391 7,119 7,314
Fire Suppression Training Hours 6,714 6,348 7,719 8,410 10,835 11,033 16,015 20,814 19,531 19,620
Fire and life-safety inspections (Note 4)2,516 3,756 3,738 2,002 3,128 1,871 2,092 1,790 1,809 1,546
Arson investigations (Note 2)44 8 12 24 21 13 5 17 5 173
Education activities (# of people)23,680 23,575 23,540 2,690 2,700 2,031 2,000 3,500 3,000 3,500
Public Utilities:
Water/Sewer customer accounts 15,167 15,188 15,505 15,555 15,672 15,958 16,256 16,703 17,015 17,133
Miles of sewerline 138 138 143 143 146 148 148 148 148 148
Miles of waterline 191 197 187 190 191 191 191 191 191 191
Water service line repairs and renewals (incl. recycled water)50 50 57 38 48 35 47 53 55 59
Sewer main stoppages - 11 4 10 8 11 14 12 1 1
Acre feet of water delivered - Nacimiento 3,574 3,817 3,753 3,484 1,470 2,449 4,460 2,096 - -
Acre feet of water delivered - Salinas 8 273 853 790 2,165 1,337 650 949 1,251 2,385
Acre feet of water delivered - Whale Rock 1,375 949 924 800 1,556 1,641 399 2,118 4,027 3,094
Continued
Schedule 23
City of San Luis Obispo, California
Operating Indicators and Capital Asset Statistics by Function
Last Ten Fiscal Years
236
Page 440 of 525
Schedule 23
City of San Luis Obispo, California
Operating Indicators and Capital Asset Statistics by Function
Last Ten Fiscal Years
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Function/Program:
Transportation:
Signals and lights:
Intersections with traffic signals 70 70 70 70 70 72 73 73 73 73
Traffic signal service requests 85 90 60 71 59 93 145 188 197 192
Streetlights operated & maintained 2,300 2,300 2,280 2,280 2,280 2,400 2,477 2,531 2,531 2,531
Streetlight service requests 45 50 13 8 11 33 47 61 69 94
Roadways:
Estimated miles of paved streets 133 133 134 134 134 134 135 143 143 143
Pavement condition index 71 71 70 73 70 73 70 76 73 74
Traffic collisions 531 482 501 431 441 259 361 388 384 466
Parking spaces provided (lot, garage & street)2,953 2,892 2,871 2,865 2,865 2,765 2,817 2,607 2,740 2,790
Parking citations written 24,213 23,348 21,647 24,415 21,240 17,748 39,254 44,439 26,427 32,286
Total transit passengers 1,209,708 1,131,716 945,288 981,995 715,380 179,456 528,000 515,007 575,255 660,056
Leisure, Cultural and Social Services (Note 5):
Open space acres maintained 3,510 3,510 3,775 4,040 4,040 4,040 4,040 4,040 4,040 4,040
Open space easement acres 3,200 3,200 3,200 3,500 3,500 3,500 3,500 3,500 3,500 3,500
Trail mileage 52 52 55 55 56 62 65 65 67 69
Total golf rounds played 30,572 28,196 35,670 24,662 16,428 24,222 17,991 16,392 20,858 24,494
Acres of park landscape maintained 157 157 500 570 530 106 106 107 115 116
City Maintained Trees 20,000 20,000 20,000 20,000 20,000 12,970 12,970 12,976 13,414 13,431
Children's services program enrollment totals 2,115 2,115 1,950 2,050 1,775 1,483 1,611 1,834 2,015 1,889
Triathlon:
participants, spectators, and volunteers
Annual Senior Center Membership 265 331 350 315 192 248 325 315 460
Facility permits processed 1,305 1,073 864 909 650 298 455 714 813 515
Annual aquatics attendance (total)68,403 96,687 97,701 87,690 55,202 51,235 62,224 66,621 75,418 76,905
Adult athletic teams registered 325 325 362 292 184 112 168 167 151 147
Youth athletic participants registered 1,300 1,150 1,115 1,140 618 611 1,083 1,180 1,368 2,322
Special event applications processed 77 101 88 95 40 2 37 45 72 57
Banner permits processed 87 56 45 81 78 48 26 80 70 41
Instructional class enrollments 1,151 1,724 1,439 1,118 595 626 1,212 900 755 1,356
Continued
Continued
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Schedule 23
City of San Luis Obispo, California
Operating Indicators and Capital Asset Statistics by Function
Last Ten Fiscal Years
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Function/Program:
Community Development (Note 6):
Housing characteristics:
Single family units (annually cumulative)11,230 11,306 11,413 11,510 11,693 11,853 12,072 12,169 12,336 12,427
2-4 units (annually cumulative)2,695 2,789 2,851 2,865 2,869 2,888 2,928 2,977 2,983 2,987
5 or more unit structures (annually cumulative)5,804 6,038 6,097 6,148 6,209 6,309 6,524 6,678 6,808 6,949
Mobile homes (annually cumulative)1,482 1,482 1,482 1,482 1,483 1,483 1,483 1,448 1,448 1,448
Total (annually cumulative)21,211 21,615 21,843 22,005 22,254 22,533 23,007 23,272 23,575 23,811
Building permits issued (Note 7):584 584 623 **202 556 721 662 605 678 687
Residential:
Single family residential incl. condos 97 62 125 159 171 253 202 157 203 126
Multi-family residential (includes second units & ADUs)5 13 18 19 17 33 16 24 8 1
Non-residential 13 14 10 15 12 2 3 11 10 6
Other permits:
Additions, alterations, demolitions 522 545 502 381 510 371 366 415 409 360
Other improvements (motel rooms)- - - 1 - - - 60 69 77
Total 637 634 655 575 710 659 587 667 699 570
Approximate value of building permits (in thousands)
Residential:
Single family residential 26,441$ 15,024$ 19,707$ 24,300$ 28,026$ 50,758$ 35,824$ 31,058$ 50,717$ 40,504$
Multi-family residential 13,500$ 8,172$ 17,249$ 21,162$ 33,606$ 10,545$ 56,085$ 20,985$ 71,330$ 900$
Non-residential 11,484$ 51,110$ 6,248$ 20,430$ 16,981$ 17,475$ 22,665$ 44,601$ 54,261$ 11,440$
Other permits:
Additions, alternations, demolitions (incl. swimming pools)30,230$ 27,711$ 14,928$ 34,596$ 60,812$ 78,780$ 29,207$ 58,766$ 34,062$ 45,211$
Total 81,655$ 102,017$ 58,132$ 100,488$ 139,425$ 157,558$ 143,783$ 155,410$ 210,370$ 27,469$
Building inspections conducted 7,195 10,745 9,974 7,537 8,670 7,959 10,470 10,423 9,948 7,523
Home occupation permits processed/applied for 163 144 112 112 131 133 140 101 117 95
Development permit applications received 253 236 215 215 338 269 282 244 109 140
Continued
Continued
238
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Schedule 23
City of San Luis Obispo, California
Operating Indicators and Capital Asset Statistics by Function
Last Ten Fiscal Years
2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Function/Program:
General Government:
Business tax certificates issued:
Located outside City limits 2,018 1,699 1,872 1,948 1,839 1,913 1,932 2,057 2,257 1,896
Total certificates issued 7,597 8,118 8,230 8,205 7,675 7,732 8,371 8,531 9,044 8,796
Citywide recruitments (total)103 103 97 99 86 90 155 142 143 116
Fleet vehicles maintained
City-wide fleet & equipment assets 318 323 339 338 340 345 347 365 361 367
Replaces prior category
Telephone lines managed 1,005 998 907 971 963 1,071 1,101 1,101 1,099 1,099
Cell phones & modems supported 453 476 492 481 487 464 538 595 593 590
IT users supported 515 467 471 488 475 487 511 560 575 582
* Data from California Department of Justice based on calendar year
** Data only reflects the second half of the Fiscal Year
Notes: Some workload indicators are projections.
1. In Fiscal year 2010-11, numbers reported used observed code from Spillman rather than condition code.
2. Police Department Conducts Arson Investigations, Fire Department Conducts Cause and Origin Investigations. Reported number is Cause and Origin Investigations
5. Leisure, Culture and Social Services Indicators for FY 19-20 were lower compared to previous years due to COVID-19 program closures and capacity restrictions.
7. Excludes special permits such as plumbing, mechanical, electrical, signs, and grading as well as plan check permits.
Source: City of San Luis Obispo Departments
4. Beginning in 2020, the fire department began utilizing new mobile inspection software that uses a different inspection methodology counting the building rather than the
number of individual units within the building.
6. Beginning in 2016-17, building permit data reported in terms of calendar years, in alignment with State-mandated reporting requirements. Beginning in 2019-20 all
Community Development Indicators are reported by calendar year.
3. Beginning in 2020-21, the Fire Department includes all "Hazardous Condition" calls for service as categorized by the National Fire Incident Reporting System (NFIRS).
Previously only chemical or flammible liquid spills were captured under this function. Moving forward this function also includes electrical and biological hazards among
Continued
239
Page 443 of 525
Fiscal Historic Increase/Sales Increase/Deliveries Increase/
Year Connections (Decrease)Revenues (Decrease)In Acre Feet (Decrease)
2015-16 15,167 1.40%17,939,024 2.33% 4,957 (7%)
2016-17 15,357 1.25%18,196,937 1.44% 5,039 2%
2017-18 15,505 0.96%19,159,169 5.29% 5,530 10%
2018-19 15,555 0.32%19,577,182 2.18% 5,074 (8%)
2019-20 15,672 0.75%21,519,632 9.92% 5,191 2%
2020-21 15,958 1.82%22,757,325 5.75% 5,602 8%
2021-22 16,256 1.87%24,129,231 6.03% 5,732 2%
2022-23 16,703 2.75%23,297,077 -3.45%5,130 (11%)
2023-24 17,015 1.87%26,088,324 11.98%4,678 (9%)
2024-25 17,127 0.66%28,958,623 11.00%5,029 8%
Source: City of San Luis Obispo Utilities Department.
