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City of Saratoga, California
Comprehensive Annual Financial Report
For the Fiscal Year Ended June 30, 2020
Celebrating Community
Saratoga, California
Comprehensive Annual Financial Report
For the Fiscal Year Ended June 30, 2020
City Council
Howard Miller ............................................................................................................. Mayor
Mary-Lynne Bernald .......................................................................................... Vice Mayor
Manny Cappello ......................................................................................... Council Member
Yan Zhao .................................................................................................... Council Member
Rishi Kumar ............................................................................................... Council Member
Presented under the direction of:
James Lindsay, City Manager
Finance & Administrative Services Department
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CITY OF SARATOGA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2020
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T ABLE OF C ONTENTS
I NTRODUCTORY SECTION
Letter of Transmittal ......................................................................................................... 9
GFOA Certificat e of Achievement for Excel lence in Financial Reporting ......................... 15
Pri ncipal Officers of the City .......................................................................................... 16
Organization Chart ......................................................................................................... 17
F INANCIAL S ECTION
Independent Au ditor s ’ Report ........................................................................................... 20
Management’s Discussion and Analysis (Required Supplementary Information) ............. 22
Basic Fi n a ncia l Statements:
Government -Wide Financial Statements
Statement of Net Position .......................................................................................... 38
Statement of Acti vities and Changes in Net Position .................................................. 39
Fund Financial Statements
Governmental Funds:
Balance Sheet ........................................................................................................... 40
Reconciliation of the Government Funds Balanc e Shee t
to the Government -Wide Financial Statement of Net Position ............................... 41
Statement of Revenues, Expenditures and Changes in Fund Balances ......................... 4 2
Reconciliation of the Governmental Funds Statement of Revenues,
Expenditures and Changes in Fund Balan c e s to the Government -Wide
Statement of Activities and Changes in Net Position ............................................. 4 3
Proprietary Funds:
Statement of Net Position .......................................................................................... 4 4
Statement of Revenues, Expenses, a nd Changes in Fund Net Position ......................... 45
Statement of Cash Flows ........................................................................................... 46
Fiduciary Funds :
Bal ance Sheet ........................................................................................................... 4 7
Basic Financia l S tatement Notes:
Notes to the Basic Financial Statements ..................................................................... 4 8
Required Supplementary Information
Budgetary Information .............................................................................................. 80
Modified Approach for City Streets Infrastructure Capital Assets ............................... 8 2
Pension Information .................................................................................................. 8 4
CITY OF SARATOGA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED JUNE 30, 2020
6
T A B LE O F C ONTENTS C ONTINUED
S UPP LEMENTARY I NFORMATION :
Non -Major Governmental Funds
Combining Balance Sheets ........................................................................................ 8 8
Combining Statement of Revenues, Expenditures and Changes in Fund Balances ........ 8 9
Combining Statement of Revenues, Exp enditures and Changes in Fu n d Ba lances
– Budget and Ac t ual:
Capital Improvements .......................................................................................... 90
Landscape & Lighting Districts Special Revenue Funds ........................................ 9 1
Library Bond Debt Service Fund .......................................................................... 9 2
Internal Service Funds
Combining Statement of Net Position ........................................................................ 94
Combining Statement of Revenu e s, E xpense s, and Change in Fun d Balance ............... 96
Comb ining Statement of Cash Flows ......................................................................... 98
Fid uciary Funds
Combining Balance Sheet ........................................................................................ 102
Statement of Changes in Fiduciary Assets and L i abilities ......................................... 103
Capital Assets Used in the Operation of Governmental Funds
C o mpar ative Schedule by Source ............................................................................. 1 0 7
Schedule by Function and Activity .......................................................................... 108
Schedule of Changes by Function and Activity ........................................................ 1 10
Statistical Sect ion (Unaudited)
Net Position by Component ..................................................................................... 114
Changes in Net Position .......................................................................................... 116
Fund Balance of Governmental Funds ...................................................................... 118
Gov ernmental Activities Tax R evenues by Source ................................................... 1 20
Changes in Fund Balances of Governmental Funds .................................................. 1 22
Property Tax Rates - Direct and Ove rlapping Government s ...................................... 1 2 4
Assessed Value of Taxable Property ........................................................................ 1 2 6
Principal Property Taxpayers ................................................................................... 1 2 8
Property Tax Le v ies and Collections ........................................................................ 1 2 9
Ratio s of Outstanding Debt by Type ........................................................................ 1 30
Ratios of Ge neral Bonded Debt Outstanding ............................................................ 1 32
Legal Debt Margin Informatio n ............................................................................... 1 3 4
Direct and Overlapping Governmental Activities Debt ............................................. 1 3 6
Demographic and Economic Statistics ..................................................................... 1 3 7
Principal E mplo yers ............................................................................................... 1 3 8
Full -Time Equiv alent City Government Employees by Function ............................... 1 40
Operating Indicators by Function ............................................................................. 1 42
Capital Asset Statistic s by Function ......................................................................... 1 4 4
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INTRODUCTORY SECTION
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C ITY OF S ARATOGA
C ITY H ALL
13777 F RUIT VALE A VENUE
S ARATOGA , C ALIFORNIA 95070
(408) 868 -1200
December 2, 2020
Honorable Mayor, City Council, and Citizens of the City of Saratoga, California
The Comprehensive Annual Financial Report (CAFR) of the City of Saratoga for the year ended June 30,
2020 is hereby submitted in accordance with mandated statutes. These statutes require that the City of
Saratoga issue a report on its financial position and activity, and that an independent firm of certified public
accountants audit the report. This annual report was prepared in accordance with accounting principles
generally accepted in the United States of America. City Management is responsible for both the accuracy of
the data and the completeness and fairness of the presentation, including all disclosures.
To provide a reasonable basis for making these representations, the City has established internal controls to
provide reasonable, rather than absolute, assurance that the financial statements will be free of material
misstatement. To the best of our knowledge and belief, the enclosed data is accurate in all material respects
and reported in a manner designed to present fairly the financial position and results of operations of the
City’s various funds. This report intends to present the reader with a comprehensive view of the City’s
financial position and the results of its operations for the fiscal year ending June 30, 2020, along with
additional disclosures and financial information designed to enable the reader to gain an understanding of the
City’s financial activities.
The report was prepared as prescribed in Governmental Accounting Standards Board (GASB) Statement
No. 34, Basic Financial Statements and Management’s Discussions and Analysis for State and Local
Governments. To facilitate the public’s understanding and usefulness of the City of Saratoga’s financial
statements, GASB Statement 34 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). The design of this formal letter of transmittal is to complement the MD&A and
should be read in conjunction with it.
Unaudited sections of this document are presented to supplement the basic financial statements. While not
audited, the supplemental information is required by the Governmental Accounting Standards Board, who
considers it to be an essential part of financial reporting for operational, economic, and historical context.
THE REPORTING ENTITY AND ITS SERVICES
The City of Saratoga (City), incorporated in 1956, is located 40 miles south of San Francisco in the Santa
Clara Valley. The City currently covers a land area of approximately 12 square miles and contains a
population of 31,030 as of January 1, 2020, as reported by the California Department of Finance. The City is
a general law city of the State of California and operates under a council-manager form of government.
Policymaking and legislative authority are vested in the City Council, which consists of a Mayor, Vice
Mayor, and three additional Council members. City Council members are elected at-large for staggered four-
10
year terms. The Mayor is selected annually by the City Council. The City Council is responsible for, among
other things, passing ordinances, adopting the budget, appointing members to the City’s six advisory
commissions and hiring the City Manager and City Attorney. The City Manager is responsible for
implementing the policies and ordinances of the City Council and overseeing the daily operations of the City.
The City provides a range of services including public safety, development regulation, public works,
community and recreation activities and events, and general administrative functions. As a minimal service
city, operations are supplemented with service contracts. Contracted services include, but are not limited to:
public safety; engineering services; infrastructure maintenance; and legal services.
The City is also committed to citizen participation in the evaluation, and enhancement of services. Saratoga
residents who wish to assist the City Council in forming government policy may do so by serving on an
advisory commission. The commissions act in an advisory capacity to the City Council, and are comprised
of the Heritage Preservation Commission, Library Commission, Parks and Recreation Commission, Planning
Commission, Traffic Safety Commission, and Youth Commission.
The financial reporting entity (the City) includes all the fund activity of the primary government, as well as
all of its component units. Component units are legally separated entities for which the City is fully
accountable. The City does not currently report any Component Units. Blended component units, although
legally separate entities, are in substance, part of the City’s operations and data from these units are combined
with data of the City. Accordingly, the operations of the Landscaping and Lighting Assessment Districts, the
West Valley Clean Water Program Authority (WVCWP) and the Arrowhead Community Facilities District
(CFD) are reported in the City’s financial statements.
ECONOMIC CONDITIONS AND OUTLOOK
Saratoga is viewed as a desirable place to live in the Silicon Valley due to its highly-rated schools,
beautiful neighborhoods nestled in the foothills at the western edge of the valley, and close proximity to
many businesses associated with the high technology industry. Saratoga is predominantly a residential
community with limited commercial or industrial activity within City boundaries.
Similar to other cities throughout the nation, the novel coronavirus (COVID-19) pandemic has created
financial uncertainty that, if the economy slides into a recession, will impact the City’s financial standing.
State and County Shelter-in-Place measures have successfully slowed the spread of the virus and
prevented local hospitals from being overwhelmed, but the efforts have also caused unprecedented
changes to everyday life. Economic engines are struggling in response to Shelter-in-Place Orders –
nearly 22 million Americans have filed for unemployment, and the stock market has experienced
extraordinary volatility. While we are still in the process of understanding the long-term impacts as
projections change daily, there is no question that there has and will continue to be economic challenges
due to COVID-19.
In general, the City is fiscally protected by the stability of its tax revenues. As is typical for California
cities, the City of Saratoga’s largest funding sources are property tax, franchise fees, sales tax, and
development fees and permits. It should be noted, however, that while development fees and permits are a
significant funding source, expense related to the intake of this fee-based revenue more than offset the
revenue received.
Property Tax
In total, Property Tax is the City’s largest revenue category, at approximately 64% of General Fund revenues.
In the last eight years, property taxes have grown extraordinarily fast. In large part this is due to the return of
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the City’s full Tax Equity Allocation (TEA) and the addition of Educational Revenue Augmentation Fund
(ERAF) allocations, which together accounted for virtually all of the $865,000 growth in the FY 2019/20
property tax revenues.
Property Tax revenue is comprised of a combination of property tax assessments. While most of property tax
categories will remain stable into the coming fiscal year, two components are expected to decline; Transfer
Tax and Supplemental Tax that come from property turnover and remodeling improvements. In prior
economic downturns these two property taxes declined with the economy, but were one of the first revenues
to increase when the economy began to recover. Surprisingly, this revenue stream has remained fairly strong
during this early part of the following fiscal year, leading to hopeful uncertainty as to what will occur in the
remainder of the fiscal year.
Franchise Fees
Franchise Fees are assessments on a number of utility services including gas, electricity, water, cable, and
solid waste for the right to conduct business within the City of Saratoga. The assessments are determined by
easement formulas or a percentage of service costs and are a pass-through fee on the utility billings. Utilities
collect the fees from customers and subsequently remit the payments to the City. Most of these services are
considered necessities in an urban setting, leading to minimal fluctuations in the revenue stream year over
year. However, in recent years cable revenue has shown steady increases due to the ongoing growth in the
use of internet services, and solid waste franchise fee revenue has increased with the rise in service charges.
Franchise Fees in total are expected to grow at a fairly slow pace into the future.
Sales Tax
With Saratoga primarily a residential community with limited retail sources, Sales Tax revenue is small in
comparison to other cities of similar size. In an average year, the City receives approximately $1 million in
Sales Tax, which is derived primarily from restaurants, grocery and drug stores, and gas stations. The
closures and service limitations put on restaurants (the City’s largest Sales Tax category) and the State of
California’s COVID-19 stimulus actions to allow small business to delay Sales Tax payments for up to one
year, are expected to impact Saratoga’s receipts significantly in the following fiscal year.
Development Fees
Development fee revenue is derived from services related to planning reviews, planning applications,
building plan reviews, engineering reviews, building inspections, and all permits, fees and costs associated
with performing these activities. These regulatory services ensure compliance with all applicable laws, and
the health and safety of the community. Although the entire community benefits from an enforced regulatory
program, the service requestor initiates the development change and benefits the most from it. Therefore, the
service requestor pays for most, if not all, of the costs. While the financial strength of the Saratoga
community has insulated this revenue source from minor economic fluctuations in the past, the recession
years proved that development activity does correlate with strong economic ebbs and flows. Hence, all types
of fee-based activities are expected to slow down over the next fiscal year.
Fiscal Outlook
While the City is well positioned to respond to the economic crisis created by COVID-19 without
compromising services or losing focus on priority initiatives, the long-term impacts of COVID-19 have yet to
be fully realized and it is clear that economic conditions and outcomes will need to be closely monitored.
Recognizing that the large increases in revenue growth have ended, is as critical to the long-term fiscal health
of the City as is containing operating expenditure growth. Moving into the new normal of slower property
tax revenue growth, additional sources of revenue must be considered in the future for the City to adjust to
the changing needs in the community, retain a highly competent workforce, and maintain aging public
infrastructure.
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FINANCIAL INFORMATION AND MAJOR INITIATIVES
Financial Controls
City Management is responsible for establishing and maintaining an internal control structure designed to
ensure that the assets of the City are protected from loss, theft, or misuse, and to ensure that adequate
accounting data is compiled to allow for the preparation of financial statements in conformity with generally
accepted accounting principles. The internal control structure is designed to provide reasonable, but not
absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: (1)
the cost of a control should not exceed benefits likely to be derived, and (2) the valuation of costs and benefits
requires estimates and judgments by management.
As a recipient of federal, state and local financial assistance, the City is also responsible for guaranteeing that
an adequate internal control structure is in place to ensure and document compliance with applicable laws and
regulations related to these programs. This internal control structure is subject to periodic evaluation by City
Management.
For cash management, the City practices a passive approach to investments and maintains flexibility by
managing a pooled cash system. Under the pooled cash concept, the City invests the cash of all funds with
maturities planned to coincide with cash needs. Idle cash is invested in certain eligible securities as
constrained by law and further limited by the City’s investment policy. The goals of the City’s investment
policy are safety, liquidity, and yield. Cash management is tracked by fund and reconciled monthly.
In addition, the City maintains extensive budgetary controls. The objective of these controls is to ensure
compliance with legal provisions embodied in the annual appropriated budget approved by the City Council.
Activities of the general fund, special revenue funds, capital projects funds and debt service funds are
included in the annual appropriation.
The level of budgetary control (i.e., the level at which expenditures cannot exceed the appropriated amount)
is at the fund level. The City also maintains an encumbrance accounting system as another method of
maintaining budgetary control. Encumbered amounts lapse at year-end with the exception of the Capital
Improvements Projects, which are multiple-year projects. On occasion, the responsible department at year-
end reviews outstanding encumbrances of a material nature, and if deemed critical, a recommendation is
made to the City Council to take action by Resolution to re-appropriate these funds into the following year’s
budget.
Major Initiatives
The fiscal year 2019/20 budget was designed to enhance the quality of life for all Saratoga residents by
focusing on the City Council’s priorities and enhancing community enrichment. Enhancements in wildfire
safety programs, community engagement, and infrastructure maintenance were prioritized.
An ongoing major initiative in the FY 2019/20 Operating Budget is the $1 million contribution toward the
City’s Tier I pension plan’s Unfunded Accrued Liability (UAL), and another $41,000 to pay off the City’s
Tier II and Tier III pension plan unfunded liabilities. These payments are intended to both proactively reduce
the City’s UAL liability and mitigate pension funding impacts to City services in the future. After an initial
$3.3 million payment in FY 2014/15, the Council committed to an annual liability payment of $500,000
toward the Tier I liability beginning in FY 2015/16, then increased that amount to $750,000 in fiscal year
2017/18, and to $1 million in fiscal year 2018/19 after actuarial changes and less than expected investment
returns continued to increase the outstanding liability. Tier II and Tier III unfunded pension liabilities total
between $0 and $40,000 each year, and are paid off in full to maintain 100% funding status. Additional
financial challenges are expected in upcoming years as the City addresses a proportional share of the Santa
Clara County Sheriff’s Office Public Safety required UAL contributions through increased service costs.
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In FY 2019/20, the City maintained prioritization of infrastructure, such as roads, parks and medians.
Additional funds were also allocated for roadway safety and traffic calming, enabling the City to install a
rapid flashing beacon crosswalk at Fruitvale Avenue and Douglass Lane and radar feedback signs on Pierce
Road, Quito Road, and Austin Way.
The Wildfire Public Safety Task Force was formed in February 2019 to serve in an advisory capacity on
matters related to wildfire. The Task Force made several recommendations to the City Council to mitigate
wildfire risk, including fuel reduction and a dead tree removal incentive program fund and City Code changes
to make it easier to remove trees that represent wildfire hazard.
In July 2019, Los Gatos-Saratoga (LGS) Recreation contracted with the City to provide recreation services
through their agency. The partnership has allowed the City to maximize its resources to better meet the needs
of residents without a loss of services to the community.
In the fall of 2019, the City celebrated the grand opening of Friendship Park at the corner of Quito Road and
Pollard Road, as well as the Garden Patio Bocce Ball Court, located between the Senior Center and Joan
Pisani Community Center. Also, despite delays caused by the spread of the Coronavirus, the City made
significant progress towards completion of the Community Development Lobby. The expansion
improvements include a self-help station and accessible counters that accommodate social distancing
protocols.
INDEPENDENT AUDIT
The City engaged Chavan & Associates, LLP to express an opinion on the financial statements based on
their audit. The audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation. Generally accepted
auditing standards set forth in the General Accounting Office’s Government Auditing Standards were used by
the auditors in conducting the engagement. The City’s Annual Financial Report received an unmodified
(clean) opinion from the auditors. The independent auditors’ report is presented as the first component of
the financial section of this report.
In addition to meeting the requirements set forth in statutes, the audit was also designed to meet the
requirements of the federal Single Audit Act of 1984, as amended, and the related U.S. Office of
Management and Budget’s Circular A-133, Audits of States, Local Governments, and Non-Profit
Organizations. The City’s federal financial assistance program also received an unqualified (clean)
opinion from the auditors.
Awards
The Government Finance Officers Association (GFOA) of the United States and Canada awarded a
Certificate of Achievement to the City for its Excellence in Financial Reporting on the CAFR for the fiscal
year ended June 30, 2019. In order to be awarded a Certificate of Achievement, the City published an easily
readable and efficiently organized financial report. This report satisfied both generally accepted accounting
principles and applicable legal requirements.
The Certificate of Achievement is valid for a period of one year. We believe our current CAFR continues to
meet the Certificate of Achievement program’s requirements, and plan on submitting it to the GFOA to
determine its eligibility for another certificate.
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ACKNOWLEDGEMENTS
This CAFR represents the culmination of numerous hours of hard work expended by many individuals in the
Finance & Administrative Services Department. In particular, we would like to express our appreciation to
Ann Xu, Accountant; Julie Ingraham, Accounting Technician; Evangeline Bundang, Accounting Technician;
Gina Scott, Administrative Analyst; Karen Caselli, Senior Accounting Technician; and Dennis Jaw, Finance
Manager, for their assistance with the audit and exemplary services throughout the year. Furthermore, we
would like to thank Chavan & Associates, LLP Certified Public Accountants for their assistance in the
preparation of this report. Finally, we would like to give credit to the City Council for their ongoing interest
and support in planning, conducting and advising on the operations of the City in a responsible and
representative manner.
Respectfully submitted,
James Lindsay Mary Furey
City Manager Administrative Services Director
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Government Finance Officers Association
Certificate of
Achievement for
Excellence in
Financial
Reporting
Presented to
City of Saratoga
California
For its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
June 30, 2019
Executive Director/CEO
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CITY OF SARATOGA
ELECTED OFFICIALS AND
ADMINISTRATIVE PERSONNEL
As of June 30, 2020
CITY COUNCIL
Howard Miller - Mayor
Mary-Lynne Bernald - Vice-Mayor
Manny Cappello
Rishi Kumar
Yan Zhao
CITY STAFF
James Lindsay – City Manager
Crystal Bothelio – Assistant City Manager
Debbie Bretschneider –City Clerk
Mary Furey – Administrative Services Director
Debbie Pedro – Community Development Director
John Cherbone – Public Works Director
CITY ATTORNEY
Richard S. Taylor – Shute, Mihaly & Weinberger, LLP
INDEPENDENT AUDITORS
Chavan & Associates, LLP Certified Public Accountants
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FINANCIAL SECTION
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`
INDEPENDENT AUDITORS’ REPORT
To the Honorable Mayor and Members of the
City Council of the City of Saratoga
Saratoga, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund,
and the aggregate remaining fund information of the City of Saratoga (the “City"), as of and for the year
ended June 30, 2020, and the related notes to the financial statements, which collectively comprise City’s
basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
The City’s management is responsible for the preparation and fair presentation of these financial statements
in accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America, the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the City’s preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, each major fund, and the aggregate remaining
fund information of the City of Saratoga, as of June 30, 2020, 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.
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Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and other required supplementary information, as listed in the table of contents, be presented to
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board who considers it to be an
essential part of financial reporting for placing the basic financial statements in an appropriate operational,
economic, or historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of America,
which consisted of inquiries of management about the methods of preparing the information and comparing
the information for consistency with management’s responses to our inquiries, the basic financial
statements, and other knowledge we obtained during our audit of the basic financial statements. We do not
express an opinion or provide any assurance on the information because the limited procedures do not
provide us with sufficient evidence to express an opinion or provide any assurance.
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City’s financial statements as a whole. The introductory section, combining individual non-
major fund statements and schedules, and statistical section, as listed in the table of contents, are presented
for purposes of additional analysis and are not a required part of the financial statements. The combining
individual non-major fund statements and schedules have been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in
relation to the basic financial statements taken as a whole. The introductory and statistical sections have not
been subjected to the auditing procedures applied in the audit of the basic financial statements and,
accordingly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated November 14,
2020 on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is 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.
November 14, 2020
San Jose, California
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
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INTRODUCTION
The Management’s Discussion and Analysis (MD&A) is a required section of the City’s Comprehensive
Annual Financial Report (CAFR), as shown in the overview below. The purpose of the MD&A is to
present discussion and analysis of the City’s financial performance during the fiscal year that ended on
June 30, 2020. This report will (1) focus on significant financial issues, (2) provide an overview of the
City’s financial activity, (3) identify changes in the City’s financial position, (4) identify any individual
fund issues or concerns, and (5) provide descriptions of significant asset and debt activity.
This information. presented in conjunction with the annual Transmittal Letter and Basic Financial
Statements is intended to provide a comprehensive understanding of the City’s operations and financial
standing.
Required Components of the Annual Financial Report
FISCAL YEAR 2019/20 FINANCIAL HIGHLIGHTS
• Total net position, or the City's assets plus deferred outflow of resources ($158.2 million) less
its liabilities plus deferred inflow of resources ($22.8 million), was $135.3 million as of June
30, 2020. This is an increase of $1.6 million over the prior fiscal year, which is primarily due to
an increase in property tax revenue and capital grants.
