Attachment 1 - FY 2021 Draft ACFR 20211216C A L I F O R N I A
Town of Los Gatos
Annual Comprehensive Financial Report
Fiscal Year 2020/21 Draft 12/16/2021ATTACHMENT 1
Cover Photos: Constantino, Evie Julian Draft 12/16/2021
TOWN OF LOS GATOS
CALIFORNIA
ANNUAL COMPREHENSIVE
FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED
JUNE 30, 2021
PREPARED BY THE
OFFICE OF THE TOWN MANAGERDraft 12/16/2021
Draft 12/16/2021
TOWN HISTORY
The name Los Gatos comes from “El Rancho de Los Gatos.” A ranch established in 1839 by a
Mexican land grant and so named because of the large number of mountain lions in the area. In
1854, James Alexander Forbes purchased some of this land and built a flour mill. In 1860, the
first hotel was opened to provide a stage stop on the toll road which had been built between San
Jose and Santa Cruz.
Wheat production gave way to orchards, and rapid growth ensued when the railroad reached
Los Gatos in 1878. The residential subdivisions of Broadway, Bayview, Fairview, and Almond
Grove were built in the 1880’s. By 1887, the population had grown to 1,500 and Los Gatans voted
to incorporate.
Fruit industries faded slowly during the Depression and World War II, but the postwar period
brought an influx of people and associated residential and commercial development. Highway
17 was constructed through the center of Town. Growth levelled off in the early 1970’s, leaving
Los Gatos with its smalltown atmosphere and pedestrianoriented downtown.
Because of its distance from other centers of population, Los Gatos developed as a complete
community including residential, business and industrial elements. Preserving Los Gatos as a
complete and well balanced community has been and remains a prominent goal of the
community. From the first 100acre Town site in 1890 with a population of 1,652, Los Gatos grew
slowly so that by 1963 the area was 6.3 square miles, with a population of 11,750. Today Los
Gatos covers between 14 and 15 square miles and has a population of 30,836. This growth over
the last 80 years resulted in a community with vibrant business districts, well maintained
neighborhoods, and lovely parks and open spaces.
As it exists now, the Town’s boundaries encompass a wide variety of terrain, ranging from level
land to steep and densely wooded hillsides. The sharp visual contrasts among these features and
charming architecture create a picturesque setting of the Town. In the midst of the growth of
Silicon Valley, Los Gatos attracts people with a preference for the Town’s distinctive, high quality
natural and urban environment. Draft 12/16/2021
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TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
TABLE OF CONTENTS
INTRODUCTORY SECTION:
Letter of Transmittal ........................................................................................................................... 1
Organizational Chart ........................................................................................................................... 7
Principal Officers ................................................................................................................................. 8
GFOA Award ....................................................................................................................................... 9
FINANCIAL SECTION:
Independent Auditor’s Report .......................................................................................................... 13
Management’s Discussion and Analysis ............................................................................................ 18
Basic Financial Statements:
GovernmentWide Financial Statements:
Statement of Net Position ....................................................................................................... 40
Statement of Activities ............................................................................................................. 41
Fund Financial Statements:
Governmental Funds:
Balance Sheet ....................................................................................................................... 46
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Position ................................................................................................ 45
Statement of Revenues, Expenditures and Changes in Fund Balances ................................ 46
Reconciliation of Governmental Funds Statement of Revenues, Expenditures,
and Changes in Fund Balances to the Statement of Activities ......................................... 47
Statement of Revenue, Expenditures and Changes in Fund Balances –
Budget and Actual (GAAP) General Fund ......................................................................... 48
Proprietary Funds – Internal Service Funds:
Statement of Net Position .................................................................................................... 50
Statement of Revenue, Expenses and Changes in Net Position ........................................... 51
Statement of Cash Flows ...................................................................................................... 52
Fiduciary Funds:
Statement of Fiduciary Net Position .................................................................................... 54
Statement of Changes in Fiduciary Net Position .................................................................. 55
Notes to the Basic Financial Statements ......................................................................................... 58
Required Supplementary Information:
Schedule of Proportionate Share of Net Pension Liability:
CalPERS Misc. AgentMultiple Employer Plan ............................................................................. 98
CalPERS Safety CostSharing Plan ................................................................................................ 100
Schedule of Pension Plans Contributions
Miscellaneous Agent MultipleEmployer Plan ............................................................................ 101
Safety CostSharing Plan .............................................................................................................. 102
Actuarial Methods and Assumptions used for Pension Actuarially
Determined Contributions ........................................................................................................... 103
Schedule of Changes in Net OPEB Liability and Related Ratios ...................................................... 104
Schedule of Employer Contributions .............................................................................................. 104
Actuarial Methods and Assumptions used for 2019/20 OPEB Actuarially
Determined Contribution ............................................................................................................ 105 Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
TABLE OF CONTENTS
SUPPLEMENTARY INFORMATION:
Major Governmental Fund Schedules (other than the General Fund):
Schedule of Revenue, Expenditures and Changes in Fund Balance –
Budget and Actual (GAAP) Appropriated Reserves Fund ............................................................ 109
Nonmajor Governmental Funds:
Combining Balance Sheets .............................................................................................................. 110
Combining Schedule of Revenues, Expenditures and Changes in
Fund Balances .............................................................................................................................. 112
Budgeted Nonmajor Funds Combining Schedule of Revenues, Expenditures and
Changes in Fund Balances – Budget and Actual (GAAP) .............................................................. 114
Internal Service Funds:
Combining Statement of Net Position ............................................................................................ 119
Combining Statement of Revenue, Expenses and Changes in Net Position ................................... 120
Combining Statement of Cash Flows .............................................................................................. 121
STATISTICAL SECTION:
Net Position by Component ............................................................................................................ 127
Changes in Net Position .................................................................................................................. 128
Fund Balances, Governmental Funds .............................................................................................. 130
Changes in Fund Balances, Governmental Funds ........................................................................... 132
Assessed Value and Estimated Actual Value of Taxable Property .................................................. 134
Direct and Overlapping Property Tax Rates .................................................................................... 135
Principal Property Tax Payers ......................................................................................................... 136
Property Tax Levies and Collections ................................................................................................ 138
Ratios of Outstanding Debt by Type ............................................................................................... 139
Direct and Overlapping Governmental Activities Debt ................................................................... 140
Legal Debt Margin ........................................................................................................................... 142
Demographic and Economic Statistics ............................................................................................ 144
Principal Employers ......................................................................................................................... 145
Fulltime Equivalent Town Government Employees by Function/Program ................................... 147
Operating Indicators by Function/Program .................................................................................... 148
Capital Assets Statistics by Function/Program ................................................................................ 150 Draft 12/16/2021
INTRODUCTORY SECTION Draft 12/16/2021
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TOWN OF LOS GATOS
OFFICE OF THE TOWN MANAGER
(408) 354-6832
FAX: (408) 399-5786
December xx, 2021
Honorable Mayor and Town Council,
I am pleased to submit the Town’s Annual Comprehensive Financial Report (ACFR) for the
fiscal year ending June 30, 2021. In coordination with the Town Manager’s Office, this
report was prepared by the Finance Department , which assumes responsibility for the
accuracy of the data, the completeness and fairness of the presentation, and all
disclosures. The information in this report presents the reader with a comprehensive
view of the Town’s financial position and the results of its operations for the fiscal year
ending June 30, 2021, along with additional disclosures and financial information
designed to enable the reader to gain an understanding of the Town’s financial activities.
This report was prepared as prescribed in Governmental Accounting Standards Board
(GASB) Statement No. 34, Basic Financial Statements and Management’s Discussion and
Analysis for State and Local Governments (GASB 34). This GASB Statement requires
management to provide a narrative introduction, overview and analysis to accompany
the basic financial statements in the form of a Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement the MD&A and should be
read in conjunction with it. The MD&A can be found immediately following the
Independent Auditor’s Report.
This Annual Comprehensive Financial Report is organized into three sections:
I. The Introductory Section includes the table of contents, letter of transmittal,
listing of elected officials, Town administrative personnel, and an organization
chart delineating organizational structure.
II. The Financial Section includes the Independent Auditor’s opinion, the MD&A, the
basic financial statements, notes to the financial statements, combining
statements of non‐major funds, and required supplemental information.
III. The Statistical Section includes both financial and non‐financial data about the
Town.
The Annual Comprehensive Financial Report is prepared in accordance with Generally
Accepted Accounting Principles (GAAP) promulgated by the Governmental Accounting
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Mayor and Town Council
December xx, 2021
Standards Board (GASB) and includes the audit report of Badawi & Associates, the Town’s
independent certified public accountants.