Schedule 24
City of San Luis Obispo, California
Water System
Statistical Data
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
Sales Revenues
-5.00%
0.00%
5.00%
10.00%
15.00%
2015-162016-172017-182018-192019-202020-212021-222022-232023-242024-25
Revenue Increase/Decrease
240
Page 444 of 525
As of Monthly Multi-family Single family
June 30 of Each Year Consumption Price per hcf*dwelling Commercial Landscape dwelling Multi-family dwelling Commercial
2016 Base Fee 9.98$ $8.32 min. charge per $8.32 min. charge per $8.32 min. charge per
Base Fee Drought Surcharge 0.74 dwelling unit dwelling unit dwelling unit
1-8 hcf 6.92 $9.17/unit volume charge** $9.17/unit volume charge**$9.17/unit volume charge
Drought Surcharge 1.10
9 + hcf 8.65
Drought Surcharge 1.37
2017 Base Fee 9.98$ $8.57 min. charge per $8.57 min. charge per $8.57 min. charge per
Base Fee Drought Surcharge 0.74 dwelling unit dwelling unit dwelling unit
1-8 hcf 6.92 $9.44/unit volume charge** $9.44/unit volume charge**$9.44/unit volume charge
Drought Surcharge 1.10
9 + hcf 8.65
Drought Surcharge 1.37
2018 Base Fee 12.33$ $8.57 min. charge per $8.57 min. charge per $8.57 min. charge per
1-8 hcf 7.27 dwelling unit dwelling unit dwelling unit
9 + hcf 9.08 $9.44/unit volume charge** $9.44/unit volume charge**$9.44/unit volume charge
2019***Residential SFR Base Fee 20.61$ Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 5.90 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 6.87 $6.73/unit volume charge $8.17/unit volume charge $10.02/unit volume charge $7.85/unit volume charge** $7.85/unit volume charge** $7.85/unit volume charge**
13 +12.59
2020 Residential SFR Base Fee 21.74$ Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 6.22 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 7.25 $7.10/unit volume charge $8.62/unit volume charge $10.57/unit volume charge $8.28/unit volume charge** $8.28/unit volume charge** $8.28/unit volume charge**
13 +13.28
2021*****Residential SFR Base Fee 22.52$ Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 6.44 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 7.51 $7.36/unit volume charge $8.93/unit volume charge $10.95/unit volume charge $8.58/unit volume charge $8.58/unit volume charge $8.58/unit volume charge
13 +13.76
2022 Residential SFR Base Fee 23.31$ Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 6.67 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 7.77 $7.62/unit volume charge $9.24/unit volume charge $11.33/unit volume charge $8.88/unit volume charge $8.88/unit volume charge $8.88/unit volume charge
2023 Residential SFR Base Fee 24.12 Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 6.9 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 8.04 $7.88/unit volume charge $9.57/unit volume charge $11.73/unit volume charge $9.19/unit volume charge $9.19/unit volume charge $9.19/unit volume charge
13 +14.74
2024 Residential SFR Base Fee 28.15 Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 7.94 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 9.16 $8.91/unit volume charge $9.43/unit volume charge $9.63/unit volume charge $9.44/unit volume charge $9.44/unit volume charge $9.88/unit volume charge
13 +15.79
Continued
Schedule 25
City of San Luis Obispo, California
Water and Sewer Rates
Last Ten Fiscal Years
Water Rates (Note 1)Sewer Rates (Monthly)
241
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Schedule 25
City of San Luis Obispo, California
Water and Sewer Rates
Last Ten Fiscal Years
As of Monthly Multi-family Single family
June 30 of Each Year Consumption Price per hcf*dwelling Commercial Landscape dwelling Multi-family dwelling Commercial
2025 Residential SFR Base Fee 30.25 Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined Base fee determined
1-5 hcf 8.54 by meter size****by meter size****by meter size****by meter size ****by meter size ****by meter size ****
6-12 hcf 9.84 $9.58/unit volume charge $10.14/unit volume charge $10.35/unit volume charge $9.82/unit volume charge** $9.82/unit volume charge**$10.27/unit volume charge
13 +16.97
*hcf = 100 cubic feet
** Total monthly volume charge capped based on average winter water consumption.
*** Beginning FY 18-19, different rate structures for SFR, Multi-Family, Commercial, and Landscape
****See table below
*****2020-21 rate increase deferred to February 1, 2021 due to COVID-19
Notes:
1. Rates are for services inside the City, outside the City rates are double.
2. Third tier applies only to single-family residential customers.
Source: City of San Luis Obispo Utilities Department
As of Water Sewer As of Water Sewer
June 30 of Each Year Base charge Base Charge June 30 of Each Year Base charge Base Charge
2022 3/4 inch or less 23.31$ 21.15$ 2023 3/4 inch or less $24.12 $21.89
1-inch 38.92 35.31 1-inch 40.28 36.55
1.5-inch 77.67 70.40 1.5-inch 80.38 72.86
2-inch 124.26 112.69 2-inch 128.61 116.63
3-inch 233.15 211.43 3-inch 241.31 218.83
4-inch 388.64 352.45 4-inch 402.24 364.78
6-inch 777.10 704.68 6-inch 804.3 729.34
8-inch 1,243.40 1,127.53 8-inch 1,286.92 1,166.99
10-inch - 1,620.99 10-inch - 1,677.72
2024 3/4 inch or less $28.15 $23.58 2025 3/4 inch or less $30.25 $24.52
1-inch 47 39.37 1-inch 50.5 40.95
1.5-inch 93.75 78.51 1.5-inch 100.8 81.65
2-inch 150.05 125.67 2-inch 161.3 130.7
3-inch 281.5 235.78 3-inch 302.6 245.21
4-inch 469.25 393.04 4-inch 504.45 408.76
6-inch 938.25 785.85 6-inch 1008.6 817.28
8-inch 1,501.25 1,257.40 8-inch 1,613.85 1,307.70
10-inch - 1,807.71 10-inch - 1,880.02
Meter Size
Base fee charges for Multi-Family, Non-Residential, Irrigation
Meter Size
Water Rates (Note 1)Sewer Rates (Monthly)
Continued
Base fee charges for Multi-Family, Non-Residential, Irrigation
242
Page 446 of 525
Service Water Use Percent of
Name Type (acre-feet)Total
City of San Luis Obispo Parks & Golf Landscape 57.85 1.2%
Silver City Mobile Home Park Mobile Homes 56.86 1.1%
ELL-CAP 97-Laguna Lake Mobile Homes 56.44 1.1%
Adventist Health System/West Care Facilities 42.86 0.9%
CAP VIII - Mustang Village LLC Apartments 40.34 0.8%
Creekside Community Mobile Homes 32.65 0.6%
Dignity Health #366 Care Facilities 31.43 0.6%
SLO Coastal Unified School 24.41 0.5%
Embassy Suites Hotel 22.02 0.4%
State of California Landscape 18.31 0.4%
All Other 92.4%
Total 383.16 100.00%
2023-24
Source: City of San Luis Obispo - Utilities Department
Schedule 26
City of San Luis Obispo, California
Water System - Ten Largest Water Users
Fiscal Year Ended June 30, 2025
1.2%
1.1%
1.1%
0.9%
0.8%
0.6%
0.6%
0.5%
0.4%0.4%
Ten Largest Water Users
City of San Luis Obispo Parks & Golf
Silver City Mobile Home Park
ELL-CAP 97-Laguna Lake
Adventist Health System/West
CAP VIII - Mustang Village LLC
Creekside Community
Dignity Health #366
SLO Coastal Unified
Embassy Suites
State of California
92.4%
7.6%
Ten Largest Water Users vs All
Other Water Users
All Other
Top 10
243
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Page 448 of 525
City of San Luis
Obispo
San Luis Obispo, California
Single Audit Reports
For the year ended June 30, 2025
Page 449 of 525
Page 450 of 525
City of San Luis Obispo
Single Audit Reports
For the year ended June 30, 2025
Table of Contents
Page
Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards .................................................................................. 1
Report on Compliance for Each Major Federal Program and on
Internal Control over Compliance in Accordance with the Uniform Guidance
And on the Schedule of Expenditures of Federal Awards .............................................................................................. 3
Schedule of Expenditures of Federal Awards ................................................................................................................. 7
Notes to the Schedule of Expenditures of Federal Awards .......................................................................................... 9
Schedule of Findings and Questioned Costs ................................................................................................................. 10
Page 451 of 525
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Page 452 of 525
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND
OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
Independent Auditor’s Report
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards issued
by the Comptroller General of the United States, the financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of the City of San
Luis Obispo, California (City), as of and for the year ended June 30, 2025, and the related notes to the
financial statements, which collectively comprise the City’s basic financial statements and have issued our
report thereon dated December 16 , 2025.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control
over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in
the circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not
express an opinion on the effectiveness of the City’s internal control.
Our consideration of internal control over financial reporting was for the limited purpose described in the
preceding paragraph and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies and therefore, material weaknesses or significant
deficiencies may exist that have not been identified. However, as described in the accompanying schedule
of findings and responses, we identified certain deficiencies in internal control that we consider to be
material weaknesses and significant deficiencies.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control such that there is a reasonable possibility that a material misstatement of the entity’s
financial statements will not be prevented, or detected and corrected on a timely basis. We consider the
deficiencies described in the accompanying schedule of findings and questioned costs as item 2025-001 to
be material weaknesses.
Page 453 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 2
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe
than a material weakness, yet important enough to merit attention by those charged with governance. We
consider the deficiencies described in the accompany schedule of findings and questioned costs as item
2025-002 to be significant deficiencies.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
financial statements. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our tests
disclosed no instances of noncompliance or other matters that are required to be reported under Government
Auditing Standards.
City of San Luis Obispo’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to
the findings identified in our engagement and described in the accompanying schedule of findings and
questioned costs. City’s response was not subjected to the auditing procedures applied in the audit of the
financial statements and, accordingly, we express no opinion on the response.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this
communication is not suitable for any other purpose.
Badawi & Associates, CPAs
Emeryville, California
December 16, 2025
2
Page 454 of 525
REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL
OVER COMPLIANCE IN ACCORDANCE WITH THE UNIFORM GUIDANCE AND ON THE
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Independent Auditor’s Report
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the City of San Luis Obispo, California’s (City) compliance with the types of compliance
requirements described in the OMB Compliance Supplement that could have a direct and material effect on
each of the City’s major federal programs for the year ended June 30, 2025. The City’s major federal
programs are identified in the summary of auditor’s results section of the accompanying schedule of
findings and questioned costs.
In our opinion, the City complied, in all material respects, with the types of compliance requirements
referred to above that could have a direct and material effect on each of its major federal programs for the
year ended June 30, 2025.
Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America (GAAS) ; the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States(Government Auditing Standards);
and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Our
responsibilities under those standards and the Uniform Guidance are further described in the Auditor’s
Responsibilities for the Audit of Compliance section of our report.
We are required to be independent of the City and to meet our other ethical responsibilities, in accordance
with relevant ethical requirements relating to our audit. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major
federal program. Our audit does not provide a legal determination of the City’s compliance with the
compliance requirements referred to above.
3
Page 455 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 2
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design,
implementation, and maintenance of effective internal control over compliance with the requirements of
laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the City’s
federal programs.
Auditor’s Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the
compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion
on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not
absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS,
Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when
it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that
resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control. Noncompliance with the compliance requirements referred to above is
considered material if there is a substantial likelihood that, individually or in the aggregate, it would
influence the judgment made by a reasonable user of the report on compliance about the City’s compliance
with the requirements of each major federal program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the Uniform
Guidance, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and
perform audit procedures responsive to those risks. Such procedures include examining, on a test basis,
evidence regarding the City’s compliance with the compliance requirements referred to above and
performing such other procedures as we considered necessary in the circumstances.
• Obtain an understanding of the City’s internal control over compliance relevant to the audit in order to
design audit procedures that are appropriate in the circumstances and to test and report on internal control
over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an
opinion on the effectiveness of the City’s internal control over compliance. Accordingly, no such opinion is
expressed.
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal
control over compliance that we identified during the audit.
4
Page 456 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 3
Report on Internal Control over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a
combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility
that material noncompliance with a type of compliance requirement of a federal program will not be
prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over
compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of
compliance requirement of a federal program that is less severe than a material weakness in internal control
over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the
Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify all
deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies
in internal control over compliance. Given these limitations, during our audit we did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses, as defined
above. However, material weaknesses or significant deficiencies in internal control over compliance may
exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control
over compliance. Accordingly, no such opinion is expressed.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing
of internal control over compliance and the results of that testing based on the requirements of the Uniform
Guidance. Accordingly, this report is not suitable for any other purpose.
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
We have audited the financial statements of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the City, as of and for the year ended June 30,
2025, and the related notes to the financial statements, which collectively comprise the City’s basic financial
statements. We issued our report thereon dated December 16, 2025, which contained unmodified opinions
on those financial statements. Our audit was conducted for the purpose of forming opinions on the
financial statements that collectively comprise the basic financial statements. The accompanying schedule of
expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform
Guidance and is not a required part of the basic financial statements. Such information is the responsibility
of management and was derived from and relates directly to the underlying accounting and other records
used to prepare the basic 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
5
Page 457 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 4
to prepare the basic financial statements or to the basic financial statements themselves, and other
additional procedures in accordance with auditing standards generally accepted in the United States of
America. In our opinion, the schedule of expenditures of federal awards is fairly stated in all material
respects in relation to the basic financial statements as a whole.
Badawi & Associates, CPAs
Emeryville, California
December 16, 2025
6
Page 458 of 525
City of San Luis Obispo
Schedule of Expenditures of Federal Awards
For the year ended June 30, 2025
Assistance
Listing Pass-through Program Subrecipient
Grantor Agency and Grant Title Number Number Expenditures Payments
U.S. Department of Housing and Urban Development
CDBG-Entitlement Grants Cluster
Passed Through the County of San Luis Obispo
Community Development Block Grants/Entitlement Grants 14.218 B-23-UC-06-0508 33,367$ -$
Total CDBG-Entitlement Grants Cluster 33,367 -
Total U.S. Department of Housing and Urban Development 33,367 -
U.S. Department of Justice
Direct awards:
Bulletproof Vest Partnership Program 16.607 7,227 -
Edward Byrne Memorial Justice Assistance Grant Program 16.738 14,730 -
Total U.S. Department of Justice 21,957 -
U.S. Department of Transportation
Direct award:
Federal Transit Formula Grants 20.507 9,106,262 -
Total Federal Transit Cluster 9,106,262 -
Passed Through the National Highway Traffic Association
State and Community Highway Safety 20.600 EM25009 130,331 -
Total Highway Safety Cluster 130,331 -
Passed Through the California department of transportation
Highway Planning and Construction 20.205 STPLR-7500(291)27,867 -
Total U.S. Department of Transportation 9,264,460 -
Department of the Treasury
Direct award:
Coronavirus State and Local Fiscal Recovery Funds 21.027 497,423 -
Total Department of the Treasury 497,423 -
U.S. Department of Energy
Direct award:
Energy Efficiency and Conservation Block Grant 81.128 76,790 -
Total U.S. Department of Energy 76,790 -
U.S. Department of Homeland Security
Direct awards:
Disaster Grants - Public Assistance (Presidentially Declared Disasters) 97.036 966,938 -
Assistance to Firefighters Grant 97.044 82,871 -
Passed Through the California 's Office of Emergency Management
Hazard Mitigation Grant - California Office of Emergency Management 97.039 FEMA-4344-DR-CA/
FEMA-4308-DR-CA
1,008,192 -
Total U.S. Department of Homeland Security 2,058,001 -
Total Expenditures of Federal Awards 11,951,998$ -$
See accompanying Notes to Schedule of Expenditures of Federal Awards.
7
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8
Page 460 of 525
City of San Luis Obispo
Notes to the Schedule of Expenditures of Federal Awards
For the year ended June 30, 2025
A. Reporting Entity
The City is a California charter city. It was incorporated on February 19, 1856 and chartered on May 1,
1876. It is organized in accordance with the Council-Mayor-City Manager form of government. With a
population of approximately 47,788, the City provides a broad range of municipal services, including
police and fire protection, parks and recreation, water and sewer utilities, street maintenance, public
transportation, parking, planning, and building and safety.
B. Basis of Accounting
Funds received under the various grant programs have been recorded within the special revenue funds
of the City. The City utilizes the modified accrual method of accounting for the special revenue funds.
Modified accrual accounting recognizes revenues when they become available and measurable and,
with a few exceptions, recognizes expenditures when liabilities are incurred. The accompanying
Schedule of Expenditures of Federal Awards (Schedule) has been prepared on the modified accrual
basis of accounting.
C. Relationship of Schedule of Expenditures of Federal Awards to Financial Statements
The accompanying Schedule presents the activity of all federal financial assistance programs of the City.
Federal financial assistance received directly from federal agencies as well as federal financial assistance
passed through the State of California is included in the Schedule.
The Schedule was prepared only from the accounts of various grant programs and, therefore, does not
present the financial position or results of operations of the City.
D. Pass-Through Entities’ Identifying Number
When federal awards were received from a pass-through entity, the Schedule shows, if available, the
identifying number assigned by the pass-through entity. When no identifying number is shown, the
City determined that no identifying number is assigned for the program or the City was unable to
obtain an identifying number from the pass-through entity.
E. Indirect Costs
The City did not elect to use the 10% de minimis indirect cost rate.
9
Page 461 of 525
City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section I - Summary of Auditor’s Results
Financial Statements
Types of auditor’s report issued: Unmodified
Internal control over financial reporting:
Material weakness(es) identified? Yes
Significant deficiency(ies) identified? Yes
Any noncompliance material to the financial statements noted? No
Federal Awards
Internal control over major programs:
Material weakness(es) identified? No
Significant deficiency(ies) identified? None noted
Type of auditor’s report issued on compliance for major programs Unmodified
Any audit findings disclosed that are required to be reported in
Accordance with section 200.516(a) No
Identification of major programs:
Assistance Listing Number(s)Name of Federal Program or Cluster Expenditures
20.507 Federal Transit Formula Grants 9,106,262$
97.036 Disaster Grants - Public Assistance (Presidentially Declared Disasters)966,938
Total Expenditures of All Major Federal Programs 10,073,200$
Total Expenditures of Federal Awards 11,951,998$
Percentage of Total Expenditures of Federal Awards 84.3%
Dollar threshold used to distinguish between type A and type B program $750,000
Auditee qualified as low-risk auditee under
section 200.520? No
10
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City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section II – Current Year Findings
A. Financial Statement Audit Finding
2025-001 Journal Entries Posting (Material Weakness)
Criteria: The access to post journal entries in the general ledger should be restricted. Journal entries
should be independently prepared, reviewed before being posted to the general ledger.
Condition: During the review of the City’s journal entry approval matrix and JE testing, we noted the
posting from the subledger to GL do not require approvals at the general ledger level nor at the
subledger level. Considering the number of employees who can post entries through subledger without
review and the fact that corrections to payroll, payable, revenue/receivables, cash management, capital
assets all can be posted through subledger and do not require approval, it increased the risk of
unauthorized or incorrect journals getting posted into general ledger.
Cause: The City didn’t have control in place to ensure all journal entries are properly reviewed before
posting.
Effect:. Journal entries recorded in the City’s accounting system may be inaccurate, unapproved, or
unsupported.
Recommendation: We recommend that the City limit the number of employees who can post journal
entries in the subledger and general ledger, and implement system control to ensure all journal entries
are reviewed before posting.
Management’s response:
City management agrees with the recommendation and continues working with the internal IT team
and consultants to explore modifications to the Oracle ERP system’s workflow to include approval for
system-generated adjusting entries, which are currently posted automatically.
Approval for manually generated journal entries was implemented in FY 2021-22 and remains in place.
While the City has approval controls for manual entries, a solution for system-generated adjustments is
still in progress. In the interim, the City has limited the number of employees that can post journal
entries and has developed reports that are generated each week to detect changes or adjustments to
payables transactions. These reports, along with procedural changes are intended to mitigate risk of
inaccurate, unapproved or unsupported entries posting to the general ledger until a system solution is
identified. This goal is considered partially implemented by the City.
11
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City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section II – Current Year Findings, continued
A. Financial Statement Audit Finding, continued
2025-002 Payroll Module Implementation (Significant Deficiency)
Criteria: An effectively implemented payroll system should process the payroll accurately, and an
effective internal control system over payroll requires timely and accurate payroll processing.
Condition: During the performance of the audit, we noted that –
• The Oracle payroll module has overtime configuration implemented incorrectly, and the City has to
manually track the payroll in a spreadsheet and correct the error as it occurs since the
implementation.
• The configuration of payroll journal entries posting was implemented incorrectly which caused the
variance between the bank record and the City’s general ledger.
Cause: The Oracle payroll module has not been implemented correctly.
Effect: Errors and fraud can go undetected in payroll processing with a large volume of manual
corrections needed.