• The City’s Net Pension Liability is $7.6 million. This is an increase of $0.3 million over the
prior fiscal year, primarily due to investment experience.
• Net Position is comprised of $117.1 million for investment in capital assets, net of depreciation
and related debt, $1.7 million restricted for specific purposes, and $16.6 million in Unrestricted
Net Position (page 38).
• Total City-wide revenues of $30.2 million consists of $24.0 million in general revenue and $6.3
million in program revenue (page 39).
• City expenses total $28.7 million (page 39).
Management’s
Discussion & Analysis
Government-Wide
Financial Statements
Fund
Financial Statements
Notes to the
Financial Statements
Basic
Financial Statements
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
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• The Governmental Funds fund balances total $20.7 million, with $14.4 million in the General
Fund, $4.7 million in the Capital Improvement Funds, and $1.6 million in Other Governmental
Funds. This represents an increase of $241,000 from the prior year (page 40).
• General Fund revenues total $23.5 million, while General Fund expenditures total $21.4 million
(page 42).
THE BASIC FINANCIAL STATEMENTS
The Basic Financial Statements are comprised of 1) Government-Wide (City-wide) Financial Statements,
and; 2) Fund Financial Statements. These two sets of financial statements provide the reader two different
perspectives of the City's financial activities and financial position.
Government-Wide Financial Statements provide a longer-term view of the City's activities as a whole and are
comprised of the Statement of Net Position and the Statement of Activities. The Statement of Net Position
provides summary level information about the financial position of the City, including all its capital assets
and long-term liabilities on a full accrual basis, similar to that used by corporations. The Statement of
Activities provides summary level information about the City's revenues and expenses, also on a full accrual
basis, with the emphasis on measuring net revenues and/or expenses for each of the City's programs. The
Statement of Activities illustrates the change in Net Position for the fiscal year.
City financial activities are required to be grouped as either government activities or business-type activities.
The amounts in the Statement of Net Position and the Statement of Activities are required to be separated into
governmental activities or business-type activities in order to distinguish between the two types of activities.
In the case of the City of Saratoga, there are no business-type activities as of June 30, 2020.
Fund Financial Statements report the City's operations in more detail than Government-Wide statements and
focus primarily on the short-term activities of the City's General Fund and other major funds. The Fund
Financial Statements measure current revenues and expenditures and fund balances; they exclude capital
assets, long-term debt, and other long-term amounts.
Major funds account for the major financial activities of the City and are presented individually, while the
activities of non-major funds are presented in summary with subordinate schedules presenting the detail for
each of these other funds in the Supplementary Information section. Major funds are explained below.
The Government-Wide Financial Statements
Government-Wide financial statements are prepared on the accrual basis, which means they measure the flow
of all economic resources of the City as a whole. The Statement of Net Position and the Statement of
Activities present information about the following:
Governmental Activities - All of the City's basic services are considered to be governmental activities,
including general government, community development, public safety, transportation, and, culture and
leisure. These services are supported by general City revenues such as taxes, and by specific program
revenues such as development and recreation program fees.
Business-Type Activities - This category includes enterprise activities such as water, sewer, and utilities.
Unlike governmental services, these activities are meant to be fully supported by charges paid by users, based
on the services used. The City of Saratoga currently does not have any business-type activities.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
24
Fund Financial Statements
A fund represents a grouping of related accounts and is used to maintain control over resources that are
segregated for specific activities or objectives. The City, like other local governments, uses fund
accounting to ensure and demonstrate compliance with finance-related legal requirements.
Fund financial statements provide detailed information about each of the City's most significant funds, called
major funds. The concept of major funds, and the determination of which funds are classified as major funds,
was established by GASB Statement 34 and replaces the concept of combining like funds and presenting
them in total. Instead, each major fund is presented individually, with all non-major funds summarized and
presented in a single column. Subordinate schedules present the detail of these non-major funds. Major
funds present the major activities of the City for the fiscal year, and may change from year to year as a result
of changes in the pattern of the City's activities. The City's funds are segregated into three types:
governmental funds, proprietary funds, and fiduciary funds.
Governmental Funds - The City's basic services are reported in governmental funds, which focus on how
money flows into and out of those funds and the balances available at year-end. Financial statements are
prepared on the modified accrual basis, which means they measure only current financial resources and uses.
Carrying amounts for capital assets and other long-lived assets, along with long-term liabilities are not
presented on the balance sheet in the governmental fund financial statements. Unlike the Government-Wide
financial statements, Governmental Fund financial statements focus on near-term inflows and outflows of
spendable resources, as well as on balances of spendable resources available at the end of the fiscal year.
Such information may be useful in evaluating the City's near-term financing requirements.
Proprietary Funds – Internal service funds are an accounting device used to accumulate and allocate costs
internally among the City’s various functions. The City uses internal service funds to account for
liability/risk management, worker’s compensation, office equipment support services, information
technology services, vehicle and building maintenance, and vehicle and information technology
equipment replacement. Because internal service funds primarily benefit governmental functions, they
have been included with the governmental activities in the Government-Wide financial statements.
Fiduciary Funds – These funds account for assets held by the City in a trustee capacity or as an agent for
individuals, private organizations, other governmental units, and/or other funds. Fiduciary funds are not
reflected in the government-wide financial statements because these resources are not available to support
the City's programs. The City reports three fiduciary funds: The West Valley Clean Water Program, the
2018 Arrowhead Community Facilities District (CFD) Bond, and the Arrowhead CFD Project. Additional
information regarding these funds can be found in Note 1 of the financial statements.
NOTES TO THE FINANCIAL STATEMENTS
Notes to the Financial Statements provide additional information that is essential to a full understanding of
the data provided in the government-wide and fund financial statements. The notes can be found
immediately following the fund financial statements.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
25
REQUIRED SUPPLEMENTARY INFORMATION
Required supplementary information, other than presented in this MD&A, follows the Notes Section and
includes a budgetary comparison for the General Fund as presented in the Governmental Fund Financial
Statements, and information on the modified approach for city streets and infrastructure.
SUPPLEMENTARY INFORMATION
Combining and individual fund statements and schedules are included to provide additional information
on non-major governmental funds including special revenue, debt service, and capital project funds, as
well as proprietary internal service fund information and uses of capital assets. An un-audited statistical
section provides historical and current data on financial trends, revenue and debt capacity, demographic
and economic information, and operating information.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Net Position serves over time as an indicator of the City's financial position. The City's Total Net Position
increased $1,554,167 from $133,793,057 in Fiscal Year 2018/19 to $135,347,224 in Fiscal Year 2019/20.
The primary reason for the increase in net position is an increase in property tax revenues and capital grants.
The net pension liability increased $0.3 million as a result of investment experience.
The most significant portion of the City's Net Position ($117,086,219 or 86.5%) accounts for its investment in
capital assets, (e.g., land, buildings, general government infrastructure, equipment, etc.) less any related debt
used to acquire those assets that are still outstanding. These capital assets represent infrastructure which
provides services to the citizens, consequently, these assets are not available for future spending.
Of the City’s Net Position, $1,689,161 or 1.2% is subject to external restrictions on how the funding may be
used. Within the restricted Net Position total, $787,734 is for Landscape & Lighting districts, $788,245 is for
repayment of long-term debt, and $113,182 is for environmental services.
The remaining balance of $16,571,845, or 12.2% of the City's Net Position, is unrestricted and may be used
to meet the City's ongoing obligations to citizens and creditors.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
26
Governmental Activities
2020 2019
Assets
Current assets 29,553,559$ 29,599,639$
Capital assets 125,423,929 124,134,211
Total Assets 154,977,488 153,733,850
Deferred Outflow of Resources
Deferred Outflow 3,206,496 3,728,611
Total Deferred Outflow of Resources 3,206,496 3,728,611
Liabilities
Current liabilities 6,242,753 6,817,238
Long-term liabilities 15,666,960 15,754,010
Total Liabilities 21,909,713 22,571,248
Deferred Inflow of Resources
Deferred Inflow 927,046 1,098,157
Total Deferred Inflow of Resources 927,046 1,098,157
Net Position
Net investment in capital assets 117,086,219 115,249,609
Restricted for environmental services 113,182 163,182
Restricted for special assessment funds 787,734 1,621,946
Restricted for debt service 788,245 932,880
Unrestricted 16,571,845 15,825,440
Total Net Position 135,347,225$ 133,793,057$
Net Position
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
27
Governmental Activities Increase
Functions/Programs 2020 2019 (Decrease)
Program Revenues
Charges for services 4,598,974$ 5,499,813$ (900,839)$
Operating grants and contributions 71,543 94,795 (23,252)
Capital grants and contributions 1,594,581 3,630,724 (2,036,143)
Total Program Revenues 6,265,098 9,225,332 (2,960,234)
General Revenues
Property taxes 16,056,222 15,250,230 805,992
Sales taxes 1,056,700 1,207,471 (150,771)
Local taxes 807,385 896,420 (89,035)
Franchise taxes 2,604,702 2,289,964 314,738
Intergovernmental revenues 2,626,904 1,237,912 1,388,992
Investment earnings 623,599 697,863 (74,264)
Other revenues 179,974 205,395 (25,421)
Total General Revenues 23,955,486 21,785,255 2,170,231
Expenses
General and intergovernmental services 7,071,357 6,465,250 606,107
Public safety 6,355,432 6,004,406 351,026
Public works 11,340,229 10,271,134 1,069,095
Community services 864,838 1,286,667 (421,829)
Community development services 2,726,768 2,198,053 528,715
Interest on long-term debt (unallocated)307,794 334,012 (26,218)
Total Expenses 28,666,417 26,559,522 2,106,896$
Increase / (Decrease) in Net Position 1,554,167 4,451,065 (2,896,898)
Net Position, Beginning of Year 133,793,057 129,341,992 4,451,065
Net Position, End of Year 135,347,225$ 133,793,057$ 1,554,167$
Statement of Activities
As shown in the above Statement of Activities schedule, program revenues decreased by $2,960,234 from
the prior fiscal year for governmental activities, and general revenues increased by $2,170,231 from the
prior year. This resulted in a total decrease in revenues of $790,003. Expenses increased by $2,106,896
from the prior year primarily due to investment in capital outlay activity.
With total program and general revenues for Fiscal Year 2019/20 at $30,220,584 and total expenses at
$28,666,417, the net activity resulted in an increase in Net Position of $1,554,167.
An analysis and graphical representation of the changes in revenues and expenditures by type of
significant events follows:
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
28
Revenues
For Fiscal Year 2019/20, the growth in property tax revenues reflect the ongoing strength of the San
Francisco Bay Area economy. The decrease in Capital Grants revenue is due to increased activity in the
prior year; there was a significant increase in activity for grant-funded Public Works and Community
Services capital projects in FY 2018/19.
General Revenues increased by $2,170,231 from the prior year. The most significant changes include:
• Property Tax revenue increased $805,992 over the prior year. The increase is due to the continuing
demand for housing in the region, which has resulted in higher assessed valuations of property within
the City upon turnover, plus the incremental TEA increase in the property tax allocation percentage.
• Intergovernmental revenue increased $1,379,224 primarily due to Measure B funds which were
suspended due to legal action in prior years.
Program Revenues decreased by $2,960,234 from the prior year. The most significant changes include:
• Capital Grants & Contributions decreased $2,036,143 from the prior year primarily due to significant
progress in FY 2018/19 of the Prospect Road Improvements project, which is funded mostly by the
Federal Highway Safety Improvement Program (HSIP) grant through Caltrans.
• Charges for Services decreased by $900,839 from the prior year due to a significant decrease in
construction and remodeling due to COVID-19 Shelter-in-Place orders halting construction activity
for most of the last quarter of the fiscal year.
Expenses
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
29
Fiscal Year 2019/20 expenses increased by $2,106,896, primarily due to capital outlay activity.
Compared to the prior year, the GASB 68 pension expense adjustment increased expenses by $698,375.
This adjustment is broken down as follows:
Increase
2020 2019 (Decrease)
General and intergovernmental services 126,886 (107,855) 234,741
Public works 166,851 (135,425) 302,276
Community services 23,194 (28,943) 52,137
Community development services 61,369 (47,852) 109,221
Total Adjustment 378,300$ (320,075)$ 698,375$
Share of Net Pension Liability Adjustment
The following analysis includes the Net Pension Liability (NPL) adjustment decreases listed above:
• Public Works expenses increased by $1,069,095 primarily due to capital outlay activity.
• Public Safety expenses increased by $351,026 due to increases in sheriff contract costs.
• General Services expenses increased by $606,107 primarily due to increases in pension and
compensated absences costs.
• Community Services expenses decreased by $421,829 primarily due to Los Gatos Saratoga
Recreation (LGS) taking over as the recreation services provider.
• Community Development expenses increased by $528,715 primarily due to the aforementioned
reduction in building activity.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
30
MAJOR AND OTHER GOVERNMENTAL FUNDS: CHANGE IN FUND BALANCE
A summary of the changes in fund balance of the Major Funds and Other Governmental Funds is
presented below:
Other
Capital Governmental
General Improvement Funds
Total Revenues 23,508,914$ 5,354,392$ 1,535,309$
Total Expenditures 21,436,239 7,269,841 1,451,552
Revenues Over
(Under) Expenditures 2,072,675 (1,915,449) 83,757
Transfers in 1,187,347 3,630,000 -
Transfers out (3,505,000) (249,743) (1,062,604)
Net change in fund balances (244,978) 1,464,808 (978,847)
Beginning of year 14,679,585 3,252,057 2,554,826
End of year 14,434,607$ 4,716,865$ 1,575,979$
Major Funds
The General Fund and Capital Improvement Funds are listed as Major Funds in Fiscal Year 2019/20. The
Other Governmental Funds category includes thirty Landscape and Lighting Districts and Storm Drain
funds (presented as one combined fund in the financials) and the Library Bond Debt Service Fund. The
total net change from fiscal year transactions, including Major Funds and Other Governmental Funds, was
an increase of $240,983.
General Fund
As shown in the Major Funds table above, the net change in the General Fund's ending fund balance is a
decrease of $244,978. This is primarily as a result of decreased revenues due to COVID-19 and increased
General Fund investment in capital improvements.
General Fund revenue decreased from the prior year for a net revenue loss of $607,034. This is primarily
due to significant decreases in development activity due to COVID-19. General Fund revenue budgets
are conservatively based upon prior year experience and revenue specific information.
Expenses are budgeted at anticipated program needs at not-to-exceed projected funding levels. However,
the City has opted to commit additional funding towards the Unfunded Accrued Liability (UAL) related
to pensions. In Fiscal Year 2019/20, the City Council directed staff to make a $1,000,000 payment
towards the UAL. This payment is in excess of the required minimum contribution amount required,
thereby reducing the principal at a faster pace. As of June 30, 2020, the Net Pension Liability, or NPL, is
approximately $7.6 million. This is an increase of $0.3 million over the prior fiscal year, primarily due to
investment experience.
Capital Improvement Project Fund
The net increase of $1,464,808 in the Capital Improvement Funds occurred due to an increased General
Fund investment in capital improvements, combined with a reduction in construction activity due to
COVID-19.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
31
Other Governmental Funds
Other Governmental Funds fund balances decreased by a total of $978,847, primarily due to the closing
of four Landscape & Lightning Districts. The $1,062,604 of fund balance in those four districts was
transferred to the General Fund and designated as the LLD Closeout Reserve.
GENERAL FUND – BUDGETARY HIGHLIGHTS
Changes from the City's General Fund original budget to the final budget are detailed in the Required
Supplementary Information Section along with a comparison to actual activity for the fiscal year.
Changes to the City's budget that increase or decrease appropriations in a fund must be approved by a
resolution of the City Council. Modifications to the budget that are a realignment of fiscal activities with
no impact to the fund's bottom line may be approved by the City Manager. Significant changes from the
City’s original budget to the final budget are summarized as follows:
Revenues and Transfers In
The General Fund adopted and final revenue budget was $23,051,519 as shown in the schedule below:
Adopted to Final Budget
Fiscal Year Ended June 30, 2020
+=
Adopted Budget Final
Budget Adjustments Budget
Revenues 23,051,519$ - 23,051,519$
Transfers in -$ - -$
General Fund Revenues and Transfers In
There were no revenue budget adjustments made in Fiscal Year 2019/20. Actual transfers into the
General Fund in Fiscal Year 2019/20 was $1,187,347, as a result of the aforementioned transfer of
Landscape & Lighting District balances, and the City’s policy to return unused capital project funds to the
General Fund when a project is deemed completed or cancelled.
Expenses and Transfers Out
The final General Fund expense budget was $22,858,195 and final transfers out at $3,505,000, as shown
in the schedule below:
Adopted to Final Budget
Fiscal Year Ended June 30, 2020
+=
Adopted Budget Final
Budget Adjustments Budget
Expenses 22,843,345$ 14,850 22,858,195$
Transfers out 2,620,000$ 885,000 3,505,000$
General Fund Expenditures & Transfers Out
During the fiscal year, adjustments to the expense budget ($14,265) were due to an increase in the
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
32
contract cost for outsourced street sweeping services. Transfers out were increased by $885,000 to fund
various additional capital projects, including the McFarlane Avenue Curb & Gutter Replacement and the
Continental Circle Stabilization projects.
The original budgeted amount of $2,620,000 for transfers from the General Fund to the Capital
Improvement Funds were allocated as follows: $675,000 for street, sidewalk, and storm drain repair;
$1,495,000 for park and trail improvements; $375,000 for City facilities related projects, and $75,000 for
various administrative projects.
CAPITAL ASSETS
The City of Saratoga elected to use the "Modified Approach" as defined by GASB Statement No. 34 for
infrastructure reporting in which eligible infrastructure capital assets are not required to be depreciated if
the following requirements are met:
• The City manages the assets using an asset management system which requires the City (1) perform
an up-to-date inventory; (2) perform condition assessments and summarize the results using a
measurement scale; and (3) estimate the annual amount to preserve the assets at the established
condition assessment level.
• The City documents that the eligible infrastructure capital assets are being preserved approximately
at or above the established and disclosed condition assessment level.
City policy is to achieve a Pavement Condition Index (PCI) average rating of 70 for all streets, at
minimum. As of June 30, 2019, the City’s overall rating was estimated to be 66 with 48% of streets rated
“Very Good”, 31% rated as “Good”, 15% of streets rated “Poor,” and 6% of streets rated as "Very Poor."
While the City Council continues to review infrastructure investment strategies, the City continues to
make significant investment into City streets in order to bring the average PCI rating up to the target of
70.
Overall, the City spent $5,005,648 to maintain and preserve eligible infrastructure assets during Fiscal
Year 2019/20. It was estimated in the most recent pavement study in February 2020 that the five-year
(2019-2023) cost to maintain street infrastructure would be $43,500,000. For more detailed information
on Capital Assets activity, please refer to Note 4 in the section entitled "Notes to the Basic Financial
Statements" and Note 2 in the "Required Supplementary Section."
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
33
As reflected in the following schedule, the City has $125,423,929 invested in a variety of capital assets as
of June 30, 2020. This represents an increase of $1,289,715, or 1.04% from the prior year.
Governmental Activities
2020 2019
Land 17,754,122$ 15,591,925$
Building and structures 14,587,928 15,051,122
Machinery and equipment 1,182,490 1,411,088
Infrastructure 80,446,694 81,760,030
Construction in progress 11,452,695 10,320,046
Total Capital Assets, Net of Depreciation 125,423,929$ 124,134,211$
Capital Assets at Year End
Net of Depreciation
The following reconciliation summarizes the changes in Capital Assets.
Balance Balance
June 30, 2019 Additions Retirements Reclassification June 30, 2020
Land 15,591,925$ -$ -$ 2,162,197$ 17,754,122$
Building and structures 26,570,197 - - 285,000 26,855,197
Machinery and equipment 4,064,301 81,884 - - 4,146,186
Infrastructure 111,389,585 - - - 111,389,585
Construction in progress 10,320,046 3,579,846 - (2,447,197) 11,452,695
Depreciation (43,801,843) (2,372,013) - - (46,173,856)
Total Capital Assets,
Net of Depreciation 124,134,211$ 1,289,718$ -$ -$ 125,423,929$
Changes in Capital Assets
Major capital projects in progress during Fiscal Year 2019/20 included the following expenditures:
• El Camino Grande Storm Drain - $353,636
• Prospect/Saratoga OBAG Improvements - $695,801
• Garden Patio Bocce Ball Court - $280,450
• Saratoga-to-the-Sea Trail - $1,195,134
• Senior Center Entrance Remodel - $215,450
Additional information on Capital Assets is included in Note 4 to the financial statements.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
34
DEBT AND OTHER LONG-TERM OBLIGATION ADMINISTRATION
The net change in outstanding obligations for the City of Saratoga is a decrease of $364,313. Total long-
term bonded debt, net of premium decreased by $546,892. Outstanding compensated absences increased
by $182,579.
Governmental Activities
2020 2019
2011 General obligation bond 8,075,000$ 8,600,000$
Net original issue premuim 262,710 284,602
Compensated absences 931,440 748,861
Total Outstanding long-term obligations 9,269,150$ 9,633,463$
Outstanding Long-Term Obligation at Year End
The current portion of long-term debt ($545,000 for the refunded 2011 General Obligation Bonds for
Fiscal Year 2020/21) and $21,892 of amortized net original premium are classified as a current liability in
the City's Statement of Net Position.
General Obligation Bonds
On July 14, 2011 the City refunded the 2001 General Obligation Bonds and, in their place, issued 2011
General Obligation Bonds for $11,995,000. Interest rates on the bonds range from 2.0% to 4.0%, and the
final payment is due August 1, 2031. Principal of $525,000 and interest of $319,035 were paid during the
fiscal year.
Compensated Absences
Compensated absences are accrued liabilities for vested and unpaid vacation and sick pay. The
compensated absences balance increased during the fiscal year by $182,579 due to a decrease in use of
paid time-off. An estimated current liability of $650,270 is anticipated for the next fiscal year.
Additional information on outstanding obligations can be found in Note 5 to the financial statements.
ECONOMIC FACTORS
The novel coronavirus (COVID-19) pandemic has created extreme uncertainty that will have significant
impacts on the City’s budget. State and County Shelter-in-Place measures have successfully slowed the
spread of the virus and prevented local hospitals from being overwhelmed, but the efforts have also
caused unprecedented changes to everyday life. Economic engines have come to a halt in response to
Shelter-in-Place Orders – nearly 22 million Americans have filed for unemployment, and the stock
market has experienced extraordinary volatility. While we are still grappling to understand the long -term
impacts as projections change daily, there is no question that there has and will continue to be economic
challenges due to COVID-19.
Declines in consumer and business spending, cancelled vacations and events, restrictions on shopping,
dining, and services, have all contributed to the economic damage and resulting unemployment levels.
Locally, we see restaurants, salons, and other small service-oriented businesses struggling to stay afloat.
Economists are declaring that a recession has already taken hold, not only for the nation, but worldwide.
CITY OF SARATOGA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED JUNE 30, 2020
35
The FY 2020/21 Operating Budget assumes that provisions of the Shelter-in-Place and social distancing
requirements will continue for some time and greatly limit the ability to resume normal activities.