This Annual Comprehensive Financial Report will be submitted to the Government
Finance Officers Association for consideration of its Achievement of Excellence Award in
financial reporting certification. This award is granted only to entities whose reports meet
the highest standards of municipal financial reporting.
THE REPORTING ENTITY AND ITS SERVICES
Los Gatos is a general law Town, incorporated under the legal framework of California in
1887. The Town is located in the foothills and level terrain of southwestern Santa Clara
Valley, referred to internationally as “Silicon Valley.” From the first 100‐acre Town site
and an 1890 population of 1,652, Los Gatos grew slowly so that by 1963 the area was 6.3
square miles with a population of 11,750. Today Los Gatos covers approximately 15
square miles with a population of 30,863. The growth over the last 80 years resulted in a
community with vibrant business districts, well maintained neighborhoods, and lovely
parks and open spaces. Preserving the unique charm of Los Gatos as a complete and well‐
balanced community while meeting its economic and housing needs, has been, and
remains a key goal for the Town.
The Town maintains a Council‐Manager form of government which combines the strong
political leadership of elected officials with the strong managerial experience of an
appointed Town Manager. Five Council members are elected at large for staggered four‐
year terms to govern the Town. The Mayor and Vice‐Mayor are appointed by the Council
from its own ranks and serve for one‐year terms. The Town Manager and Town Attorney
are appointed and supervised directly by the Council. The Town Manager oversees all
municipal services such as Public Safety, Parks and Public Works, Community
Development, Library, and Town Administration including Human Resources, Information
Technology, and Finance.
ECONOMIC CONDITIONS AND OUTLOOK
While the National Bureau of Economic Research (NBER) declared April 2020 as the
official end of the nation’s recession, the Town and communities across America continue
to grapple with the fiscal disruptions caused by the COVID‐19 pandemic. Even with the
recession officially being the shortest on record, the Town’s economically sensitive
Transient Occupancy Tax (TOT) revenue remains near historic lows while Sales Tax
receipts indicate modest improvement from the depths of the pandemic. Conversely, the
Town’s Property Tax revenues remained relatively strong as inventories of available
homes remained low and demand was high with millennials transitioning from renting to
homeownership, and remote work became more of a permanent fixture.
General Fund revenues (not including transfer‐ins) increased 0.1% from the prior year.
Property tax revenues remain the largest and most consistent source of support for
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Mayor and Town Council
December xx, 2021
General Fund operations, comprising approximately 47% of General Fund revenues in FY
2020/21. For FY 2020/21 property tax receipts of $19.9 million were $1.5 million higher
than the prior year’s collection, reflecting the continued desirability of the Town, its
environment, culture, and educational opportunities.
The Town also relies heavily on sales tax revenues to support General Fund operations,
comprising approximately 18.6% of General Fund revenues in FY 2020/21. For FY 2020/21
sales tax receipts of $7.5 million were $0.4 million higher than the prior year’s collection.
Sales tax revenues increased as the worst of the unprecedented disruption to business
activity and public health restrictions waned. The Town’s 1/8 cent District Sales Tax
continued to perform well as the District Tax captured a larger share of the increase in
online sales.
Due to the unprecedented economic dislocations associated with the pandemic the
Federal government initiated two federal relief programs designed to provide direct
funding to states and cities. The first program, the Coronavirus Aid, Relief, and Economic
Security (CARES) Act established a $150 billion Coronavirus Relief Fund. Federal law
specifies that these funds may only be used for unbudgeted costs incurred between
March 1, 2020 and December 31, 20201. Control Section 11.90 of the 2021 Budget Act
extended the expenditures deadline for cities, counties and community colleges to
September 1, 2021. The Budget Act authorized the California Department of Finance to
allocate $1,289,065,000 to address the public health and public safety impacts of COVID‐
19, including homelessness. Cities will receive $500,000,000 for similar purposes.
Pursuant to the provisions of Control Section 11.90, cities with populations between
300,000 and 500,000 were allocated $225 million and cities with populations less than
300,000 were allocated $275 million. Allocations Generally for cities were derived using
the proportional share of the State population. of the city was used to determine their
share of the allocation. The Town of Los Gatos nonrecurring allocation of $388,181 was
received in July 2020. On March 11, 2021, the second program, the American Rescue Plan
Act (ARPA) was signed into law by President Biden. The $1.9 trillion package (the Act)
provides financial aid to families, governments, businesses, schools, non‐profits and
others impacted by the COVID‐19 public health crisis. The Act will allocate $7,229,744 to
the Town over a two year period. The first tranche nonrecurring payment of $3,614,872
was received on July 13, 2021. The replacement of lost revenue is an eligible ARPA use,
and initial budgetary estimates required approximately $1.4 million in ARPA funding to
close anticipated revenue shortfalls. With actual revenues performing better in several
areas and expenditure savings being better than projected, ARPA funding was not
required under the revenue loss eligible use. For more information regarding the two
federal programs please refer to Note 15.
The Town continues to adjust and prepare for pension employer costs to continue to be
a primary expense in conjunction with salaries. The Town’s pension plans over the past
several decades, like all other CalPERS participants, have experienced unfavorable
investment returns, changes in actuarial assumptions, and demographic changes which
have outweighed any positive plan experiences. The outcome of these unfavorable
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Mayor and Town Council
December xx, 2021
economic and demographic results is unfunded pension and Other Post‐Employment
Benefits (OPEB) obligations for the Town. According to the 2020 actuarial valuations, the
unfunded actuarial liability for pensions was $61.8 million and $8.7 million for OPEB as of
June 30, 2019.
To address the escalation in pension costs, current and previous Councils have allocated
additional discretionary pension funding totaling $10.4 million. These additional
discretionary payments will ultimately yield an approximate $12.7 million in pension
contribution savings. In addition to the management of the Town’s pension obligations,
prior Councils have worked to curb cost escalation in Other Post‐Employment Benefits
(OPEB). In 2009, the Town initiated prefunding of the retiree healthcare benefit and has
since established approximately $26.2 million in OPEB assets from zero in 2009.
Despite these efforts, in the past five years the Net Pension Obligation reported in the
Town’s ACFR’s has increased 73.8% from $33.4 million as of the June 30, 2016 ACFR to
the current Net Pension Obligation of $58.02 million as of June 30, 2021.
Readers are cautioned that in considering the amount of the pension and OPEB liabilities,
and other actuarial data as reported by CalPERS and the Town’s actuary, this is “forward
looking” information. Such “forward looking” information reflects the judgment of the
Board of Administration of CalPERS, its actuaries, and the Town’s actuary as to the
amount of assets which the pension and OPEB plans will be required to accumulate to
fund future benefits. These judgments are based upon a variety of assumptions, one or
more of which may prove to be inaccurate or that may change with the future experience
of the pension and OPEB plans. The actuarial methods and assumptions could be changed
by CalPERS and the Town’s actuary at any time based on their professional judgement.
Such changes could cause the Town’s obligations to the pension and OPEB plans to be
higher or lower in any particular year. This sensitivity to changes in actuarial assumptions
is especially evident in changes to the Discount Rate as illustrated in Note 9 and changes
to Healthcare Trend and Discount rates as illustrated in Note 10.
For detailed information about the Town employees’ retirement plan please refer to Note
9 of the Notes to Basic Financial Statements Section. For detailed information about the
Town OPEB obligations please refer to Note 10 of the Notes to Basic Financial Statements
Section. In addition, the Town provides extensive information on pension and OPEB
information on the Town’s website.
Despite revenue constraints and increasing costs associated with unfunded federal and
state mandates, the Town has managed to maintain high service levels through increased
efficiency and prudent fiscal management as evidenced by General Fund’s resilience
through the unprecedented events of FY 2020/21. The Town continues its outreach to
the community, the League of California Cities, and local legislators to prevent and limit
any future revenue losses and mandated cost increases.
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Mayor and Town Council
December xx, 2021
MAJOR CAPITAL PROJECT INITIATIVES
Major capital asset and infrastructure initiatives were once again a priority for the fiscal
year. Approximately $4.3 million in Town infrastructure and other capital asset
improvements were invested in FY 2020/21, including $0.5 million in street projects
Town‐wide to improve the pavement condition. Other investments included $0.8 million
in equipment purchases, $0.9 million in traffic signal improvements, $0.9 million in
building improvements, and $0.2 million in pathways and trails and $0.2 million in
guardrail replacement.
Additional infrastructure improvements are scheduled in accordance with the Town’s
approved Capital Improvement Plan, and will continue into future years. All of these
improvements are funded either through grants, or via revenues accumulated from prior
year budget savings and/or excess revenues per Town Council Policy.
ACCOUNTING SYSTEM AND BUDGETARY CONTROL
The effectiveness of internal controls is a primary consideration in the development and
evaluation of the Town’s accounting system. Internal accounting controls are designed
to provide reasonable but not absolute assurance regarding:
1) safeguarding of assets against loss from unauthorized loss or disposition,
2) accuracy and reliability of accounting data, and
3) adherence to managerial policy.