Recommendation: We recommend the City to work with the third-party vendor to correct the
implementation of payroll module.
Management’s Response:
City Management agrees with the finding and has engaged a consultant to reconfigure the payroll
module to correct overtime calculations. Significant progress has been made in identifying and testing
solutions as of June 30, 2025, with full implementation occurring in October 2025. Manual intervention
in the calculation of overtime is no longer required as of the implementation.
In the interim, the City continued to monitor payroll, manually correcting overtime issues each pay
period. To enhance accuracy, staff has delivered comprehensive training on time card entry and created
Oracle Guided Learnings (OGLs) for real-time payroll module training. Additionally, the City has
implemented the mandatory "Redwood" Oracle user interface upgrade, improving usability and time-
tracking accuracy.
Configuration of the payroll journal entries was a one-time occurrence that has since been corrected.
12
Page 464 of 525
City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section II – Current Year Findings, continued
B. Federal Award Program Audit Finding
No findings or questioned costs were noted in the current year.
13
Page 465 of 525
City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section III – Prior Year Findings
A. Financial Statement Audit Finding
2024-001 Journal Entries Posting (Material Weakness)
Criteria: The access to post journal entries in the general ledger should be restricted. Journal entries
should be independently prepared, reviewed before being posted to the general ledger.
Condition: During the review of the City’s journal entry approval matrix and JE testing, we noted the
posting from the subledger to GL do not require approvals at the general ledger level nor at the
subledger level. Considering the number of employees who can post entries through subledger without
review and the fact that corrections to payroll, payable, revenue/receivables, cash management, capital
assets all can be posted through subledger and do not require approval, it increased the risk of
unauthorized or incorrect journals getting posted into general ledger.
Cause: The City didn’t have control in place to ensure all journal entries are properly reviewed before
posting.
Effect:. Journal entries recorded in the City’s accounting system may be inaccurate, unapproved, or
unsupported.
Recommendation: We recommend that the City limit the number of employees who can post journal
entries in the subledger and general ledger, and implement system control to ensure all journal entries
are reviewed before posting.
Status: Not implemented. See current year finding 2025-001.
14
Page 466 of 525
City of San Luis Obispo
Single Audit Reports
Schedule of Findings and Questioned Costs
For the year ended June 30, 2025
Section III – Prior Year Findings, continued
A. Financial Statement Audit Finding, continued
2024-002 Payroll Module Implementation (Significant Deficiency)
Criteria: An effectively implemented payroll system should process the payroll accurately, and an
effective internal control system over payroll requires timely and accurate payroll processing.
Condition: During the performance of the audit, we noted that –
• The Oracle payroll module has overtime configuration implemented incorrectly, and the City has to
manually track the payroll in a spreadsheet and correct the error as it occurs since the
implementation.
• The configuration of payroll journal entries posting was implemented incorrectly which caused the
variance between the bank record and the City’s general ledger.
Cause: The Oracle payroll module has not been implemented correctly.
Effect: Errors and fraud can go undetected in payroll processing with a large volume of manual
corrections needed.
Recommendation: We recommend the City to work with the third-party vendor to correct the
implementation of payroll module.
Status: Not Implemented. See current year finding 2025-002.
B. Federal Award Audit Finding
No findings or questioned costs were noted in the prior year.
15
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Page 468 of 525
City of San Luis Obispo
Transportation
Development Act Funds
Financial Statements
Years Ended
June 30, 2025 and 2024
Page 469 of 525
Page 470 of 525
City of San Luis Obispo, California
Transportation Development Act Funds
Financial Statements
Years Ended June 30, 2025 and 2024
Page 471 of 525
Page 472 of 525
City of San Luis Obispo,
California
Transportation Development
Act Funds Report and
Financial Statements
Year Ended June 30, 2025 and 2024
Table of Contents
Page
Independent Auditor’s Report..................................................................................................................................................1
Balance Sheets ........................................................................................................................................................................5
Statements of Revenues, Expenditures and Changes in Fund Balance –
Years Ended June 30, 2025 and 2024 ......................................................................................................................................6
Statements of Fund Net Position..............................................................................................................................................7
Statements of Revenues, Expenses and Changes in Fund Net Position –
Years Ended June 30, 2025 and 2024 ......................................................................................................................................8
Statements of Cash Flows .......................................................................................................................................................9
Notes to Financial Statements ................................................................................................................................................11
TDA Fund Supplementary Information
Schedule of Revenues and Expenditures –Budget and Actual –
Years Ended June 30, 2025 and 2024 ....................................................................................................................................21
Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in accordance with Government Auditing Standards ....................................................23
Report on Compliance and on Internal Control over Compliance for
Transportation Development Act Funds ................................................................................................................................25
Page 473 of 525
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Page 474 of 525
INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Report on the Audit of the Financial Statements
Opinions
We have audited the accompanying financial statements of the Transportation Development Act (TDA)
Fund and the Transit Fund of the City of San Luis Obispo, California, as of and for the year ended June
30, 2025 and 2024, and the related notes to the financial statements as listed in the table of contents.
In our opinion, the accompanying financial statements present fairly, in all material respects, the
respective financial position of the TDA Fund and the Transit Fund, as of June 30, 2025 and 2024, and
the respective changes in financial position for the year then ended in accordance with accounting
principles generally accepted in the United States of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States
of America (GAAS) and the standards applicable to financial audits contained in Government Auditing
Standards (GAS), issued by the Comptroller General of the United States. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are required to be independent of the City and to meet our other
ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
Responsibilities of Management for the Financial Statements
The City’s management is responsible for the preparation and fair presentation of the financial
statements in accordance with accounting principles generally accepted in the United States of
America, and for the design, implementation, and maintenance of internal control relevant to the
preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions
or events, considered in the aggregate, that raise substantial doubt about the TDA fund and the Transit
Fund’s ability to continue as a going concern for twelve months beyond the financial statement date,
including any currently known information that may raise substantial doubt shortly thereafter.
Page 475 of 525
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 2
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance
and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a
material misstatement when it exists. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control. Misstatements are considered
material if there is a substantial likelihood that, individually or in the aggregate, they would influence
the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, and design and perform audit procedures responsive to those risks. Such
procedures include examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the TDA fund and the Transit Fund’s internal control.
Accordingly, no such opinion is expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate,
that raise substantial doubt about the TDA fund and the Transit Fund’s ability to continue as a
going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit, significant audit findings, and certain internal control–
related matters that we identified during the audit.
Emphasis of Matter
As discussed in Note 1, the financial statements present only the TDA Fund and the Transit Fund and
do not purport to, and do not,present fairly the financial position of the City, as of June 30, 2025 and
2024, and the changes in its financial position or where applicable,its cash flows for the years ended in
accordance with accounting principles generally accepted in the United States of America.Our opinion
is not modified with respect to this matter.
2
Page 476 of 525
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 3
Required Supplementary Information
Management has omitted management’s discussion and analysis that accounting principles generally
accepted in the United States of America require to be presented to supplement the basic financial
statements. Such missing information, although not a part of the basic financial statements, is required
by the Governmental Accounting Standards Board who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. Our opinions on the basic financial statements are not affected by this missing
information.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Transportation Development Act (TDA) Fund and the Transit Fund’s
financial statements. The budgetary comparison schedule is presented for purposes of additional
analysis and is not a required part of the financial statements.
The budgetary comparison schedule on page 21 is the responsibility of management and was derived
from and relate directly to the underlying accounting and other records used to prepare the financial
statements. Such 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
budgetary comparison schedule is fairly stated in all material respects in relation to the financial
statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 16,
2025 on our consideration of the TDA fund and the Transit Fund’s internal control over financial
reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and
grant agreements and other matters. The purpose of that report is solely to describe the scope of our
testing of internal control over financial reporting and compliance and the results of that testing, and
not to provide an opinion on the effectiveness of internal control over financial reporting or on
compliance.That report is an integral part of an audit performed in accordance with Government
Auditing Standards in considering the TDA fund and the Transit Fund’s internal control over financial
reporting and compliance.
Badawi &Associates, CPAs
Emeryville, California
December 16, 2025
3
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Page 478 of 525
2025 2024
Assets
Cash and investments 10,050$ 33,132$
Total assets 10,050$ 33,132$
Liabilities and Fund Balance
Liabilities
Unearned revenue -$-$
Total liabilities --
Fund balances:
Unassigned 10,050 33,132
Total liabilities and fund balance 10,050$ 33,132$
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund
Balance Sheets
June 30, 2025 and 2024
The accompanying notes are an integral part of these financial statements.
5
Page 479 of 525
2025 2024
Revenues - intergovernmental allocations 66,918$ 69,451$
Other financing uses - operating transfers to City of San Luis Obispo (90,000) (45,000)
Excess of revenues over other financing uses (23,082) 24,451
Fund balance - beginning of year 33,132 8,681
Fund balance - end of year 10,050$ 33,132$
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund
Statements of Revenues, Expenditures and Changes in Fund Balance
June 30, 2025 and 2024
The accompanying notes are an integral part of these financial statements.
6
Page 480 of 525
2025 2024
Assets
Current assets:
Cash and investment 7,609,119$ 8,850,539$
Interest receivable 46,685 40,580
Due from other governments 6,396,968 2,397,142
Total current assets 14,052,772 11,288,261
Capital assets:
Infrastructure 110,972 110,972
Buildings and improvements 5,212,278 5,212,278
Transit operating equipment 13,205,125 10,558,191
Construction in progress 6,189,900 2,522,125
Total capital assets 24,718,275 18,403,566
Less accumulated depreciation (11,285,382) (10,810,219)
Total capital assets, net of accumulated depreciation 13,432,893 7,593,347
Total assets 27,485,665 18,881,608
Deferred Outflows of Resources
Pension related 189,397 222,768
Other post‐employment benefits related 23,563 19,436
Total deferred outflows of resources 212,960 242,204
Liabilities
Current liabilities:
Accounts payable 1,779,374 639,534
Accrued salaries and compensated absences 64,154 62,067
Unearned revenues 10,058,588 8,466,347
Total current liabilities 11,902,116 9,167,948
Noncurrent liabilities:
Compensated absences, net of current portion 12,574 13,847
Net pension liability 797,275 791,956
Net other post‐employment benefits liability 21,955 25,947
Total noncurrent liabilities 831,804 831,750
Total liabilities 12,733,920 9,999,698
Deferred Inflows of Resources
Pension related -815
Other post‐employment benefits related 18,083 21,807
Total deferred inflows of resources 18,083 22,622
Net Position
Net investment in capital assets 13,432,893 7,593,347
Restricted 1,513,729 1,508,145
Total net position 14,946,622$ 9,101,492$
City of San Luis Obispo, California
Transit Fund
Statements of Fund Net Position
June 30, 2025 and 2024
The accompanying notes are an integral part of these financial statements.