Consequently, proposed expenses were closely scrutinized under the lens of allowable activities and
anticipated health order restrictions.
OUTLOOK
While the City is well positioned to respond to the economic crisis created by COVID -19 without
compromising services or losing focus on priority initiatives, the long-term impacts of COVID-19 have
yet to be fully realized and it is clear that we will need to closely monitor economic conditions and
outcomes. In the meantime, the City will continue to address its liabilities, deferred maintenance on
infrastructure and facilities, and explore ways in which the City can refine Saratoga and make it an even
better place for the people who live, work, and visit the community.
REQUEST FOR FINANCIAL INFORMATION
This financial report is designed to provide a general overview of the City of Saratoga's finances for all of
Saratoga's residents, taxpayers, customers, investors, and creditors. This financial report seeks to
demonstrate the City's accountability for the money it receives. Questions concerning any of the
information provided in this report or requests for additional information should be addressed to the
Administrative Services Department, 13777 Fruitvale Avenue, Saratoga, California 95070.
36
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37
BASIC FINANCIAL
STATEMENTS
CITY OF SARATOGA
STATEMENT OF NET POSITION
JUNE 30, 2020
38
Primary Government
Governmental
Activities
ASSETS
Current Assets:
Cash and investments 26,866,301$
Restricted cash and investments 1,622,662
Receivables:
Accounts 1,059,735
Prepaids 4,861
Total Current Assets 29,553,559
Noncurrent Assets:
Capital Assets:
Non-depreciable 81,890,055
Depreciable, net 43,533,874
Total Capital Assets 125,423,929
Total Noncurrent Assets 125,423,929
Total Assets 154,977,488
DEFERRED OUTFLOW OF RESOURCES
Adjustments related to pension liability 3,206,496
Total Deferred Outflow of Resources 3,206,496
LIABILITIES
Current Liabilities:
Accounts payable 1,249,342$
Accrued payroll 295,044
Interest payable 128,557
Deposits payable 3,099,296
Claims payable 90,720
Long-term obligations - due within one year 1,217,162
Total Current Liabilities 6,242,753
Noncurrent Liabilities:
Net pension liabilty 7,614,972
Long-term obligations - due in more than one year 8,051,988
Total Noncurrent Liabilities 15,666,960
Total Liabilities 21,909,713
DEFERRED INFLOW OF RESOURCES
Adjustments related to pension liability 861,981
Unavailable revenue 65,065
Total Deferred Inflow of Resources 927,046
Net Position
Net investment in capital assets 117,086,219
Restricted for:
Environmental funds 113,182
Special assessment funds 787,734
Debt service 788,245
Total Restricted 1,689,161
Unrestricted 16,571,845
Total Net Position 135,347,225$
CITY OF SARATOGA
STATEMENT OF ACTIVITIES AND CHANGES IN NET POSITION
FOR THE YEAR ENDED JUNE 30, 2020
39
Net (Expense)
Revenue and
Changes in
Program Revenues Net Position
Primary
Operating Capital Government
Charges for Grants and Grants and Governmental
Functions/Programs Expenses Services Contributions Contributions Total Activities
Primary Government:
Governmental Activities:
General and intergovt'l services 7,071,357$ 57,304$ -$ -$ 57,304$ (7,014,053)$
Public safety 6,355,432 339,935 71,543 - 411,477 (5,943,955)
Public works 11,340,229 2,055,911 - 1,584,581 3,640,491 (7,699,737)
Community services 864,838 239,575 - - 239,575 (625,263)
Community development services 2,726,768 1,906,250 - 10,000 1,916,250 (810,518)
Interest on long-term debt (unall.)307,794 - - - - (307,794)
Total 28,666,418$ 4,598,974$ 71,543$ 1,594,581$ 6,265,098$ (22,401,320)$
General Revenues:
Taxes
Property taxes 16,056,222$
Sales taxes 1,056,700
Local taxes 807,385
Franchise taxes 2,604,702
Total taxes 20,525,010
Intergovernmental 2,626,904
Investment earnings 623,599
Other revenues 179,974
Total General Revenues 23,955,487
Change in Net Position 1,554,167
Net Position - Beginning of Year 133,793,057
Net Position - End of Year 135,347,225$
The accompanying notes are an integral part of these financial statements
CITY OF SARATOGA
GOVERNMENTAL FUNDS – BALANCE SHEET
JUNE 30, 2020
40
Other Total
Capital Governmental Governmental
General Improvement Funds Funds
ASSETS
Cash and investments 17,856,838$ 4,942,266$ -$ 22,799,104$
Restricted cash and investments - - 1,622,662 1,622,662
Receivables:
Accounts 463,730 585,027 2,764 1,051,521
Prepaid Items 4,861 - - 4,861
Total assets 18,325,429 5,527,293 1,625,426 25,478,148
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 420,697$ 705,004$ 49,447$ 1,175,148$
Accrued payroll 248,556 - - 248,556
Deposits payable 2,993,872 105,424 - 3,099,296
Other payable 162,632 - - 162,632
Total liabilities 3,825,757 810,428 49,447 4,685,632
DEFERRED INFLOW OF RESOURCES
Unavailable Revenue 65,065 - - 65,065
Total deferred outflow of resources 65,065$ -$ -$ 65,065$
Fund Balances:
Restricted:
Environmental services 113,182 - - 113,182
Special assessment funds - - 787,734 787,734
Debt service - - 788,245 788,245
Committed:
Capital improvement program - 4,716,865 - 4,716,865
Hillside stability 1,000,000 - - 1,000,000
Assigned:
Future capital & efficiency 2,488,878 - - 2,488,878
Carryforwards 155,556 - - 155,556
Facility replacement 3,200,000 - - 3,200,000
Unassigned:
Working capital 1,000,000 - - 1,000,000
Fiscal stabilization 3,150,000 - - 3,150,000
LLD Closeout 1,062,604 1,062,604
Compensated absences 310,479 - - 310,479
Other unassigned 1,953,908 - - 1,953,908
Total fund balances 14,434,607 4,716,865 1,575,979 20,727,451
Total liabilities and fund balances 18,325,429$ 5,527,293$ 1,625,426$ 25,478,148$
The accompanying notes are an integral part of these financial statements
Major Funds
CITY OF SARATOGA
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO THE STATEMENT OF NET POSITION
JUNE 30, 2020
41
Total Fund Balances - Total Governmental Funds 20,727,451$
Amounts reported for governmental activities in the statement of net position were
different because:
Capital assets used in governmental activities were not current financial resources. Therefore,
they were not reported in the Governmental Funds Balance Sheet. The capital assets were
adjusted as follows:
Non-depreciable capital assets 81,890,055
Depreciable capital assets, net 43,022,568
Total Capital Assets 124,912,623
Interest payable on long-term debt did not require current financial resources. Therefore,
interest payable was not reported as a liability in Governmental Funds Balance Sheet.(128,557)
Internal service funds are used by management to charge the costs of office stores,
vehicle and equipment maintenance and replacement, information services and replacement,
building maintenance, risk management, and workers compensation. The assets and
liabilities of the internal service funds are included in the governmental activities in
the statement of net position 4,375,315
Deferred outflow of resources are transactions that have already taken place but are not ready
to be recognized on the financial statements as expenses
Changes of Assumptions 363,117
Differences between Expected and Actual Experience 528,892
Change in employer's proportion 612,640
Pension Contributions Made Subsequent to Measurement Date 1,701,847
3,206,496
Long-term obligations were not due and payable in the current period. Therefore, they were not
reported in the Governmental Funds Balance Sheet. The long-term liabilities were adjusted
as follows:
General obligation bonds (8,075,000)
Net Pension Liability (7,614,972)
Compensated absences (931,440)
Net original issue premium (262,710)
Total Long-Term Obligations (16,884,122)
Deferred inflow of resources are transactions that have already taken place but are not ready
to be recognized on the financial statements as revenues
Changes of Assumptions (128,722)
Differences between Expected and Actual Experience (40,978)
Differences between Projected and Actual Investment Earnings (133,133)
Differences between Employer's Contributions and Proportionate Share of Contributions (416,313)
Change in employer's proportion (142,835)
(861,981)
Net Position of Governmental Activities 135,347,225$
CITY OF SARATOGA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE
FOR THE YEAR ENDED JUNE 30, 2020
42
Other Total
Capital Governmental Governmental
General Improvement Funds Funds
REVENUES:
Property taxes 15,031,057$ -$ 325,414$ 15,356,471$
Special assessments - - 1,174,242 1,174,242
Sales taxes 1,056,700 - - 1,056,700
Other local taxes 807,385 - - 807,385
Licenses & permits 1,601,278 440,266 - 2,041,544
Fines & forfeiture 104,829 7,220 - 112,049
Intergovernmental - Federal - 1,034,714 - 1,034,714
Intergovernmental - State 531,639 1,287,055 - 1,818,694
Intergovernmental - Other 54,650 2,026,866 - 2,081,516
Franchise fees 2,244,318 360,384 - 2,604,702
Use of money and property 853,870 26,730 35,653 916,253
Other revenue 1,223,188 171,157 - 1,394,345
Total revenues 23,508,914 5,354,392 1,535,309 30,398,615
EXPENDITURES:
Current:
General and intergovernmental services 5,261,487 - - 5,261,487
Public safety 6,355,432 - - 6,355,432
Public works 6,312,786 - 605,842 6,918,628
Community services 961,800 - - 961,800
Community development services 2,544,734 - - 2,544,734
Capital outlay - 7,269,841 - 7,269,841
Debt service:
Principal - - 525,000 525,000
Interest and fiscal charges - - 320,710 320,710
Total expenditures 21,436,239 7,269,841 1,451,552 30,157,632
REVENUES OVER
(UNDER) EXPENDITURES 2,072,675 (1,915,449) 83,757 240,983
OTHER FINANCING SOURCES (USES):
Transfers in 1,187,347 3,630,000 - 4,817,347
Transfers out (3,505,000) (249,743) (1,062,604) (4,817,347)
Total other financing sources (uses)(2,317,653) 3,380,257 (1,062,604) -
Net change in fund balances (244,978) 1,464,808 (978,847) 240,983
FUND BALANCES:
Beginning of year 14,679,585 3,252,057 2,554,826 20,486,468
End of year 14,434,607$ 4,716,865$ 1,575,979 20,727,451$
The accompanying notes are an integral part of these financial statements.
Major Funds
CITY OF SARATOGA
RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE TO THE
GOVERNMENT-WIDE STATEMENT OF ACTIVITIES AND CHANGES IN NET
POSITION
FOR THE YEAR ENDED JUNE 30, 2020
43
Net Change in Fund Balances - Total Governmental Funds 240,983$
Amounts reported for governmental activities in the Statement of Activities and Changes
in Net Position were different because:
Governmental Funds report capital outlay as expenditures. However, in the Government-Wide
Statement of Activities and Changes in Net Position, the cost of those assets was allocated over
their estimated useful lives as depreciation expense. This is the amount of capital assets
recorded in the current period.3,579,842
Depreciation expense on capital assets was reported in the Government-Wide Statement
of Activities and Changes in Net Position, but it did not require the use of current financial
resources. Therefore, depreciation expense was not reported as expenditures in the
Governmental Funds.(2,183,595)
Internal service funds are used by management to charge the costs of office stores,
vehicle and equipment maintenance and replacement, information services and replacement,
building maintenance, risk management, and workers' compensation. The net revenue
or excess expenses of the internal service funds is reported with government activities.216,648
GASB 68 Adjustments to pension expense
Change in net pension liability - current year (378,300)
Amortization of changes in deferred outflows (522,115)
Amortization of changes in deferred inflows 223,475
Adjustments to pension expense as a result of GASB 68 (676,940)
Long-term compensated absences and claims payables were reported in the Government-Wide
Statement of Activities and Changes in Net Position, but they did not require the use of current
financial resources. Therefore, long-term compensated absences and claims payable were not
reported as expenditures in governmental funds.
Compensated absences (182,579)
Repayment of bond principal was an expenditure in governmental funds, but the repayment
reduced long-term liabilities in the Government-Wide Statement of Net Position.
Long-term debt repayments 525,000
Revenues resulting from the refunding of outstanding debt are not available to pay
current-period expenditures and therefore, are revenue in the funds.
Net original issue premium 21,892
Interest expense on long-term debt was reported in the Government-Wide Statement of
Activities and Changes in Net Position, but it did not require the use of current financial
resources. Therefore, interest expense was not reported as expenditures in governmental
funds. The following amount represented the change in accrued interest from prior year.12,916
Change in Net Position of Governmental Activities 1,554,167$
The accompanying notes are an integral part of these financial statements
CITY OF SARATOGA
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2020
44
Governmental
Activities -
Internal
Service Funds
ASSETS
Current assets:
Cash and investments 4,067,197$
Accounts receivable 8,214
Total current assets 4,075,411
Noncurrent assets:
Capital assets:
Machinery and equipment 1,876,897
Less: accumulated depreciation (1,365,591)
Total capital assets (net of
accumulated depreciation) 511,306
Total assets 4,586,717
LIABILITIES
Liabilities:
Current liabilities:
Accounts payable 74,194
Accrued payroll 46,488
Other payables 90,720
Total current liabilities 211,402
NET POSITION
Net investment in capital assets 511,306
Unrestricted 3,864,009
Total net position 4,375,315$
The accompanying notes are an integral part of these financial statements
CITY OF SARATOGA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2020
45
Governmental
Activities -
Internal
Service Funds
Operating revenues:
Charges for services 2,890,000$
Other operating revenues 44,880
Total operating revenues 2,934,880
Operating expenses:
Cost of services 2,529,815
Depreciation 188,417
Total operating expenses 2,718,232
Operating income (loss)216,648
Change in net position 216,648
Total net position - beginning 4,158,667
Total net position - ending 4,375,315$
The accompanying notes are an integral part of these financial statements
CITY OF SARATOGA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2020
46
Governmental
Activities -
Internal
Service Funds
Cash flows from operating activities:
Receipts from customers and users 2,933,318$
Payments to suppliers (1,514,822)
Payments to employees (968,928)
Net cash provided (used) by operating activities 449,568
Cash flows from capital activities:
Acquisition of capital assets (81,884)
Net cash provided for the acquisition of capital assets (81,884)
Net increase in cash and cash equivalents 367,684
Cash and cash equivalents, beginning of year 3,699,513
Cash and cash equivalents, ending of year 4,067,197
Reconciliation of operating income to net cash provided
by operating activities:
Operating income (loss)216,648
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:
Depreciation 188,417
Change in operating assets and liabilities:
Accounts receivables (1,564)
Accounts payable 14,198
Claims payable 37,427
Accrued payroll (5,558)
Net cash provided (used) by operating activities 449,568$
The accompanying notes are an integral part of these financial statements
CITY OF SARATOGA
BALANCE SHEET
FIDUCIARY FUNDS
JUNE 30, 2020
47
Total
Agency
Funds
ASSETS
Cash and investments 1,329,156$
Total assets 1,329,156
LIABILITIES
Accounts payable 104,201
Due for debt service 294,269
Due to other agencies 930,686
1,329,156$
The accompanying notes are an integral part of these financial statements.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
48
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basic financial statements of the City of Saratoga, California (the City) have been prepared in
conformity with generally accepted accounting principles (GAAP) as applied to governmental agencies.
The Governmental Accounting Standards Boards (GASB) is the accepted standard setting body for
establishing governmental accounting and financial reporting principles. The more significant of the
City's accounting policies are described below.
A. Financial Reporting Entity
The City was incorporated as a municipal corporation in 1956 under the general laws of the State of
California. The City is a largely residential community located in the foothills of the Santa Cruz
Mountains with a population of 31,030 as of January 1, 2020.
The City operates under the Council-Manager form of government, with five-elected Council members
served by a full-time City Manager and staff. At June 30, 2020, the City's staff was comprised of 60 full-
time or part-time employees, and various part-time temporary and seasonal employees. Staff is
responsible for the following City services:
• Public Safety - The City provides around-the-clock police services under a contract with the Santa
Clara County Sheriff's offices. Emergency management and Fire services are provided by a special
district. Code enforcement and inspection services are provided by City employees.
• Public Works/Maintenance - The City builds and maintains its parks, streets, curbs, gutters, and
related public property with a force of 24 employees. Major projects may be contracted out to
reduce costs.
• Community Development - Zoning administration, plan checking and advance planning services are
provided by 14 employees.
• Culture, Recreation and Community Support services are provided by a total of 4 employees.
• General Government services are provided by a total of 18 employees.
As required by GAAP, these basic financial statements present the City and its component units, entities
for which the City is considered to be financially accountable. The City Council acts as the governing
board. In addition, the City staff performs all administrative and accounting functions for these entities
and these entities provide their services entirely to the City. Blended component units, although legally
separate entities, are, in substance, part of the City's operations and data from these units are combined
with data of the City. Discretely presented component units, on the other hand, are reported in a separate
column in the government-wide financial statements to emphasize their legal separation from the City.
Each blended component unit has a June 30 year-end. The City has no discretely presented component
units.
The following entity is reported as blended component unit:
Landscape & Lighting District - The Landscape & Lighting District (the District) was established in 1980
for the levy and the collection of assessments upon lots or parcels of land in the District, and for the
construction or installation of improvements and maintenance. The District is reported as a blended
component unit of the City because it has the same Governing Board as the City. The activity for the
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
49
District has been included in the accompanying basic financial statements and no separate financial
statements are issued.
B. Basis of Accounting and Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is considered a separate
accounting entity. The operations of each fund are accounted for with a separate set of self-balancing
accounts that are comprised of assets, liabilities, fund equity, revenues, and expenditures or expenses, as
appropriate. Governmental resources are allocated to and accounted for in individual funds based upon
the purposes for which they are to be spent and the means by which spending activities are controlled.
Government-Wide Financial Statements
The City's government-wide financial statements include a Statement of Net Position and a Statement of
Activities and Changes in Net Position. These statements present summaries of governmental activities
for the City. Fiduciary activities of the City are not included in these statements.
These statements are presented on an "economic resources" measurement focus and the accrual basis of
accounting. Accordingly, all of the City's assets and liabilities, including capital assets, as well as
infrastructure assets, long-term liabilities, and deferred inflows and outflows of resources are included in
the accompanying Statement of Net Position. The Statement of Activities presents changes in net position.
Under the accrual basis of accounting, revenues are recognized in the period in which they are earned
while expenses are recognized in the period in which the liability is incurred.
Certain types of transactions are reported as program revenues for the City in three categories:
• Charges for services
• Operating grants and contributions
• Capital grants and contributions
Certain eliminations have been made as prescribed by GASB Statement No. 34 in regards to inter-fund
activities, payables, and receivables. All internal balances in the Statement of Net Position have been
eliminated. The following inter-fund activities have been eliminated:
• Transfers in/Transfers out
• Internal Service Fund charges
• Landscape and Lighting District Service Fees
Interfund services provided and used are not eliminated in the process of consolidation.
Deferred Outflow of Resources and Deferred Inflow of Resources
Deferred outflow of resources is a consumption of net position by the City that is applicable to a future
reporting period, such as deferred charges.
Deferred inflow of resources is an acquisition of net position by the City that is applicable to a future
reporting period, such as unavailable revenue and advance collections.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
50
Governmental Fund Financial Statements
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues,
Expenditures and Changes in Fund Balances for all major governmental funds and aggregated non-major
funds. An accompanying schedule is presented to reconcile and explain the differences in net position as
presented in these statements to the net position presented in the government-wide financial statements.
The City has presented all major funds that met the applicable criteria. The following funds are major
funds:
General Fund
The General Fund is used to account for all of the general resources of the City not specifically levied or
collected for other City funds and related expenditures. The General Fund accounts for all financial
resources of the City which are not accounted for in another fund.
Capital Improvement Capital Projects Fund
This fund accounts for resources used for the major capital acquisition and construction activities.
All governmental funds are accounted for on a spending or "current financial resources" measurement
focus and the modified accrual basis of accounting. Accordingly, only current assets, deferred outflows
of resources, current liabilities and deferred inflows of resources are included on the balance sheets. The
Statement of Revenues, Expenditures and Changes in Fund Balances present increases (revenues and
other financing sources) and decreases (expenditures and other financing uses) in net current assets.
Under the modified accrual basis of accounting, revenues are recognized in the accounting period in
which they become both measurable and available to finance expenditures of the current period.
Accordingly, revenues are recorded when received in cash, except that revenues subject to accrual (up to
45 days after year-end) are recognized when due. The primary revenue sources, which have been treated
as susceptible to accrual by the City, are property tax, sales tax, special assessments, intergovernmental
revenues, other taxes, interest revenue, rental revenue and certain charges for services. Fines, forfeitures,
licenses and permits and parking meter revenues are not susceptible to accrual because they are usually
not measurable until received in cash. Expenditures are recorded in the accounting period in which the
related fund liability is incurred.
Unearned revenues arise when potential revenues do not meet both the "measurable" and "available"
criteria for recognition in the current period. Unearned revenues also arise when the government receives
resources before it has a legal claim to them, as when grant monies are received prior to incurring
qualifying expenditures. In subsequent periods when both revenue recognition criteria are met or when
the government has a legal claim to the resources, the unearned revenue is removed from the combined
balance sheet and revenue is recognized.
Reconciliation of the Fund Financial Statements to the Government-Wide Financial Statements is
provided to explain the differences created by the integrated approach of GASB Statement No. 34.
Proprietary Funds
The City’s Internal Service Funds are proprietary funds. In the fund financial statements, proprietary
funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned,
and expenses are recognized when the related goods or services are delivered. In the fund financial
statements, proprietary funds are presented using the “economic resources measurement focus”. This
means all assets and liabilities (whether current or noncurrent) associated with their activities are included
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
51
on their balance sheets. Proprietary fund type operating statements present increases (revenues) and
decreases (expenses) in total net position.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions
associated with principal activity of the fund. Exchange transactions are those in which each party
receives and gives up essentially equal value. Non-operating revenues, such as subsidies, taxes, and
investment earnings result from non-exchange transactions or ancillary activities. Amounts paid to
acquire capital assets are capitalized as assets in the internal service funds financial statements.
Internal Service Funds account for charges to City departments for services provided, on a cost
reimbursement basis, in the following areas: general liability, workers’ compensation, office support,
information technology services, vehicle maintenance, building maintenance, equipment replacement, and
information technology replacement.