The concept of reasonable assurance recognizes that the cost of internal controls should
not outweigh the benefits, and that management must make estimates and judgments in
evaluating these costs and benefits.
All governmental fund types use the modified accrual basis of accounting. This means
that revenues are recorded when measurable and available rather than when received.
Measurable means the amount can be determined and available means the cash is
received within sixty days after the end of the fiscal year. Expenditures are recorded
when the liability is incurred, rather than when paid. An exception to this rule is principal
and interest on general long‐term debt, which is not recognized by debt service funds
until it is due.
Proprietary (internal service) funds are accounted for using the accrual basis of
accounting, similar to that used by corporations. Proprietary fund revenues are
recognized when they are earned rather than when the cash is received, even if the cash
is not available and proprietary fund expenses are recognized when they are incurred.
With the implementation of GASB 34, the Town prepares its Basic Financial Statements
on the accrual basis.
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Mayor and Town Council
December xx, 2021
Internal accounting procedures have been developed to provide reasonable assurance
regarding the safeguarding of assets and the reliability of financial records for preparing
financial statements and maintaining asset accountability.
An annual operating budget, five‐year budget forecast, and five‐year capital improvement
plan is adopted by the Town Council consistent with generally accepted accounting
principles. All budget adjustments and transfers between funds must be approved by the
Town Council during the fiscal year. The Town Manager is authorized to transfer
unencumbered appropriations within a budget category, within a fund. Appropriations
are valid for each fiscal year and lapse at year‐end.
AWARDS
The Town’s Comprehensive Annual Financial Report for the fiscal year ended June 30,
2020 was awarded a Certificate of Achievement for Excellence in Financial Reporting by
the national Government Finance Officers Association. This is the 26th consecutive year
that the Town has received the award. This prestigious award recognizes the report’s
conformance with strict accounting and reporting standards established by the
Government Accounting Standards Board and government finance organizations. This
award is annual in nature and valid for one year only. This year’s report will be submitted
for award consideration by this organization, as we believe it continues to meet these
standards.
INDEPENDENT AUDIT
State law requires an annual audit of the Town’s accounts by independent certified public
accountants. The accounting firm of Badawi & Associates performs this function for the
Town of Los Gatos, and their report is included in the financial section of the ACFR.
ACKNOWLEDGEMENTS
The preparation of this Annual Comprehensive Financial Report, as presented herein, is
the result of the combined efforts and dedicated services of the excellent staff of the
Department of Finance. Special thanks to Gitta Ungvari, Finance and Budget Manager;
Mark Gaeta, Accountant; Melissa Ynegas, Finance Analyst; Diane Howard, Finance
Analyst; and Maurice De Castro, Accountant and Finance Analyst; and Arn Andrews
Assistant Town Manager for their efforts in preparing this report. The Town’s Finance
Commission is also recognized for its contributions to strengthening the ACFR through its
review, discussion, and comments.
Respectfully submitted,
____________________________ ___________________________________
Laurel Prevetti Stephen D. Conway
Town Manager Director of Finance
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TOWN OF LOS GATOS ORGANIZATIONAL CHART FY 2020/21
COMMUNITY DEVELOPMENT
CDD Administration
Development ReviewCode Compliance
Inspection ServicesAdvanced PlanningBMP Housing Program
POLICE
Police AdministrationRecords/CommunicationsPatrol
InvestigationsTraffic
Support ServicesParking Management
PARKS &PUBLIC WORKS
PPW Administration
Park ServicesEngineering Development
Engineering ProgramStreets & SignalsBuilding Maintenance
Landscape & LightingEnvironmental Services
LIBRARY
Library AdministrationReference ServicesChildren's Program
Reading/Literacy ProgramCollection Maintenance
Circulation & System AdministrationLos Gatos History Program
HUMAN
RESOURCES
Recruitment
Benefits ManagementTrainingEmployee Relations
Organizational Development
FINANCE
General Ledger
Accounts PayableAccounts Receivable
PayrollBusiness License TaxPurchasing
Budget AdministrationFinancial ReportingTreasury & Investments
CLERK &
ADMINISTRATIVE
PROGRAMS
Records ManagementBoards & CommissionsElection CoordinationClaims & InsuranceCustomer Service CenterLegislative CoordinationPublic InformationCable/Broadcasting ManagementArts & CultureCommunity Grants
INFORMATION
TECHNOLOGY
Technology Support
IT Systems ManagementTechnology Planning & Implementation
Website Management
TOWN MANAGER
ASSISTANT TOWN MANAGER
ELECTED
TOWN COUNCIL
BOARDS &COMMISSIONSTOWN ATTORNEY
RESIDENTS of LOS GATOS
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TOWN OF LOS GATOS
PRINCIPAL OFFICERS
AS OF JUNE 30, 2021
TOWN COUNCIL
Mayor Marico Sayoc
Vice Mayor Rob Rennie
Council Member Mary Badame
Council Member Matthew Hudes
Council Member Maria Ristow
COUNCIL APPOINTEES
Town Manager Laurel Prevetti
Town Attorney Robert Schultz
APPOINTED OFFICIALS
Assistant Town Manager Arn Andrews
Chief of Police Peter Decena
Community Development Director Joel Paulson
Parks and Public Works Director Matt Morley
Library Director Ryan Baker
Finance Director Stephen Conway
Human Resources Director Lisa Velasco
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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Town of Los Gatos
California
For its Comprehensive Annual
Financial Report
For the Fiscal Year Ended
June 30, 2020
Executive Director/CEO
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FINANCIAL SECTION
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INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of the Town Council of the
Town of Los Gatos
Los Gatos, California
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, the
aggregate remaining fund information and the budgetary comparison for the General Fund of the Town of Los
Gatos, California, as of and for the year ended June 30, 2021, and the related notes to the financial statements,
which collectively comprise the Town’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair 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 and 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 entity’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 entity’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.
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To the Honorable Mayor and Members of the Town Council
of the Town of Los Gatos
Los Gatos, California
Page 2
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 Town as of June 30, 2021, and the respective changes in financial position and, where applicable, cash flows
thereof, and the respective budgetary comparison for the General Fund for the year then ended in accordance with
accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis, pensionrelated schedules and OPEBrelated schedules on pages 1836, 48, and 98105 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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the Town of Los Gatos, California’s basic financial statements. The introductory section, major funds (other than
General fund and Special revenue funds) budgetary schedules, combining and individual nonmajor fund financial
statements, nonmajor fund budgetary schedules, and statistical section are presented for purposes of additional
analysis and are not a required part of the basic financial statements.
The major funds (other than General fund and Special revenue funds) budgetary schedules, combining and
individual nonmajor fund financial statements, and nonmajor fund budgetary schedules, are the responsibility of
management and were derived from and relate directly to the underlying accounting and other records used to
prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in
the audit of the basic financial statements and certain additional procedures, including comparing and reconciling
such information directly to the underlying accounting and other records used to prepare the basic financial
statements or to the basic financial statements themselves, and other additional procedures in accordance with
auditing standards generally accepted in the United States of America. In our opinion, the combining and individual
nonmajor fund financial statements are fairly stated, in all material respects, in relation to the basic financial
statements 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.
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To the Honorable Mayor and Members of the Town Council
of the Town of Los Gatos
Los Gatos, California
Page 3
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December xx, 2021 on
our consideration of the Town’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 Town’s internal control over financial reporting and compliance.
Badawi & Associates, CPAs
Berkeley, California
December xx, 2021
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Management’s Discussion and Analysis
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MANAGEMENT’S DISCUSSION AND ANALYSIS
This section of the Town of Los Gatos’s Annual Comprehensive Financial Report (ACFR) presents
management’s discussion and analysis of the Town’s financial performance during the fiscal year
that ended on June 30, 2021. This analysis should be read in conjunction with the Transmittal
Letter at the front of this report and the accompanying Basic Financial Statements.
FINANCIAL HIGHLIGHTS
Town assets exceeded liabilities at the close of FY 2020/21 by $113,518,100 (total net
position).
The Town’s total net position decreased by $1,332,931 during the fiscal year largely as a result
of an approximate $1.2 million dollar increase in non‐capitalized capital outlay expenses from
the prior year. Non‐capitalized project expense reduces net position as they are not added
back to total assets as new infrastructure capital investments. Major non‐capitalized expense
projects included approximately $650K in direct economic assistance provided through the
Town’s Economic Recovery project. Other significant non‐capitalized projects included
approximately $500K in expenses for wildfire protection through the Roadside Fuel Reduction
project and approximately $200K for the Vegetation Management project. One other
significant expense was approximately $105K to prepare a Town Storm Water Master Plan.
