HomeMy WebLinkAbout2024-05-09 - Agenda Packet - Community Parks and Landscape Citizens' Oversight Committee CITY OF RANCHO CUCAMONGA
�. MAY 9, 2024
COMMUNITY PARKS & LANDSCAPE
CITIZENS' OVERSIGHT COMMITTEE AGENDA
RANCHO CUCAMONGA CITY HALL, TRI-COMMUNITIES ROOM
10500 CIVIC CENTER DRIVE
RANCHO CUCAMONGA, CA 91730
A. CALL TO ORDER - 6:00 PM
Al. Pledge of Allegiance
A2. Roll Call
April McAllister Matthew Parmental
Dave Terry Pascal Pangestu
Denise Garzaro Velma Gilbert
Lisa Morgan-Perales
B. PUBLIC COMMUNICATIONS
This is the time and place for the general public to address the Community Parks & Landscape
Citizens' Oversight Committee on any item listed or not listed on the agenda. State law prohibits
the Committee from addressing any issue not previously included on the Agenda. The Committee
may receive testimony and set the matter for a subsequent meeting. Comments are to be limited
to five minutes per individual.
C. ITEM(S) FOR DISCUSSION
C1. Oath of Office for Committee Members Reappointments.
C2. Election of Committee Chair and Vice Chair
C3. Consideration to adopt Regular Meeting Minutes of February 21, 2023
C4. Review and Discussion of Annual Independent Auditor's Report with the City's Auditors
C5. Review and Approval of Annual Written Report to the City Council
C6. Staff updates for the Committee
D. ADJOURNMENT
I, Kelly Guerra, Special Districts Analyst of the City of Rancho Cucamonga, hereby certify under penalty
of perjury that a true, accurate copy of the foregoing agenda was posted on at least Seventy-Two (72)
hours prior to the meeting per Government Code Section 54954.2 at 10500 Civic Center Dr, Rancho
Cucamonga and on the City's website.
Kelly Guerra
CITY OF RANCHO CUCAMONGA
February 21, 2023
COMMUNITY PARKS AND LANDSCAPE CITIZENS' OVERSIGHT COMMITTEE
MEETING MINUTES
A. CALL TO ORDER - 6:04 PM
The City of Rancho Cucamonga Community Parks and Landscape Citizens' Oversight Committee
held their Annual Meeting on Tuesday, February 21, 2023, at the Rancho Cucamonga City Hall,
Tri-Communities Room, 10500 Civic Center Drive, Rancho Cucamonga, California.
Al. Pledge of Allegiance:
Committee Member Dave Terry led the Pledge of Allegiance.
A2. Roll Call:
Present Committee Members: April McAllaster, Lisa Morgan-Perales, Velma Gilbert,
Pascal Pangestu, Matthew Parmental, and Denise Garzaro.
Staff Present: Elisa Cox, Assistant City Manager, Noah Daniels, Finance Director, Bill
Wittkopf, Public Works Services Director; Jeff Benson, Superintendent
(Parks/Landscape), Kelly Guerra, Special Districts Analyst, and City Auditor — Frank
North, Audit Manager.
B. PUBLIC COMMUNICATIONS
B1. No public communications were made.
C. ITEM(S) OF DISCUSSION
Cl. Election of Committee Chair and Vice-Chair
Committee Member Denise Garzaro nominated April McAllaster as Chair and Committee
Member Velma Gilbert nominated Matthew Parmental as Vice-Chair. Committee Member
April McAllaster accepted the Chair nomination and Committee Member Matthew
Parmental accepted the Vice-Chair nomination and was unanimously approved.
C2. Approval of Minutes: April 27, 2022
Committee Vice-Chair Matthew Parmental motioned to approve the minutes from the
February 10, 2021 Meeting. The motion was seconded by Committee Member Denise
Garzaro and was unanimously approved.
C3. Review and Discussion of Annual Independent Auditors' Report
City Auditor Frank North provided information about the purpose of the letters and
financial report, the role of the auditor, audit procedures, and the audit results to the
Committee. A discussion ensued regarding the uses of funds and the purpose of
specific accounts and City Staff provided information to the specific questions. The
Committee Members closed the item after the discussion.
Page 2
COMMUNITY PARKS AND LANDSCAPE CITIZENS' OVERSIGHT COMMITTEE MEETING MINUTES
FEBRUARY 21, 2023
PAGE 2
C4. Review and Approval of Annual Written Report to the City Council
A discussion concerning the draft report to City Council ensued. Committee Member
Denise Garzaro motioned to approve the Annual Report to the City Council. The motion
was seconded by Chair Member Lisa Morgan-Perales and was unanimously approved.
Chair April McAllaster agreed to present the report to the City Council.
C5. Staff updates for the Committee
Public Works Director Bill Wittkopt provided updates on completed and upcoming projects
throughout the City. A discussion ensued concerning the maintenance at LMDs 2, 4-R.
He explained the challenges staff and contractors are experiencing being short-staffed.
Another discussion ensued pertaining to revenue increases due to new district
annexations. Finance Director Noah Daniels, explained the procedures of the property
taxes and how annexations affect the districts' revenues.
D. ADJOURNMENT
Chair April McAllaster adjourned the meeting at 6:48 PM.
Respectfully submitted,
Appointed Chair
Date: May 9, 2024
Page 3
Summary of the
Fiscal Year 2022/23
Statement of
Revenues ,
Expenditure and
Changes in Fund
Balances for the
Districts
CITY OF RANCHO CUCAMONGA
DATE: May 9, 2024
TO: Community Parks and Landscape Citizens' Oversight Committee
FROM: Noah Daniels, Finance Director
BY: Kelly Guerra, Special Districts Analyst
SUBJECT: SUMMARY OF THE FISCAL YEAR 2022/23 STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE
DISTRICTS.