7
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2025 2024
Operating revenues:
Passenger fares 234,855$ 250,790$
Special transit fares 750,000 750,000
Other revenue 5,883 2,326
Total operating revenues 990,738 1,003,116
Operating expenses:
Purchased transportation 3,912,353 3,006,116
Other transportation services 587,851 587,497
Fuel and lubricants 461,073 406,007
Other materials and supplies 41,804 42,037
Salaries and wages 256,219 275,338
Fringe benefits 163,245 135,434
General and administrative 460,609 463,491
Depreciation 475,162 436,460
Total operating expenses 6,358,316 5,352,380
Operating loss (5,367,578) (4,349,264)
Nonoperating revenues:
Transportation Development Act operating grants 226,556 733,905
Transportation Development Act capital grants -479,938
Federal Transit Administration operating grants 2,364,895 2,802,275
Federal Transit Administration capital and planning grants 958,938 684,498
Low Carbon Operation Revenue Grant 376,368 -
Federal Stimulus Grants 1,570,203 -
Air Pollution Control District Grant 498,473 -
State of Good Repair (SGR) Grant 9,943 394,054
Interest 494,453 377,325
Total nonoperating revenues 6,499,829 5,471,995
Income (loss) before transfers and capital contribution 1,132,251 1,122,731
Capital Contribution 4,712,879 -
Change in net position 5,845,130 1,122,731
Net position - beginning of year 9,101,492 7,978,761
Net position - beginning of year, as restated 9,101,492 7,978,761
Net position - end of year 14,946,622$ 9,101,492$
City of San Luis Obispo, California
Transit Fund
Statements of Revenues, Expenses and Changes in Net Position
Years Ended June 30, 2025 and 2024
The accompanying notes are an integral part of these financial statements.
8
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2025 2024
Cash flows from operating activities:
Cash received from customers (1,416,847)$ 2,211,862$
Cash payments to suppliers for goods and services (3,863,241) (4,317,891)
Cash payments to General Fund for interfund services (460,609) (463,491)
Cash payments to employees for services (392,618) (353,413)
Net cash used in operating activities (6,133,315) (2,922,933)
Cash flows from noncapital financing activities:
Operating grants received 6,005,377 5,094,670
Net cash provided by noncapital financing activities 6,005,377 5,094,670
Cash flows from capital and related financing activities:
Capital grants received 4,712,879 -
Acquisition and construction of capital assets (6,314,709) (1,665,372)
Net cash used in capital and related financing activities (1,601,830) (1,665,372)
Cash flows from investing activities:
Interest on investments 488,348 363,741
Net cash provided by (used in) investing activities 488,348 363,741
Net increase (decrease) in cash and cash equivalents and investments (1,241,420) 870,106
Cash and cash equivalents and investments - beginning of year 8,850,539 7,980,433
Cash and cash equivalents and investments - end of year 7,609,119$ 8,850,539$
City of San Luis Obispo, California
Transit Fund
Statements of Cash Flows
Years Ended June 30, 2025 and 2024
The accompanying notes are an integral part of these financial statements.
9
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2025 2024
Reconciliation of operating loss to net cash used in operating activities:
Operating loss (5,367,578)$ (4,349,264)$
Adjustments to reconcile operating loss to net cash used in operating activities:
Depreciation 475,162 436,460
Changes in operating assets, deferred outflows, liabilities,
and deferred inflows:
Accounts receivable (3,999,826) (248,306)
Accounts payable 1,139,840 (276,234)
Unearned revenue 1,592,241 1,457,052
Accrued salaries and compensated absences 814 38,807
Pension related deferred outflows and inflows and net pension liability 37,875 19,815
OPEB related deferred outflows and inflows and net OPEB liability (11,843) (1,263)
Net cash used in operating activities (6,133,315)$ (2,922,933)$
Reconciliation of cash and cash equivalents and investments to the statement
of fund net position:
Cash and investment 7,609,119$ 8,850,539$
Total cash and cash equivalents and investments 7,609,119$ 8,850,539$
Statements of Cash Flows, Continued
Years Ended June 30, 2025 and 2024
City of San Luis Obispo, California
Transit Fund
The accompanying notes are an integral part of these financial statements.
10
Page 484 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Note 1 -THE REPORTING ENTITY
The City of San Luis Obispo (the City) operates a fixed route public transportation system within the City limits and to the
California Polytechnic State University (Cal Poly). Vehicle operations and vehicle maintenance are provided under contract by a
private transportation company. Nonvehicle-related support and administrative services are provided by City staff.
The Transportation Development Act (TDA) Fund (the Fund) of the City of San Luis Obispo, California (the City) is a special
revenue fund created by resolution of the City Council to account for the revenues received pursuant to the TDA. Such revenues
allocated under specific state statutes are legally restricted to financial expenditures made of the development and construction of
local streets and roads, including pedestrian and bicycle facilities.
The Transit Fund is an enterprise fund of the City created by resolution of the City Council to account for the revenues received
pursuant to the Transportation Development Act (TDA), Federal Transit Authority (FTA) and the revenues received from the
transit operations described above. Such revenues are allocated under specific statutes and are legally restricted to finance
expenditures made for transit operations, the development of public transportation systems and transportation planning. When both
restricted and unrestricted resources are available for the same purpose, it is the City’s policy to use restricted funds first.
Note 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Measurement Focus, Basis of Accounting and Basis of Presentation
The Transportation Development Act (TDA) Fund’s financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized when measurable and available.
Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay the
liabilities of the current period. For this purpose, the City considers interest and grant revenues earned but not received as
susceptible to accrual under this method. Expenditures are generally recognized at the time liabilities are incurred.
The Transit Fund’s financial statements are reported using the economic resources measurement focus and the accrual basis of
accounting. Revenues are recognized when earned and expenses are recognized when incurred regardless of the timing of related
cash flows. The Fund distinguishes operating revenues and expenses from nonoperating items. Operating revenues and expenses
generally result from providing services in connection with the Fund’s principal ongoing operations. The principal operating
revenues of the Fund are charges to customers for transit services. Operating expenses for the Fund include cost of services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as
nonoperating revenues and expenses, including non-exchange transactions such as TDA and FTA grants.
Non-exchange transactions, in which the Transit Fund receives value without directly giving equal value in return, include grants.
Revenue from grants is recognized in the fiscal year in which all eligibility requirements have been satisfied. Eligibility
requirements include timing requirements, which specify the fiscal year when the resources are to be used or the fiscal year when
use is first permitted; matching requirements, in which the Transit Fund must provide local resources to be used for a specific
purpose; and expenditures requirements, in which the resources are provided to the Transit Fund on a reimbursement basis.
11
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City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 2
Note 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Annual Financial Statements
The financial statements of the Transportation Development Act (TDA) Fund and the Transit Fund are intended to reflect the
financial position; results of operations and cash flows where applicable in conformity with generally accepted accounting
principles and are not intended to present the financial position, results of operations, or cash flows of the City of San Luis Obispo,
California.
Measurement Focus, Basis of Accounting and Basis of Presentation
Special Revenue Fund –Transportation Development Act Fund
This fund is used to account for the City’s share of Transportation Development Act (TDA) Article 3 funds that are legally
restricted for the improvement and maintenance of street systems including pedestrian and bicycle facilities. Under the City's
Financial Plan policies, all TDA Article 3 revenues are allocated for alternative transportation purposes. The purpose of this fund
is to account for these revenues.
Enterprise Fund -Transit
This fund is used to account for the operation and maintenance of the City’s transit system. TDA Article 4 and FTA allocations
for transit operations are accounted for in this fund.
Cash, Cash Equivalents,and Investments
Cash and cash equivalents consist of cash on hand, cash balances in checking and money market accounts and short-term
investments, with an original maturity of three months or less. Investments which are in the City’s internal investment pool are
also treated as cash equivalents for the purposes of the statement of cash flows.
Amounts Due from Other Governments
Generally, amounts due from other governments are recorded as revenues when earned. However, when the use of funds is the
prime factor for determining eligibility for grants, revenue is accrued when the related expenses have been made on an approved
grant.
Capital Assets
Capital assets are recorded at cost and depreciated using the straight-line method over their estimated useful lives, ranging from 5
to 20 years. Capital assets are defined by the City as assets with an initial, individual cost of more than $25,000. Detailed capital
assets can be found in Note 5.
12
Page 486 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 3
Note 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Net Pension Liability, Deferred Outflows and Deferred Inflows
The City recognizes a net pension liability, which represents the City’s excess of the total pension liability over the fiduciary net
position of the pension reflected in the actuarial reports provided by the California Public Employees’ Retirement System
(CalPERS) plans (Plans). The City has allocated a proportionate share of the net pension liability, deferred outflows, deferred
inflows and pension expense to the Transit Fund. The net pension liability is measured as of the City’s prior fiscal year-end.
Changes in the net pension liability are recorded, in the period incurred, as pension expense or as deferred inflows of resources or
deferred outflows of resources depending on the nature of the change. The changes in the net pension liability that are recorded as
deferred inflows of resources or deferred outflows of resources (that arise from changes in actuarial assumptions or other inputs
and differences between expected or actual experience) are amortized over the weighted average remaining service life of all
participants in the respective pension plan and are recorded as a component of pension expense beginning with the period in which
they are incurred.
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to pensions, and pension
expense, information about the fiduciary net position of the City’s CalPERS Plans and additions to/deductions from the Plans’
fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this purpose, benefit
payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit
terms. Investments are reported at fair value. Projected earnings on pension investments are recognized as a component of pension
expense.
Other Post-Employment Benefits (OPEB) Liability, Deferred Outflows and Deferred Inflows
For purposes of measuring 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 City’s plan (OPEB Plan), and additions to or deductions
from the OPEB Plan’s fiduciary net position, have been determined on the same basis as they are reported by the California
Employer’s Retiree Benefit Trust Program (CERBT). For this purpose, benefit payments (including refunds of employee
contributions) are recognized when currently due and payable in accordance with benefit terms. Investments are reported at fair
value.