Depreciation expense allocated to all Town Departments increased by approximately $700K
from the prior year reflecting the significant additional investments made in the Town’s
infrastructure through FY 2019/20.
Total pension expense calculated for the Town’s miscellaneous and safety plans decreased
approximately $1.0 million or 10.7% from the prior fiscal year primarily reflecting the impact
of the Town’s approximate $4.8 million nonrecurring additional discretionary payment (ADP)
made to pay down the Town’s unfunded liability in FY 2019/20. Fiscal year 2020/21 was the
first year to see the benefits of this ADP as the ADP did not appear as Town assets until they
were included as part of the June 30, 2020 “measurement date” pension expense calculation.
Pension expense growth related to the Town’s pension plans has averaged approximately
20.0% annually since FY 2014/15. More discussion on the Town’s unfunded pension liabilities
can be found in Note 9.
Reported unrestricted net position is negative ($4,735,103) compared to negative
($3,967,178) the prior year. The $767K additional decrease in unrestricted net position
resulted largely from the use of approximately $2.4 million in unrestricted cash balances for
non‐capitalized project costs offset by revenue gains from amounts received the prior fiscal
year in large revenue sources such as property tax and sales tax offset by declines in
investment earnings from amounts earned the prior year. Unrestricted net position
represents all resources not included as net investment in capital or restricted assets.
Despite the ongoing economic impacts resulting from the nationwide pandemic, the Town’s
economically sensitive major revenues of property tax and sales tax were able to record gains
from amounts reported the prior fiscal year. Property taxes collected increased $1.5 million
18Draft 12/16/2021
from the prior year while sales taxes increased a modest $0.4 million from amounts collected
the prior year.
The economic impacts related to pandemic travel restrictions began in March 2020 and
continued into FY 2020/21. These impacts are primarily evidenced by Transient Occupancy
Tax (TOT) revenue declines of approximately $820K relative to the amounts collected in prior
years.
Total expenses as reported in the Statement of Activities increased $2.6 million from the prior
year. The increase was driven by a combination of factors detailed under the Government
Activities Expenditures Discussion. Contributing factors to the total fiscal year increase
included the cost of the aforementioned non‐capitalized project expenses which exceeded
the prior year’s expenses by approximately $1.2 million, $700K increased depreciation
expense on the Town’s infrastructure investment and the FY 2020/21 approximate $602K
cost of a 1% negotiated cost of living adjustment (COLA) and 2% one‐time bonus and related
benefit increases offered to all Town employees during the fiscal year.
The cost of all governmental activities this year was $50.6 million. However, as shown in the
Statement of Activities, the amount of taxpayer supported governmental activities was $35.1
million. Taxpayers who directly benefited from the programs paid Charges for services were
$11.48 million, and other governments and organizations subsidized certain programs with
operating grants and contributions of $3.32.9 million and capital grants and contributions of
$0.8 million. Overall, the Town’s governmental program revenues were $15.5 million. The
Town paid for the remaining “public benefit” portion of governmental activities with $33.2
million in taxes and general revenues including interest and miscellaneous revenues. This
$35.1 million in net cost of governmental activities is an approximate 5.7% increase from the
prior fiscal year, resulting largely from one‐time “non‐capitalized” expense growth for
economic recovery efforts and wildfire protection and the cost of negotiated salary and
related benefit increases offered to all Town bargaining units during the fiscal year and lower
amounts of vacant positions primarily in the parks and public works function.
At the end of FY 2020/21, General Fund balance was $23,914,618 compared to $29,335,497
in the prior year. The ending fund balance of $23,914,618 represents approximately 51.3%
of General Fund expenditures for the current fiscal year excluding transfers‐out to the Town’s
capital projects funds and internal service funds. The $5.4 million reduction in General Fund
ending fund balances was primarily from:
o Non‐recurring payments of $5.6 million of General Fund restricted cash balances
for an $3.6 million additional discretionary payment (ADP) made to CalPERS in July
2020 and another $2.0 million ADP made in April 2021. The ADPs to CalPERS were
used to pay down a portion of the Town’s actuarially determined unfunded
pension liability beyond the mandated annual payments.
19Draft 12/16/2021
o Additionally, the General Fund transferred approximately $3.4 million to the
Town’s capital projects fund to provide resources for Town infrastructure
improvements.
o This reduction of General Fund balance was partially offset by an approximate
$1.1 million excess operating revenues above operating expenditures (excluding
the nonrecurring $5.6 million ADP payment and the $3.4 million transfers out to
other funds expenditures for Town capital projects.
Fund balances for all governmental funds at year end were $47,837,752 a decrease of
approximately $2.7 million or (5.3%) from the prior year. Governmental fund balances
decreased primarily due to:
o $5.6 million nonrecurring ADP payment made to CalPERS in FY 2020/21 from the
General fund.
o $5.7 million of capital outlay expenditures made from the Town’s capital projects
funds.
o These uses were partially offset by an approximate $1.1 million excess operating
revenues above operating expenditures (excluding the nonrecurring $5.6 million
ADP payment and the $3.4 million transfers out to other funds expenditures for
Town capital projects).
At fiscal year end, the Town’s General Fund restricted cash assets reported a zero balance as
the entire amount that remained in its recently established Town’s IRS Section 115 Pension
Trust was used for payment of the ADP to CalPERS made in April 2021.
The Town received $388,181 from the Coronavirus Aid, Relief, and Economic Security (CARES)
Act which was utilized for fully expended on assistanceing to small businesses to boost
economic recovery, supporting non‐profit organizations with direct grants and rent
forgiveness, and obtaining equipment to provide municipal services consistent with Public
Health Orders. The entire amount of the $388,181 was recognized as revenue in FY 2020/21
and categorized as Operating Grants and Contributions in the Statement of Activities
Schedule, and Intergovernmental Revenues in the Governmental Funds Statement of
Revenues, Expenditures, and Changes in Fund Balance Schedule.
The Town received the first tranche payment of $3,614,872 from the American Rescue Plan
Act (ARPA) grant on July 13, 2021. The replacement of lost revenue is an eligible ARPA use,
and initial budgetary estimates estimated programmed approximately $1.4 million in ARPA
fundsing to close anticipated revenue shortfalls. ARPA funding for budget shortfalls was not
required under the revenue loss eligible use requirements since actual revenues performed
better in several areas and expenditure savings were higher than projected.
However, For FY 2020/21 $200K of ARPA proceeds was recognized as FY 2020/21 revenue to
reimburse the Town for qualifying expenditures under the provisions of the Act including
boosting economic recovery and providing rent forgiveness and direct grants to non‐profit
organizations. The $200K was categorized as Operating Grants and Contributions in the
Statement of Activities Schedule, and Intergovernmental Revenues in the Governmental
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Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Schedule. The
remainder of ARPA proceeds will be recognized as revenues in the current and future fiscal
years with eligible expenses. The proceeds not spent remain in the Town deposit account.
The Town’s total capital assets decreased by $1,805,289 to $109,894,936 net of depreciation
due to smaller infrastructure expenditures and further reduced by the annual total
equipment, buildings and infrastructure depreciation expense.
OVERVIEW OF THE FINANCIAL STATEMENTS
The financial section of the ACFR contains the following information: Independent Auditor’s
Report, Management’s Discussion and Analysis (this section), the Basic Financial Statements, and
the Required Supplementary Information. The ACFR also includes a Supplementary Information
section, which presents combining and budgetary schedules for individual non‐major funds. The
Basic Financial Statements are comprised of three components: 1) Government‐Wide Financial
Statements, 2) Fund Financial Statements, and 3) Notes to the Financial Statements. The
Management’s Discussion and Analysis is intended to be an introduction to the Basic Financial
Statements.
Government‐Wide Financial Statements
The Government‐Wide Financial Statements present the financial picture of the Town from an
economic resources measurement focus using the accrual basis of accounting. An economic
resources measurement focus is when a body of financial statements report all inflows, outflows,
and balances affecting or reflecting an entity’s net position.
The Statement of Net Position presents information on all of the Town’s assets and liabilities,
with the difference between the two reported as net position. Over time, increases or decreases
in net position may serve as a useful indicator of whether the financial position of the Town is
improving or deteriorating.
The Statement of Activities presents information showing how the Town’s net position changed
during the most recent fiscal year. All changes in net position are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this Statement for some items that will only result
in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation
leave).
Both of the Government‐Wide Financial Statements distinguish functions of the Town that are
principally supported by taxes and intergovernmental revenues (governmental activities) from
other functions that are intended to recover all or a significant portion of their costs through
user fees and charges (business–type activity). The governmental activities of the Town include
public safety, parks and public works, community development, library, community services,
debt service, and general government. Governmental activities typically include financial data
for all governmental funds. Internal service funds are typically incorporated into governmental
activities as well. Business‐type activities typically include financial data for all enterprise funds.