BACKGROUND:
Established by Resolution No. 19-075, the Community Parks and Landscape Citizens' Oversight
Committee's core purpose is to review the annual financial audit for certain Districts and report to
the City Council and the community. The Committee accomplishes this task by reviewing the
Statement of Revenues, Expenditures and Changes in Fund Balances with City staff and the
City's independent auditors.
The purpose of an audit is for the auditor to provide an opinion on whether the financial statements
and disclosures are presented accurately and free from material misstatement. In other words,
the auditor's purpose is to provide a degree of confidence in the financial statements. As the basis
for the auditor's opinion, the auditor must obtain a high level of assurance that the financial
statements are free from material error by obtaining sufficient audit evidence. Audit evidence
includes information in accounting records underlying the financial statements and other
information, which is measured by quantity and quality.
The Committee has neither budgetary nor operational decision-making authority nor the authority
to allocate financial resources or direct staff.
ANALYSIS:
The City's independent auditors, Lance Soll & Lunghard, LLP, have completed their annual audit
of the Districts'financial statements. Attached you will find the following reports for your reference:
• The required Auditor's Communication with Those Charged with Governance—This letter
communicates the auditor's responsibilities and information regarding the audit.
• Independent Auditors' Report on Internal Control over Financial Reporting and on
Compliance and Other Matters —This letter communicates the auditor's evaluation of the
City's internal controls over financial reporting.
• The Districts' Statement of Revenues, Expenditures and Changes in Fund Balances for
the Fiscal Year Ended June 30, 2023 —This report provides detailed financial information
and disclosures that indicate the Districts' financial condition. It covers the fiscal period
Page 1 of 9 Page 5
between July 1, 2022, to June 30, 2023. The City received an unqualified or"clean"opinion
on the presentation of its financial statements.
Staff Analysis: While the Committee is not directly involved with the audit or the examination of
accounting records, the Committee provides community oversight of the financial reporting
process and, at the meeting, is encouraged to engage in dialogue with the auditors and City staff
to learn more about the audit process and preparation of the financial reports. City staff has
provided the highlights of the operating results for each District for your information and
understanding of the Statement of Revenues, Expenditures and Changes in Fund Balances for
the Fiscal Year Ended June 30, 2023.
General Notes:
• The Use of money and property category includes a temporary adjustment of investments
to fair value at the end of each fiscal year. The adjustment impacts all Districts but is more
noticeable in certain districts without rental and lease revenues. Accounting standards
require adjustment, and negative adjustments are common with rising interest rates due
to the City's fixed-income portfolios. These fluctuations are unrealized gains or losses.
• Contract Services increased overall, impacting all Districts. Services include annual
landscaping and irrigation maintenance, park, paseos, and median maintenance, and
replacement of pressure valve regulators in certain districts. The increase in Contract
Services is mainly due to inflation in labor costs. In recent years, the average increase is
approximately 8-10% annually.
• All Landscape Districts and the Park and Recreation District experienced a significant
reduction in Utilities due to the heavy rain in winter 2022, thus reducing irrigation services.
Districts are also incorporating new improvements to install WeatherTRAK controllers,
which will contribute to future water conservation and savings.
• Tree Maintenance increased overall, impacting all Districts. The maintenance includes
routine tree maintenance and pruning. A consultant service is also included for developing
a comprehensive urban forest management plan.
Page 2 of 9 Page 6
Landscape Maintenance District#1 General City
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 1,255,130 $ 1,256,185 $ (1,055)
Charges for services 19,961 19,612 349
Use of money and property 65,407 38,403 27,004
General benefit equivalent 32,934 30,743 2,191
Contributions from other funds 74,980 34,380 40,600
Total Revenues $ 1,448,412 $ 1,379,323 $ 69,089
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 26,543 $ 34,364 $ (7,821)
Operations and maintenance 57,071 47,576 9,495
Contract services 570,126 505,623 64,503
Tree Maintenance 124,709 88,821 35,888
Utilities 320,558 349,057 (28,499)
Assessment administration 43,290 62,850 (19,560)
General overhead allocation 74,140 57,340 16,800
Capital outlay 177,394 15,259 162,135
Total Expenditures $ 1,393,831 $ 1,160,890 $ 232,941
• Revenues from assessments were virtually unchanged but decreased slightly. The
reduction is due to delinquent properties. As a note, the assessment rates for LIVID 1
cannot be increased due to state law without a voter-approved ballot measure.
• The City Council has approved a General Benefit Equivalent to subsidize operating
expenditures. For the current year, the subsidy is 5% of operational expenditures.
• Contract Services increased this current year by $64,503, including $5,181 used for the
replacement of the pressure valve regulator and $17,800 for a fence repair at Golden Oak
Park.
• Capital outlay included emergency repairs at multiple locations due to rainstorm damage
and a design survey to repair the Almond Trail located at the northwest corner of
Gooseneck Rd and Almond St.
Page 3 of 9 Page 7
Landscape Maintenance District#2 Victoria
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 3,850,052 $ 3,750,829 $ 99,223
Charges for services 3,152 1,298 1,854
Use of money and property 65,464 (167,147) 232,611
General benefit contribution 268,584 274,756 (6,172)
Miscellaneous 15,300 - 15,300
Total Revenues $ 4,202,552 $ 3,859,736 $ 342,816
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 794,951 $ 703,497 $ 91,454
Operations and maintenance 74,636 63,960 10,676
Contract services 1,439,473 1,275,981 163,492
Tree Maintenance 244,541 189,739 54,802
Utilities 562,221 954,253 (392,032)
Assessment administration 24,760 35,080 (10,320)
Interfund allocation 83,160 83,160 -
General overhead allocation 373,270 324,160 49,110
Capital outlay 779,364 607,184 172,180
Total Expenditures $ 4,376,376 $ 4,237,014 $ 139,362
• Revenues from assessments increased from $3,750,829 to$3,850,052 due to a 3.0% rate
increase to sustain scheduled capital improvements and operations. Public Works is
currently managing a multi-year capital project to replace landscaping with drought-
tolerant landscaping and hardscape, as well as paseo lighting retrofits.