Fiduciary Fund Financial Statements
Fiduciary Funds Financial Statements include a Statement of Net Position and a Statement of Changes in
Net Position for Trust Funds. The City's fiduciary funds include Agency Funds, which are custodial in
nature (assets equal liabilities) and do not involve measurement of results of operations. The Agency
Funds are accounted for on the accrual basis of accounting. Beginning in FY 2018/19, the City is
reporting the following Agency Funds:
West Valley Clean Water Program. The Cities of Campbell, Monte Sereno, Saratoga and the Town of Los
Gatos, representing the West Valley Communities, joined together to create West Valley Clean Water
Program (WVCWP) in 1994. Together they work to control discharge of polluted stormwater into local
creeks and the San Francisco Bay. Their mission is to:
• Reduce pollutants in stormwater and discharges from storm drains into creeks
• Maximize the effectiveness of pollution prevention efforts and work toward repair of impaired waters
• Help the four West Valley Communities meet State Water Resources Control Board & Federal Clean
Water Act goals for clean and healthy local water bodies
In late 2017, after notification from West Valley Sanitation District that the District would no longer be
involved in or provide fiscal agent services for WVCWP after June 30, 2018, the four agencies decided to
establish the operation as a legal entity by entering into a Joint Powers Agreement, consistent with what
the agencies had already set up for the West Valley Solid Waste Management oversight activities. With
this action, the West Valley Clean Water Program is now overseen by the same Board that includes
Council representation from each of the four municipalities. The Clean Water Program’s dedicated
program staff and contractors carry out the day-to-day operations. The JPA also collaborates with Santa
Clara Valley Urban Runoff Pollution Prevention Program, West Valley Sanitation District, and the Santa
Clara County Fire District in their operational activities.
With the loss of West Valley Sanitation functioning as the fiscal agent for the group, the four cities
determined one of the cities would take on this role. Effective July 1, 2018, the City of Saratoga began
performing these duties, which are limited to payroll and vendor payment functions, in addition to
financial reporting. The City does not oversee operational aspects of the WVCWP and is acting only in a
fiduciary function
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
52
Arrowhead Bond and Project Funding. The Arrowhead Community Facilities District encompasses 39
homes located along the hillside between Rolling Hills Road and Blue Hills Lane, off of Prospect Road.
Since 1951, this neighborhood has operated its own private water company (Arrowhead Cooperative
Company Inc., aka ACCI). Over the years the number of Arrowhead Cooperative residents and water
service meters have increased, to the extent that the water system infrastructure is no longer sufficient for
water and fire protection needs. The potential of the fire danger situation prompted the Arrowhead Board
to ask the City for assistance to issue a bond for the purpose of financing improvements to the water
system. Subsequently, on December 21, 2016, the City Council approved the formation of the Arrowhead
Community Facility District (CFD). On May 2, 2017, the CFD’s 39 residential parcel owners
unanimously approved Measure L, which allowed for the assessment of a special tax levy to finance a
bond.
On October 17, 2018, the City Council authorized the issuance of the Saratoga Community Facilities
District 2016-1 (Arrowhead Project) Special Tax Bonds, Series 2018, with the issue date of December 10,
2018. Debt service on the Special Tax Bond is payable only from special taxes levied annually on taxable
properties within the CFD in the manner set forth in the Rate and Method of Apportionment (RMA)
approved by the Council in connection with the formation of the District. The 2018 Bonds will not have
any impact on the City’s General Fund or Government-wide financial statements, and these special
financing district bonds are not assets or liabilities of the City for financial statement purposes.
C. Cash, Cash Equivalents and Investments
The City pools its available cash for investment purposes. The City's cash and cash equivalents are
considered to be cash on hand, demand deposits, and short-term investments with original maturity of
three months or less from the date of acquisition. Cash and cash equivalents are combined with
investments and displayed as Cash and Investments.
Deposit and Investment Risk Disclosures - In accordance with GASB Statement No. 40, Deposit and
Investment Disclosures (Amendment of GASB Statement No. 3), certain disclosure requirements, if
applicable, for Deposits and Investment Risks in the following areas:
• Interest Rate Risk
• Credit Risk
▬ Overall
▬ Custodial Credit Risk
▬ Concentrations of Credit Risk
• Foreign Currency Risk
Other disclosures are specified including use of certain methods to present deposits and investments,
highly sensitive investments, credit quality at year-end and other disclosures.
The City participates in an investment pool managed by the State of California titled Local Agency
Investment Fund (LAIF), which has invested a portion of the pool funds in Structured Notes and Asset
Backed Securities. LAIF's investments are subject to credit risk with the full faith and credit of the State
of California collateralizing these investments. In addition, these Structured Notes and Asset-Backed
Securities are subject to market risk as to change in interest rates.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
53
D. Inter-fund Transactions
Inter-fund services provided and used are accounted for as revenue, expenditures or expenses, as
appropriate. Transactions that constitute reimbursements to a fund for expenditures/expenses initially
made from it that are properly applicable to another fund are recorded as expenditures/expenses in the
reimbursed fund. All other inter-fund transfers are reported as transfers.
E. Capital Assets
Capital assets, including land, buildings, improvements, furniture, equipment and infrastructure assets
(e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental activities
in the government-wide financial statements. Capital assets were recorded at historical cost or estimated
historical cost if actual cost was not available. Donated capital assets, donated works of art and similar
items, and capital assets received in service concession agreement are reported at acquisition value. City
policy has set the capitalization threshold for reporting capital assets at $10,000. The City has chosen the
Modified Approach for reporting the streets subsystem of infrastructure capital assets.
Depreciation is recorded on a straight-line basis over the useful lives of the assets as follows:
Buildings and structures 40 Years
Machinery and equipment 5 to 10 Years
Infrastructure 15 to 50 Years
In June 1999, GASB issued Statement No. 34 Basic Financial Statements – and Management’s
Discussion and Analysis – for State and Local Governments which requires the inclusion of infrastructure
capital assets in local governments' basic financial statements. In accordance with Statement No. 34, the
City has included the value of all infrastructure assets in its basic financial statements.
The City defines infrastructure as the basic physical assets that allow the City to function, which includes
the street system, park and recreation lands and improvements system; storm water conveyance and
drainage system, buildings combined with site amenities such as parking and landscaping areas used by
the City in the conduct of its business.
Each major infrastructure system can be divided into subsystems. For example, the street system can be
subdivided into pavement, curb and gutters, sidewalks, medians, streetlights, traffic control devices
(signs, signals and pavement markings), landscaping and land. These subsystems were not delineated in
the basic financial statements. The appropriate operating department maintains information regarding the
subsystems. The City elected to use the Modified Approach as defined by GASB Statement No. 34 for
infrastructure reporting of its streets, concrete and asphalt pavements. The City commissioned a physical
assessment of the streets condition as of May 31, 2020. This condition assessment was performed in
2017. A Pavement Condition Index (PCI) was assigned to each street segment. The index is expressed in
a continuous scale from 0 to 100, where 0 is assigned to the least acceptable physical condition and 100 is
assigned to segments of street that have the physical characteristics of a new street.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
54
The following conditions were defined:
Condition Rating
Very Good 70 - 100
Good 50 - 69
Poor 25 - 49
Very Poor 0 - 24
The City's policy relative to maintaining the street assets is to achieve an average rating of 70 for all street
segments. This acceptable rating allows minor cracking and raveling of the pavement along with minor
roughness that could be noticeable to drivers traveling at the posted speeds. For all other infrastructure
systems, the City elected to use the Basic Approach as defined by GASB Statement No. 34 for
infrastructure reporting. An appraisal determined the original cost, which is defined as the actual cost to
acquire new property in accordance with market prices at the time of first construction/acquisition.
Original costs were developed in one of three ways: 1) historical records; 2) standard unit costs
appropriate for the construction/acquisition date; or 3) present cost indexed by a reciprocal factor of the
price increase from the construction/acquisition date to the current date. The accumulated depreciation,
defined as the total depreciation from the date of construction/acquisition to the current date on a straight
line, unrecovered cost method was computed using industry accepted life expectancies for each
infrastructure subsystem. The book value was then computed by deducting the accumulated depreciation
from the original cost.
F. Interest Payable
In the government-wide financial statements, interest payable of long-term debt is recognized as an
incurred liability for governmental fund types. The City has not allocated the interest on long-term debt
to departments.
In the fund financial statements, governmental fund types do not recognize the interest payable when the
liability is incurred. Interest on long-term debt is recorded in the fund statements when payment is made.
G. Claims Payable
The City records a liability to reflect an actuarial estimate of ultimate uninsured losses for both general
liability claims (including property damage claims) and workers' compensation claims. The estimated
liability for workers' compensation claims and general liability claims includes "incurred but not
reported" (IBNR) claims. There is no fixed payment schedule to pay these liabilities.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
55
H. Compensated Absences
In the government-wide financial statements, compensated absences are recorded as incurred and the
related expenses and liabilities are reported.
In the fund financial statements, compensated absences are recorded as expenditures in the years paid, as
it is the City's policy to liquidate any unpaid compensated absences at June 30 from future resources,
rather than currently available financial resources. Only the amounts which become due at June 30 are
reported in the fund financial statements as a liability.
I. Long- Term Obligations
In the government-wide financial statements, long-term debt and other long-term obligations are reported
as liabilities in the applicable governmental activities. Bond premiums and discounts, as well as issuance
costs, are deferred and amortized over the life of the bonds using the effective interest method. Bonds
payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as
deferred charges and amortized over the term of the related debt.
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as
well as bond issuance costs, during the current period. The face amount of debt issued is reported as
other financial sources. Premiums received on debt issuance are reported as other financing sources while
discounts on debt issuance reported as other financing uses. Issuance costs, whether or not withheld from
the actual debt proceeds received, are reported as debt service expenditures.
J. Fund Balances
In February 2009, the Governmental Accounting Standards Board (GASB) issued Statement No. 54,
Fund Balance Reporting and Governmental Fund Type Definitions. This standard left unchanged the
total amount reported as fund balance, but substantially altered the categories and terminology used to
describe its components. Rather than focus on financial resources available for appropriation, the new
categories focus on “the extent for which the government is bound to honor constraints in the specific
purposes for which amounts in the reserve can be spent”.
The components of fund balance are now categorized as follows: “non-spendable fund balance”,
resources that are inherently non-spendable from the vantage point of the current period; “restricted fund
balance”, resources that are subject to enforceable legal restrictions; “committed fund balance”, resources
whose specified use is constrained by limitations the government entity imposes upon itself through
formal action at its highest level of decision making and remains binding unless removed in the same
manner; “assigned fund balance”, resources that reflects a government’s intended general use of
resources, such intent would have to be established at either the highest level of decision making, by a
body, or an official designated for that purpose; and “unassigned fund balance”, net resources in excess of
what can properly be classified in one of the other four categories. Currently, the City’s fund balance
reserves fall into one of the four spendable categories; restricted, committed, assigned, or unassigned fund
balance.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
56
The City maintains three restricted fund balances constrained by external legal restrictions that can be
spent only for the stipulated purposes. Restrictions may effectively be changed or lifted only with the
consent of resource providers. These fund balances are:
• Special Assessments Fund Balance – collectively represents year-end fund balances of thirty
Landscape & Lighting and Storm Drain zones which use is restricted to the individual district.
• Environmental Services Fund Balance – represents surcharges collected on solid waste bills for
use as supplemental funding of Environmental Services program fees for household hazardous
waste fees, storm drain, street sweeping, and other pollution mitigation expenses related to
integrated waste programs and storm water management. These funds are used to supplement
environmental expenditures by using $50,000 per year.
• Debt Service Fund Balance – represents funding collected for use in the City’s general obligation
bond debt.
The committed category, in which fund balance is constrained by limitations that the government imposes
upon itself at its highest level of decision making by formal vote on a resolution of the City Council, and
remains binding unless removed in the same manner, includes the following:
• Capital Improvement Program (CIP) Fund Balance – represents the collective balance of funding
appropriated for capital improvement projects. Capital Projects are funded through direct
revenues or budgeted transfers for improvement work within the following program funds:
Streets, Park & Trail, Facility, or Administrative & Technology Improvements.
• Hillside Stability - funding set aside for use either in emergency repairs or high-cost and non-
routine mitigation of hillside or landslide projects.
In the assigned category, fund balance reflects an intended use as established by Council that is neither
restricted nor committed. Use of Assigned Fund Balance is approved by formal vote of the Council or
official authorized to assign amounts to a specific purpose, either through specific action, fund balance
policy, or through budget direction and approval. This category includes the following reserves:
• Future Capital & Efficiency Funding - represents General Fund funding set aside for capital
and/or efficiency projects but not yet committed for a specific improvement project.
• Facility Replacement Reserve – represents accumulated funding for the future replacement, major
rehabilitation, or new construction of City-owned facilities. This funding is to be used for
funding the construction or provide for the services of related debt, but is not yet committed for a
specific improvement project.
• Carryforward – represents either prior-year funds designated for one-time operational activities
not yet completed by year-end, or to carryforward prior-year funding for specific activities as
directed by Council. Carryforward funds are appropriated for use in the following fiscal year.
The Unassigned Fund Balance category represents funding which may be held for specific types of uses
or stabilization purposes, but is not yet directed to be used for a specific purpose. Reserve amounts are
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
57
determined by, and align with, fund policy direction. The General Fund is the only governmental fund
that reports a positive unassigned fund balance.
• Working Capital Reserve – Council policy is to maintain $1,000,000 to meet cash flow
requirements. As of June 30, 2020, the Working Capital Reserve balance is $1,000,000.
• Fiscal Stabilization Reserve – Council designates and annually revisits the level of undesignated
funding for use at Council direction in case of disasters, emergencies, and economic downturns.
As of June 30, 2020, the Fiscal Stabilization Reserve balance is $3,200,000.
• Landscape & Lighting District (LLD) Closeout Reserve – Funds reserved to provide services to
four Landscape & Lightning Districts which were closed in FY 2019/20.
• Compensated Absences Reserve – represents reserve funding for employee payout compensation
equal to one-third of the annual liability balance. This funding level is anticipated to be the
maximum potential payout in excess of budgeted salary in a fiscal year.
• Other Unassigned Fund Balance – represents funding not yet appropriated or assigned for use.
Council policy is to maintain a minimum of $500,000 in unassigned funds as a buffer for
unplanned expenditures or revenue shortfalls during the fiscal year.
Flow Assumption / Spending Order Policy – When expenditures are incurred for purposes for which both
restricted and unrestricted fund balance is available, the City considers restricted funds to be spent first.
When expenditures are incurred for which committed, assigned, or unassigned fund balances are
available, the City considers amounts to be spent first out of committed funds, then assigned funds, and
finally unassigned funds, as needed, unless the City Council has directed otherwise.
K. Net Position
In the government-wide financial statements, net position is classified in the following categories:
• Net Investment in Capital Assets – This amount consists of capital assets net of accumulated
depreciation and reduced by outstanding debt that attributed to the acquisition, construction,
or improvement of the assets. In addition, deferred outflows of resources and deferred inflows
of resources that are attributable to the acquisition, construction, or improvement of those
assets or related debt also are included in the net investment in capital assets component of
net position.
• Restricted Net Position – This amount is restricted by external creditors, grantors,
contributors, or laws or regulations of other governments.
• Unrestricted Net Position – This amount is all net position that does not meet the definition of
"invested in capital assets, net of related debt" or "restricted net position."
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
58
L. Use of Restricted/Unrestricted Net Position
When an expense is incurred for purposes for which both restricted and unrestricted net positions are
available, the City's policy is to apply restricted net position first.
M. Property Tax and Special Assessments
County tax assessments include secured and unsecured property taxes and special assessments.
"Unsecured" refers to taxes on personal property. These tax assessments are secured by liens on the
property being taxed.
Revenue is recognized in the period for which the tax and assessment is levied. The County of Santa
Clara levies, bills and collects property taxes for the City, the County remits the entire amount levied and
handles all delinquencies, retaining interest and penalties. Secured and unsecured property taxes are
levied on January 1.
Secured property tax is due in two installments on November 1 and February 1 and becomes a lien on
those dates. It becomes delinquent on December 10 and April 10, respectively. Unsecured property tax is
due on July 1 and becomes delinquent on August 31.
N. Use of Estimates
The preparation of basic financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
O. New GASB Pronouncements
A. Upcoming Accounting and Reporting Changes
GASB Statement No. 84, Fiduciary Activities
The objective of this Statement is to improve guidance regarding the identification of fiduciary activities
for accounting and financial reporting purposes and how those activities should be reported. This
Statement establishes criteria for identifying fiduciary activities of all state and local governments. The
focus of the criteria generally is on (1) whether a government is controlling the assets of the fiduciary
activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria are included
to identify fiduciary component units and postemployment benefit arrangements that are fiduciary
activities. The requirements of this Statement were initially to be effective for financial statements for
periods beginning after December 15, 2018 but have been delayed to periods beginning after December
15, 2019, pursuant to GASB Statement No. 95. Earlier application is encouraged. The City is in the
process of determining the impact this Statement will have on the financial statements.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
59
GASB issued Statement No. 87, Leases
The objective of this statement is to better meet the information needs of financial statement users by
improving accounting and financial reporting for leases by governments. This statement increases the
usefulness of governments’ financial statements by requiring recognition of certain lease assets and
liabilities for leases that previously were classified as operating leases and recognized as inflows of
resources or outflows of resources based on the payment provisions of the contract. It establishes a single
model for lease accounting based on the foundational principle that leases are financings of the right to
use an underlying asset. Under this statement, a lessee is required to recognize a lease liability and an
intangible right-to-use lease asset, and a lessor is required to recognize a lease receivable and a deferred
inflow of resources, thereby enhancing the relevance and consistency of information about governments’
leasing activities. The requirements of this Statement were initially to be effective for financial statements
for periods beginning after December 15, 2019 but have been delayed to periods beginning after
December 15, 2021, pursuant to GASB Statement No. 95. Earlier application is encouraged. The City
does not believe this statement will have a significant impact on the City’s financial statements.
GASB Statement No. 89, Accounting for Interest Cost Incurred Before the End of the Construction
Period
This Statement addresses interest costs incurred before the end of a construction period be recognized as
an expense in the period in which the cost is incurred for financial statements prepared using the
economic resources measurement focus. As a result, interest cost incurred before the end of a construction
period will not be included in the historical cost of a capital asset reported in a business-type activity or
enterprise fund. The requirements of this Statement were initially to be effective for financial statements
for periods beginning after December 15, 2019 but have been delayed to periods beginning after
December 15, 2020, pursuant to GASB Statement No. 95. Earlier application is encouraged. The City
does not believe this statement will have a significant impact on the City’s financial statements.
GASB Statement No. 90, Majority Equity Interests - an Amendment of GASB Statements No. 14 and No.
61
The objectives of this Statement are to improve the consistency and comparability of reporting a
government’s majority equity interest in a legally separate organization and to improve the relevance of
financial statement information for certain component units. This Statement also requires t hat a
component unit in which a government has 100 percent equity interest account for its assets, deferred
outflows of resources, liabilities, and deferred inflows of resources at a cquisition value at the date the
government acquired a 100 percent equity interest in the component unit. The requirements of this
Statement were initially to be effective for financial statements for periods beginning after December 15,
2018, but have been delayed to periods beginning after December 15, 2019, pursuant to GASB Statement
No. 95. The requirements should be applied retroactively, except for the provisions related to (1)
reporting a majority equity interest in a component unit and (2) reporting a component unit if the
government acquires a 100 percent equity interest. Those provisions should be applied on a prospective
basis. The City does not believe this statement will have a significant impact on the City’s financial
statements.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
60
GASB Statement No. 91, Conduit Debt Obligations
The objectives of this Statement are to provide a single method of reporting conduit debt obligations by
issuers and eliminate diversity in practice associated with (1) commitments extended by issuers, (2)
arrangements associated with conduit debt obligations, and (3) related note disclosures. This Statement
also clarifies the existing definition of a conduit debt obligation; establishing that a conduit debt
obligation is not a liability of the issuer; establishing standards for accounting and financial reporting of
additional commitment and voluntary commitments extended by issuers and arrangements associated
with the debt obligations; and improving required note disclosures. The requirements of this Statement
were initially to be effective for financial statements for periods beginning after December 15, 2020 but
have been delayed to periods beginning after December 15, 2021, pursuant to GASB Statement No. 95.
Earlier application is encouraged. The City is in the process of determining the impact this Statement will
have on the financial statements.
GASB Statement No. 92, Omnibus 2020
The objectives of this Statement are to enhance comparability in accounting and financial reporting and to
improve the consistency of authoritative literature by addressing practice issues that have been identified
during implementation and application of certain GASB Statements. This Statement establishes
accounting and financial reporting requirements for specific issues related to leases, intra-entity transfers
of assets, postemployment benefits, government acquisitions, risk financing and insurance-related
activities of public entity risk pools, fair value measurements, and derivative instruments. The
requirements of this Statement apply to the financial statements of all state and local governments. The
requirements of this Statement were initially to be effective for financial statements for periods beginning
after June 15, 2020 but have been delayed to periods beginning after June 15, 2021, pursuant to GASB
Statement No. 95. Earlier application is encouraged. The City is in the process of determining the impact
this Statement will have on the financial statements.
GASB Statement No. 93, Replacement of Interbank Offered Rates
This Statement establishes accounting and financial reporting requirements related to the replacement of
IBORs in hedging derivative instruments and leases. It also identifies appropriate benchmark interest rates
for hedging derivative instruments. The requirements of this Statement apply to the financial statements
of all state and local governments. The requirements of this Statement apply to the financial statements of
all state and local governments. The requirements of this Statement were initially to be effective for
financial statements for periods beginning after June 15, 2020 but have been delayed to periods beginning
after June 15, 2021, pursuant to GASB Statement No. 95. Earlier application is encouraged. The City
does not believe this statement will have a significant impact on the City’s financial statements.
GASB Statement No. 94, Public-Private Partnerships and Public-Public Partnerships and Availability
Payment Arrangements
The primary objective of this Statement is to improve financial reporting by addressing issues related to
public-private and public-public partnership arrangements (PPPs). As used in this Statement, a PPP is an
arrangement in which a government (the transferor) contracts with an operator (a governmental or
nongovernmental entity) to provide public services by conveying control of the right to operate or use a
nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of
time in an exchange or exchange-like transaction. Some PPPs meet the definition of a service concession
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
61
arrangement (SCA), which the Board defines in this Statement as a PPP in which (1) the operator collects
and is compensated by fees from third parties; (2) the transferor determines or has the ability to modify or
approve which services the operator is required to provide, to whom the operator is required to provide
the services, and the prices or rates that can be charged for the services; and (3) the transferor is entitled to
significant residual interest in the service utility of the underlying PPP asset at the end of the arrangement.
This Statement also provides guidance for accounting and financial reportin g for availability payment
arrangements (APAs). As defined in this Statement, an APA is an arrangement in which a government
compensates an operator for services that may include designing, constructing, financing, maintaining, or
operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like
transaction. The requirements of this Statement are to be effective for financial statements for periods
beginning after June 15, 2022. Earlier application is encouraged. The City does not believe this statement
will have a significant impact on the City’s financial statements.
P. Pensions
For purposes of mea suring the net pension liability and deferred outflows/inflows of resources related
to pensions, and pension expense, informati on about the fiduciary net position of the City of
Saratoga’s California Public Employees’ Retirement System (CalPERS) plans (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.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
62
NOTE 2 - CASH AND INVESTMENTS
The City maintains a cash and investment pool, which includes cash balances and authorized investments
of all funds, which the City Treasurer invests to enhance interest earnings. The pooled interest earned is
allocated to the funds based on average month-end cash and investment balances in these funds. The City
has the following cash and investments at June 30, 2020:
Primary Fiduciary
Government Activities Total
Cash and investments 28,488,963$ 678,048$ 29,167,011$
Cash and investments with Fiscal Agent - 651,108 651,108
Total Deposits and Investments 28,488,963 1,329,156 29,818,119
The City's Cash and Investments at June 30, 2020, in more detail:
Cash and cash equivalents:
Petty cash 1,300$
Demand deposits 574,580
With Fiscal Agent 442,732
Total Cash and Cash Equivalents 1,018,612
Investments:
Local Agency Investment Fund (LAIF)28,799,507
Total Cash and Investments 29,818,119$
A. Cash Deposits
The carrying amounts of the City's cash deposits were $574,580 at June 30, 2020. Bank balances before
reconciling items were $855,437 at that date due to deposits in transit and outstanding checks. The total
amount was collateralized or insured with securities held by the pledging financial institutions. The fiscal
agent deposits are related to the Arrowhead bond and funding activities and are held with BNY Mellon.