21Draft 12/16/2021
The Town has no enterprise funds and therefore reports no business type activities. The Town
has no business‐type activities for accounting purposes.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have
been segregated for specific activities or objectives. The Town, like other local governments,
uses fund accounting to ensure and demonstrate compliance with finance‐related legal
requirements. The funds of the Town are segregated into three categories: governmental funds,
proprietary funds, and fiduciary funds.
Governmental funds – The Town’s basic services are reported in governmental funds, which focus
on how money flows into and out of those funds and the balances left at year‐end that are
available for spending. These funds are reported using the modified accrual basis of accounting,
which measures cash and other financial assets that can readily be converted to cash. The
Governmental Fund Statements provide a detailed short‐term view of the Town’s general
government operations and the basic services it provides. Governmental fund information helps
determine whether there are more or fewer financial resources that can be spent in the near
future to finance the Town’s operations. Both the governmental fund balance sheet and the
governmental fund statement of revenues, expenditures, and changes in fund balances provide
a reconciliation to facilitate this comparison between governmental funds and governmental
activities.
Proprietary funds – The Town maintains one type of proprietary fund: Internal Service Funds.
Proprietary funds are reported using the accrual basis of accounting. Internal Service Funds are
an accounting tool used to accumulate and allocate costs internally among the Town’s various
functions. The Town uses Internal Service Funds to account for its fleet of vehicles, computer
equipment, risk management activities, and other items. Internal Service Funds help smooth the
variability of certain expenses and insulate the Town from large unanticipated costs. The Internal
Service Funds are included within governmental activities in the Government‐Wide Financial
Statements.
Fiduciary funds – Fiduciary funds are used to account for resources held for the benefit of parties
outside the Town. Fiduciary funds are not reflected in the Government‐Wide Financial
Statements because the resources of those funds are not available to support the Town’s own
programs.
Included in fiduciary funds is the Redevelopment Successor Agency private‐purpose Trust Fund
created upon the dissolution of the former Redevelopment Agency (RDA) in 2012. The Trust
Fund was created to hold the assets of the former Redevelopment Agency until they are
transferred for governmental purposes to other entities or distributed to the underlying taxing
jurisdictions in Santa Clara County after the payment of enforceable obligations. Additional
information on the dissolution of the RDA and this fiduciary fund can be found in Note 12 in the
notes to basic financial statements.
22Draft 12/16/2021
Notes to Basic Financial Statements
The notes provide additional information to facilitate a full understanding of the data provided
in the Government‐Wide and Fund Financial Statements. The Notes to the Basic Financial
Statements can be found on pages 58‐120 of this report.
ANALYSIS OF GOVERNMENT‐WIDE FINANCIAL STATEMENTS
The Government‐Wide Financial Statements provide long‐term and short‐term information
about the Town’s overall financial condition. This analysis addresses the financial statements of
the Town as a whole, utilizing data from throughout the ACFR to describe the changes between
2020 and 2021. Given the unique nature of COVID pandemic economic impacts during the
reporting period, 2019 data has also been provided to provide additional context.
Net Position Discussion
As shown below, the Town’s combined net position for the year ended June 30, 2021 was
$113.52 million, reflecting a decrease of approximately $1.33 million to the prior years’ net
position of $114.85 million. In general, net position can serve as an important indicator of
whether the Town’s overall financial condition is improving or deteriorating over time.
Current and other assets decreased $3.9 million from the prior year, primarily due to an
approximate $4.9 million decrease in cash/restricted cash and investments. The $4.9 million
2021 2020 2019
Current and other Assets 72,065,091$ 75,995,161$ 79,464,869$
Capital Assets 111,416,264 111,700,225 107,542,588
Total Assets 183,481,355$ 187,695,386$ 187,007,457$
Deferred Outflows ‐ Pension/OPEB 19,746,595 17,441,310 13,521,349
Current Liabilities 16,334,887 18,093,199 17,002,972
Long‐Term Liabilities Outstanding 71,339,626 69,465,025 66,521,231
Total Liabilities 87,674,513$ 87,558,224$ 83,524,203$
Deferred Inflows ‐ Pension/OPEB 2,335,387 2,727,441 2,185,494
Net Position
Net Investment in Capital Assets 109,894,936 111,700,225 107,542,588
Restricted 8,358,267 7,117,984 11,918,688
Unrestricted (4,735,103) (3,967,178) (4,642,167)
Total Net Position 113,518,100$ 114,851,031$ 114,819,109$
Town of Los Gatos
Net Position
Governmental Activites
For the Year Ended June 30, 2021
23Draft 12/16/2021
decrease is primarily related to the nonrecurring $3.6 million additional discretionary payment
(ADP) made in July 2020 and the $2.0 million ADP made in April 2021 paid by the Town to CalPERS
to reduce the Town’s actuarial unfunded pension liability beyond the mandated annual
payments.
Capital assets remained relatively stable at $111.4 million for the year reflecting current year’s
capital asset additions less the annual depreciation expense. Capital infrastructure activity
slowed from the prior year but some infrastructure work was accomplished including:
Approximately $537K in street repair and resurfacing and curb and gutter work Town‐
wide,
Approximately $894K of work completed on the Town’s corporation yard building
replacement project,
$389K in communications and emergency dispatch equipment,
$863K investment in Town traffic signals and intersection improvements.
Deferred Outflows increase of $2.3 million was primarily due to the nonrecurring additional
discretionary payment made in July 2020 and April 2021 made to reduce the Town’s unfunded
pension liability. Current liabilities increased $1.8 million from the prior year primarily due to
decreases in accounts payable ($1.2M), deposits payable ($510K), and unearned revenue
($403K), offset by an increase in claims payable ($448K).
Long‐term liabilities increased $1.9 million. The increase is primarily due to the $1.56 million low
interest PG&E on‐bill financing loan used for Town facility energy efficiency project upgrades.
There was an additional increase of $792K for net pension liabilities and $157K for compensated
absences increase from the prior year. These increases were offset by a $631K reduction in net
other post‐employment benefits (OPEB) liabilities due to the continued additional discretionary
funding of the unfunded OPEB liability. See Note 9 and Note 10 of Notes to the Financial
Statements for more information on Town’s pension and other post‐retirement benefit plans.
Deferred Inflows decreased by $500K resulting primarily from the difference between projected
and actual earnings on investments, pension inflows decreased $664K which were offset by
$173K increase in OPEB plan inflows.
The largest segment of the Town’s net position, representing $109.9 million of net position,
reflects the net investment in capital assets (e.g., land, buildings, infrastructure, and equipment)
less accumulated depreciation and related outstanding debt used to acquire those assets. The
Town uses these capital assets to provide infrastructure and services to our residents. Therefore,
they do not represent a liquid financial resource to the Town and consequently are not readily
available for funding current obligations.
Restricted net position totaled approximately $8.4 million representing approximately $7.8
million for capital projects and maintenance and $553K placed in a special revenue trust fund for
library services.
As of June 30, 2021, unrestricted net position reports an approximate $767K decrease from a
deficit of approximately ($3.97 million) the prior year to an ending deficit balance of
24Draft 12/16/2021
approximately ($4.74 million). The deficit in governmental unrestricted net position is primarily
due to the Town’s outstanding long term pension and OPEB liabilities. It is not uncommon for
governments with these types of long term liabilities to report a deficit in unrestricted net
position. A deficit in unrestricted net position is not the only measure to assess the Town’s fiscal
health, other factors can also be important to consider such as an expanding and growing
property tax base and the condition of the Town’s infrastructure including streets, parklands,
civic center and library, police operations building, neighborhood center, corporation yard and
other improvements.
Governmental Activities
Governmental activities are generally financed through taxes, intergovernmental revenues, and
other non‐exchange revenues. The Statement of Activities is intended to illustrate how the cost
of governmental activities is financed and determine the annual change in net position.