Generally accepted accounting principles require that the reported OPEB results must pertain to liability and asset information
within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date June 30, 2023 and 2021
Measurement Dates June 30, 2024 and 2023
Measurement Periods July 1, 2023 to June 30, 2024,
and July 1, 2022 to June 30, 2023
Fund Balance
The TDA Fund’s financial statements report fund balance in classifications that comprise a hierarchy based primarily on the extent
to which the City is bound to honor constraints on the specific purpose for which amounts in the funds can be spent. The Fund
does not have a fund balance in the current fiscal year; therefore classification is not necessary. However, GASB Statement No.
54, Fund Balance Reporting and Governmental Fund Type Definitions, identifies five components of fund balance –
nonspendable, restricted, committed, assigned and unassigned.
Nonspendable -This component includes amounts that cannot be spent because they are either (a) not in spendable form or (b)
legally or contractually required to be maintained intact.
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Page 487 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 4
Note 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Fund Balance (Continued)
Restricted -This component consists of amounts that have constraints placed on them either externally by third parties (creditors,
grantors, contributors, or laws or regulations of other governments) or by law through constitutional provisions or enabling
legislation. Enabling legislation authorizes the City to assess, levy, charge or otherwise mandate payment of resources (from
external resource providers) and includes legally enforceable requirements (compelled by external parties) that those resources be
used only for the specific purposes stipulated in the legislation.
Committed -This component consists of amounts that can only be used for specific purposes pursuant to constraints imposed by
minute order authorized by the City Council. Also included in this component are encumbrances which represent legal and binding
obligations for the acquisition of future goods and services. Those committed amounts established by minute order cannot be used
for any other purpose unless the City Council adopts a new minute order so directing. With respect to encumbered amounts, the
City may take steps to cancel the order for goods or services and thereby terminate the obligation.
Assigned -This component consists of amounts that are constrained by the City’s intent to be used for specific purposes but are
neither restricted nor committed. The City Manager or Director of Finance are authorized to assign amounts to a specific purpose.
Constraints imposed on the use of assigned amounts can be removed with no formal Council actions.
Unassigned -This classification represents amounts that have not been restricted, committed,or assigned to specific purposes.
Fund Balance Spending Policy
The City follows a practice in which restricted, committed, assigned, and unassigned fund balances are spent when more than one
amount is available for a specific purpose. When both restricted and unrestricted resources are available for use, it is the City’s
policy to use restricted resources first, then unrestricted resources (committed, assigned and unassigned) as they are needed. When
unrestricted resources (committed, assigned and unassigned) are available for use, it is the City’s policy to use committed
resources first, then assigned, and then unassigned as they are needed.
Budgets and Budgetary Accounting
The City has received national recognition for its use of a two-year Financial Plan and budgetary process that emphasizes long-
range planning and effective program management. Significant features of the City’s two-year Financial Plan include the
integration of Council goal setting into the budgetary process and the extensive use of formal policies and measurable objectives.
The Financial Plan includes operating budgets for two years and a capital improvement plan (CIP) for five years.
Under this multi-year approach, appropriations continue to be made annually; however, the Financial Plan is the foundation for
preparing the budget for the second year. Additionally, unexpended operating appropriations from the first year may be carried
over for specific purposes into the second year with the approval of the City Manager.
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 certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
14
Page 488 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 5
Note 3 -CASH AND CASH EQUIVALENTS AND INVESTMENTS
Transportation Act Development (TDA) Fund and Transit Fund are pooled with the City’s cash and investments in order to
generate optimum interest income. The City pools its available cash for investment purposes. Cash and cash equivalents are
combined with investments and displayed as Cash and Investments.
At June 30, 2025 and 2024, cash and investments consisted of the following:
Investment Fair Value Measurements
The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting
principles. Investment securities classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets
for those securities. Investment securities classified in Level 2 of the fair value hierarchy are valued using matrix pricing or market
corroborated pricing. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices.
Custodial Credit Risk –Deposits
Custodial credit risk is the risk that in the event of a bank failure, the City’s deposits may not be returned to it. Cash balances held
in banks are insured up to $250,000 by the Federal Depository Insurance Corporation. For custodial credit risk associated with
deposits, the City follows California Government Code, which requires California financial institutions to secure the City’s
deposits by pledging government securities as collateral. The market value of the pledged securities must equal 110% of the City’s
deposits. California law also allows financial institutions to secure the City’s deposits by pledging first trust deed mortgage notes
equal to 150% of the City’s deposits. All deposits held by financial institutions are fully insured or collateralized with securities,
held by the pledging financial institutions’ trust departments in the City’s name.
The City follows the practice of pooling cash and investments for all funds under its direct daily control. Funds held by outside
fiscal agents under provisions of bond indentures are maintained separately.
Interest earned on pooled cash and investments is allocated quarterly to the various funds based on the respective fund’s average
quarterly cash balance. Interest earned from cash and investments with fiscal agents is credited directly to such funds.
Interest Rate Risk
This is the risk that the market value of securities in the portfolio will fall due to changes in general interest rates. In accordance
with its policies in the Investment Management Plan, the City mitigates interest rate risk by:
Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby
avoiding the need to sell securities on the open market before maturity.
Investing operating funds primarily in shorter-term securities.
The City’s investment policy also includes portfolio maturity targets. A minimum of 20% of the portfolio will be invested in
securities maturing in one year or less. Up to 80% of the portfolio can be invested in securities with a maturity over one year, with
no more than 10% of the portfolio invested in securities with a maturity over five years.
2025 2024
Cas h and investment 7,619,169$ 8,883,671$
15
Page 489 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 6
Note 3 -CASH AND CASH EQUIVALENTS AND INVESTMENTS, Continued
Credit Risk
This is the risk of loss due to the failure of the security issuer or backer. The City’s policies to mitigate credit risk include:
Limiting investments to the safest types of securities. The California Government Code limits the investment vehicles
available to local agencies. The credit risk of these securities is measured by the assignment of a rating by a nationally
recognized statistical rating organization.
Pre-qualifying the financial institutions, broker/dealers, intermediaries and advisors with which the City will do business.
Concentration of Credit Risk
The City’s policies contained in the Investment Management Plan provide guidelines (by type of investment that limits either the
dollar amount, the percent of the portfolio or the maturity term) for diversifying the investment portfolio so that potential losses on
individual securities will be minimized.
The City’s Investment Management Plan outlines the following criteria related to portfolio diversification:
No more than 5% of the City’s portfolio (exclusive of government agency issues or LAIF) shall be placed with any
financial institution.
No more than 25% of the City’s portfolio shall be invested in collateralized certificates of deposit issued by financial
institutions.
Certificates of deposit (negotiable and collateralized) placed by the City shall not constitute more than 15% of the total
assets of the institution; and negotiable certificates of deposit will only be placed with institutions with total assets in
excess of $200 million and that maintain a ratio of equity to total assets of at least 5%.
Additional Cash and Investment Disclosures
See the City of San Luis Obispo June 30, 2025 and 2024 Annual Comprehensive Financial Reports for additional cash and
investment disclosures.
Note 4 -DUE FROM OTHER GOVERNMENTS
At June 30, 2025 and 2024 the amounts due from other governments were as follows:
2025 2024
Federal Transit Administration - capital and operating gr ants 6,396,968$ 2,397,142$
Total 6,396,968$ 2,397,142$
16
Page 490 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 7
Note 5 -CAPITAL ASSETS
Capital Assets activity for the fiscal year ended June 30, 2025, was as follows:
Capital Assets activity for the fiscal year ended June 30,2024, was as follows:
Balance Deletions /Balance
June 30, 2024 Addi ti ons Transfers/Adjus tment June 30, 2025
Capita l assets not being depreciated:
Cons tr uc tion in progress 2,522,125$ 6,314,709$ (2,646,934)$ 6,189,900$
Capita l assets being depreciated:
Infr astructur e 110,972 - - 110,972
Bui ldings and imp rovements 5,212,278 - - 5,212,278
Transit operating equipme nt 10,558,191 - 2,646,934 13,205,125
Total capital assets being depreciated 15,881,441 - 2,646,934 18,528,375
Le ss accumulated depreciati on (10,810,219) (475,163) - (11,285,382)
Total capital assets, net of accumulated depreciation 7,593,347$ 5,839,546$ -$ 13,432,893$
Ba la nce Dele tions/Ba la nce
June 30, 2023 Additions Transters Ju ne 30, 2024
Ca pital assets n ot being depreciated:
Co nstruction in p ro gres s 2,408,227$ 1,665,372$ (1,551,474)$ 2,522,125$
Ca pital assets b eing depreciated:
In frastru cture 110,972 - - 110,972
Bu ild in gs and improveme nts 5,212,278 - - 5,212,278
Trans it o pera ting equipment 9,006,717 - 1,551,474 10,558,191
Total cap it al assets b eing depreciated 14,329,967 - - 15,881,441
Le ss accumu la ted depreciation (10,373,759) (436,460) - (10,810,219)
Total capital a ssets , n et of accumulated depreciation 6,364,435$ 1,228,912$ 1,551,474$ 7,593,347$
17
Page 491 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 8
Note 6 -INTERGOVERNMENTAL ALLOCATIONS
The City has been allocated the following funds from the State Transit Assistance Fund (STAF), Local Transportation Fund (LTF)
and State of Good Repair (SGR) for the years ended June 30, 2025 and 2024. The amounts have been and will be used for both
operating expenses and capital assets.
For the years ended June 30, 2025 and 2024, the City also directly allocated $1,237,660 and $1,275,654, respectively,of LTF
Article 4.0, Section 99260 funds to San Luis Obispo Regional Transit Authority (SLORTA).These funds are not shown in the
accompanying financial statements.
In addition to TDA allocations for the year ended June 30, 2025, the City received a Low-Carbon Transit Operations Program
(LCTOP) allocation of $376,378 to be spent toward the purchase of one electric bus and vehicle charging infrastructure. As of
June 30, 2025, the vehicle and infrastructure had not been placed in service and they are reflected as construction in progress.