The California Government Code requires California banks and savings and loan associations to secure
the City's cash deposits by pledging securities as collateral. This Code states that collateral pledged in
this manner shall have the effect of perfecting a security interest, and places the City ahead of general
creditors of the institution.
The market value of pledged securities must equal at least 110 percent of the City's cash deposits.
California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes
that have a value of 150 percent of the City's total cash deposits. The City has waived the collateral
requirements for cash deposits which are fully insured to $250,000 by the Federal Deposit Insurance
Corporation (FDIC). Other accounts are insured up to $250,000 per custodian within agency.
The City follows the practice of pooling cash and investments of all funds, except for funds required to be
held by fiscal agents under the provisions of bond indentures. Interest income from cash and investments
with fiscal agents is credited directly to the related fund.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
63
B. Investments
Under the provisions of the City's investment policy, and in accordance with California Government
Code, the following investments are authorized:
• Securities of the U.S. Government or its agencies.
• Certificates of Deposit (or Time Deposits) placed with commercial banks and/or savings
and loan companies.
• Negotiable Certificates of Deposit.
• California Local Agency Investment Fund.
• Investment-grade obligations of State, local governments or public authorities.
• Money market mutual funds.
• Passbook savings account and demand deposits.
Investments are recorded at fair value in accordance with GASB Statement No. 72, Fair Value
Measurement and Application. Accordingly, the change in fair value of investments is recognized as an
increase or decrease to investment assets and investment income. This statement changed the definition of
fair value and is effective for periods beginning after June 15, 2015.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction. In determining this amount, three valuation techniques are available:
• Market approach - This approach uses prices generated for identical or similar assets or liabilities.
The most common example is an investment in a public security traded in an active exchange
such as the NYSE.
• Cost approach - This technique determines the amount required to replace the current asset. This
approach may be ideal for valuing donations of capital assets or historical treasures.
• Income approach - This approach converts future amounts (such as cash flows) into a current
discounted amount.
Each of these valuation techniques requires inputs to calculate a fair value. Observable inputs have been
maximized in fair value measures, and unobservable inputs have been minimized.
GASB 72 established a hierarchy of inputs to the valuation techniques above. This hierarchy has three
levels:
• Level 1 inputs are quoted prices in active markets for identical assets or liabilities.
• Level 2 inputs are quoted market prices for similar assets or liabilities, quoted prices for
identical or similar assets or liabilities in markets that are not active, or other than quoted prices
that are not observable.
• Level 3 inputs are unobservable inputs, such as a property valuation or an appraisal.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
64
C. External Investment Pool
The City's investments with LAIF at June 30, 2020 include a portion of the pool funds invested in
Structured Notes and Asset-Backed Securities. These investments include the following:
• Structured Notes - debt securities (other than asset-backed securities) whose cash flow
characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more
indices and/or that have embedded forwards or options.
• Asset-Backed Securities - the bulk of which are mortgage-backed securities, entitle their
purchasers to receive a share of the cash flows from a pool of assets such as principal and interest
repayments from a pool of mortgages (such as CMO's) or credit card receivables.
LAIF is overseen by the Local Agency Investment Advisory Board, which consists of five members, in
accordance with State statute. The approved investments policy is listed on the LAIF website, located at
http://www.treasurer.ca.gov/pmia-laif/ .
As of June 30, 2020, the City had $28,799,510 invested in LAIF. In accordance with GASB 72, a fair
value factor of 1.004912795 was used to calculate the fair value of the investments in LAIF. GASB
Statement No. 72, Fair Measure Value and Application requires investments held primarily for the
purpose of income or profit and has a present service capacity based solely on its ability to generate cash
or to be sold to generate cash to be measured at their fair value.
D. Risk Disclosures
Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an
investment. Generally, the longer the term of an investment’s maturity, the greater the sensitivity to
changes in market interest rates. Although the City’s investment policy allows for a broad range of
investment instruments with varying terms of maturity, investments are limited to the Local Agency
Investment Fund (LAIF) which is managed by the State Treasurer Office and overseen by the Pooled
Money Investment Board, the State Treasurer investment committee, and a Local Agency Advisory
Board.
Included in LAIF’s investment portfolio are U.S. Treasuries, Federal Agency obligations, time deposits,
negotiable certificates of deposits, commercial paper, corporate bonds, and security loans. Funds are
available for withdrawal on demand and are recorded on an amortized cost basis. At June 30, 2020, these
investments had a weighted average maturity of 194 days. The City had the following invested in LAIF:
Investment
Maturities in Years
Fair Less Than
Value One Year
State of California - Local Agency Investment Fund (LAIF)28,799,507$ 28,799,507$
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
65
Credit Risk
As of June 30, 2020, the City's investments in external investment pools are unrated. The City only
invests in LAIF, therefore has no other policy relating to the credit risk of investments.
Custodial Credit Risk
For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the
City will not be able to recover the value of its investments or collateral securities that are in the
possession of an outside party. The City did not hold any securities through investment counterparties at
the year ended June 30, 2020.
NOTE 3 - FUND FINANCIAL STATEMENTS INTERFUND TRANSACTIONS
Transfers In/Out
Transfers for the year ended June 30, 2020 were as follows:
Transfer in Transfer out Amount
Capital Improvement Fund General Fund 3,505,000$
Capital Improvement Fund Capital Improvement Fund 125,000
General Fund Capital Improvement Fund 124,743
General Fund Landscape & Lighting District
Special Revenue Fund 1,062,604
Total 4,817,347$
The Capital Improvement Funds received funds from the General Fund adopted in the Budget in the
amount of $3,505,000. Of this amount, $1,525,000 was allocated for street, sidewalk, and storm drain
repair, $1,495,000 for park and trail improvements, $410,000 for City facilities projects and $75,000 for
various administrative projects. $125,000 was transferred between CIP projects and $124,743 was
transferred to the General Fund from closed CIP projects during the fiscal year. $25,000 was transferred
from the Landscape & Lighting District to the General Fund as a result of closing four Landscape &
Lighting Districts in FY 2019/20.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
66
NOTE 4 - CAPITAL ASSETS
Capital asset activity for the year ended June 30, 2020 is illustrated in the following table:
Primary Government
Balance Balance
July 1, 2019 Additions Retirements Reclassifications June 30, 2020
Governmental activities:
Capital assets, not being depreciated:
Land and land improvements 15,591,925$ -$ -$ 2,162,197$ 17,754,122$
Construction in progress 10,320,046 3,579,846 - (2,447,197) 11,452,695
Infrastructure:
Street pavement system 52,683,239 - - - 52,683,239
Total capital assets, not being depreciated 78,595,210 3,579,846 - (285,000) 81,890,056
Capital assets, being depreciated:
Buildings and structures 26,570,195 - - 285,000 26,855,195
Machinery and equipment
Governmental funds 2,269,290 - - - 2,269,290
Internal service funds 1,795,011 81,884 - - 1,876,896
Infrastructure:
Bridges 1,563,654 - - - 1,563,654
Signs and lights 2,463,676 - - - 2,463,676
Drainage system 40,140,053 - - - 40,140,053
Sidewalks 14,538,964 - - - 14,538,964
Total capital assets, being depreciated 89,340,844 81,884 - 285,000 89,707,728
Accumulated depreciation:
Buildings and structures (11,519,073) (748,194) - - (12,267,267)
Machinery and equipment
Governmental funds (1,476,039) (122,066) - - (1,598,105)
Internal service funds (1,177,174) (188,417) - - (1,365,591)
Infrastructure:
Bridges (1,178,779) (18,390) - - (1,197,169)
Signs and lights (1,410,328) (85,061) - - (1,495,389)
Drainage system (19,544,577) (802,801) - - (20,347,378)
Sidewalks (7,495,872) (407,083) - - (7,902,955)
Total accumulated depreciation (43,801,843) (2,372,013) - - (46,173,855)
Total capital assets, being depreciated, net 45,539,001 (2,290,128) - 285,000 43,533,873
Governmental activities capital assets, net 124,134,211$ 1,289,718$ -$ -$ 125,423,929
In accordance with GASB Statement No. 34, the City has reported all capital assets including
infrastructure in the Government-Wide Statement of Net Position. The City elected to use the "Modified
Approach" as defined by GASB Statement No. 34 for infrastructure reporting for its pavement system.
As a result, no accumulated depreciation or depreciation expense has been recorded for this system. A
more detailed discussion of the "Modified Approach" is presented in the Required Supplementary
Information section of this report. All other capital assets including other infrastructure systems were
reported using the Basic Approach whereby accumulated depreciation and depreciation expense have
been recorded.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
67
NOTE 5 – LONG-TERM OBLIGATIONS
A summary of the City's governmental long-term obligations for the year ended June 30, 2020, is
presented below:
Classification
Balance Balance Due Within Due In More
Description June 30, 2019 Additions Retirements June 30, 2020 One Year Than One Year
Government Activities:
General Obligation Bonds:
2011 Library bonds 8,600,000$ -$ (525,000)$ 8,075,000$ 545,000$ 7,530,000$
Net original issue premium 284,602 - (21,892) 262,710 21,892 240,818
Compensated absences 748,861 182,579 - 931,440 650,270 281,170
Total 9,633,463$ 182,579$ (546,892)$ 9,269,150$ 1,217,162$ 8,051,988$
General Obligation 2011 Library Bonds - Original Issue $11,995,000
On July 14, 2011, the City issued General Obligation Bonds Series 2011 in the amount of $11,995,000.
The bonds were issued to fully refund the General Obligation 2001 Library Bonds. The bonds are
payable from and secured by certain property taxes within the City held in the Library Bond Debt Service
Fund. Interest on the bonds ranges from 2.0 percent to 4.0 percent and is payable on February 1 and
August 1 of each year, commencing February 1, 2012. Principal is due annually beginning on August 1,
2012, in amounts ranging from $455,000 to $790,000, with a final payment on August 1, 2031 of
$820,000. The bonds maturing on or before August 1, 2021 are not subject to redemption prior to their
respective stated maturity dates. Bonds maturing on or after August 1, 2022 are subject to redemption
prior to their respective stated maturity dates at the option of the city at the principal amount of the bonds
called for redemption, together with interest accrued thereon to the date of redemption, without premium.
The annual debt service requirements on these bonds are as follows:
Year Ended Principal Interest Total
2021 545,000 297,635 842,635
2022 565,000 278,260 843,260
2023 580,000 258,185 838,185
2024 610,000 234,385 844,385
2025 630,000 209,585 839,585
2026-2030 3,535,000 673,639 4,208,639
2031-2032 1,610,000 65,000 1,675,000
Total 8,075,000$ 2,016,689$ 10,091,689$
Compensated Absences
The City's liability for vested and unpaid compensated absences (accrued vacation and sick pay) has been
accrued and amounts to $931,440 at June 30, 2020. The compensated absences liability will generally be
liquidated through the General Fund.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
68
A summary of the Fiduciary Fund long-term obligations for the year ended June 30, 2020, is presented
below:
Classification
Balance Balance Due Within Due In More
Description June 30, 2019 Additions Retirements June 30, 2020 One Year*Than One Year
Fiduciary (Agency) Funds:
Special Tax Bonds:
2018 Arrowhead CFD 2,498,848$ -$ (189,919)$ 2,308,929$ 545,887$ 1,763,042$
Total 2,498,848$ -$ (189,919)$ 2,308,929$ 545,887$ 1,763,042$
* Includes expected debt payoff by property owners
Arrowhead Community Facilities District Bond
The Arrowhead Community Facilities District encompasses 39 homes located along the hillside between
Rolling Hills Road and Blue Hills Lane, off of Prospect Road. Since 1951, this neighborhood has
operated its own private water company (Arrowhead Cooperative Company Inc., aka ACCI). Over the
years the number of Arrowhead Cooperative residents and water service meters have increased, to the
extent that the water system infrastructure is no longer sufficient for water and fire protection needs. The
potential of the fire danger situation prompted the Arrowhead Board to ask the City for assistance to issue
a bond for the purpose of financing improvements to the water system. Subsequently, on December 21,
2016, the City Council approved the formation of the Arrowhead Community Facility District (CFD). On
May 2, 2017, the CFD’s 39 residential parcel owners unanimously approved Measure L, which allowed
for the assessment of a special tax levy to finance a bond.
On October 17, 2018, the City Council authorized the issuance of the Saratoga Community Facilities
District 2016-1 (Arrowhead Project) Special Tax Bonds, Series 2018, with the issue date of December 10,
2018. Debt service on the Special Tax Bond is payable only from special taxes levied annually on taxable
properties within the CFD in the manner set forth in the Rate and Method of Apportionment (RMA)
approved by the Council in connection with the formation of the District. The 2018 Bonds will not have
any impact on the City’s General Fund or Government-wide financial statements, and these special
financing district bonds are not assets or liabilities of the City for financial statement purposes.
Bond terms are 30 years at 6.05% interest. The payment amounts may change over time if bond holders
choose to pay off their share of the debt instead of following the bond’s payment schedule. The annual
debt service requirements on these bonds are as follows:
Year Ended Principal Interest Total
2021*545,887 123,177 669,064
2022 25,520 105,892 131,412
2023 27,064 104,301 131,365
2024 28,701 102,615 131,316
2025 30,438 100,826 131,264
2026-2030 182,143 453,267 635,410
2031-2035 244,324 409,205 653,529
2036-2040 327,731 323,274 651,005
2041-2045 439,614 208,007 647,621
2046-2049 457,507 57,388 514,895
Total 2,308,929$ 1,987,952$ 4,296,881$
* Includes expected debt payoff by property owners
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
69
NOTE 6 - RISK MANAGEMENT
The City participates in the following public entity risk pool:
PLAN Workers' Compensation Shared Agency Risk Pool (SHARP) – covers workers' compensation
coverage up to $250,000 and excess coverage provides an employer liability limit of $5 million per
occurrence, and workers’ compensation per occurrence limit to $100 million. The City has no deductible
for these claims. During the fiscal year ended June 30, 2020, the City contributed $155,444 for current
year coverage. The City's contribution equals the ratio of the City's payroll to the total payrolls of all
entities participating in the same layer of each program, in each program year.
Actual surpluses or losses are shared according to a formula developed from overall loss costs and spread
to member entities on a percentage basis after a retrospective rating.
There have been no significant reductions of insurance settlements that exceeded insurance coverage for
the past three years.
The workers’ compensation and general liability claims payable of $90,720 reported at June 30, 2020, is
based on the requirements of GASB Statement No. 10, which requires that a liability for claims be
reported if information prior to the issuance of the basic financial statements indicates that it is probable
that a liability has incurred at the date of the basic financial statements and the amount of the loss can be
reasonably estimated. Changes in the claims payable amounts were as follows:
The General Fund has been used in the prior years to liquidate the liability for claims and judgments.
Year Ended Year Ended
June 30, 2020 June 30, 2019
Claims payable, beginning of year 53,293$ 76,001$
Fiscal year claims and changes in estimates 37,428 (15,404)
Claims payments - (7,304)
Claims payable, end of year 90,720$ 53,293$
Each risk pool is governed by a board consisting of representatives from member municipalities. The
board controls the operations of each risk pool, including selection of management and approval of
operating budgets, independent of any influence by member municipalities beyond their representation on
the Board.
Audited financial information for each risk pool may be obtained from Bickmore at 1750 Creekside Oaks
Dr., Ste. 200, Sacramento, California 95833.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
70
NOTE 7 - RETIREMENT PLANS
Defined Benefit Pension Plan
Plan Description – All CalPERS qualified employees are eligible to participate in the City’s
Miscellaneous Employee Pension Plan (the Plan), a cost-sharing multiple-employer defined benefit
pension plan administered by the California Public Employees’ Retirement System (CalPERS).
CalPERS act as a common investment and administrative agent for participating public entities within the
State of California. Benefit provisions and all other requirements are established by State statute and City
ordinance. 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 or copies of these reports may be obtained from their Executive Office located at 400 P Street,
Sacramento, California 95811.
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 55. All members are eligible for non-duty disability
benefits after 10 years of service. Death benefits include the 1959 Survivor Benefit and the Optional
Settlement 2 Death Benefit. The cost of living adjustments for the Plan are applied as specified by the
Public Employee’s Retirement Law. The Plan’s provisions and benefits in effect at June 30, 2019, are
summarized as follows:
Tier 1 Tier 2 PEPRA
Benefit formula 2% @ 55 2% @ 60 2% @ 62
Benefit vesting schedule 5 Years 5 Years 5 Years
Benefit payments Monthly for Life Monthly for Life Monthly for Life
Retirement age 55 60 62
Monthly benefits as a % of eligible compensation 2.00%2.00%2.00%
Required employee contribution rates 7.000%7.000%7.250%
Required employer contribution rates 10.868%8.668%7.072%
Miscellaneous
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
71
Employees Covered – At June 30, 2020, the following employees were covered by the benefit terms for
the Plan:
Miscellaneous
Active 58
Transferred 43
Separated 36
Retired 119
Total 256
Contributions – Section 20814(c) of California Public Employees’ Retirement Law requires that the
employer contribution rates for all public employers are determined on an annual basis by an actuary and
shall be effective on the 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.
For the year ended June 30, 2020, the employer contributions, including the UAL payment of $1,000,000,
recognized as part of pension expense for the Plan were as follows:
Miscellaneous
Contributions - employer $ 1,701,847
Contributions - employee 586,275
Total $ 2,288,122
Pension Liabilities, Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions -
As of June 30, 20, the City reported net pension liabilities for its proportionate share of the net pension
liability of the Plan as follows:
Miscellaneous
Proportionate Share of
Net Pension
Liability/(Asset)
$ 7,614,972
The City’s net pension liability for the Plan is measured as the proportionate share of the Plan’s net
pension liability. The net pension liability of the Plan is measured at June 30, 2020, 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, 2019 rolled forward to June 30, 2020 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 the
contributions to the pension plan relative to the projected contributions of all participating employers,
actuarially determined. The City’s proportionate share of the net pension liability for the Plan as of June
30, 2019 and 2020 was as follows:
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
72
Miscellaneous
Proportion - June 30, 2019 0.19202%
Proportion - June 30, 2020 0.19016%
Change - Increase/(Decrease)-0.00186%
For the year ended June 30, 2020, the City recognized pension expense of $2,378,787. At June 30, 2020,
the City reported deferred outflows of resources and deferred inflows of resources related to pensions
from the following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Changes of Assumptions 363,117$ 128,722$
Differences between Expected and Actual Experience 528,892 40,978
Differences between Projected and Actual Investment Earnings - 133,133
Differences between Employer's Contributions and Proportionate
Share of Contributions - 416,313
Change in Employer's Proportion 612,640 142,835
Pension Contributions Made Subsequent to Measurement Date 1,701,847 -
Total 3,206,496$ 861,981$
The City reported $1,701,847 as deferred outflows of resources related to contributions subsequent to the
measurement date that will be recognized as a reduction of the net pension liability in the year ended June
30, 2021.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
73
Other amounts reported as deferred outflows and deferred inflows of resources related to pensions will be
recognized as pension expense as follows:
528,237$
77,977
9,552
26,902
-
-
642,668$
2025
2021
Thereafter
Total
2022
2023
2024
Deferred
Outflows/
(Inflows) of
Resources
Fiscal Year
Ending June 30:
Actuarial Assumptions – The total pension liabilities in the June 30, 2018 actuarial valuations were
determined using the following actuarial assumptions:
Valuation Date June 30, 2018
Measurement Date June 30, 2019
Actuarial Cost Method Entry-Age Normal
Cost Method
Actuarial Assumptions:
Discount Rate 7.15%
Inflation 2.50%
Payroll Growth 2.75%
Projected Salary Increase (1)
Investment Rate of Return 7.15% (2)
Mortality (3)
(1) Varies by entry age and service
(2) Net of pension plan investment expenses, including inflation
(3) Derived using CalPERS' membership data for all funds
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
74
The underlying mortality assumptions and all other actuarial assumptions used in the June 30, 2018
valuation were based on the results of a January 2014 Actuarial Experience Study for the period 1997 to
2011. Further details of the Experience Study can be found on the CalPERS website.
Discount Rate – The discount rate used to measure the total pension liability was 7.15 percent for the
Plan. To determine whether the municipal bond rate should be used in the calculation of a discount rate
for the Plan, CalPERS stress tested plans that would most likely result in a discount rate that would be
different from the actuarially assumed discount rate. Based on the testing, none of the tested plans ran out
of assets. Therefore, the current 7.15 percent discount rate is adequate, and the use of the municipal bond
rate calculation is not necessary. The long term expected discount rate of 7.15 percent will be applied to
all plan in the Public Employees’ Retirement Fund (PERF). The stress test results are presented in the
detailed report called “GASB Crossover Testing Report” that can be obtained from the CalPERS website.
According to Paragraph 30 of Statement 68, the long-term discount rate should be determined without
reduction for pension plan administrative expense. The 7.15 percent investment return assumption used in
this accounting valuation is net of administrative expenses. Administrative expenses are assumed to be
15 basis points. Using this lower discount rate has resulted in a slightly higher Total Pension Liability
and Net Pension Liability. CalPERS checked the materiality threshold for the difference in calculation
and did not find it to be a material difference.
In determining the long-term expected rate of return, CalPERS took into account both short-term and
long-term market return expectations as well as the expected pension fund cash flows. Using historical
returns of all the funds’ asset classes, expected compound returns were calculated over the short-term
(first 10 years) and the long-term (11-60 years) using a building-block approach. Using the expected
nominal returns for both short-term and long-term, the present value of benefits was calculated for each
fund. The expected rate of return was set by calculating the single equivalent expected return that arrived
at the same present value of benefits for cash flows as the one calculated using both short-term and long-
term returns. The expected rate of return was then set equivalent to the single equivalent rate calculated
above and rounded down to the nearest one quarter of one percent.
The table below reflects 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.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
75
Assumed
Asset Real Return Real Return
Asset Class (a)Allocation Years 1 - 10 (b)Years 11+ (c)
Global Equity 50.00%4.80%5.98%
Fixed Income 28.00%1.00%2.62%
Inflation Sensitive 0.00%0.77%1.81%
Private Equity 8.00%6.30%7.23%
Real Estate 13.00%3.75%4.93%
Liquidity 1.00%0.00%-0.92%
Total 100.00%
(a) In the System's CAFR, Fixed Income is included in Global Debt Securities; Liquidity
Liquidity is included in Short-term Investments; Inflation Assets are included in both
Global Equity Securities and Global Debt Securities.