2021 2020 2019
Revenues:
Program revenues:
Charges for Services 11,353,932$ 10,288,351$ 11,350,345$
Operating Grants and Contributions 3,287,564 3,854,188 2,175,277
Capital Grants and Contributions 846,345 850,113 146,792
General Revenues:
Property Taxes 19,878,835 18,330,426 17,321,347
Sales Taxes 7,933,604 7,531,425 8,158,152
Franchise Taxes 2,499,463 2,495,792 2,475,916
Other Taxes 1,126,887 1,911,774 2,726,743
Motor Vehicle in Lieu 23,058 24,526 14,689
Investment Earnings 227,136 2,428,470 1,809,128
Miscellaneous 1,528,039 323,940 2,407,840
Total Revenues 48,704,863 48,039,005 48,586,229
Expenses:
Police Department 19,808,230 20,446,188 16,635,726
Parks and Public Works 13,141,034 11,803,005 10,627,716
General Government 7,452,136 7,405,368 8,163,991
Community Development 6,481,075 5,001,958 5,064,637
Library Services 3,496,153 3,347,523 3,059,294
Sanitation 185,981 3,041 684,673
Total Expenses 50,564,609 48,007,083 44,236,037
Change in Net Position (1,859,746) 31,922 4,350,192
Net Position, beginning 115,377,846 114,819,109 110,468,917
Net Position, Ending 113,518,100$ 114,851,031$ 114,819,109$
Town of Los Gatos
Statement of Activities
For the Year Ended June 30, 2021
25Draft 12/16/2021
Governmental Activities Revenue Discussion
The Statement of Activities shown above details how the $48.7 million in Governmental Activities
revenue was derived. As categorized in the Statement of Activities as program revenues,
approximately $11.3 million or 23.3% of the revenues were recorded from fees paid by residents
who directly benefited from the program or serviceas a charge for service. Another $4.1 million
or 8.5% of the revenues were sourced from operating/capital grants and contributions.
Operating Grants and Contributions include approximately $600k in nonrecurring Federal CARES
Act ($388k) and ARPA ($200k) funds. The remaining $33.2 million or 68.2% represents general
revenues of the Town, including taxes, intergovernmental revenues, and other miscellaneous
revenues.
Program revenues increased by approximately $495K from the prior year. This is largely due to
an increase in revenues from charges for services of $1.06 million offset by decreases of
approximately $567K in operating grant revenues and contributions.
The Town’s General Revenues related to Governmental Activities increased by approximately
$171K from the prior year. The increase is attributable to a combination of approximately $1.5
million increase in property taxes, a $402K increase in sales tax, and a $1.2 million gain on sale of
property. The increases were offset by nearly $2.2 million reduction in investment earnings from
the prior year as result of lower market values above purchase cost on the Town’s investment
portfolio and declines of approximately $820K in transient occupancy tax receipts due to the
pandemic and its related effects on business travel and tourism.
Property tax is the largest individual revenue source for the Town and collections finished the
year $1.5 million higher than the previous year. This increase was mostly due to an increase of
$600K in secured taxes received as a rebate of excess property taxes collected and available from
the State of California’s Educational Revenue Augmentation Fund (ERAF), $430K increase in
property transfer tax as well as continued strong demand for residential Town property. In
addition, the approval of the annexations of County pockets with tax revenues accruing to the
Town effective FY 2019/20 and new developments helped to drive property values higher. It’s
important to note that assessed valuations for FY 2020/21 were established on the tax roll in
January 2020 and collected in FY 2020/21.
At $7.9 million, sales taxes represent the second largest individual revenue source for the Town.
Sales taxes increased $402K from the previous year largely due to the gradual recovery from the
economic impacts related to COVID‐19 which began with the March 2020 shelter‐in‐place public
health orders. The increase was aided by the receipt of online purchase revenues which accrue
to a new additional 1/8 cent District Sales Tax approved by the Los Gatos voters in the fall of 2018
which became effective fully in FY 2019/20.
Franchise taxes, the Town’s third largest revenue source, finished the year at $2.5 million,
reflecting only a very small increase of $4K from the previous fiscal year.
Investment earnings decreased $2.2 million from the prior year. The primary factor responsible
for this decline was the lower total market value above historical investment cost than the prior
26Draft 12/16/2021
year. These non‐cash or paper gains/losses are recognized as investment income/loss as a result
of the “mark to market value” procedure required by GASB 31.
Miscellaneous other revenues increased by approximately $1.2 million from the prior year. The
increase is due to a gain on sale of property on gain of the 14850 Winchester Boulevard land
sale finalized in July 2020.
Governmental Activities Expenses Discussion
The Town provides residents and visitors with an array of high quality services. General
government strategic support is comprised of six departments (Town Council, Town Clerk, Town
Manager, Town Attorney, Human Resources, Information Technology, and Finance) which
provide services in information technology, executive management, economic vitality, legal,
records management, risk management, human resources, finance, and accounting. The Town’s
Police Department (public safety) provides general law enforcement, crime prevention, dispatch,
and responses to emergency and non‐emergency calls for services. Parks and Public Works
provides engineering, construction, and maintenance of public streets, street lighting, Town
owned buildings, parks, and related infrastructure; as well as traffic engineering and engineering
evaluation of private development proposals. Community Development provides planning and
zoning services; and building plan check and inspection; and code enforcement services. The
Library Department provides library, local history, and cultural services to the community.
Total expenses increased $2.6 million from the prior year. The $2.4 million of the total increase
was driven largely by the combination of the following factors:
Community Development expenses increased by $1.8 $1.5 million for the year chiefly due
to increased development and building inspection activity. Other costs incurred this fiscal
year included Departmental support toward economic recovery in the form of absorbing
and mitigating certain development fees, and $0.6 million in non‐capitalized parklet
expenses. There were also cost increases from negotiated salary increases and related
benefits and increased required employer pension contributions and lower position
vacancies than in prior years.
Parks and Public Works expenses grew by approximately $1.3 million from the prior year
resulting largely from the “one‐time non‐capitalized” expense of $1.2 $0.6 million for the
economic recovery and wildfire protection efforts. There were also increased costs for
infrastructure depreciation related to new significant additions to the Town’s
infrastructure in prior years and increases related to negotiated salary and related
benefits offered to all Town employees during the fiscal year. In addition, Parks and Public
Works experienced lower amounts of vacant positions relative to the rest of the
organization.
$700K in increased depreciation expense on the Town’s infrastructure investments.
602K in negotiated salary increases and subsequent benefit increases. All sworn, non‐
sworn and management employees received a 1% across the board salary increase and a
“one‐time” non‐pensionable bonus of 2% that did not raise the employee’s base salary.
Library expenses increased approximately $149K from the prior year primarily from
negotiated salary increases and related benefits and increased required employer
pension contributions.
27Draft 12/16/2021
General Government expenses decreased increased $319K $47K from the prior year.
Pension expense calculated under accounting standards and allocated for the current
fiscal year of $9.8 million was approximately $1.0 million lower than the $10.8 million
allocated pension expense in the prior fiscal year.
Public safety expenses decreased approximately $637K from the prior fiscal year. The
decrease resulted mostly from higher position vacancies throughout the fiscal year
compared to the prior year. These savings were partially offset by the cost of negotiated
salary increases and related benefits including increased pension contribution rates for
both safety and miscellaneous safety employee classifications.
Non‐capitalized project expenses which exceeded the prior years expenses by
approximately $1.2 million.
Expenses for urban runoff decreased approximately $182K from the prior year. In the
prior fiscal year, the Town received program management fees from the West Valley
Sanitation District and expensed those fees for program management. Effective fiscal
year 2019/20, the West Valley Clean Water Authority receives its funding through
property tax bill assessments and related expenses are paid through the Authority.
FINANCIAL ANALYSIS OF THE TOWN’S FUNDS
Governmental Funds
Recognizing the financial resources measurement focus, the Town’s Governmental Funds
provide information on near‐term inflows and outflows, and balances of spendable resources.
This information is useful in assessing the Town’s financing requirements and may serve as a
useful measure of a government’s net resources available for spending at the end of the fiscal
year. Unlike the Statement of Activities which does not include transfers, the Governmental
Funds Balance Sheet does include transfers in and out.
Fund Balance – As discussed below, the Town’s Governmental Funds Balance Sheet reports the
following fund balances.
Restricted Fund Balance – The Town has $8.4 million in fund balance classified as restricted to
indicate that it has an externally imposed restriction on how the money may be spent. Of the
$8.4 million restricted fund balance, $7.6 million is restricted for capital projects, $0.6 million for
library trusts and $0.2 million for maintenance and repairs.
Committed Fund Balance – The Town has $11.2 million in fund balance classified as committed
to indicate that the Town Council previously committed how the money will be spent. Of the
$11.2 million $10.9 million is for budget stabilization and catastrophe response.
Assigned Fund Balance – The Town has $27.9 million in fund balance which is not restricted or
committed and is classified as assigned to indicate the Town Council’s intent to be used for
specific purposes. The largest assignments of fund balance are the Reserve for Capital/Special
projects with a balance of approximately $7 million and the Appropriated Reserves of $13.3
million which are the primary funding sources for the Town’s five year capital improvement plan
and special projects as budgeted by the Town.
28Draft 12/16/2021
Additional information on the Town’s Fund Balance can be found in Note (8) of the Notes to the
Financial Statements.