Note 7 -FARE REVENUE RATIOS
For the years ended June 30, 2025 and 2024 the City had fare revenue ratios of 228%, and 121%,respectively, computed as
follows:
Ar ticle Se ction 2025 2024
LTF 3.0 99233.3 66,981$ 69,451$
LTF 4.0 99260 1,957,532 1,953,245
STAF 6.5 99313 542,448 648,214
STAF 6.5 99314 66,458 69,436
SGR 6.5 99314 9,943 9,054
SGR 6.5 99313 - 385,000
2,643,362$ 3,134,400$
Ap plicabl e
Al locating TDA Stat ut e Am ount
2025 2024
Operating revenue s - fares 984,855$ 1,000,790$
Other local support - federal grants 8,859,273 3,486,773
(a) Net Oper ating revenue s 9,844,128 4,487,563
(b) Net operating costs, net of depreciation and vehicle lease costs 5,883,154$ 4,915,920$
Exclude capital expenses und er uni form system of accounts
for purposes of calculating fa re revenue ratios but
treated as operating expenses for financial statements (1,564,941) (1,202,446)
(b) Adjusted operating costs for purposes of calculating fare revenue ratios 4,318,213$ 3,713,474$
(c) Fare revenue ratio [(a) / (b)]228%121%
18
Page 492 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 9
Note 7 -FARE REVENUE RATIOS, Continued
Due to the global pandemic, the California legislature passed AB 90 and AB 149. AB 90 prohibits the imposition of a penalty on
an operator that does not maintain the required ratio of fare revenues to operating cost during the 2021–22, 2022–23, and 2023-24
fiscal years.AB 149 extends the penalty exemption through the fiscal year 2024-25 as well as authorizes transit operators to
include federal grant funds as local funds for the purpose of computing fare revenue ratios.
TDA regulations require a minimum ratio of 20% for a municipality the size of the City. The City is in compliance with the
applicable TDA regulations for the year ended June 30, 2025 and June 30,2024.
Note 8 -PENSIONS
The City contributes to the California Public Employees’ Retirement System (CalPERS) for its employees and participates in an
agent-multiple employer plan (Miscellaneous Plan) for its miscellaneous employees. The City has allocated a portion of the
Miscellaneous Plan that relates to the Transit Fund. The portion of the net pension liability allocated to the Transit Fund for the
years ended June 30, 2025 and 2024 were $797,275 and $791,956, respectively. The portion of the deferred outflows of resources
allocated to the Transit Fund for the years ended June 30, 2025 and 2024 were $189,397 and $222,768, respectively. The portion
of the deferred inflows of resources allocated to the Transit Fund for the years ended June 30, 2025 and 2024 were $0 and $815
respectively. The portion of the pension expense allocated to the Transit Fund for the years ended June 30, 2025 and 2024 were
$131,104 and $19,815 respectively, and is shown as a part of total fringe benefits in the related fiscal year.
Additional Pension Disclosures
See the City of San Luis Obispo June 30, 2025 and 2024 Annual Comprehensive Financial Reports for additional pension
disclosures as well as required supplementary information.
Note 9 -OTHER POST-EMPLOYMENT BENEFITS (OPEB)
The City’s primary other post-employment benefits (OPEB) cost obligation is for retiree health benefits under its election to
participate in the CalPERS Health Benefit Program, an agent multiple-employer defined benefit OPEB plan, under the “unequal
contribution option.” The City has allocated a portion of the plan that relates to the Transit Fund. The portion of the net OPEB
liability allocated to the Transit Fund for the years ended June 30, 2025 and 2024 were $21,955 and $25,947, respectively. The
portion of the deferred outflows of resources allocated to the Transit Fund for the years ended June 30, 2025 and 2024 were
$23,563 and $19,436, respectively. The portion of the deferred inflows of resources allocated to the Transit Fund for the years
ended June 30, 2025 and 2024 were $18,083 and $21,807 respectively. The portion of the OPEB expense allocated to the Transit
Fund for the years ended June 30, 2025 and 2024 were $1,785 and $1,064,respectively,and is shown as a part of total fringe
benefits in the related fiscal year.
Additional OPEB Disclosures
See the City of San Luis Obispo June 30, 2025 and 2024 Annual Comprehensive Financial Reports for additional OPEB
disclosures as well as required supplementary information.
Operating Transfers
The City expends all amounts for alternate transportation projects in its General Fund or Capital Outlay Fund. LTF monies
received by the City are initially deposited in the Transportation Development Act (TDA) Fund and subsequently transferred to the
General Fund, where such funds are expended or transferred to the Capital Outlay Fund to be expended on designated
transportation projects.
19
Page 493 of 525
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund and Transit Fund
Notes to the Financial Statements
June 30, 2025 and 2024
Page 10
Note 10 -COMMITMENTS AND CONTINGENCIES
Regional Transit Authority Pension Expense
The City is presently a member agency of the San Luis Obispo Regional Transit Authority (see ACFR Note 10), a duly established
Joint Powers Authority (JPA) comprised of all local cities and the County of San Luis Obispo. The City’s contractual contribution
to that entity is approximately 18%of the total expense. The City was advised that the Regional Transit Authority was working
with CalPERS to determine whether it is required to enroll certain previously unenrolled transit employees in the CalPERS
pension system and whether the entity may be liable for obligations related to the failure to enroll those employees and make
contributions on their behalf. On December 10, 2019 the County Board of Supervisors approved a contract for participation of the
JPA in the San Luis Obispo County Pension Trust and the Employees Retirement Plan. The current amount of potential CalPERS
unfunded liability for the JPA may reach as high as $4 million. It is not anticipated that the City’s annual payment to the JPA will
increase to satisfy this unfunded liability.
Note 11 -SUBSEQUENT EVENTS
Events subsequent to June 30, 2025 have been evaluated through December 16, 2025,which is the date the financial statements
were available to be issued. Management did not identify subsequent events that required disclosure.
20
Page 494 of 525
2025 Original Final Actal
Revenues - intergovernmental allocations 90,000$ 90,000$ 66,918$ (23,082)$
Other financing uses - operating transfers
to City of San Luis Obispo (90,000) (90,000) (90,000) -
Excess of revenues over other financing uses -$-$(23,082)$ (23,082)$
2024 Original Final Actal
Revenues - intergovernmental allocations 45,000$ 45,000$ 69,451$ 24,451$
Other financing uses - operating transfers
to City of San Luis Obispo (45,000) (45,000) (45,000) -
Excess of revenues over other financing uses -$-$24,451$ 24,451$
Budget Variance with
Final Budget
Positive
City of San Luis Obispo, California
Transportation Development Act (TDA) Fund
Supplementary Information
Schedules of Revenues and Expenditures - Budget and Actual
June 30, 2025 and 2024
Variance with
Final Budget
Positive
(Negative)
Budget
21
Page 495 of 525
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Page 496 of 525
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE
AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Independent Auditor’s Report
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the Transportation
Development Act (TDA) Fund and the Transit Fund (TDA Program) of the City of San Luis Obispo,
California (City), as of and for the year ended June 30, 2025,and the related notes to the financial
statements, and have issued our report thereon dated December 16, 2025.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal
control over financial reporting (internal control) to determine the audit procedures that are
appropriate in the circumstances for the purpose of expressing our opinions on the financial statements,
but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control.
Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees in the normal course of performing their assigned functions, to prevent, or
detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material
misstatement of the entity’s financial statements will not be prevented or detected and corrected on a
timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control
that is less severe than a material weakness, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of
this section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify
any deficiencies in internal control that we consider to be material weaknesses. However, material
weaknesses or significant deficiencies may exist that were not identified.
Page 497 of 525
To the Honorable Mayor and Members of the City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page Two
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the TDA Program’s financial statements are
free from material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts, and grant agreements, noncompliance with which could have a direct and
material effect on the determination of financial statement amounts. However, providing an opinion on
compliance with those provisions was not an objective of our audit and,accordingly, we do not express
such an opinion.The results of our tests disclosed no instances of noncompliance or other matters that
are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the
entity’s internal control or on compliance. This report is an integral part of an audit performed in
accordance with Government Auditing Standards in considering the entity’s internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
Badawi &Associates, CPAs
Emeryville, California
December 16, 2025
24
Page 498 of 525
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL
OVER COMPLIANCE FOR TRANSPORTATION DEVELOPMENT ACT FUNDS
Independent Auditor’s Report
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Report on Compliance
Opinions
We have audited the City of San Luis Obispo’s (City)compliance with the types of compliance
requirements described in Section 6666 and 6667 of the Rules and Regulations of the California
Administrative Code in the Transportation Development Act Statutes and Administrative Code for 1987 (the
Act)and the allocation instructions and resolutions of the San Luis Obispo Council of Governments
applicable to the City’s Transportation Development Act Article 3, 4 and 6.5 Program (TDA Program)
for the years ended June 30, 2025 and 2024.
In our opinion, the City complied, in all material respects, with the compliance requirements referred
to above that could have a direct and material effect on its TDA Program for the years ended June 30,
2025 and 2024.
Basis for Opinion
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America (GAAS); the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States; and Section 6666 and 6667 of
the rules and regulations of the California Administrative Code in the Transportation Development Act
Statutes and Administrative Code for 1987 (the Act); and the allocation instructions and resolutions of
the San Luis Obispo Council of Governments.Our responsibilities under those standards and the Act
are further described in the Auditor’s Responsibilities for the Audit of Compliance section of our
report.
We are required to be independent of the City and to meet our other ethical responsibilities, in
accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for the
City’s TDA Program. Our audit does not provide a legal determination of the City’s compliance with
the compliance requirements referred to above.
Page 499 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 2
Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design,
implementation, and maintenance of effective internal control over compliance with the requirements
of laws, statutes, regulations, rules and provisions of contracts or grant agreements applicable to the
City’s TDA Program.
Auditors’Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the
compliance requirements referred to above occurred, whether due to fraud or error, and express an
opinion on the City’s compliance based on our audit. Reasonable assurance is a high level of assurance
but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance
with GAAS, Government Auditing Standards, and the Section 6666 and 6667 of the Rules and Regulations
of the California Administrative Code in the Transportation Development Act Statutes and Administrative Code
for 1987 (the Act)and the allocation instructions and resolutions of the San Luis Obispo Council of
Governments will always detect material noncompliance when it exists. The risk of not detecting
material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Noncompliance with the compliance requirements referred to above is considered material if there is a
substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a
reasonable user of the report on compliance about the City’s compliance with the requirements of the
TDA Program as a whole.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the Section 6666
and 6667 of the Rules and Regulations of the California Administrative Code in the Transportation
Development Act Statutes and Administrative Code for 1987 (the Act)and the allocation instructions and
resolutions of the San Luis Obispo Council of Governments,we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material noncompliance, whether due to fraud or error, and
design and perform audit procedures responsive to those risks. Such procedures include
examining, on a test basis, evidence regarding the City’s compliance with the compliance
requirements referred to above and performing such other procedures as we considered
necessary in the circumstances.