(b) An expected inflation of 2.0% used for this period.
(c) An expected inflation of 2.92% used for this period.
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate –
The following presents the City’s proportionate share of the net pension liability for the Plan, calculated
using the discount rate for the Plan, 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:
Miscellaneous
1% Decrease 6.15%
Net Pension Liability 14,608,820$
Current 7.15%
Net Pension Liability 7,614,972$
1% Increase 8.15%
Net Pension Liability 1,842,046$
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net
position is available in the separately issued CalPERS financial reports.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
76
NOTE 8 - NET POSITION
A. Net Investment in Capital Assets
As of June 30, 2020, the net investment in capital assets consisted of the following:
Capital assets, net 125,423,929$
2011 general obligation library bonds (8,075,000)
Net original issue premium (262,710)
Net investment in capital assets 117,086,219$
B. Restricted Net Position
As of June 30, 2020, the restricted net position consisted of the following:
Environmental Special Debt
Services Assessments Service Total
Restricted Net Position 113,182$ 787,734$ 788,245$ 1,689,161$
Restricted For
NOTE 9 - JOINT POWERS AGREEMENTS
The City is a member of several Joint Power Agreements, as follows:
The Santa Clara County Valley Transportation Authority (VTA) consists of various cities in the San
Francisco Bay area. The Transportation Authority was formed in 1985, by a joint exercise of powers
agreement between the County of Santa Clara and the cities of Santa Clara County for the purpose of
financing highway capital improvements within the County to serve transportation needs. Financial
statements may be obtained from the Traffic Authority at 1754 Technology Drive, Suite 224, San Jose,
California 95110.
The West Valley Solid Waste Management Joint Powers Authority consists of the West Valley cities of
Campbell, Los Gatos, Monte Sereno, and Saratoga. The JPA was formed to coordinate efforts in carrying
out solid waste collection and disposal activities, and in meeting the mandates of AB939, the States’
Integrated Waste Management Act.
The Silicon Valley Regional Interoperability Authority (SVRIA) consists of Silicon Valley agencies
formed to coordinate the design and implementation of an interoperable public safety communication
system.
The Santa Clara County Library System JPA consists of various member agencies as a policy making and
governing body of the County’s library system.
The Silicon Valley Clean Energy Authority (SVCEA) consists of various Silicon Valley agencies formed
to address climate change by reducing energy related greenhouse gas emissions and securing energy
supply and price stability, energy efficiencies and local economic benefits.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
77
The West Valley Clean Water Program consists of the Cities of Campbell, Monte Sereno, Saratoga and
the Town of Los Gatos, and works to control discharge of polluted stormwater into local creeks and the
San Francisco Bay.
These JPA's are governed by boards consisting of representatives from their members. The boards
control the operations of each JPA, including selection of management and approval of operating budgets,
independent of any influence by its members beyond their representation on the board.
NOTE 10 - EXCESS EXPENDITURES OVER APPROPRIATIONS
Excess of expenditures over appropriations in individual funds did not occur during Fiscal Year 2019/20.
NOTE 11 - COMMITMENTS AND CONTINGENCIES
A. Lawsuits
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 not expected to result in a material adverse financial impact on the
City. Additionally, City management believes that the City's insurance programs are sufficient to cover
any potential losses should an unfavorable outcome materialize.
B. Federal and State Grant Programs
The City participates in Federal and State grant programs. In qualifying years, these programs are audited
by the City's independent accountants in accordance with the provisions of the Federal Single Audit Act
Amendments of 1996 and applicable State requirements. For Federal programs, the City did not reach the
level of qualifying cost during the current fiscal year, so no single audit was required. Expenditures
which may be disallowed, if any, by the granting agencies, cannot be determined at this time. The City
expects such amounts, if any, to be immaterial.
C. Commitments
The City had outstanding contracts or planned construction projects as of June 30, 2020 totaling $1.84
million. Of this amount, $0.9 million was committed to the Mountain Bikers of Santa Cruz for the
Saratoga to Sanborn Trail project and $0.21 million was committed to Villalobos & Associates for
Fruitvale & Allendale Intersection Improvement Project. The entire total of outstanding commitments are
within the Capital Projects Fund.
In the opinion of City management, there were no additional outstanding matters that would have a
significant effect on the financial position of the funds of the City as of June 30, 2020.
CITY OF SARATOGA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2020
78
NOTE 12 – TAX ABATEMENT DISCLOSURES
A. Williamson Act and Mills Act
The City enters into property tax abatement agreements with local property owners under the California
Land Conservation Act of 1965, commonly referred to as the Williamson Act. Under the Act, local
entities may lower property tax assessments on private parcels that have been restricted to agricultural or
open space land use.
The Mills Act is a state law allowing cities to enter into contracts with the owners of historic structures.
Such contracts require a reduction of property taxes in exchange for the continued preservation of the
property. Property taxes are recalculated using a formula in the Mills Act and Revenue and Taxation
Code.
For the fiscal year ended June 30, 2020, the City abated property taxes totaling $20,140 under these
programs.
79
REQUIRED SUPPLEMENTARY INFORMATION
CITY OF SARATOGA
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020
80
NOTE 1 - BUDGETARY INFORMATION
The following is the budget comparison schedule for General Fund.
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
REVENUES:
Property taxes 14,009,000$ 14,009,000$ 15,031,057$ 1,022,057$
Sales taxes 1,100,000 1,100,000 1,056,700 (43,300)
Other local taxes 865,000 865,000 807,385 (57,615)
Licenses & permits 1,841,850 1,841,850 1,601,278 (240,572)
Fines & forfeitures 110,500 110,500 104,829 (5,671)
Intergovernmental - Fed - - - -
Intergovernmental - State 480,000 480,000 531,639 51,639
Intergovernmental - Other 35,000 35,000 54,650 19,650
Franchise fees 2,382,000 2,382,000 2,244,318 (137,682)
Use of money & property 909,250 909,250 853,870 (55,380)
Other revenue 1,318,919 1,318,919 1,223,188 (95,731)
Total revenues 23,051,519 23,051,519 23,508,914 457,395
EXPENDITURES:
Current:
General and intergovernmental services 5,833,993 5,833,993 5,261,487 572,506
Public safety 6,396,706 6,396,706 6,355,432 41,274
Public works 6,680,610 6,695,460 6,312,786 382,674
Community services 1,092,603 1,092,603 961,800 130,803
Community development services 2,839,433 2,839,433 2,544,734 294,699
Capital outlay - - - -
Total expenditures 22,843,345 22,858,195 21,436,239 1,421,956
REVENUES OVER
(UNDER) EXPENDITURES 208,174 193,324 2,072,675 1,879,351
OTHER FINANCING SOURCES (USES):
Transfers in - - 1,187,347 1,187,347
Transfers out (2,620,000) (3,505,000) (3,505,000) -
Total other financing sources (uses)(2,620,000) (3,505,000) (2,317,653) 1,187,347
Net change in fund balances (2,411,826)$ (3,311,676)$ (244,978) 3,066,698$
FUND BALANCES:
Beginning of year 14,679,585
End of year 14,434,607$
CITY OF SARATOGA
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020
81
Through the budget, the City Council sets the direction of the City, allocates its resources and establishes
its priorities. The Annual Operating and Capital Budgets assure the efficient and effective uses of the
City's economic resources, as well as establishing that the highest priority objectives are accomplished.
The annual budgets are adopted for the period of July 1 to June 30, and prepared to accurately and openly
communicate service and infrastructure priorities to the community, businesses, vendors, employees, and
other public agencies. The Annual Operating Budget is developed on a program basis for all funds with
fund level authority. It establishes the foundation of effective financial planning by providing resource
planning, performance measures and controls that permit the evaluation and adjustment of the City's
performance. The City adopts an annual budget for the capital projects as part of adopting the five-year
Capital Improvement Plan. The annual capital budget is adopted on a project-by-project basis.
The City follows these procedures in establishing the budgetary data reflected in the basic financial
statements:
a. The City Manager submits to the City Council a proposed operating budget and five-year capital
improvements plan for the fiscal year commencing the following July 1. The operating and
capital budgets include proposed expenditures and the means of financing them.
b. Public hearings are conducted to obtain taxpayer comments.
c. The budgets are legally enacted through the passage of a resolution.
d. For the Operating Budget, the City Manager may authorize transfers of budget amounts within a
fund. However, any revisions that increase the total budgeted expenditures of any fund must be
approved by the City Council. Expenditures may not legally exceed budgeted appropriations at
the fund level without City Council approval.
e. As Capital Projects are adopted on a project basis, the City Council must approve increases or
decreases of budgeted amounts or changes in project scope. Upon project completion, immaterial
amounts are transferred to ongoing maintenance projects within the capital program. If remaining
project funds are material, the project balance is brought back to Council for approval to transfer.
f. Formal budgetary integration in the form of legally adopted budgets is employed as a
management control device for all funds. Budgets are adopted on a basis consistent with
generally accepted accounting principles. Budgeted expenditures reported are as amended by
supplemental appropriations of the City Council.
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the
expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is
employed as an extension of formal budgetary integration in the General, Special Revenue, Internal
Service, and Capital funds. Unexpended and unencumbered appropriations automatically lapse at the end
of the fiscal year.
CITY OF SARATOGA
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020
82
NOTE 2 - MODIFIED APPROACH FOR CITY STREETS INFRASTRUCTURE CAPITAL
ASSETS
In accordance with GASB Statement No. 34, the City is required to account for and report infrastructure
capital assets. The City defines infrastructure as the basic physical assets that allow the City to function
and those resources utilized primarily by the public which provide future economic benefits for a
minimum of two years. Infrastructure can be defined as assets that are immovable and of value only to
the government. Major infrastructure includes the street system, park and recreation lands and
improvements; storm water conveyance and drainage systems, and buildings combined with site
amenities such as parking and landscaping areas used by the City in the conduct of its business. Each
major infrastructure system can be divided into subsystems. For example, the street system can be
divided into concrete and asphalt pavements, concrete curb and gutters, sidewalks, medians, streetlights,
traffic control devices (signs, signals and pavement markings), landscaping and land. Subsystem detail is
not presented in these basic financial statements; however, the City maintains detailed information on
these subsystems.
The City has elected to use the "Modified Approach" as defined by GASB Statement No. 34 for
infrastructure reporting for its Streets Pavement System. Under GASB Statement No. 34, eligible
infrastructure capital assets are not required to be depreciated under the following requirements:
• The City manages the eligible infrastructure capital assets using an asset management system
with characteristics of (1) an up-to-date inventory; (2) perform condition assessments and
summarize the results using a measurement scale; and (3) estimate annual amount to maintain
and preserve at the established condition assessment level.
• The City documents that the eligible infrastructure capital assets are being preserved
approximately at or above the established and disclosed condition assessment level.
The City commissioned a physical assessment of the streets conditions with the final report received
February 21, 2020. The study assists the City by providing current inspection data used to evaluate
current pavement condition. This helps to maintain a City-defined desirable level of pavement
performance while optimizing the expenditure of limited fiscal resources. The entire pavement network
within the City is composed of approximately 141.1 centerline miles of paved surfaces. The City’s road
system can be grouped by function class and includes 24.2 centerline miles of arterial, 23.2 centerline
miles of collector, and 93.7 miles of residential.
To determine the City’s street condition, a visual survey of all pavement segments is conducted to assess
the existing surface condition of each of the individual pavement segments. Upon completion of the
study, a Pavement Condition Index (PCI) is calculated for each segment in the City's pavement network
to reflect the overall pavement condition. Rating between 0 and 100, a PCI of 0 would correspond to a
badly deteriorated pavement with virtually no remaining life. A PCI of 100 would correspond to a
pavement with proper engineering design and construction at the beginning of its life cycle.
CITY OF SARATOGA
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020
83
The following conditions were defined:
Condition Rating
Very Good 70 - 100
Good 50 - 69
Poor 25 - 49
Very Poor 0 - 24
The City's policy is to achieve an average rating of 70 for all streets, which is a very good rating. This
rating allows minor cracking and raveling of the pavement along with minor roughness that could be
noticeable to drivers traveling at the posted speeds. As of May 31, 2020, the City's street system was
rated at an estimated PCI index of 66 on average with the detail condition as follows:
Condition
Percent of
Streets
Very Good 48%
Good 31%
Poor 15%
Very Poor 6%
The City’s expenditures on street infrastructure over the previous five fiscal years are as follows:
2016 2017 2018 2019 2020
Street Infrastructure 1,731,058 4,315,145 5,363,853 8,735,674 7,438,484
Fiscal Year Ended June 30,
The City expended $5,005,648 on street maintenance and infrastructure for the year ended June 30, 2020.
These projects include resurfacing, safety improvements, sidewalks, curbs and gutters, storm drain
improvements, beautification projects, and various other routine maintenance projects help to delay
deterioration and beautify the City’s roadway system. Council has established a goal for a minimum of
$2,000,000 be budgeted for the CIP Streets program on an annual basis. $10,296,145 is budgeted for
various street projects in the five-year CIP cycle beginning Fiscal Year 2020/21.
As of June 2020, approximately 21 percent of the City's streets were rated below the average standard of
“Good.” The City will continue to rehabilitate these segments of the streets. Total deficiencies (deferred
maintenance) identified in the Pavement Management System Report at the end of a five-year period
(2019-2024) will amount to approximately $43,500,000 for all streets.
CITY OF SARATOGA
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED JUNE 30, 2020
84
NOTE 3 – PENSION INFORMATION
Miscellaneous Plan
Plan Measurement Date 2014 2015 2016 2017 2018 2019
Fiscal Year Ended 2015 2016 2017 2018 2019 2020
Contractually Required Contributions 908,980$ 668,417$ 617,707$ 707,891$ 583,629$ 660,749$
Contributions in Relation to Contractually
Required Contributions 4,203,599 1,109,589 1,016,197 1,289,450 1,637,179 1,701,847
Contribution Deficiency (Excess)(3,294,619)$ (441,172)$ (398,490)$ (581,559)$ (1,053,550)$ (1,041,098)$
Covered Payroll 4,856,304$ 6,335,330$ 5,908,831$ 5,692,653$ 6,156,572$ 6,590,150$
Contributions as a % of Covered Payroll 86.56%17.51%17.20%22.65%26.59%25.82%
Notes to Schedule:
Valuation Date:June 30, 2018
Assumptions Used:Entry Age Method used for Actuarial Cost Method
Level Percentage of Payroll and Direct Rate Smoothing
3.8 Years Remaining Amortization Period
Inflation Assumed at 2.5%
Investment Rate of Returns set at 7.15%
Fiscal year 2015 was the first year of implementation, therefore only six years are shown.
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.
The CalPERS mortality assumptions was adjusted in fiscal year 2019.
CalPERS mortality table based on CalPERS' experience and include 15 years of projected ongoing mortality
improvement using 90 percent of Scale MP 2016 published by the Society of Actuaries.
Schedule of Proportionate Share of Net Pension Liability
Last 10 Fiscal Years
Miscellaneous and Safety Plan
Plan Measurement Date 2014 2015 2016 2017 2018 2019
Fiscal Year Ended 2015 2016 2017 2018 2019 2020
Proportion of Net Pension Liability (Misc Plan Only)0.28104%0.15551%0.18238%0.19170%0.19202%0.19016%
Proportionate Share of Net Pension Liability 6,945,916$ 4,266,268$ 6,335,606$ 7,556,748$ 7,236,672$ 7,614,972$
Covered Payroll 4,714,858$ 4,856,304$ 6,335,330$ 5,908,831$ 5,692,653$ 6,156,572$
Proportionate Share of NPL as a %
of Covered Payroll 147.32%87.85%100.00%127.89%127.12%123.69%
Plan's Fiduciary Net Position as a % of the TPL 83.02%90.52%85.60%84.66%85.34%85.36%
Fiscal year 2015 was the first year of implementation, therefore only six years are shown.
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.
The CalPERS mortality assumptions was adjusted in fiscal year 2019.
85
SUPPLEMENTARY INFORMATION
86
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87
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Landscape & Lighting District and Storm Drain Funds – These funds account for revenues and
expenditures associated with maintaining the City’s 30 Landscape, Lighting, and Storm Drain zones
which were approved by consent of property owners living along or within the boundaries of the zones.
Debt Service Fund
Library Bond - Santa Clara County general obligation bond tax revenues are accumulated in this fund to
pay annual principal and interest payments on the refunded 2011 Library Improvement Bond.
CITY OF SARATOGA
COMBINING BALANCE SHEETS
NONMAJOR GOVERNMENTAL FUNDS
JUNE 30, 2020
88
Special
Revenue Debt Service
Lighting and Total
Landscaping Other
Assessment Library Governmental
District Bond Funds
ASSETS
Cash and investments 836,476$ 786,186$ 1,622,662$
Receivables:
Accounts 705 2,059 2,764
Total assets 837,181$ 788,245$ 1,625,426$
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable 49,447$ -$ 49,447$
Total liabilities 49,447 - 49,447
Fund Balances:
Restricted:
Special revenue funds 787,734 - 787,734
Debt service - 788,245 788,245
Total fund balances 787,734 788,245 1,575,979
Total liabilities and fund balances 837,181$ 788,245$ 1,625,426$
CITY OF SARATOGA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2020
89
Special Debt
Revenue Service
Lighting and Total
Landscaping Other
Assessment Library Governmental
District Bond Funds
REVENUES:
Property taxes 325,414$ -$ 325,414$
Special assessment 474,493 699,749 1,174,242
Use of money and property 34,327 1,326 35,653
Total revenues 834,234 701,075 1,535,309
EXPENDITURES:
Current:
General and ingov't services
Public works 605,842 - 605,842
Debt service:
Principal - 525,000 525,000
Interest and fiscal charges - 320,710 320,710
Total expenditures 605,842 845,710 1,451,552
REVENUES OVER
(UNDER) EXPENDITURES 228,392 (144,635) 83,757
OTHER FINANCING SOURCES (USES):
Proceeds from bond issuance - - -
Transfers in - - -
Transfers out (1,062,604) - (1,062,604)
Total other financing sources (uses)(1,062,604) - (1,062,604)
Net change in fund balances (834,212) (144,635) (978,847)
FUND BALANCES:
Beginning of year 1,621,946 932,880 2,554,826
End of year 787,734$ 788,245$ 1,575,979$
CITY OF SARATOGA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
CAPITAL IMPROVEMENT
FOR THE YEAR ENDED JUNE 30, 2020
90
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
REVENUES:
Licenses & permits 451,300$ 451,300$ 440,266$ (11,034)$
Fines & forfeitures - - 7,220 7,220
Intergovermental - Federal 3,267,311 3,267,311 1,034,714 (2,232,597)
Intergovermental - State 1,374,909 1,534,909 1,287,055 (247,854)
Intergovermental - Other 2,840,987 2,840,987 2,026,866 (814,121)
Franchise Fees 340,789 340,789 360,384 19,595
Use of money and property 35,000 35,000 26,730 (8,270)
Other revenue 456,198 456,198 171,157 (285,041)
Total revenues 8,766,494 8,926,494 5,354,392 (3,572,102)
EXPENDITURES:
Capital outlay 14,588,154 15,647,886 7,269,841 8,378,045
Total expenditures 14,588,154 15,647,886 7,269,841 8,378,045
REVENUES OVER
(UNDER) EXPENDITURES (5,821,661) (6,721,393) (1,915,449) 4,805,944
OTHER FINANCING SOURCES (USES):
Transfers in 2,620,000 3,630,000 3,630,000 -
Transfers out - (125,000) (249,743) (124,743)
Total other financing sources (uses)2,620,000 3,505,000 3,380,257 (124,743)
Net change in fund balances (3,201,661)$ (3,216,393)$ 1,464,808 4,681,201$
FUND BALANCES:
Beginning of year 3,252,057
End of year 4,716,865$
CITY OF SARATOGA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
LANDSCAPE & LIGHTING DISTRICT SPECIAL REVENUE FUND
FOR THE YEAR ENDED JUNE 30, 2020
91
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
REVENUES:
Property taxes 257,590$ 257,590$ 325,414$ 67,824$
Special assessments 479,720 479,720 474,493 (5,227)
Use of money and property 16,077 16,077 34,327 18,250
Other revenue - - - -
Total revenues 753,387 753,387 834,234 80,847
EXPENDITURES:
Current:
Public works 839,042 839,042 605,842 233,200
Total expenditures 839,042 839,042 605,842 233,200
REVENUES OVER
(UNDER) EXPENDITURES (85,655) (85,655) 228,392 314,047
OTHER FINANCING SOURCES (USES):
Transfers in - - - -
Transfers out - - (1,062,604) (1,062,604)
Total other financing sources (uses)- - (1,062,604) (1,062,604)
Net change in fund balances (85,655)$ (85,655)$ (834,212) (748,557)$
FUND BALANCES:
Beginning of year 1,621,946
End of year 787,734$
CITY OF SARATOGA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
LIBRARY BOND DEBT SERVICE FUND
FOR THE YEAR ENDED JUNE 30, 2020
92
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
REVENUES:
Special assessments 664,616$ 664,616$ 699,749$ 35,133$
Use of money and property 8,000 8,000 1,326 (6,674)
Total revenues 672,616 672,616 701,075 28,459
EXPENDITURES:
Debt service:
General and ingov't services
Principal 525,000 525,000 525,000 -
Interest and fiscal charges 321,035 321,035 320,710 325
Total expenditures 846,035 846,035 845,710 325
REVENUES OVER
(UNDER) EXPENDITURES (173,419) (173,419) (144,635) 28,784
Net change in fund balances (173,419)$ (173,419)$ (144,635) 28,784$
FUND BALANCES:
Beginning of year 932,880
End of year 788,245$
93
INTERNAL SERVICE FUNDS
Liability/Risk Management Insurance Fund – Accounts for insurance premiums, self-insurance portion
of claims, and administrative cost associated with settling claims. Charges made to operating departments
are based on liability risk and claim occurrence history.
Worker’s Compensation Fund – Accounts for insurance premiums, self-insured portion of claims, and
administrative costs associated with settling claims. Charges made to operating departments are based on
liability risk and claim occurrence history.
Office Support Fund - Photocopy equipment, postage and bulk mail meter expenses are controlled at
one source point and expended to the departments as goods or services are utilized.
Information Technology Services Fund – Supports the delivery of technology-based services and
infrastructure, including desktop support, network systems, technology upgrades and initiatives,
community systems, and associated information technology equipment.
Vehicle & Equipment Maintenance Fund – Accounts for the cost of operating and maintaining
automotive equipment used for service operations in various City departments.
Building Maintenance Fund – Accounts for operating costs associated with building maintenance.
Expenses include custodial supplies and services, maintenance and repair, utilities, and staffing costs.
Vehicle & Equipment Replacement Fund – Established to accumulate funding for the replacement of
vehicles and equipment. Replacement costs are charged to program over the asset’s life span, reflective
of usage.
Information Technology Equipment Replacement Fund – Established to accumulate funding for the
replacement of information technology equipment. Replacement costs are charged to departments over
the asset’s lifespan, reflective of usage.
Facility Furniture, Fixtures & Equipment Replacement Fund – Established to accumulate funding for
the replacement furniture, fixtures and equipment within city facilities. Replacement costs are charged to
programs based on that program’s share of asset use over the asset’s lifespan, reflective of usage.