Major Governmental Funds results for the year included the following:
Overall, Total Governmental Funds revenues finished $0.6 million or 1.2% lower than the prior
year, while total expenditures finished $0.6 million or 1.2% higher than the prior year. The
approximate $1.2 million decline in total governmental fund balance is the net result of the $1.2
million decrease in Governmental Funds income before transfers and other financing sources and
REVENUES 202120202019
Property Taxes 19,917,428$ 18,368,466$ 17,359,435$
Sales Taxes 7,933,604 7,531,425 8,158,152
Other Taxes 1,126,887 1,911,774 2,726,742
Licenses & Permits 5,212,831 4,818,671 5,173,876
Intergovernmental 3,746,587 4,292,453 2,310,655
Charges for Services 6,035,659 5,309,470 5,584,504
Fines and Forfeitures 103,468 271,117 510,266
Franchise Fees 2,499,463 2,495,792 2,475,916
Interest 227,940 2,428,453 1,809,164
Use of Property 40,372 31,039 32,960
Other 423,115 376,922 579,755
Total Revenues 47,267,354$ 47,835,582$ 46,721,425$
EXPENDITURES
Current:
Public Safety 16,570,836$ 15,793,815$ 14,945,407$
General Government 14,040,134 13,024,146 8,004,254
Parks and Public Works 8,229,944 8,168,599 7,962,135
Community Development 5,195,302 4,473,790 4,577,495
Library Services 2,847,988 2,700,802 2,493,617
Sanitation and Other 166,173 162,837 628,240
Capital Outlay 5,746,447 7,861,972 7,888,914
Total Expenditures 52,796,824$ 52,185,961$ 46,500,062$
Excess Revenues over Expenditures (5,529,470)$ (4,350,379)$ 221,363$
Proceeds from sales of assets 1,201,369 1,566 1,912,316
Proceeds from issuance of debt 1,560,336
Transfers in 4,053,535 8,935,260 4,264,131
Tranfers out (3,940,015) (8,628,719) (3,323,756)
Total Other Financing Sources (Uses)2,875,225$ 308,107$ 2,852,691$
Net Changes in Fund Balances (2,654,245) (4,042,272) 3,074,054
Beginning/Ending Fund Balances As Restate 50491997 54,007,454 50,560,772
Ending Fund Balances 47,837,752$ 49,965,182$ 53,634,826$
TOTAL GOVERNMENTAL FUNDS REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2021
TOWN OF LOS GATOS
29Draft 12/16/2021
uses and the approximately $2.8 million increase from proceeds of sale of land ($1.2 million) and
proceeds from the issuance of debt ($1.6 million PG&E Energy Efficiency Loan) and lower
amounts of General Fund capital and special projects reserve dollars transferred to the Town’s
General Fund Allocated Reserve (GFAR) Capital Projects fund than the prior fiscal year.
General Fund revenues totaled $42.8 million or nearly 90% of the total $47.3 million in Total
Governmental Fund revenues. Total General Fund operating revenues decreased by $568K,
resulting from the net effect of:
$1.5 million increase in property tax collections
$402K increase in sales tax
$394K increase in licenses and permits
$726K increase in charges for services
$2.2 million decrease in investment income
$167K decrease in fines and forfeitures
$564K decrease in intergovernmental revenues for the year
$784K decreases in other taxes (e.g., TOT)
The declines in revenues from the prior year were impacted by the COVID‐19 pandemic and its
Public Health restrictions which began in March 2020 and continued to impact the Town in FY
2020/21. It should be noted that Intergovernmental revenue includes approximately $600k in
nonrecurring Federal CARES Act ($388k) and ARPA ($200k) funds.
General Fund expenditures represent approximately $46.2 million of the Total Governmental
Fund expenditures of $52.8 million compared to $44.3 million of total Governmental Funds
expenditures of $52.2 million in the prior year. The increase in governmental funds expenditures
was led by an approximate $1.0 million increase in general governmental and an $777K increase
in public safety expenditures from the prior year.
The increase in general governmental expenditures was largely attributable to the total of $5.6
million in nonrecurring ADP payments made in the FY that were approximately $800K higher than
the amounts paid in the prior fiscal. These payments were used to pay down an additional
portion of the Town’s actuarial unfunded pension liability beyond mandated annual payments.
Increases in public safety expenditures from the prior year of approximately $777K were due
primarily to mandated pension contribution rate increases by CalPERS and by increases in
negotiated salary from the prior year. Additionally, salary and benefit cost increases resulting
from labor negotiations and mandated increases in employer pension contribution rates were
also a contributing factor to increases to all Town Departments and services.
GFAR capital projects fund balances increased $1.2 million from the prior year reflecting $3.2
million of capital outlay expenditures above operating revenues, offset by $1.5 million proceeds
from the PG&E on‐bill financing loan and net transfers into the GFAR fund of approximately
$3.0 million. Gas Tax fund balances increased approximately $1.1 million reflecting gas tax
revenues of $1.2 million exceeding capital outlay expenditures and transfers out of $100K for
the fiscal year.
30Draft 12/16/2021
Proprietary Funds
The Town’s Proprietary Funds (Internal Service Funds) presented in the Fund Financial
Statements section basically provide the same type of information in the Government‐Wide
Financial Statements and include individual segment information.
Total net position in the Internal Service Funds decreased $100K in the current year due primarily
to expense over revenues for workers compensation and general liability costs including
administration, insurance premiums, and claims expense.
GENERAL FUND BUDGETARY HIGHLIGHTS
Changes to the Original Budget
Comparing the FY 2020/21 original budget (i.e., the adopted budget) General Fund expenditures
of $46,908,324 (excluding budgeted transfers‐out and debt payments that are reimbursed) to
the final adjusted budget of $47,741,860 indicates a net increase of approximately $0.8 million.
Additions to the original expenditure budget included adjustments approved by Town Council
throughout the fiscal year.
The increase in General Fund appropriations occurred primarily from the following selected
budget adjustments made during the fiscal year.
Use of $708,807 of Pension/OPEB Reserve and Restricted Pension Trust to make
nonrecurring additional discretionary payments (ADPs) to CalPERS
$88,185 expenditure budget increase utilizing SB 2 Planning Grant received by the Town
for the review of housing development applications, and to identify amendments to the
Town Code necessary to add the objective standards and findings to Chapter 29 of the
Town Code (Zoning Regulations).
$9,729 increase expenditures for electronic collections to utilize Library Grant received by
the Town.
$100,000 expenditure budget adjustment to Traffic Program Safety Supplies to provide
funding toward technology that will assist Patrol Officers in property crime prevention.
$55,000 expenditure budget adjustment to provide funding to the Chamber of Commerce
for Destination Marketing from American Rescue Plan Act (ARPA) proceeds.
$48,325 expenditure budget adjustment to provide funding for Engineering General
Plan update work that carried forward from FY 2019/20 into FY 2020/21 from available
General Plan Update deposits.
Original Budget
GF Expenditures
+
Misc. Adjustments &
Mid‐Year Adjustments
=
Final
Budget
$46,908,324 $833,536 $47,741,860
31Draft 12/16/2021
$35,222 budget expenditure increase for the purchase and maintenance of Police Vehicle
Mobile Audio and Video with License Plate Reader from available Equipment
Replacement Fund balance.
$31,959 increase to salary and benefits for the Town Manager and the Town Attorney.
$9,729 increase expenditures for additional downtown street lighting repairs.
$129,000 expenditure budget decrease for the Parking Management Program since the
COVID‐19 pandemic has significantly impacted the visitation and parking patterns to
parking enforcement areas.
$129,000 expenditure budget decrease for the Holiday Valet Parking Program since the
Town did not implement the annual Holiday Valet Parking Program to reduce potential
health impacts.
$87,786 expenditure budget decrease for Crossing Guard Services reflecting Santa Clara
County Health Orders requiring remote learning instruction at all schools, thus reducing
Crossing Guard service delivery needs.
$19,708 budget decrease for recognizing ARPA proceeds for 50% subsidizing permit
expenses for parklets.
Variance with the Final General Fund Budget
The General Fund Statement of Revenues, Expenditures, and Changes in Fund Balance‐Budget
and Actual (GAAP) for Fiscal Year Ended June 30, 2021 reports an approximate overall favorable
variance with the final budget of approximately $1.0 million. This favorable variance was created
largely by the net effect of the following factors:
Actual revenues ended the fiscal year at $100K below final budgeted revenues. The
negative $0.1 million variances represent a combined effect of $3.2 million favorable
variances of the economic sensitive revenues from budget, an unfavorable variance of
$0.5 million in investment earnings for year, an unfavorable $32K variance in Franchise
fees collected, and to the fact that staff budgeted the $2.8 million anticipated American
Recovery Plan (ARPA) proceeds in the General Fund, however after further Treasury
guidance the ARPA proceeds are accounted in a Special Revenue Fund.