Obtain an understanding of the City’s internal control over compliance relevant to the audit in
order to design audit procedures that are appropriate in the circumstances and to test and
report on internal control over compliance in accordance with the Section 6666 and 6667 of the
Rules and Regulations of the California Administrative Code in the Transportation Development Act
Statutes and Administrative Code for 1987 (the Act)and the allocation instructions and resolutions
of the San Luis Obispo Council of Governments,but not for the purpose of expressing an
opinion on the effectiveness of City’s internal control over compliance. Accordingly, no such
opinion is expressed.
26
Page 500 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 3
We are required to communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and any significant deficiencies and material weaknesses in
internal control over compliance that we identified during the audit.
Report on Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their
assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance
requirement of the Section 6666 and 6667 of the Rules and Regulations of the California Administrative Code
in the Transportation Development Act Statutes and Administrative Code for 1987 (the Act)and the allocation
instructions and resolutions of the San Luis Obispo Council of Governments on a timely basis. A
material weakness in internal control over compliance is a deficiency, or combination of deficiencies in
internal control over compliance, such that there is a reasonable possibility that material
noncompliance with a type of compliance requirement of the Section 6666 and 6667 of the Rules and
Regulations of the California Administrative Code in the Transportation Development Act Statutes and
Administrative Code for 1987 (the Act)and the allocation instructions and resolutions of the San Luis
Obispo Council of Governments will not be prevented, or detected and corrected, on a timely basis. A
significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in
internal control over compliance with a type of compliance requirement of the Section 6666 and 6667 of
the Rules and Regulations of the California Administrative Code in the Transportation Development Act
Statutes and Administrative Code for 1987 (the Act)and the allocation instructions and resolutions of the
San Luis Obispo Council of Governments that is less severe than a material weakness in internal
control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the
Auditor’s Responsibilities for the Audit of Compliance section above and was not designed to identify
all deficiencies in internal control over compliance that might be material weaknesses or significant
deficiencies in internal control over compliance. Given these limitations, during our audit we did not
identify any deficiencies in internal control over compliance that we consider to be material
weaknesses, as defined below. However, material weaknesses or significant deficiencies in internal
control over compliance may exist that were not identified.
Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal
control over compliance. Accordingly, no such opinion is expressed.
27
Page 501 of 525
To the Honorable Mayor and Members of City Council
of the City of San Luis Obispo
San Luis Obispo, California
Page 4
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of
the Section 6666 and 6667 of the Rules and Regulations of the California Administrative Code in the
Transportation Development Act Statutes and Administrative Code for 1987 (the Act), and the allocation
instructions and resolutions of the San Luis Obispo Council of Governments.Accordingly, this report is
not suitable for any other purpose.
Badawi &Associates, CPAs
Emeryville, California
December 16, 2025
28
Page 502 of 525
1
2020-21
Annual
Comprehensive
Financial Report
Recommendation
2
Review and accept the Annual Comprehensive
Financial Report, Transportation Development
Act (TDA) Report and Single Audit for Fiscal
Year 2024-25.
2024-2 5 A u d i t
Annual Audits
3
•Annual audits are required by the City’s Charter and State
laws
•Purpose is to fairly present the financial condition of the
City in accordance with Generally Accepted Accounting
Principles
•TDA Report pertains to how the City spent funds provided
by this specific revenue and is unique to California
•Single Audit pertains to how the City spent Federal funds
•City’s current auditing firm – Badawi & Associates
2024-2 5 A u d i t
Audit Highlights
4
•Unqualified, Clean Audit
•Increase in Fund Balance in General Fund, Water Fund,
Sewer Fund, Parking Fund and Transit Fund
•Findings are areas for improvement and are included with
the Single Audit Report
2024-2 5 A u d i t
FY 2024-25 Governmental Funds
Total Revenue: $144.6 million
ACFR page 71
Revenues
Sales & Use Tax Local Revenue Measure Property Tax
Transient Occupancy Tax Utility User Tax Franchise Tax
Business Tax Cannabis Tax Charges for Services
Subventions & Grants Miscellaneous Investment Income
Total Expenditures: $122.3 million
Expenditures
General Government Public Safety
Transportation Leisure, Cultural and Social Services
Community Development Debt Service
Proprietary Funds
Proprietary (Enterprise) Funds
ACFR page 77 6
Local Revenue Measure – G-20
7
$30.5
▪Community Safety & Emergency
Preparedness
▪Creek & Flood Protection
▪Safe & Clean Public Spaces
▪Youth/Senior & recreation Facilities
▪Open Space Preservation &
Maintenance
▪Street Maintenance & Transportation
▪Address Homelessness
▪Economic Development & Business
Retention
▪Protection of Financial Stability
ACFR page 151
Transportation Development Act Report
8
Funding is restricted for transportation related
expenditures
•Bicycle and Pedestrian projects ($66,918)
•Transit ($2.6 million)
2024-2 5 A u d i t
Must maintain a fare box revenue
ratio of 20%
•FY 2024-25 ratio = 228%
Single Audit Report
9
Report on how the City spent Federal funding during the fiscal year
No questioned costs or significant deficiencies related to Federal awards
Two findings or areas for improvement – both of which staff believe have now
been resolved
•Internal controls related to posting manual adjustments
•Payroll implementation – upgraded configuration October 2025
2024-2 5 A u d i t
Popular Annual Financial Report
102024-2 5 A u d i t
Auditor’s Report
11
Mitesh Desai
Badawi & Associates
abadawi@b-acpa.com
“It is not just about numbers. It is about long-term relationships that are built on consistent
quality results, responsiveness, and professionalism.”
2024-2 5 A u d i t
City of San Luis Obispo
Presentation to the City Council
January 13, 2026
Agenda
13
Deliverables and Scope of the Audit
Auditor’s Report and Financial
Statements
Required Communications
Deliverables and Scope of the Audit
14
Report on the Annual Comprehensive Financial Report (ACFR)
Report on Internal Control Over Financial Reporting and on
Compliance
Single Audit Report
Report on TDA Compliance
Agreed-Upon Procedures on Appropriation Limit Schedule (GANN)
Communications With Those Charged With Governance
Auditor’s Report
15
•Audit performed in accordance with Generally Accepted Auditing
Standards
•Audit performed in accordance with Government Auditing
Standards and the Uniform Guidance
Auditing Standards
•Financial statements are fairly presented in all material respects
•Significant accounting policies have been consistently applied
•Estimates are reasonable
•Disclosures are properly reflected in the financial statements
Unmodified Opinions
16
Government-Wide Financial Statements
Cash & Investments Receivables Prepaids & Other
Assets Capital Assets Deferred Outflows of
Resources
2023 $224,375,528 $79,594,486 $3,581,606 $531,914,267 $65,914,816
2024 $265,088,410 $83,997,034 $3,603,436 $591,317,456 $65,011,032
2025 $274,231,528 $92,224,148 $4,702,584 $648,599,328 $53,948,193
$-
$100
$200
$300
$400
$500
$600
$700
Mi
l
l
i
o
n
s
Assets and Deferred Inflows of Resources
Government-Wide Financial Statements
17
Accounts
Payable &
Accrued
Expenses
Unearned
Revenues
Compensated
Absences
Long-Term
Debt
Net Pension
Liability
Net OPEB
Liability
Deferred
Inflows of
Resources
2023 $18,208,947 $20,159,212 $4,012,537 $156,526,868 $174,252,000 $5,284,717 $47,576,985
2024 $18,348,038 $11,382,712 $5,365,925 $218,407,818 $181,113,251 $2,284,314 $46,788,617
2025 $17,548,516 $12,897,064 $5,544,678 $229,342,342 $177,995,199 $1,705,707 $43,371,520
$-
$50
$100
$150
$200
$250
Mi
l
l
i
o
n
s
Liabilities and Deferred Inflows of Resources
General Fund
18
2023 2024 2025
Unrestricted Fund Balance $42,436,606 $40,461,285 $45,679,832
Total Expenditures $90,266,388 $86,550,461 $92,208,464
As % of Total Expenditures 47.01%46.75%49.54%
Number of Months*6 6 6
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
Mi
l
l
i
o
n
s
Expenditure Coverage
* Measure of the City's ability to operate with no revenues using available fund balance. GFOA recommendation no less than 2 months.
Required Communications
19
Auditor’s Responsibilities
Provide an opinion on whether financial statements
are fairly stated in accordance with U.S. GAAP
Evaluate internal control over financial reporting
including tone at the top
Evaluate compliance with laws, contracts, and grants.
Ensure financial statements are clear and transparent
Communicate with the governing body
Management’s Responsibilities
Take responsibility for the financial statements
Establish and maintain internal control over
financial reporting
Make all financial records available to us
Establish internal control to prevent and detect fraud
Inform us of all known and suspected fraud
Comply with laws and regulations
Take corrective action on audit findings
Required Communications
20
•It is our responsibility to maintain independence
•We maintained our independence by strict adherence to the AICPA and the
Board of Accountancy rules and regulations
•Other than preparing the financial statements, no services performed that
could affect our independence.
Independence
•Within the time frame originally communicated to the City in our engagement
letters.
Timing of the Audit
•The City adopted the following new pronouncement during the year:
•GASB Statement No. 102 –Certain Risk Disclosures
Significant Accounting Policies and Unusual Transactions
Required Communications
21
•No difficulties encountered.
Difficulties Encountered in Performing the Audit
•There were adjustments and reclassifying entries during the course of the
audit. Management has posted all proposed audit adjustments.
•Significant adjustments include corrections to restricted cash and grant
receivables
Significant Audit Adjustments and Unadjusted Differences
•Material weakness for journal entries posting.
•Significant deficiency for incorrect payroll module implementation.
Deficiencies in Internal Control over Financial Reporting
Required Communications
22
Required Communications
23
Thank You for Allowing
us to Provide Audit
Services to the City.
FY 2024-25 Financial Statements
Questions?
2024-2 5 A u d i t 25
Recommendation
2023-2 4 A u d i t 26
Review and accept the Annual Comprehensive
Financial Report, Transportation Development
Act (TDA) Report and Single Audit for Fiscal
Year 2024-25.