• The General Benefit Contribution is the legally required contribution from the General
Fund equal to 8.62% of operating expenditures.
• Contract Services increased by $163,492 due to annual maintenance, including $17,350
for repairs and painting facilities at Windrows Park.
• Capital outlay included completing the drought-tolerant project at Lark Drive and Kenyon
Way and the purchase of WeatherTRAK controllers, which will contribute towards future
water conservation and savings.
Page 4 of 9 Page 8
Landscape Maintenance District#4-R Terra Vista
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 2,798,154 $ 2,805,344 $ (7,190)
Charges for services 983 757 226
Use of money and property 101,330 (271,471) 372,801
Total Revenues $ 2,900,467 $ 2,534,630 $ 365,837
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 980,573 $ 894,263 $ 86,310
Operations and maintenance 67,782 55,843 11,939
Contract services 565,035 536,778 28,257
Tree Maintenance 77,540 60,335 17,205
Utilities 382,376 441,957 (59,581)
Assessment administration 14,440 20,980 (6,540)
General overhead allocation 302,420 257,850 44,570
Capital outlay 382,393 425,671 (43,278)
Total Expenditures $ 2,772,559 $ 2,693,677 $ 78,882
• Revenues from assessments were virtually unchanged, decreasing slightly from
$2,805,344 to $2,798,154. The reduction is due to delinquent properties. Assessments
are below the maximum allowable assessment rate but were not increased for Fiscal Year
2022-23 because the current rate was adequate for capital and operational needs.
• Contract Services increased by $28,257, including $11,402 used for the replacement of
pressure valve regulators due to normal wear and tear and $17,300 used for facility repairs
and painting at Spruce Park.
• The capital outlay was for the purchase of the WeatherTRAK controllers, which will
contribute towards future water conservation and savings.
Page 5 of 9 Page 9
Landscape Maintenance District#6-R Caren Community
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 568,205 $ 558,911 $ 9,294
Use of money and property 8,189 (30,602) 38,791
General benefit equivalent 31,913 31,266 647
Total Revenues $ 608,307 $ 559,575 $ 48,732
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 20,517 $ 22,067 $ (1,550)
Operations and maintenance 5,037 7,014 (1,977)
Contract services 273,410 205,098 68,312
Tree Maintenance 63,198 41,347 21,851
Utilities 93,734 171,126 (77,392)
Assessment administration 4,570 6,680 (2,110)
General overhead allocation 52,270 40,790 11,480
Capital outlay 703 453 250
Total Expenditures $ 513,439 $ 494,575 $ 18,864
• Revenues from assessments increased from $558,911 to $568,205. The growth in
revenues is due to a 3.0% rate increase to sustain scheduled capital improvements and
operations. Planned capital projects are to replace landscaping with drought-tolerant
landscaping and hardscape.
• The City Council has approved a General Benefit Equivalent to subsidize operating
expenditures. For the current year, the subsidy was 7% of operational expenditures.
• Contract Services increased this current year by $68,312 due to annual maintenance,
including $1,275 used for the replacement of pressure valve regulators due to normal wear
and tear.
Page 6 of 9 Page 10
Landscape Maintenance District#7 North Etiwanda
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 953,906 $ 950,978 $ 2,928
Charges for services 5,911 4,793 1,118
Use of money and property 92,554 33,724 58,830
Total Revenues $ 1,052,371 $ 989,495 $ 62,876
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 202,808 $ 197,038 $ 5,770
Operations and maintenance 43,686 29,661 14,025
Contract services 445,473 416,224 29,249
Tree Maintenance 60,733 38,272 22,461
Utilities 202,333 376,054 (173,721)
Assessment administration 11,070 16,130 (5,060)
General overhead allocation 128,180 104,930 23,250
Capital outlay 12,722 1,359 11,363
Total Expenditures $ 1,107,005 $ 1,179,668 $ (72,663)
• Revenues from assessments reported were virtually unchanged for the current year,
increasing from $950,978 to$953,906. As a note, the assessment rates for LIVID 7 cannot
be increased due to state law without a voter-approved ballot measure.
• Contract Services increased by$29,249 mainly due to the increase in maintenance costs.
• Capital outlay included emergency repairs at multiple locations due to rainstorm damage.
Page 7 of 9 Page 11
Street Lightinq Maintenance District#2 Residential
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 381,861 $ 379,111 $ 2,750
Use of money and property 4,229 (40,202) $ 44,431
General benefit equivalent 74,114 76,021 (1,907)
Contributions from other funds 26,400 18,510 7,890
Total Revenues $ 486,604 $ 433,440 $ 53,164
Fiscal Year
Expenditures 2023 2022 Change
Operations and maintenance $ 104,324 $ 112,312 $ (7,988)
Contract services 437 619 (182)
Utilities 348,764 320,711 28,053
Assessment administration 26,350 38,080 (11,730)
General overhead allocation 2,500 1,920 580
Total Expenditures $ 482,375 $ 473,642 $ 8,733
• Revenues from assessments were virtually unchanged for the current year, increasing
from $379,111 to $381,861. As a note, the assessment rates for SLD 2 cannot be
increased due to state law without a voter-approved ballot measure.
• The City Council has approved a General Benefit Equivalent to subsidize operations.
• Contributions from other Funds increased by $7,890 due to the Empire Lakes Resort CFD
for the development's proportionate share of the District's expenditures. In June 2021, the
formation of the Street Lighting Services CFD will contribute through the annual
annexation into the CFD. This current year, its contribution is $150.