CITY OF SARATOGA
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET POSITION
JUNE 30, 2020
94
Liability /Information
Risk Workers'Office Technology
Management Compensation Support Services
ASSETS
Current assets:
Cash and investments 604,305$ 252,710$ 135,927$ 403,490$
Accounts receivable 3,023 2,079 - 405
Total current assets 607,328 254,789 135,927 403,895
Noncurrent assets:
Capital assets:
Machinery and equipment - - - -
Less: accumulated depreciation - - - -
Total capital assets (net of
accumulated depreciation) - - - -
Total assets 607,328 254,789 135,927 403,895
LIABILITIES
Liabilities:
Current liabilities:
Accounts payable 8,841 886 134 3,508
Accrued payroll 3,948 1,891 - 18,264
Claims payable 90,720 - - -
Total current liabilities 103,509 2,777 134 21,772
NET POSITION
Investment in capital assets - - - -
Unrestricted 503,819 252,012 135,793 382,123
Total net position 503,819$ 252,012$ 135,793$ 382,123$
95
Information Building
Vehicle Vehicle Technology Furniture &
and Equipment Building and Equipment Equipment Fixtures
Maintenance Maintenance Replacement Replacement Replacement Total
311,286$ 687,709$ 536,308$ 606,832$ 528,630$ 4,067,197$
- 1,683 1,024 - - 8,214
311,286 689,392 537,332 606,832 528,630 4,075,411
- - 1,593,355 110,465 173,076 1,876,897
- - (1,215,114) (110,465) (40,012) (1,365,591)
- - 378,242 - 133,064 511,306
311,286 689,392 915,574 606,832 661,694 4,586,717
6,914 50,121 - 3,790 - 74,194
3,697 18,688 - - - 46,488
- - - - - 90,720
10,611 68,809 - 3,790 - 211,402
- - 378,242 - 133,064 511,306
300,675 620,583 537,332 603,042 528,630 3,864,009
300,675$ 620,583$ 915,574$ 603,042$ 661,694$ 4,375,315$
CITY OF SARATOGA
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET POSITION
FOR THE YEAR ENDED JUNE 30, 2020
96
Liability /Information
Risk Workers'Office Technology
Management Compensation Support Services
Operating revenues:
Charges for services 400,000$ 175,000$ 40,000$ 575,000$
Other operating revenues 10,855 8,998 8,963 13,866
Total operating revenues 410,855 183,998 48,963 588,866
Operating expenses:
Cost of services 486,318 206,903 33,548 598,568
Administration - - - -
Depreciation - - - -
Total operating expenses 486,318 206,903 33,548 598,568
Operating income (75,463) (22,905) 15,415 (9,702)
Transfers in - - - -
Change in net position (75,463) (22,905) 15,415 (9,702)
Total net position - beginning 579,282 274,917 120,378 391,825
Total net position - ending 503,819$ 252,012$ 135,793$ 382,123$
97
Information Building
Vehicle Vehicle Technology Furniture &
and Equipment Building and Equipment Equipment Fixtures
Maintenance Maintenance Replacement Replacement Replacement Total
275,000$ 925,000$ 150,000$ 150,000$ 200,000$ 2,890,000$
- 2,199 - - (1) 44,880
275,000 927,199 150,000 150,000 199,999 2,934,880
240,423 869,121 7,369 36,641 50,924 2,529,815
- - - - - -
- - 161,742 - 26,675 188,417
240,423 869,121 169,111 36,641 77,599 2,718,232
34,577 58,078 (19,111) 113,359 122,400 216,648
- - - - - -
34,577 58,078 (19,111) 113,359 122,400 216,648
266,098 562,505 934,685 489,683 539,294 4,158,667
300,675$ 620,583$ 915,574$ 603,042$ 661,694$ 4,375,315$
CITY OF SARATOGA
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2020
98
Liability /Information
Risk Workers'Office Technology
Management Compensation Support Services
Cash flows from operating activities:
Receipts from customers and users 407,833$ 186,028$ 48,963$ 591,004$
Payments to suppliers (369,968) (170,867) (34,027) (245,156)
Payments to employees (81,743) (35,064) - (345,415)
Other receipts - - - -
Net cash provided by operating activities (43,878) (19,903) 14,936 433
Cash flows from capital activities:
Acquisition of capital assets - - - -
Net cash used for acquisition of capital assets - - - -
Net increase (decrease) in cash and cash equivalents (43,878) (19,903) 14,936 433
Cash and cash equivalents, beginning of year 648,183 272,613 120,991 403,057
Cash and cash equivalents, ending of year 604,305$ 252,710$ 135,927$ 403,490$
Reconciliation of operating income to net cash provided
by operating activities:
Operating income (loss)(75,463)$ (22,905)$ 15,415$ (9,702)$
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:
Depreciation - - - -
Change in operating assets and liabilities:
Accounts receivables (3,022) 2,029 - 2,138
Accounts payable 8,840 396 (479) 1,425
(Decrease) in deposits payable - - - -
Claims payable 37,427 - - -
Accrued payroll (11,660) 577 - 6,572
Net cash provided (used) by operating activities (43,878)$ (19,903)$ 14,936$ 433$
99
Information Building
Vehicle Vehicle Technology Furniture &
and Equipment Building and Equipment Equipment Fixtures
Maintenance Maintenance Replacement Replacement Replacement Total
275,000$ 925,516$ 148,975$ 150,000$ 199,999$ 2,933,318$
(131,035) (444,909) (7,370) (39,251) (72,239) (1,514,822)
(108,576) (398,130) - - - (968,928)
- - - - - -
35,389 82,477 141,605 110,749 127,760 449,568
- - (81,884) - - (81,884)
- - (81,884) - - (81,884)
35,389 82,477 59,721 110,749 127,760 367,684
275,897 605,232 476,587 496,083 400,870 3,699,513
311,286$ 687,709$ 536,308$ 606,832$ 528,630$ 4,067,197$
34,577$ 58,078$ (19,111)$ 113,359$ 122,400$ 216,648$
- - 161,742 - 26,675 188,417
- (1,683) (1,026) - - (1,564)
1,068 26,873 (2,610) (21,315) 14,198
- - - - - -
- - - - - 37,427
(256) (791) - - - (5,558)
35,389$ 82,477$ 141,605$ 110,749$ 127,760$ 449,568$
100
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101
FIDUCIARY FUNDS
West Valley Clean Water Program – Accounts for all activities of the West Valley Clean Water Program
Joint Powers Agreement. The City of Saratoga accounts for the JPA’s financial activities.
Arrowhead Community Facilities District Bond – Accounts for the bond reserves and debt service for
the Arrowhead District
Arrowhead Community Facilities District Project Funding - Accounts for the financial activity related
to the District’s capital outlay.
CITY OF SARATOGA
FIDUCIARY FUNDS
COMBINING BALANCE SHEET
FOR THE YEAR ENDED JUNE 30, 2020
102
West Valley Arrowhead Arrowhead Total
Clean Water CFD CFD Agency
Program Bond District Funds
ASSETS
Cash and investments 678,048$ 294,268$ 356,840$ 1,329,156$
Total assets 678,048 294,268 356,840 1,329,156
LIABILITIES
Accounts payable 104,201 - - 104,201
Due for debt service - 294,268 - 294,268
Due to other agencies 573,847 - 356,840 930,687
678,048$ 294,268$ 356,840$ 1,329,156$
CITY OF SARATOGA
FIDUCIARY FUNDS
STATEMENT OF CHANGES IN FIDUCIARY ASSETS AND LIABILITIES
FOR THE YEAR ENDED JUNE 30, 2020
103
Balance Balance
West Valley Clean Water Program July 1, 2019 Additions Deductions June 30, 2020
ASSETS
Cash and investments 573,059$ 999,986$ (894,997)$ 678,048$
Total assets 573,059 999,986 (894,997) 678,048
LIABILITIES
Accounts Payable 57,618 46,583 - 104,201
Deposits payable 14,888 - (14,888) -
Due to other agencies 500,553$ 73,294$ -$ 573,847
Total liabilities 573,059$ 119,877$ (14,888)$ 678,048$
Balance Balance
Arrowhead Community Facilities District Bond July 1, 2019 Additions Deductions June 30, 2020
ASSETS
Cash and investments 280,736$ 159,790$ (146,258)$ 294,268$
Total assets 280,736 159,790 (146,258) 294,268
LIABILITIES
Due for debt service 280,736 159,790 (146,258) 294,268
Total liabilities 280,736$ 159,790$ (146,258)$ 294,268$
Balance Balance
Arrowhead Community Facilities District July 1, 2019 Additions Deductions June 30, 2020
ASSETS
Cash and investments 408,605$ -$ (51,765)$ 356,840$
Total assets 408,605 - (51,765) 356,840
LIABILITIES
Due to other agencies 408,605 - (51,765) 356,840
Total liabilities 408,605$ -$ (51,765)$ 356,840$
Balance Balance
Total Agency Funds July 1, 2019 Additions Deductions June 30, 2020
ASSETS
Cash and investments 1,262,400$ 1,159,776$ (1,093,020)$ 1,329,156$
Total assets 1,262,400 1,159,776 (1,093,020) 1,329,156
LIABILITIES
Accounts Payable 57,618 46,583 - 104,201
Deposits payable 14,888 - (14,888) -
Due for debt service 280,736 159,790 (146,258) 294,268
Due to other agencies 909,158 73,294 (51,765) 930,687
Total liabilities 1,334,906$ 279,667$ (212,911)$ 1,329,156$
104
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105
CAPITAL ASSETS
USED IN THE OPERATION OF GOVERNMENTAL FUNDS
106
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CITY OF SARATOGA
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
COMPARATIVE SCHEDULE BY SOURCE
JUNE 30, 2020 AND 2019
107
2020 2019
Governmental Funds Capital Assets:
Land and land improvements 17,754,123$ 15,591,925$
Buildings and structures 26,855,196 26,570,196
Machinery and equipment 2,269,289 2,269,291
Infrastructure 111,389,585 111,389,586
Construction in progress 11,452,692 10,320,046
Total Governmental Funds Capital Assets 169,720,885 166,141,044
Accumulated depreciation (44,808,263) (42,624,670)
Total Governmental Funds Capital Assets, Net 124,912,622$ 123,516,374$
Investments in Governmental Funds
Capital Assets by Source:
General Fund 115,212,479$ 115,212,479$
Special revenue funds 960,972 960,972
Capital projects funds 52,700,085 49,120,244
Donations 847,348 847,348
Accumulated depreciation (44,808,263) (42,624,670)
Total Governmental Funds Capital Assets 124,912,622$ 123,516,374$
1 This schedule presents only the capital asset balances related to governmental funds. Accordingly
the capital assets reported in internal service funds are excluded from the above amounts.
Generally, the capital assets of internal service funds are included as governmental activities in the
statement of net position.
CITY OF SARATOGA
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
SCHEDULE BY FUNCTION AND ACTIVITY1
JUNE 30, 2020
108
Land Buildings
and Land and
Improvements Structures
Function and Activity
General and intergovernmental services:
Management services -$ 564,632$
Administrative services - 521,073
Intergovernmental services 118,184 3,138,641
Total General and Intergovernmental Services:118,184 4,224,346
Public safety:
Police services - -
Code enforcement - -
Total Public Safety:- -
Public works:
Streets and sidewalks 835,155 62,921
Parks/open space 6,880,783 3,275,380
Total Public Works:7,715,938 3,338,301
Community services 8,177,538 4,977,650
Community development services 1,742,463 14,314,899
Total Governmental Funds Capital Assets 17,754,123 26,855,196
Accumulated depreciation - (12,267,267)
Total Governmental Funds Capital Assets, Net 17,754,123$ 14,587,929$
1 This schedule presents only the capital asset balances related to governmental funds. Accordingly
the capital assets reported in internal service funds are excluded form the above amounts.
Generally, the capital assets of internal service funds are included as governmental activities in the
statement of net position.
109
Machinery Construction
and in
Equipment Infrastructure Progress Total
624,241$ -$ 73,051$ 1,261,924$
140,332 - - 661,405
22,225 - - 3,279,050
786,798 - 73,051 5,202,379
15,434 - - 15,434
7,548 - - 7,548
22,982 - - 22,982
315,275 111,262,348 8,701,581 121,177,280
151,110 - 2,132,580 12,439,853
466,385 111,262,348 10,834,161 133,617,133
916,772 127,237 545,480 14,744,677
76,352 - - 16,133,714
2,269,289 111,389,585 11,452,692 169,720,885
(1,598,105) (30,942,891) - (44,808,263)
671,184$ 80,446,694$ 11,452,692$ 124,912,622$
CITY OF SARATOGA
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
SCHEDULE OF CHANGE BY FUNCTION AND ACTIVITY
JUNE 30, 2020
110
Governmental Governmental
Funds Capital Funds Capital
Assets Assets
July 1, 2019 Additions Deletions June 30, 2020
Function and Activity
General and intergovernmental services:
Management services 1,261,924$ -$ -$ 1,261,924$
Administrative services 661,405 - - 661,405$
Intergovernmental services 3,279,050 - - 3,279,050$
Total General and Intergovernmental Services:5,202,379 - - 5,202,379$
Public safety:
Police services 15,434 - - 15,434$
Code enforcement 7,548 - - 7,548$
Total Public Safety:22,982 - - 22,982$
Public works:
Streets and sidewalks 119,618,383 1,558,897 - 121,177,280$
Parks/open space 11,145,240 3,456,810 (2,162,197) 12,439,853$
Total Public Works:130,763,623 5,015,707 (2,162,197) 133,617,133$
Community services 14,018,343 1,011,334 (285,000) 14,744,677$
Community development services 16,133,714 - - 16,133,714$
Total Governmental Funds Capital Assets 166,141,041 6,027,041 (2,447,197) 169,720,885$
Accumulated depreciation (42,624,668) (2,183,595) - (44,808,263)$
Total Governmental Funds Capital Assets, Net 123,516,373$ 3,843,446$ (2,447,197)$ 124,912,622$
1 This schedule presents only the capital asset balances related to governmental funds. Accordingly
the capital assets reported in internal service funds are excluded form the above amounts.
Generally, the capital assets of internal service funds are included as governmental activities in the
statement of net position.
111
STATISTICAL SECTION
112
This page is intentionally blank
113
This part of the City of Saratoga's comprehensive annual financial report presents detailed information as
a context for understanding what the information in the financial statements, note disclosures and required
supplementary information says about the government's overall financial health.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how
the government's financial performance and well-being have changed over time. 114-119
Revenue Capacity
These schedules contain information to help the reader assess the government’s
most significant local revenue source; property tax. 120-129
Debt Capacity
These schedules present information to help the reader assess the affordability
of the government's current levels of outstanding debt and the government's ability
to issue additional debt in the future. 130-136
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the government's financial activities
take place. 137-138
Operating Information
These schedules contain service and infrastructure data to help the reader understand
how the information in the government's financial report relates to the services the
government provides and the activities it performs. 140-145
The City of Saratoga implemented GASB Statement No. 34 in Fiscal Year 2001/02; schedules presenting
government-wide information include information beginning in that year.
The City of Saratoga implemented GASB Statement No. 44 in Fiscal Year 2007/08; newly required
schedules presenting information in the Statistical Section include the earliest available information.
CITY OF SARATOGA
NET POSITION BY COMPONENT
LAST TEN YEARS
(ACCRUAL BASIS OF ACCOUNTING)
114
(amounts expressed in thousands)
2011 2012 2013 2014
Primary government
Governmental activities
Net investment in capital assets 110,016$ 111,201$ 112,353$ 112,116$
Restricted 5,830 1,938 1,971 2,045
Unrestricted 7,964 12,248 13,357 15,095
Total primary government 123,810$ 125,387$ 127,681$ 129,256$
Source: CAFR
Fiscal Year
$100,000
$110,000
$120,000
$130,000
$140,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Net Position by Component
Net investment in capital assets Restricted Unrestricted
115
2015 2016 2017 2018 2019 2020
112,092$ 112,030$ 111,241$ 113,053$ 115,250$ 117,086$
2,138 2,242 2,375 2,596 2,718 1,689
6,691 13,837 13,438 13,693 15,825 16,572
120,921$ 128,109$ 127,054$ 129,342$ 133,793$ 135,347$
CITY OF SARATOGA
CHANGES IN NET POSITION
LAST TEN YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
116
(amounts expressed in thousands)
2011 2012 2013 2014
Expenses:
Governmental activities:
General and intergovernmental services 4,368$ 3,486$ 4,143$ 4,522$
Public safety 4,457 4,300 4,382 4,491
Public works 6,645 9,121 6,922 7,379
Community services 1,846 1,996 1,804 1,586
Community development services 1,839 1,553 1,713 2,179
Interest on long-term debt (unallocated)656 453 410 400
Total governmental activities expenses 19,811 20,909 19,374 20,557
Program revenues:
Charges for services:
General and intergovernmental services 171 140 102 120
Public safety 561 594 607 330
Public works 2,771 2,079 3,316 2,768
Community services 1,020 890 946 958
Community development services 1,734 1,923 2,184 2,220
Operating grants and contributions 401 1,319 75 117
Capital grants and contributions 1,221 2,337 599 808
Total governmental activates program revenues 7,879 9,282 7,829 7,321
Net (expense) revenue and change in net position (11,932) (11,627) (11,545) (13,236)
General revenue and other changes in net assets
Taxes:
Property taxes 8,199 8,457 9,153 9,737
Sales taxes 991 1,101 1,051 941
Local taxes 632 683 769 822
Franchise taxes 1,821 1,852 1,920 1,949
Motor vehicle in-lieu 146 16 16 14
Total Taxes 11,789 12,109 12,909 13,463
Intergovernmental 773 910 766 981
Investment earnings 65 67 51 62
Other revenues 97 118 113 305
Total general revenues 12,724 13,204 13,839 14,811
Change in net position 792 1,577 2,294 1,575
Net position - beginning of year 123,018 123,810 125,387 127,681
GASB 68 adjustment - - - -
Net position - beginning of year, as adjusted 123,018 123,810 125,387 127,681
Net position - end of year 123,810$ 125,387$ 127,681$ 129,256$
Source: CAFR
Fiscal Year
117
2015 2016 2017 2018 2019 2020
7,566$ 5,143$ 6,450$ 6,010$ 6,465$ 7,071$
4,850 4,787 5,444 5,728 6,005 6,355
6,273 6,181 9,164 7,943 10,271 11,340
1,589 1,582 1,557 1,594 1,287 865
1,962 2,012 2,906 2,285 2,198 2,727
391 381 367 359 334 308
22,631 20,086 25,888 23,919 26,560 28,666
122 98 153 152 107 57
354 310 327 368 467 340
2,474 3,004 2,462 2,397 2,376 2,056
952 1,114 1,071 914 736 240
2,234 2,397 2,127 2,343 1,815 1,906
107 165 223 90 95 72
785 183 1,062 219 3,631 1,595
7,028 7,271 7,425 6,483 9,227 6,266
(15,603) (12,815) (18,463) (17,436) (17,333) (22,400)
10,669 11,549 12,264 14,124 15,250 16,056
1,224 1,189 1,185 1,125 1,207 1,056
866 898 857 960 896 807
2,070 2,069 2,171 2,166 2,290 2,605
13 12 13 16 15 25
14,842 15,717 16,490 18,391 19,658 20,549
1,023 718 589 802 1,223 2,602
67 101 124 319 698 623
237 273 205 212 205 180
16,169 16,809 17,408 19,724 21,784 23,954
566 3,994 (1,055) 2,288 4,451 1,554
129,256 120,921 128,109 127,054 129,342 133,793
(8,901) 3,193 - - - -
120,355 124,114 128,109 127,054 129,342 133,793
120,921$ 128,109$ 127,054$ 129,342$ 133,793$ 135,347$
CITY OF SARATOGA
FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
118
(amounts expressed in thousands)
2011 2012 2013 2014
General fund:
Restricted 513$ 513$ 463$ 413$
Committed 500 600 675 993
Assigned 667 3,161 792 2,648
Unassigned 5,804 4,655 7,989 7,782
Total general fund 7,484$ 8,929$ 9,919$ 11,836$
All other governmental funds:
Restricted
Special revenue funds 504$ 563$ 622$ 734$
Debt service 851 862 886 898
Committed
Capital project funds 4,475 3,544 3,420 3,126
Total all other governmental funds 5,830$ 4,969$ 4,928$ 4,758$
Source: CAFR
Fiscal Year
Balances prior to fiscal year 2011 have been updated to conform with GASB 54 requirements
$-
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
General -
Restricted
General -
Committed
General -
Assigned
General -
Unassigned
Debt
Service
Special
Revenue
Capital
Projects
Fund Balances of Governmental Funds
2011
2012
2013
2014
2015
2016
2017
2012
2019
2020
119
2015 2016 2017 2018 2019 2020
363$ 313$ 263$ 213$ 163$ 113$
1,000 1,000 790 1,000 1,000 1,000
2,854 2,672 3,272 3,705 5,399 5,845
5,589 6,655 6,659 8,216 8,117 7,477
9,806$ 10,640$ 10,984$ 13,134$ 14,679$ 14,435$
868$ 1,006$ 1,153$ 1,385$ 1,622$ 788$
907 923 959 998 933 788
3,859 4,716 5,085 3,537 3,252 4,717
5,634$ 6,645$ 7,197$ 5,920$ 5,807$ 6,293$
CITY OF SARATOGA
GOVERNMENTAL ACTIVITIES TAX REVENUES BY SOURCE
LAST TEN YEARS
(ACCRUAL BASIS OF ACCOUNTING)
120
(amounts expressed in thousands)
2011 2012 2013 2014
Tax revenues:
Property taxes 8,199$ 8,457$ 9,153$ 9,737$
Special assessments 1,255 1,243 1,185 1,207
Sales taxes 991 1,101 1,051 941
Local taxes 632 683 769 822
Franchise taxes 1,821 1,852 1,920 2,024
Motor vehicle in-lieu 146 16 16 14
Total tax revenues 13,044$ 13,352$ 14,094$ 14,745$
Source: CAFR
Fiscal Year
$-
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
Property
taxes
Special
assessments
Sales taxes Local taxes Franchise
taxes
Motor
vehicle in-
lieu
Tax Revenues by Source
2011
2012
2013
2014
2015
2016
2017
2012
2019
2020
121
2015 2016 2017 2018 2019 2020
10,669$ 11,549$ 12,264$ 13,247$ 14,475$ 15,356$
1,220 1,222 1,270 1,333 1,205 1,174
1,224 1,189 1,185 1,125 1,207 1,057
866 898 857 960 881 807
2,069 2,068 2,171 2,166 2,290 2,605
13 12 14 16 15 25
16,061$ 16,938$ 17,761$ 18,847$ 20,073$ 21,024$
CITY OF SARATOGA
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
LAST TEN YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
122
(amounts expressed in thousands)
2011 2012 2013 2014
Revenues:
Property taxes 8,199$ 8,457$ 9,153$ 9,737$
Special assessments 1,255 1,243 1,185 1,207
Sales taxes 991 1,101 1,051 941
Other local taxes 632 683 769 823
Licenses and permits 1,950 1,728 2,177 2,023
Fines and forfeitures 285 234 199 196
Intergovernmental - federal 1,033 1,915 975 796
Intergovernmental - state 1,480 1,728 1,142 1,410
Intergovernmental - other 337 73 269 129
Franchise fees 1,821 1,852 1,920 1,949
Use of money any property 550 589 527 521
Other revenues 2,169 2,199 2,421 2,547
Total tax revenues 20,702 21,802 21,788 22,279
Expenditures:
Current:
General and intergovernmental services 3,524 3,145 3,269 3,247
Public safety 4,467 4,310 4,392 4,491
Public works 4,717 4,751 4,966 5,243
Community services 1,322 1,269 1,318 1,383
Community development services 2,193 1,888 2,047 2,182
Capital outlay 3,704 5,179 3,979 3,096
Debt service:
Principal 350 370 455 485
Interest and fiscal charges 665 551 414 405
Total expenditures 20,942 21,463 20,840 20,532 Excess of revenues
over (under) expenditures (240) 339 948 1,747
Other financing sources (uses):
Transfers in 1,725 510 510 1,291
Transfers out (1,700) (485) (485) (1,291)
Total other financing sources (uses)25 25 25 220
Net change in fund balances (215)$ 364$ 973$ 1,967$
Debt as a percentage of noncapital expenditures 5.89%5.66%5.15%5.10%
Source: CAFR
Debt as percentage of noncapital expenditures calculated by
dividing total debt service expenditures by total noncapital expenditures
Fiscal Year
123
2015 2016 2017 2018 2019 2020
10,669$ 11,549$ 12,264$ 13,247$ 14,475$ 15,356$
1,220 1,222 1,270 1,333 1,205 1,174
1,224 1,189 1,185 1,125 1,207 1,057
866 898 857 960 896 807
1,613 2,216 1,908 2,677 2,360 2,042
175 248 171 127 127 112
651 158 954 181 3,375 1,035
1,538 1,182 1,053 1,253 1,777 1,819
97 76 222 136 241 2,082
2,070 2,068 2,171 2,166 2,290 2,605
557 647 651 779 1,148 916
2,589 2,709 2,203 2,397 2,081 1,394
23,269 24,162 24,909 26,381 31,182 30,399
6,624 4,246 4,372 4,585 5,205 5,261
4,860 5,226 5,444 5,705 6,005 6,355
5,381 5,701 6,002 6,085 6,535 6,919
1,328 1,475 1,573 1,292 1,397 962
2,087 2,193 2,324 2,247 2,309 2,545
3,253 2,591 3,450 4,747 7,458 7,270
- - -
495 500 475 485 500 525
395 385 373 362 341 321
24,423 22,317 24,013 25,508 29,750 30,158
(1,154) 1,845 896 873 1,432 241
785 1,768 3,580 3,397 3,397 4,817
(785) (1,768) (3,580) (3,397) (3,397) (4,817)
- - - - - -
(1,154)$ 1,845$ 896$ 873$ 1,432$ 241$
4.35%4.41%4.33%4.08%3.77%3.70%
CITY OF SARATOGA
PROPERTY TAX RATES – DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN YEARS
124
(Property Tax Rates per $100 of Assessed Value)
2011 2012 2013 2014
General 1.0000 1.0000 1.0000 1.0000
County Retirement Levy 0.0388 0.0388 0.0388 0.0388
County Library 0.0024 0.0024 0.0024 0.0024
City of Saratoga 0.0094 0.0088 0.0080 0.0074
1.0506 1.0500 1.0492 1.0486
Campbell School District 0.0249 0.0283 0.0246 0.0264
County Bond 2008 Hospital 0.0095 0.0047 0.0051 0.0035
Co. Housing Bond 2016 - - - -
Campbell Elementary 2002 0.0298 0.0266 0.0220 0.0288
Campbell Elementary 2010 0.0005 0.0003 0.0086 -
Campbell Elementary 2016 - - - -
Campbell Union High 1999 0.0196 0.0186 0.0165 0.0134
Campbell Union High 2006 0.0131 0.0156 0.0160 0.0156
Campbell Union High 2016 - - - -
West Valley Community College District 2004 0.0139 0.0137 0.0139 0.0125
West Valley Community College District 2012 - - 0.0150 0.0130
West Valley Mission Community College District 2018 - - - -
Santa Clara Valley Water District - State Water Project 0.0070 0.0063 0.0069 0.0070
Santa Clara Valley Water District - Zone W-1 0.0002 0.0001 - -
Mid Peninsula Open Space 2014 - - - -
0.1185 0.1142 0.1286 0.1202
Total Tax Rate 1.1691 1.1642 1.1778 1.1688
Source: Muniservices, LLC
Fiscal Year
125
2015 2016 2017 2018 2019 2020
1.0000 1.0000 1.0000 1.0000 1.0000 1.0000
0.0388 0.0388 0.0388 0.0388 0.0388 0.0388
0.0024 0.0024 0.0024 0.0024 0.0024 0.0024
0.0070 0.0065 0.0060 0.0056 0.0046 0.0040
1.0482 1.0477 1.0472 1.0468 1.0458 1.0452
0.0235 0.0220 0.0294 0.0244 0.0175 0.0235
0.0091 0.0088 0.0086 0.0082 0.0072 0.0069
- - - 0.0127 0.0105 0.0100
0.0172 0.0196 0.0258 0.0148 0.0085 0.0146
0.0145 0.0136 - 0.0158 0.0240 0.0131
- - - 0.0122 0.0172 0.0160
0.0130 0.0119 0.0126 0.0120 0.0111 0.0098
0.0154 0.0138 0.0126 0.0119 0.0108 0.0100
- - - 0.0280 0.0268 0.0238
0.0101 0.0118 0.0096 0.0096 0.0089 0.0081
0.0019 0.0114 0.0100 0.0104 0.0190 0.0105
- - - - - 0.0110
0.0065 0.0057 0.0086 0.0062 0.0042 0.0041
- - - - - -
- 0.0008 0.0006 0.0009 0.0018 0.0016
0.1112 0.1194 0.1178 0.1671 0.1675 0.1630
1.1594 1.1671 1.1650 1.2139 1.2133 1.2082
CITY OF SARATOGA
ASSESSED VALUE OF TAXABLE PROPERTY
LAST TEN YEARS
126
(amounts expressed in thousands)
Fiscal
Year Total
Ended Residential Commercial Industrial Other Unsecured Assessed
June 30 Property Property Property Property Property Property
2011 9,639,782 107,269 9,633 323,881 57,172 10,137,737
2012 9,834,082 111,232 9,706 323,563 55,535 10,334,118
2013 10,312,597 112,875 11,455 335,765 62,378 10,835,070
2014 11,158,775 113,915 11,684 352,830 59,684 11,696,888
2015 11,775,973 117,466 11,737 361,202 56,354 12,322,732
2016 12,581,463 134,321 11,143 397,318 50,193 13,174,438
2017 13,227,811 141,391 10,245 426,257 45,838 13,851,542
2018 14,000,116 154,592 10,449 440,188 39,751 14,645,096
2019 14,899,703 160,219 10,658 460,375 45,669 15,576,624
2020 15,671,996 164,159 10,872 458,536 48,661 16,354,224
Source:Santa Clara County Assessor data, MuniServices, LLC
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Total Assessed Property
Unsecured
Other
Industrial
Commercial
Residential
127
Total
Less:Total Taxable Direct
Tax Exempt Assessed Tax
Real Property Value Rate
(230,477) 9,907,260 1.0506
(230,868) 10,103,250 1.0476
(233,895) 10,601,175 1.0492
(238,683) 11,458,205 1.0486
(242,724) 12,080,008 1.0482
(232,693) 12,941,745 1.0477
(232,279) 13,619,263 1.1650
(244,172) 14,400,924 1.2139
(233,581) 15,343,043 1.2082
(236,668) 16,117,556 1.2082
CITY OF SARATOGA
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO
JUNE 30, 2020
128
(amounts expressed in thousands)
% of Total % of Total
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Rank Value Value Rank Value
Fellowship Plaza LP 49,115$ 1 0.30%
Humboldt Fields LLC 46,818 2 0.29%
SHP Quito Village LLC 35,913 3 0.22%
San Jose Water Works 29,025 4 0.18%14,676 4 0.15%
Keller Trustee 17,694 5 0.11%
House Trustee 17,226 6 0.11%
Ctr Partnership LP 15,160 7 0.09%
Osheanic Capital LLC 14,929 8 0.09%
Argonaut Assoc LLC 14,581 9 0.09%10,485 8 0.11%
Stormin Norman, LLC 13,909 10 0.09%
Cupertino Village Ass LLC 34,807 1 0.35%
Quito Village Associates LLC 19,000 2 0.19%
John Keller 18,456 3 0.19%
Gregpenn Properties, LLC 14,390 5 0.15%
Morrison, David J & Terri E 12,939 6 0.13%
Sobrato Trustee 10,993 7 0.11%
Krishnamurthi Ashok 10,414 9 0.11%
Comcast of California 9,428 10 0.10%
Top Ten Total Assessed Value 254,370$ 1.6%155,588$ 1.6%
City Total Assessed Value 16,117,556$ 9,907,259$
Source: Santa Clara County Assessor data, MuniServices, LLC
2020 2011
CITY OF SARATOGA
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN YEARS
129
Fiscal Year Total Tax Collections in
Ended Levy for Subsequent
June 30 Fiscal Year Amount Percentage Years Amount Percentage
2011 8,199,341 8,199,341 100.0%- 8,199,341 100.0%
2012 8,456,687 8,456,687 100.0%- 8,456,687 100.0%
2013 9,152,865 9,152,865 100.0%- 9,152,865 100.0%
2014 9,737,144 9,737,144 100.0%- 9,737,144 100.0%
2015 10,669,281 10,669,281 100.0%- 10,669,281 100.0%
2016 11,549,213 11,549,213 100.0%- 11,549,213 100.0%
2017 12,263,575 12,263,575 100.0%- 12,263,575 100.0%
2018 13,247,030 13,247,030 100.0%- 13,247,030 100.0%
2019 14,475,102 14,475,102 100.0%- 14,475,102 100.0%
2020 15,356,471 15,356,471 100.0%- 15,356,471 100.0%
Source: City of Saratoga
Collected within the
Fiscal Year of the Levy Total Collections to Date
CITY OF SARATOGA
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN YEARS
130
(amounts expressed in thousands, except per capita amounts)
2011 2012 2013 2014
Governmental activities
General obligation bonds 12,605$ 11,995$ 11,540$ 11,055$
Net original issue premium - 438 416 394
Total primary government 12,605$ 12,433$ 11,956$ 11,449$
Percentage of Personal Income 1 0.57%0.57%0.53%0.49%
Per capita 2 417 409 389 371
Source: CAFR
1 US Census Bureau, adjusted for inflation, MuniServices LLC
2 Population information from California State Controller's Office
Fiscal Year
131
2015 2016 2017 2018 2019 2020
10,560$ 10,060$ 9,585$ 9,100$ 8,600$ 8,075$
372 350 328 306 285 263
10,932$ 10,410$ 9,913$ 9,406$ 8,885$ 8,338$
0.47%0.45%0.40%0.35%0.32%0.29%
355 344 324 299 283 269
CITY OF SARATOGA
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN YEARS
132
(amounts expressed in thousands, except per capita amounts)
2011 2012 2013 2014
General obligation bonds 12,605$ 11,995$ 11,540$ 11,055$
Net original issue premium - 438 416 394
Less: Amount available in debt service fund (848) (860) (885) (898)
Total primary government 11,757$ 11,135$ 10,655$ 10,551$
Percentage of actual taxable
value of property 0.12%0.11%0.10%0.09%
Per capita1 389 367 347 342
Source: CAFR
1Population information from California State Controller's Office
Fiscal Year
133
2015 2016 2017 2018 2019 2020
10,560$ 10,060$ 9,585$ 9,100$ 8,600$ 8,075$
372 350 328 306 285 263$
(906) (923) (959) (998) (933) (788)
10,026$ 9,487$ 8,954$ 8,408$ 7,405$ 7,550$
0.08%0.07%0.07%0.06%0.05%0.05%
326 314 293 267 236 243
CITY OF SARATOGA
LEGAL DEBT MARGIN INFORMATION
LAST TEN YEARS
134
(amounts expressed in thousands)
2011 2012 2013 2014
Debt Limit 1,520,660$ 1,550,118$ 1,625,261$ 1,754,233$
Total net debt applicable to limit 11,757 11,135 10,655 10,157
Legal debt margin 1,508,903$ 1,538,983$ 1,614,606$ 1,744,076$
Total net debt applicable to the limit
as a percentage of debt limit 0.77%0.72%0.66%0.58%
Legal debt margin calculation
Assessed value 9,907,259$ 10,103,250$ 10,601,175$ 11,458,205$
Add back: exempt real property 230,477 230,868 233,895 236,683
Total assessed value 10,137,736$ 10,334,118$ 10,835,070$ 11,694,888$
Debt limit (15% of total assessed value)1,520,660$ 1,550,118$ 1,625,261$ 1,754,233$
Debt applicable to limit:
General obligation bonds 12,605$ 11,995$ 11,540$ 11,055$
Net original issue premium - 438 416 394
Less: Amount available in debt service fund (848) (860) (885) (898)
Total net debt applicable to limit 11,757$ 11,135$ 10,655$ 10,157$
Legal debt margin 1,508,903$ 1,538,983$ 1,614,606$ 1,744,076$
Source: CAFR
Fiscal Year
135
2015 2016 2017 2018 2019 2020
1,848,410$ 1,976,166$ 2,077,731$ 2,196,764$ 2,453,134$ 2,453,134$
9,654 9,137 8,626 8,102 7,287 7,287
1,838,756$ 1,967,029$ 2,069,105$ 2,328,827$ 2,445,847$ 2,445,847$
0.52%0.46%0.42%0.33%0.30%0.30%
12,080,008$ 12,941,745$ 13,619,263$ 14,400,924$ 15,343,044$ 16,117,556$
242,724 232,693 232,279 244,172 233,581 236,668
12,322,732$ 13,174,438$ 13,851,542$ 15,576,624$ 16,354,224$ 16,354,224$
1,848,410$ 1,976,166$ 2,077,731$ 2,196,764$ 2,453,134$ 2,453,134$
10,560$ 10,060$ 9,585$ 9,100$ 8,600$ 8,075$
372 350 328 306 285 263$
(906) (923) (959) (998) (933) (788)$
9,654$ 9,137$ 8,626$ 8,102$ 7,287$ 7,287$
1,838,756$ 1,967,029$ 2,069,105$ 2,188,662$ 2,445,847$ 2,445,847$
CITY OF SARATOGA
DIRECT AND OVERLAPPING
GOVERNMENTAL ACTIVITIES DEBT
136
(amount expressed in thousands)
Estimated
Estimated Share of
Debt Percentage Overlapping
Outstanding Applicable1 Debt
Direct Debt:
City of Saratoga 8,338$ 100.000%8,338$
City of Saratoga Community Facilities District No. 2016-1 2,309 100.000%2,309
Total Direct Debt 10,647
Overlapping Tax and Assessment Debt:
Santa Clara County 881,455 3.136%27,642
Foothill-De Anza Community College District 607,961 1.429%8,688
West Valley Community College District 617,330 9.131%56,368
Campbell Union High School District 369,655 5.506%20,353
Fremont Union High School District 520,515 3.175%16,526
Los Gatos-Saratoga Joint Union High School District 88,930 38.332%34,089
Campbell Union School District 218,860 6.615%14,478
Cupertino Union School District 281,813 5.706%16,080
Moreland School District 98,962 12.862%12,728
Saratoga Union School District 21,227 86.448%18,351
Saratoga Fire Protection District 2,534 97.588%2,473
Midpeninsula Regional Open Space District 88,810 5.166%4,588
Santa Clara Valley Water District Benefit Assessment 65,495 3.136%2,054
Total Overlapping Tax and Assessment Debt 234,418
Overlapping General Fund Debt:
Santa Clara County General Fund Obligations 966,725$ 3.136%30,316$
Santa Clara County Pension Obligations 346,997 3.136%10,882
Santa Clara County Board of Education
Certificates of Participation 3,480 3.136%109
Santa Clara County Vector Control District
Certificates of Participation 2,010 3.136%63
Foothill-De Anza Community College District
Certificates of Participation 24,093 1.429%344
West Valley-Mission College District
General Fund Obligations 50,780 9.131%4,637
Campbell Union High School District
Certificates of Participation 20,000 5.506%1,101
Los Gatos-Saratoga Joint Union High School District
Certificates of Participation 2,634 38.332%1,010
Campbell Union High School District
Certificates of Participation 2,440 6.615%161
Saratoga Union School District
Certificates of Participation 3,150 86.448%2,723
Midpeninsula Open Space Park District
General Fund Obligations 111,986 5.166%5,785
Total Overlapping General Fund Debt 57,131
Less: Santa Clara County Supported Obligations (1,008)
Total Overlapping Tax & Assessment and General Fund Debt 290,541
Combined Total Debt2 302,196$
1Percentage of overlapping agency's assessed valuation located within boundaries of the city.
2Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation
bonds and non-bonded capital lease obligations.
Source: Muniservices, LLC
CITY OF SARATOGA
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN YEARS
137
Personal Per Capita
Fiscal City Income Personal Labor Unemployment
Year Population 1 (in thousands)2 Income2 Force3 Rate3
2011 30,195 2,211,963 73,256 13,400 5.0%
2012 30,363 2,119,463 69,804 14,000 4.4%
2013 30,706 2,179,904 70,993 13,900 4.2%
2014 30,887 2,243,458 72,634 14,200 3.4%
2015 30,799 2,248,481 73,005 15,100 2.7%
2016 30,219 2,239,926 74,123 14,700 2.9%
2017 30,569 2,374,919 77,690 14,600 2.7%
2018 31,435 2,597,561 82,633 15,000 2.8%
2019 31,407 2,681,900 85,392 15,000 2.0%
2020 31,030 2,755,859 88,813 13,600 6.5%
Source:1 Popluaton information from California State Controller's Office
2 US Census Data, adjusted for inflation, MuniServices LLC
3 EDD Labor Market Information Division, MuniServices LLC
10,000
15,000
20,000
25,000
30,000
35,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Labor Force vs. Population
Population Labor Force
CITY OF SARATOGA
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO AT JUNE 30, 2020
138
Percentage Percentage
of Total City of Total City
Employer Employees Rank Employment Employees Rank Employment
West Valley Community College 602 1 4.43%-
Saratoga Retirement Community 296 2 2.18%-
Saratoga Union School District 193 3 1.42%-
Sub-Acute Saratoga Hospital 147 4 1.08%-
Saratoga High School 133 5 0.98%-
Prospect High School 123 6 0.90%-
Our Lady Fatima Villa 135 7 0.99%-
Safeway 93 8 0.68%65 2 0.52%
City of Saratoga 57 9 0.42%-
Saint Andrew's Episcopal School 56 10 0.41%-
Gene's Fine Foods 85 1 0.68%
Saratoga Country Club 65 3 0.52%
McDonald's 45 4 0.36%
Roku Inc.33 5 0.26%
La Fondue 22 6 0.18%
CVS 20 7 0.16%
Classic Car Wash 20 8 0.16%
Hinshaw, Draa & Marsch 20 9 0.16%
Jakes of Saratoga 20 10 0.16%
Total Top 10 Employers 1,835 13.5%395 3.2%
Total City Employment 1 13,600 12,500
1EDD Labor Market Information Division, MuniServices LLC
2019 2010
139
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CITY OF SARATOGA
FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS
140
2011 2012 2013 2014
Function
General government 11.45 10.80 10.90 13.65
Public works 21.65 21.55 20.65 20.75
Community development 12.00 12.00 11.00 12.00
Parks and recreation 9.50 9.50 9.60 9.60
Total 54.60 53.85 52.15 56.00
Source: City of Saratoga Budget Document
Fiscal Year
-
10
20
30
40
50
60
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Full-Time Equivalents
General gov't Public works Comm Development Parks & Rec
141
2015 2016 2017 2018 2019 2020
13.70 13.70 13.65 14.55 14.65 15.15
20.65 20.65 20.65 21.15 21.75 23.50
12.00 12.00 12.00 12.50 12.00 16.00
9.55 9.55 8.35 8.30 8.70 2.25
55.90 55.90 54.65 56.50 57.10 56.90
CITY OF SARATOGA
OPERATING INDICATORS BY FUNCTION
LAST TEN FISCAL YEARS
142
2011 2012 2013 2014
Function
Part 1 crimes 1 373 287 277 408
Total incidents 41,642 35,664 40,141 41,228
Police reports 1,549 1,329 1,106 978
Public Works
Street resurfacing (miles)- 6 6 4
Street lights repaired 25 41 29 34
Potholes filled (sq. ft.)11,000 10,000 12,060 11,000
Community Development
Total permit valuation ($000)50,936 59,675 79,896 79,702
Parks and Recreation 2
Youth Programs 1,465 919 793 947
Adult Programs 661 647 1,663 2,173
Staffed Day/summer camps (enrollment)326 - 45 160
1 Part 1 Crimes are the following as reported to DOJ: homicide, rape, robbery, burglary, assault, theft,
auto theft, and arson.
2 Beginning in FY 2019/20, the City outsourced Recreation Services to Los Gatos-Saratoga Community
Education and Recreation (LGS).
Source: City of Saratoga various records
Fiscal Year
143
2015 2016 2017 2018 2019 2020
315 463 301 190 289 241
40,695 39,213 38,893 32,222 31,955 37,652
917 1,334 1,295 927 885 837
2.5 15.2 0 0 8 5
39 33 37 15 12 10
10,500 21,010 13,000 9,000 11,000 8,000
89,929 75,599 106,631 128,062 82,722 80,513
933 1,028 1,270 1,151 713 655
1,650 2,099 2,824 2,082 731 679
90 172 71 129 - 146
CITY OF SARATOGA
CAPITAL ASSET STATISTICS BY FUNCTION
LAST TEN FISCAL YEARS
144
2011 2012 2013 2014
Function
Public safety
Police Station - - - -
Fire Station
Saratoga Fire District 1 1 1 1
Central Fire District 1 1 1 1
Public Works
Street Miles - Private 14 14 14 15
Street Miles - Public 140 140 141 142
West Valley Sanitation District
Number of Connections 8,664 8,679 8,821 8,919
Length of Sewer Lines 127 127 127 127
Cupertino Valley Sanitation District
Number of Connections 2,954 2,959 2,961 2,963
Length of Sewer Lines 37 37 37 37
Parks and Recreation
Parks Acreage 84 84 84 84
Parks 15 15 15 15
Source: City of Saratoga various records
Fiscal Year
145
2015 2016 2017 2018 2019 2020
- - - - - -
1 1 1 1 1 1
1 1 1 1 1 1
15 14.5 14.5 14.5 14.5 14.5
142 142 142 142 142 142
8,402 8,488 8,563 9,051 9,058 9,060
128 129 126 126 126
2,963 2,999 3,000 3,000 3,003 3,003
37 37 37 37 37 37
84 148 148 148 148 148
15 16 16 16 16 16