City of Pacifica accounts are a little more flush heading into 2022, however there were warning signs in the form of unfunded pension liabilities that will be due in the future.

The city conducts an independent audit of financial transactions and issues the annual financial report prepared by the city’s independent auditing firm, Maze and Associates, and finance department staff, said Sheila Tioyao, financial services manager.

City Council unanimously accepted the report on Dec. 13.

Despite the pandemic, net assets exceed liabilities on June 30, 2021, by $73.4 million, which remains the same compared to the prior year, Tioyao said.

At the same time, the unrestricted net position increased to negative $47.6 million from negative $41.5 million in the prior year, Tioyao said. That is the result of the city’s recognition of net pension and other liabilities, but the obligations do not represent a liability immediately due and payable, she said.

Long-term pension liability increased by $6.5 million from $55.2 to $61.7 million, Tioyao said. Council approved prefunding these obligations through the irrevocable trust with the Public Agency Retirement Services to help reduce this liability over time. The city will start seeing positive impacts of this decision in the next annual financial report, Tioyao said.

The city’s long-term net pension liability of $61.7 million combined with other post-employment benefits obligation of $8.4 million in the fiscal year 2020-21 results in the city’s negative unrestricted net position of $47.6 million. That may limit the city’s ability to meet ongoing obligations to citizens and creditors in the future, Tioyao said. Staff will continue to evaluate and make any recommendations for adjustments in future budget discussions, she said.

Of the unrestricted net assets, $11 million is for sewer operations, Tioyao said.

The net change in fund balances was an increase of $1.2 million from $35.6 million to $36.8 million in 2020-21 due to the allocation of Educational Revenue Augmentation Fund funds to the disaster accounting special reserve fund, Tioyao said.

Total city revenues were $59.5 million, a decrease of $3.2 million from the prior year, due primarily to a $2.5 million shortfall in the vehicle license fee allocation, Tioyao said.

City expenses were $58.9 million, a decrease of $2.3 million over the prior year, Tioyao said. The decrease is mainly due to the prior year’s correction of depreciation expense in the Sewer Utility Fund, she said.

Staff manually reviewed accounts receivable billings over the last decade resulting in a restatement of beginning fund balances for the general fund of $586,000, the stormwater special reserve fund by $17,000 and the sewer utility enterprise fund by $6,200 annually, she said.

The general fund, the city’s primary operating fund, balance on June 30, 2021, was $16.5 million, unchanged from last year, Tioyao said. General fund revenues were at $35.7 million, an increase from last year, she said. General fund expenditures of $34 million increased by $900,000, Tioyao said.

Besides manually reconciling aging receivables, staff is now reconciling the most recent refundable deposit transactions on a regular basis, she said.

“The city is slowly recovering from the pandemic,” said Tioyao, who is retiring from the city after giving this report at the Dec. 13 City Council meeting.

Jane Northrop has covered Pacifica for the Pacifica Tribune since 1996. She has won first place John Swett Awards from the California Teachers Association for her coverage of education.

(0) comments

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.

More Stories

  • 0

The environmental impact report on a quarry reclamation plan will be released shortly for review, said Pacifica City Manager Kevin Woodhouse in an email to the Tribune. A minimum 45-day public review and comment period will follow release of the draft EIR.

  • 0

The skies cleared over the Coastside on Tuesday after two days of consistent rain caused localized flooding, felled trees and closed several roads.

  • 0

A year after San Mateo County purchased the Coastside Inn to create a transitional housing shelter, and more than six months after the county engaged an independent organization to operate the shelter, Coast House, as it is now known, is near capacity and largely meeting the expectations of …

Recommended for you