• Utilities increased by $28,053, an 8.75% increase compared to prior year. The increase is
mainly due to rate increases from Southern California Edison and higher electricity costs.
Page 8 of 9 Page 12
Park and Recreation Improvement District#85
Fiscal Year
Revenues 2023 2022 Change
Taxes $ 1,166,047 $ 1,163,122 $ 2,925
Charges for services 31,302 34,998 (3,696)
Use of money and property 218,447 39,616 178,831
General benefit equivalent 123,287 71,829 51,458
Contributions from other funds 30,180 22,480 7,700
Miscellaneous - 128 (128)
Total Revenues $ 1,569,263 $ 1,332,173 $ 237,090
Fiscal Year
Expenditures 2023 2022 Change
Personnel services $ 223,862 $ 187,506 $ 36,356
Operations and maintenance 77,530 48,655 $ 28,875
Contract services 323,258 282,528 40,730
Tree Maintenance 8,892 20,490 (11,598)
Utilities 308,257 338,263 (30,006)
Assessment administration 99,190 144,590 (45,400)
General overhead allocation 65,750 54,780 10,970
Capital outlay 637,332 114,508 522,824
Total Expenditures $ 1,744,071 $ 1,191,320 $ 55Z751
• Revenues from assessments were virtually unchanged, increasing from $1,163,122 to
$1,166,047. As a note, the assessment rates for PD-85 cannot be increased due to state
law without a voter-approved ballot measure.
• The City Council has approved a General Benefit Equivalent to subsidize operating
expenditures.
• Contributions from other Funds increased by$7,700 due to Empire Lakes Resort CFD for
the development's proportionate share of PD 85 expenditures.
• Contract Services increased to $40,730 mainly due to annual services for park
maintenance.
• Capital Outlay includes expenditures at Heritage Park, including replacements and
upgrades of LED light fixtures, trail renovations, plans and specifications for the Baseball
field LED sports lights, and roof replacement at the Equestrian Center, and then at Red
Hill Park for pathway lights.
Page 9 of 9 Page 13
Audit
Communication
Letter
LSUe
000
000
••
January 12, 2024
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, California
We have audited the statement of revenues, expenditures and changes in fund balances of Landscape
Maintenance Districts#1 General City,#2 Victoria,#4R Terra Vista,#6R Caryn Community,and#7 North Etiwanda,
Street Lighting Maintenance District #2 Residential, and Park and Recreation Improvement District #85
(collectively,the Districts)of the City of Rancho Cucamonga, California(the City),for the year ended June 30,2023.
Professional standards require that we provide you with information about our responsibilities under generally
accepted auditing standards, Government Auditing Standards and the Uniform Guidance, as well as certain
information related to the planned scope and timing of our audit. We have communicated such information in our
letter to the City Council of the City of Rancho Cucamonga dated April 20,2023. Professional standards also require
that we communicate to you the following information related to our audit.
Significant Audit Matters
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant accounting
policies used by the Districts are described in the notes to statement of revenues, expenditures and changes in
fund balances. No new accounting policies were adopted and the application of existing policies was not changed
during Fiscal Year 2022/23. We noted no transactions entered into by the Districts during the year for which there
is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial
statements in the proper period.
The statement of revenues, expenditures and changes in fund balances disclosures are neutral, consistent, and
clear.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit,
other than those that are clearly trivial, and communicate them to the appropriate level of management. We are
pleased to report that no such misstatements were identified during the course of our audit.
Disagreements with Management
For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter,
whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's
report. We are pleased to report that no such disagreements arose during the course of our audit.
Management Representations
We have requested certain representations from management that are included in the management representation
letter dated January 22, 2024.
PrimeGlobal "A "Rg1-i— °
www.lslcpas.com ""`'`' ,""Q''"°�
Avenida d . 00 2151 River Plaza Dr.,Suite 150 21 Waterway Avei—,ou——
Laguna Hills,CA 92653 Santa Ana,CA 92701 Sacramento,CA 95833 'V,o6 27 ,ds,TX :0
000
L:9'0::•••LS
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, California
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters,
similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting
principle to the Districts' financial statements or a determination of the type of auditor's opinion that may be
expressed on those statements, our professional standards require the consulting accountant to check with us to
determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with
other accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing standards,
with management each year prior to retention as the Districts'auditors. However, these discussions occurred in the
normal course of our professional relationship and our responses were not a condition to our retention.
Future GASB Pronouncements
The following Government Accounting Standards Board (GASB) pronouncements will be effective for the following
fiscal years' audits and should be reviewed for proper implementation by management:
Fiscal Year 2023-2024
GASB Statement No. 99, Omnibus 2022.
Fiscal Year 2024-2025
GASB Statement No. 101, Compensated Absences.
Future Projects
Comprehensive Project, Financial Reporting Model.
Comprehensive Project, Revenue and Expense Recognition.
Major Project, Going Concern Uncertainties and Severe Financial Stress.
Major Project, Infrastructure Assets.
Practice Issue, Classification of Nonfinancial Assets.
Practice Issue, Risks and Uncertainties Disclosures.
Pre-Agenda Research Activities, Subsequent Events.
Restriction on Use
This information is intended solely for the use of the Community Parks and Landscape Citizens' Oversight
Committee and management of the Districts and is not intended to be, and should not be, used by anyone other
than these specified parties.
Very truly yours,
0��, 0_, 4za, Voo
Brea, California
Page 16
Statement of
Revenues ,
Expenditures and
Changes in Fund
Balances for the
Districts for the
Year Ended
June 30 , 2023
LANDSCAPE MAINTENANCE DISTRICTS
#1 GENERAL CITY, #2 VICTORIA, #4R TERRA VISTA,
#6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL,
AND PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Statement of Revenues, Expenditures
And Changes in Fund Balances
Year Ended June 30, 2023
Page 18
LANDSCAPE MAINTENANCE DISTRICTS #1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND #7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Statement of Revenues, Expenditures
And Changes in Fund Balances
Year Ended June 30, 2023
Table of Contents
Page
Number
INDEPENDENT AUDITORS' REPORT .....................................................................................................................1
Statement of Revenues, Expenditures and Changes
inFund Balances .................................................................................................................................................3
Notes to the Statement of Revenues, Expenditures and Changes
inFund Balances .................................................................................................................................................5
Page 19
LSUe
000
000
••
INDEPENDENT AUDITORS' REPORT
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, California
Report on the Statement of Revenues, Expenditures and Changes in Fund Balances
Opinions
We have audited the accompanying statement of revenues, expenditures and changes in fund balances of the
Landscape Maintenance Districts #1 General City, #2 Victoria, #4R Terra Vista, #6R Caryn Community, and
#7 North Etiwanda, Street Lighting Maintenance District #2 Residential, and Park and Recreation Improvement
District #85 (collectively, the Districts) of the City of Rancho Cucamonga (the City) as of and for the year ended
June 30, 2023, and the related notes to the statement of revenues, expenditures and changes in fund balances, as
listed in the table of contents.
In our opinion, the statement of revenues, expenditures and changes in fund balances referred to above present
fairly, in all material respects, the respective financial position of the revenues, expenditures and changes in fund
balances of the Districts of the City, as of June 30, 2023, 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
(GARS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by
the Comptroller General of the United States; and the State Controller's Minimum Audit Requirements for California
Special Districts. Our responsibilities under those standards are further described in the Auditor's Responsibilities
for the Audit of the Statement of Revenues, Expenditures and Changes in Fund Balances section of our report. We
are required to be independent of the Districts 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 opinion.
Management's Responsibility for the Statement of Revenues, Expenditures and Changes in Fund Balances
Management is responsible for the preparation and fair presentation of the statement of revenues, expenditures
and changes in fund balances 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 the statement of revenues, expenditures and changes in fund balances that are free from
material misstatement, whether due to fraud or error.
In preparing the statement of revenues, expenditures and changes in fund balances, management is required to
evaluate whether there are conditions or events, considered in the aggregate,that raise substantial doubt about the
Districts' ability to continue as a going concern for twelve months beyond the date of the statement of revenues,
expenditures and changes in fund balances.
)nrfefimrlvni MxmLvi of
PrimeGlobal ""A�°"°"°"°'Ad"'°ry nnAd«o,n:rina rr„1::
1Blvd,Suite 203 •, •-la Carlota, • 11 2151 River PI aza1 21 Waterway Avenue,Suite IIS
Brea,CA 92821 Laguna Hills,CA 92653 Santa Ana,CA 1Sacramento, Woodlands,
11 111 1
LSU`6::0
••
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, California
Auditor's Responsibilities for the Audit of the Statement of Revenues, Expenditures and Changes in Fund
Balances
Our objectives are to obtain reasonable assurance about whether the statement of revenues, expenditures and
changes in fund balances as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor's report that includes our opinion. 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 the GAAS and
Government Auditing Standards 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 statement of revenues, expenditures and changes in fund
balances.
In performing an audit in accordance with GAAS and Government Auditing Standards, we:
• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the statement of revenues, expenditures and changes
in fund balances, 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 statement of revenues, expenditures and changes in fund balances.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate to 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 statement of revenues,
expenditures and changes in fund balances.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about the District'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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated
January 12, 2024, on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The
purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal
control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards in considering the City's internal control over financial reporting and
compliance.
Brea, California
January 12, 2024
2 Page 21
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY,#2 VICTORIA,#4R TERRA VISTA,
#6R CARYN COMMUNITY,AND#7 NORTH ETIWANDA,STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL,
AND PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA
Satement of Revenues,expenditures,and Changes in Fund Balances
For the Year Ended June 30,2023
Landscape
Landscape Landscape Landscape Maintenance
Maintenance Maintenance Maintenance District#6R
District#1 District#2 District#4R Caryn
General City Victoria Terra Vista Community
Revenues:
Taxes $ 1,255,130 $ 3,850,052 $ 2,798,154 $ 568,205
Charges for services 19,961 3,152 983 -
Use of money and property 65,407 65,464 101,330 8,189
Contributions from General Fund:
General benefit contribution - 268,584 - -
General benefit equivalent 32,934 - - 31,913
Contributions from other funds 74,980 - - -
Miscellaneous - 15,300 - -
Total Revenues 1,448,412 4,202,552 2,900,467 608,307
Expenditures:
Personnel services 26,543 794,951 980,573 20,517
Operating costs:
Operations and maintenance 57,071 74,636 67,782 5,037
Contract services 570,126 1,439,473 565,035 273,410
Tree maintenance 124,709 244,541 77,540 63,198
Utilities 320,558 562,221 382,376 93,734
Assessment administration 43,290 24,760 14,440 4,570
Interfund allocation - 83,160 - -
General overhead allocation 74,140 373,270 302,420 52,270
Capital outlay 177,394 779,364 382,393 703
Total Expenditures 1,393,831 4,376,376 2,772,559 513,439
Net Change in Fund Balances 54,581 (173,824) 127,908 94,868
Fund Balances, Beginning of Year 1,956,533 4,273,562 7,383,647 788,298
Fund Balances, End of Year $ 2,011,114 $ 4,099,738 $ 7,511,555 $ 883,166
See Notes to the Statement of Revenues,Expenditures and Changes in Fund Balances.
3 Page 22
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY,#2 VICTORIA,#4R TERRA VISTA,
#6R CARYN COMMUNITY,AND#7 NORTH ETIWANDA,STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL,
AND PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA
Satement of Revenues,expenditures,and Changes in Fund Balances
For the Year Ended June 30,2023
Landscape Street Lighting Park and
Maintenance Maintenance Recreation
District#7 District#2 Improvement
North Etiwanda Residential District#85
Revenues:
Taxes $ 953,906 $ 381,861 $ 1,166,047
Charges for services 5,911 - 31,302
Use of money and property 92,554 4,229 218,447
Contributions from General Fund: -
General benefit contribution - - -
General benefit equivalent 74,114 123,287
Contributions from other funds 26,400 30,180
Miscellaneous - - -
Total Revenues 1,052,371 486,604 1,569,263
Expenditures:
Personnel services 202,808 - 223,862
Operating costs:
Operations and maintenance 43,686 104,324 77,530
Contract services 445,473 437 323,258
Tree maintenance 60,733 - 8,892
Utilities 202,333 348,764 308,257
Assessment administration 11,070 26,350 99,190
Interfund allocation - - -
General overhead allocation 128,180 2,500 65,750
Capital outlay 12,722 - 637,332
Total Expenditures 1,107,005 482,375 1,744,071
Net Change in Fund Balances (54,634) 4,229 (174,808)
Fund Balances, Beginning of Year 1,123,256 977,830 3,332,241
Fund Balances, End of Year $ 1,068,622 $ 982,059 $ 3,157,433
See Notes to the Statement of Revenues,Expenditures and Changes in Fund Balances.
4 Page 23
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Notes to the Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2023
NOTE 1: DESCRIPTION OF THE REPORTING ENTITY
The City of Rancho Cucamonga was incorporated on November 30, 1977, under the laws of the State of California
and enjoys all the rights and privileges applicable to a General Law City. It is governed by an elected five-member
board.
The City of Rancho Cucamonga, California, has formed certain maintenance districts and authorized the levy of
assessments pursuant to the terms and provisions of the"Landscaping and Lighting Act of 1972," being Division 15,
Part 2 of the Streets and Highways Code of the State of California(commencing with Section 22500).The City levies
annual assessments to finance the costs and expenses necessary for maintenance and improvements in each
assessment district.
The City cannot levy and collect annual assessments within an assessment district without complying with the
procedures specified in the Landscaping and Lighting Act of 1972. On an annual basis,an Engineer's Report must be
prepared for each assessment district which contains a full and detailed description of the improvements and the
proposed assessments upon assessable lots and parcels of land within the district.
The City Council must also adopt a resolution of intention which:
• Declares the intention of the City Council to levy and collect assessments within the assessment district for the
fiscal year stated therein.
• Generally,describes the existing and proposed improvements and any substantial changes proposed to be made
in existing improvements.
• Refers to the assessment district by its distinctive designation and indicates the general location of the district.
• Refers to the Engineer's Report for a full and detailed description of the improvements, the boundaries of the
assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of
land within the district.
• Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment.
• States whether the assessment is proposed to increase from the previous year.
The improvements for the districts include, but are not limited to turf, ground cover, planter beds, shrubs, plants and
trees, landscape lighting, irrigation systems,electrical energy for irrigation controllers, hardscapes,entry signs,sound
walls, and all associated appurtenant facilities. A description of the specific improvements to be maintained and
serviced within each assessment district is set forth in the Annual Engineer's Report. Maintenance may include the
furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any
improvement, including repair, removal, or replacement of all or any part of any improvement; providing for the life,
growth, health,and beauty of landscaping, including cultivation,irrigation,trimming,spraying,fertilizing,ortreating for
disease or injury; the removal of trimmings, rubbish, debris, and other solid waste; the cleaning, sandblasting, and
painting of walls and other improvements to remove or cover graffiti. Service may include the furnishing of electric
current or energy,gas,or other illuminating agent for the lighting or operation of any improvements,and water for the
irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements.
The accompanying statement of revenues, expenditures and changes in fund balances contains information relative
only to the Landscape Maintenance Districts#1 General City, #2 Victoria, #4R Terra Vista, #6R Caryn Community,
and#7 North Etiwanda, Street Lighting Maintenance District#2 Residential, and Park and Recreation Improvement
District #85 of the City of Rancho Cucamonga, which are an integral part of the City of Rancho Cucamonga.
5 Page 24
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Notes to the Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2023
NOTE 1: DESCRIPTION OF THE REPORTING ENTITY(CONTINUED)
Landscape Maintenance District No. 1 General City (LMD 1)was formed in 1979 and consists of 8,413 single
family homes, 10,382 multi-family units, and 8.83 acres of vacant land, seven parks, and trails. Landscape
improvements provided in LMD 1 may include, but are not limited to: turf, ground cover, shrubs and trees, sprinkler
and irrigation systems,ornamental lighting,drainage systems, masonry walls,entryway monuments,and associated
appurtenances. These improvements include all necessary services; operations; administration; and maintenance
required to keep the abovementioned improvements in healthy, vigorous, and satisfactory working condition.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 92.21 $ 92.21 0.00%
Condominium unit 46.11 46.11 0.00%
Multi-family unit 46.11 46.11 0.00%
Commercial/industrial parcel per acre 184.42 184.42 0.00%
Victoria Neighborhood Parks and Landscape Maintenance District(LMD 2)was formed in 1982 and consists of
5,890 single family homes, 972 condominiums, 729 multi-family units, 57.97 acres of commercial/industrial,
75.28 acres of public service parcels, and 16.97 acres of vacant land, six parks, and trails. On June 5, 2013, a
Proposition 218 ballot proceeding was held, and residents approved a rate increase.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 562.85 $ 579.73 3.00%
Condominium unit 414.21 426.64 3.00%
Multi-family unit 393.50 405.31 3.00%
Commercial/industrial parcel per acre 2,660.74 2,740.56 3.00%
Public service parcel per acre 153.50 158.10 3.00%
Undeveloped parcel per acre 112.08 115.44 3.00%
Landscape Maintenance District No. 4R Terra Vista (LMD 4R)was formed in 1984 and consists of 2,652 single
family homes, 1,249 condominiums,4,001 multi-family,35.41 acres of schools, 176.40 acres of commercial/industrial,
and 61.08 acres of vacant land. On December 2, 2009, a Proposition 218 ballot proceeding was held, and residents
approved a rate increase.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 397.15 $ 417.01 5.00%
Condominium unit 317.72 333.61 5.00%
Multi-family unit 278.01 291.91 5.00%
Commercial/industrial parcel per acre 1,290.74 1,355.29 5.00%
Undeveloped parcel per acre 99.29 104.26 5.00%
School parcel per acre 99.29 104.26 5.00%
6 Page 25
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Notes to the Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2023
NOTE 1: DESCRIPTION OF THE REPORTING ENTITY(CONTINUED)
Landscape Maintenance District No. 6R Caryn Community (LMD 6R) was formed in 1986 and consists of
966 single family homes in Zone 1, 310 single family homes in Zone 2, 5.35 acres of schools, and 0.00 acres of
vacant land. On September 1, 2010, a Proposition 218 ballot proceeding was held, and residents approved a rate
increase.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home- Zone 1 $ 475.93 $ 490.21 3.00%
Single family home- Zone 2 356.95 367.66 3.00%
School parcel per acre 118.98 122.55 3.00%
Undeveloped parcel per acre 118.98 122.55 3.00%
Landscape Maintenance District No. 7 North Etiwanda (LMD 7) was formed in 1989 and currently consists of
3,096 single family homes.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 307.05 $ 307.05 0.00%
Street Lighting Maintenance District No. 2 Residential (SLD 2) was formed in August 1983 and consists of
7,339 single family homes,2,144 multi-family units,and 35.16 acres of non-residential land.The SLD 2 assessments
pay for energy and maintenance for streetlights within the public right-of-way and dedicated easements within the
boundaries of SLD 2.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 39.97 $ 39.97 0.00%
Multi-family unit 39.97 39.97 0.00%
Commercial/industrial parcel per acre 79.94 79.94 0.00%
7 Page 26
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Notes to the Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2023
NOTE 1: DESCRIPTION OF THE REPORTING ENTITY(CONTINUED)
Park and Recreation Improvement District No. 85 Red Hill and Heritage Park District (PD 85) was formed in
April 1985. PD 85 is a combination Improvement and Maintenance District. This special tax was issued to pay for
bonds that were sold in 1985 and refinanced in 1993.The bonds that were sold for the construction of the parks have
been paid off as of 2005. However, all parcels in PD 85 will continue to be assessed for the on-going maintenance of
both parks. The boundary of PD 85 is citywide except properties within the planned communities.
The assessment rates are as follows:
Fiscal Year Fiscal Year Percentage
2022/23 2023/24 Change
Single family home $ 31.00 $ 31.00 0.00%
Condominium unit 31.00 31.00 0.00%
Multi-family unit 31.00 31.00 0.00%
Commercial/industrial parcel
<1.50 acres 15.50/Lot 15.50 0.00%
1.51 - 3.50 acres 46.50/Lot 46.50 0.00%
3.51 - 7.00 acres 108.50/Lot 108.50 0.00%
7.01 - 14.00 acres 217.00/Lot 217.00 0.00%
14.01 - 25.00 acres 434.00/Lot 434.00 0.00%
>25.01 acres 775.00/Lot 775.00 0.00%
NOTE 2: MEASUREMENT FOCUS,BASIS OF ACCOUNTING AND FINANCIAL STATEMENT PRESENTATION
The statement of revenues, expenditures and changes in fund balances is 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
considers revenues to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures are generally recorded when a liability is incurred,as under accrual accounting except for sales tax and
grant revenue where the government considers revenue to be available if collected within 180 days of the end of the
current fiscal year period. However, debt service expenditures, as well as expenditures related to compensated
absences and claims and judgments, are recorded only when payment is due.
Assessment Revenue
Assessment revenue is recognized on the modified accrual basis,that is, in the fiscal year forwhich the assessments
have been levied providing they become available.Available means then due, or past due and receivable within the
current period and collected within the current period or expected to be collected soon enough thereafter to be used to
pay liabilities of the current period. The County of San Bernardino collects the assessments for the Districts.
Assessment liens attach annually as of 12:01 A.M.on the first day in January proceeding the fiscal year for which the
assessments are levied. Assessments are levied on real property as it exists on that date. The assessment levy
covers the fiscal period July 1 to June 30. One-half of the assessment is due November 1; the second half of the
assessment is due February 1.All assessments are delinquent if unpaid on December 10 and April 10, respectively.
8 Page 27
LANDSCAPE MAINTENANCE DISTRICTS#1 GENERAL CITY, #2 VICTORIA,
#4R TERRA VISTA, #6R CARYN COMMUNITY, AND#7 NORTH ETIWANDA,
STREET LIGHTING MAINTENANCE DISTRICT#2 RESIDENTIAL, AND
PARK AND RECREATION IMPROVEMENT DISTRICT#85
CITY OF RANCHO CUCAMONGA, CALIFORNIA
Notes to the Statement of Revenues, Expenditures and Changes in Fund Balances
For the Year Ended June 30, 2023
NOTE 2: MEASUREMENT FOCUS,BASIS OF ACCOUNTING AND FINANCIAL STATEMENT PRESENTATION
(CONTINUED)
Fund Type
The Landscape Maintenance District #1 General City, #2 Victoria, #4R Terra Vista, #6 Caryn Community, and
#7 North Etiwanda, Street Lighting Maintenance District#2,and Park and Recreation Improvement District#85 funds
included in this report are accounted for in the City's financial records as special revenue funds. Special revenue funds
account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for
specified purposes. Special revenue funds are designed to help determine and demonstrate resources that must be
used for a specified purpose are, in fact, used for that purpose.
NOTE 3: CONTRIBUTIONS FROM GENERAL FUND
A General Benefit Contribution quantifies the dollar value of a general benefit to parcels within a district which is
required by law to be funded from sources other than special assessments. This general benefit is contributed from
general revenues by the City's General Fund. In the event a district is operating at a deficit, lacks the resources for
necessary maintenance or maintains insufficient operating reserves,a General Benefit Equivalent may be authorized
by the ity Council through the annual budget process. Per City policy, the amount of the General Benefit Equivalent
will not exceed 11% of the adjusted total budget of the district under consideration for the subsidy.
NOTE 4: ADVANCES FROM CITY
On August 16, 2017, the City Council authorized an advance of $4,286,054 from the General Fund to the Street
Lighting Maintenance District #2 Fund to provide funding for the purchase and acquisition of Southern California
Edison owned streetlights, the installation of LED lighting to streetlights, and other one-time costs necessary to
inventory the streetlights. The advance was completed in phases and bears interest at 1.0% on the outstanding
balance.The advance is to be repaid to the City's General Fund at such time as funds are available by Street Lighting
Maintenance District #2 at the end of each fiscal year. At June 30, 2023, the outstanding balance amounted to
$3,481,246.
9 Page 28
Independent
Auditors ' Report
on Internal Control
Over Financial
Reporting and on
Compliance and
Other Matters
LSUe
000
000
••
INDEPENDENT AUDITORS' 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
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, 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 statement of revenues, expenditures and changes in fund balances
of Landscape Maintenance Districts #1 General City, #2 Victoria, #4R Terra Vista, #6R Caryn Community, and
#7 North Etiwanda, Street Lighting Maintenance District #2 Residential, and Park and Recreation Improvement
District#85 (collectively, the Districts), of the City of Rancho Cucamonga, California (the City), for the year ended
June 30, 2023, and the related notes to statement of revenues, expenditures and changes in fund balances, and
have issued our report thereon January 12, 2024.
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.
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 City'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.
Report on 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.
)nrfefimrlvni MxmLvi of
PrimeGlobal ""A-"°"°'Ad"°ry
nnAd«o,n:rina rr„1::
203 N.Brea Blvd,Suite 203d. •-la Carlota, • 11 2151 River Plaza Dr.,Suite 150 1 21 Waterway Avenue,Suite 30089
Brea,CA 92821 Laguna Hills,CA 92653 Santa Ana,CA 92701 Sacramento,CA 95833 The Woodlands,
11 111 1
LS L""
..
e:::
To the Community Parks and Landscape Citizens' Oversight Committee
City of Rancho Cucamonga, California
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 City'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 City's internal control and compliance. Accordingly, this communication is not suitable for any
other purpose.
Brea, California
January 12, 2024
Page 31
Report to the
C ity Council
CITY OF RANCHO CUCAMONGA
DATE: TBD
TO: Mayor and Members of the City Council
FROM: John R. Gillison, City Manager
INITIATED BY: Community Parks and Landscape Citizens' Oversight Committee
SUBJECT: Summary Of Review Of Results Of Annual Independent Audit Concerning
The Fiscal Year 2022-23 Expenditures In Landscape Maintenance
Districts #1 General City, #2 Victoria, #4R Terra Vista, #6R Caryn
Community, And #7 North Etiwanda, Street Lighting District #2
Residential, and Park and Recreation Improvement District#85. (CITY)
RECOMMENDATION:
It is recommended that the City Council receive and file this report.
BACKGROUND:
Established by Resolution 19-075, the Community Parks and Landscape Citizens' Oversight
Committee is made up of members of the public who reside and own property within Landscape
Maintenance Districts#1 General City, #2 Victoria, #4R Terra Vista, #6R Caryn Community, and
#7 North Etiwanda, Street Lighting District#2 Residential, and Park and Recreation Improvement
District#85 (collectively "the Districts"), and do not serve on any other standing City Commission
or Committee. The primary purpose of the Committee is to review the annual audit after it is
prepared and report the results of its review to the City Council and the community on an annual
basis.
The Committee does not have budgetary, operational decision-making authority, nor the authority
to allocate financial resources or direct staff.
ANALYSIS:
At our meeting on May 9, 2024, Noah Daniels, Finance Director, and Ryan Domino, Partner of
Lance, Soll & Lunghard, LLP, provided an overview of the audit for the Districts for the Fiscal Year
2022/23. The reports generated by the audit include:
• Audit Communication Letter
• Independent Auditors' Report on Statement of Revenues, Expenditures, and Changes in
Fund Balances
• Independent Auditors' Report on Internal Control over Financial Reporting
By law, each District accounts for its revenue and expenditures in its funds. The auditor reviewed
their work, and a discussion was held regarding the audit process and how the City ensures that
funds collected for maintenance and operations are spent to benefit each District. The auditors
and City Finance staff confirmed that the revenues received have been expended appropriately
Page 33
on maintenance, operations, and capital improvements in each District.
We appreciate the opportunity to serve our community on this Committee. If you have any
questions regarding our annual meeting, members of the Committee will be present at the City
Council meeting to present this report and discuss those questions with you.
FISCAL IMPACT:
There is no fiscal impact.
COUNCIL MISSION /VISION /VALUE(S) ADDRESSED:
This item addresses the City Council's core value of actively seeking and respectfully considering
all public input.
ATTACHMENTS:
Attachment 1 —Audit Communication Letter
Attachment 2 —Statement of Revenues, Expenditures and Changes in Fund Balances for the
Districts for the year ended June 30, 2023
Attachment 3 — Independent Auditors' Report on Internal Control Over Financial Reporting and
on Compliance and Other Matters
Page 2
Page 34