The Town economically sensitive revenues started to show increases after the negative
impact related to the COVID‐19 pandemic and its related restrictions. The following
economically sensitive revenues experienced increases:
A favorable variance of $1.1 million in property tax collections
A favorable variance of $0.8 million in charges for services
A favorable variance of $600K in sales tax collections
A favorable variance of $337K in Transient Occupancy Tax collections
A favorable variance of $86K in Business License Tax collections
A favorable variance of $174K in licenses and permits
A favorable variance of $8K in fines and forfeitures
32Draft 12/16/2021
Significant factors affecting actual expenditures include:
Public safety expenditures had a favorable variance of approximately $900K . $614K in
savings is reflective of limited term vacancies in Police Officer and Dispatcher positions,
savings of $300K due to savings on vehicle maintenance expenses, decreased service cost
of crossing guards and parking violation services, decreased travel activity due to the
Shelter in Place order, and other miscellaneous operational savings.
Community Development expenditures reflected a $600K favorable variance explained
largely by staff vacancies with salary and benefit savings of approximately $220K due to
the partial year vacancies of the Planning Manager and temporary Assistant Planner
positions, decreased temporary Code compliance service delivery, and the General Plan
Update expenditures being approximately $306K lower than budgeted because the
budget reflected the entire contract amount which has not been fully executed through
the end of the fiscal year.
Administrative Services reflected a favorable balance of approximately $327K in large
measure due to savings in salary and benefits due to partial year vacancies in the
Emergency Manager position, decreased workload for the Special Event Coordinator
position, savings in special events cost due to cancellation of events, and decreased travel
activity due to the Shelter in Place order, and other miscellaneous operational savings.
Library services reflected a favorable variance of $128K due mainly to salary and benefit
savings from partial staff vacancies in the Librarian, and Library Specialist position and
other temporary vacancies.
Town Attorney reflected a favorable balance of approximately $121K in large measure
due to savings in salary and benefits due to partial year vacancies of the Legal
Administrative position and saving on legal services.
Town Council reflected a favorable balance of approximately $50K due to temporary
salary savings, and decreased travel activity due to the Shelter in Place order, and other
miscellaneous operational savings.
Parks and Public Works reflects a favorable variance of approximately $30K reflecting
miscellaneous savings.
CAPITAL ASSETS
As of June 30, 2021, the Town’s investment in capital assets for its governmental activity is
recorded at $111,416,265 (net of accumulated depreciation). The investment in capital assets
includes land, buildings and improvements, infrastructure, construction in progress, machinery
and equipment. Capital assets decreased $300Knet of depreciation expense totaling
approximately $4.7 million for the year.
33Draft 12/16/2021
During FY 2020/21, the Town’s approximate $4.3 million investment in capitalized assets for the
current year represented approximately 2.4% of total assets for governmental activities. Major
capital asset events during the current fiscal year include the following:
$500K in street repair and resurfacing and curb and gutter work Town‐wide;
$800K in equipment purchases, including $400K in construction in progress for public
safety communications/dispatch equipment, vehicle fleet replacements, and $100K in IT
server fire suppression and disaster recovery equipment;
$900K in traffic signal and intersection improvements;
$900K expended on the Town’s corporation yard building replacement;
$200K in construction in progress for pathways and trails; and
$200K in guardrail replacement efforts.
Additional information on the Town’s capital assets is found in Note 5 of this financial report.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
A product of an ongoing examination of how the Town provides cost‐effective services, the
Town’s budget emphasizes outcomes or results for the community and allows for longer‐term
financial planning decisions.
During the development and adoption of the Town’s FY 2021/22 budget, the Town Council and
management considered the following factors:
The FY 2021/22 Budget reflect maintaining high service levels with little to no increases in the
employee headcount. The budget identified contingencies should revenues come in below
projected amounts. The Town is carefully monitoring its revenues sources and will identify
any modification at the mid‐year budget discussion.
Several Strategic Priorities are not one‐time projects, but rather are ongoing commitments
due to their critical significance to ensure the Town’s fiscal and infrastructure stability and
the safety and quality of life for Los Gatos residents, businesses, and visitors. These
commitments include continuing to address the Town’s unfunded pension and other post‐
employment benefits (OPEB) obligations; developing Measure B transportation projects so
Governmental
Activities
Infrastructure 60,505,727$
Buildings 22,891,327
Land 20,254,949
Equipment 2,312,214
Construction in Progress 5,452,048
111,416,265$
Capital Assets
Town of Los Gatos
For the Year Ended June 30, 2021
34Draft 12/16/2021
the Town is positioned to receive its fair share of the funds; and fostering emergency
preparedness and community wildfire resilience.
In terms of capital projects, the Town Council affirmed its interest in investing in bicycle and
pedestrian improvements and implementing elements of the Comprehensive Parking Study.
In addition to capital projects, the Council identified new policy priorities which include
engaging our senior community and implementing diversity, equity, and inclusion efforts.
Other Strategic Priorities should position the Town well for its future. The Council is
interested in exploring new revenue opportunities. The Council continues the General Plan
Update to engage the community in land use planning and policies to guide development for
the next couple of decades and address environmental sustainability and climate resiliency.
Other Priorities included continuing to enhance economic and community vitality. As the
Town continues to emerge from the economic upheaval of pandemic, the significance of
enhancing economic and community vitality are paramount.
Specific trends affecting the fund balance forecast include:
o General property tax collections represent approximately 33.6% (not including the State’s
property tax “backfill” shifts) of the Town’s General Fund revenues. Property tax
collections are expected to increase 13.9% in FY 2021/22 from the prior year’s tax
collections. This increase is primarily due to the additional tax collection from the first
phase of North 40 residential sales and continued strong property assessment values
through the Town. This forecast is based on data from the Santa Clara County Tax
Assessor’s Office. The Town closely monitor its actual collection and other legislative
changes regarding property tax.
o The Town anticipates an increase in general sales tax for FY 2021/22. Sales tax estimates
of $8.1 million for FY 2021/22 were budgeted reflecting a 6.7% increase from the prior
year’s adjusted sales tax budget.
o The Town’s investment portfolio experienced a decrease in its overall weighted average
annual yield, reducing from 1.86% as of June 30, 2020 to 1.37% as of June 30, 2021.
Prevailing interest rates at the end of fiscal year were at historic lows due to economic
impacts of the COVID‐19 pandemic and Federal Reserve actions.
o Transient Occupancy Tax (TOT) is expected to increase by 30% from FY 2020/21 adjusted
budget. During FY 2020/21 TOT has experienced the most significant percentage decline
relative to the adopted budget and Town Council approved a 69% decrease to the budget.
In addition to the initial Shelter‐in‐Place (SIP) restrictions instituted on March 17, 2020,
on November 28, 2020, Santa Clara County issued new mandatory directives which
included that hotels and other lodging facilities would be open only for essential travel
and for use to facilitate isolation or quarantine. Unlike sales tax forecasts which predict
an acceleration of revenues tied to pent up consumer demand, the Town’s TOT revenue
has historically been primarily driven by business travel. Given the uncertainty around
physical business travel resuming at prior levels, as opposed to a continuation of remote
35Draft 12/16/2021
work and online meeting forums, staff is recommending modest growth for base case
development of the FY 2021/22 budget.
o The Town’s pension plans over the past several decades, like all other CalPERS
participants, have experienced unfavorable investment returns, changes in actuarial
assumptions, and demographic shifts which have outweighed any positive plan
experiences. To address this unfunded status, the Town took proactive steps including
initiating the prefunding of OPEB obligations, budgeting and programming additional
discretionary pension payments to accelerate reduction of unfunded liabilities, and
recently partnering with the Town’s employee groups to eliminate the existing retiree
healthcare benefit for new employees. Even with these proactive steps, the Town
continues to be impacted by the continuing rising cost of pension related benefits. Over
the next five fiscal years, the Town’s five‐year forecast includes increasing pension costs
due to further changes in actuarial assumptions or lowering the discount rate. The Town’s
net pension liability is $29.3 million for the safety cost sharing plan and $32.5 million for
the miscellaneous plan based upon data from CalPERS as of 6/30/2020.
o To illustrate the sensitivity of the net pension liability to changes in the discount rate,
CalPERS estimates that a 1 % reduction in the discount rate from 7.0% to 6.0% would
increase the total net pension liability for both Miscellaneous and Safety by $28.1 million.
Conversely, an increase in the discount rate from 7.0% to 8.0% would decrease the total
net pension liability for both Miscellaneous and Safety by $23.1 million.
o In addition, CalPERS provides a hypothetical termination liability estimate of the plans
should the contract with CalPERS be terminated. The plan liability on a termination basis
is calculated differently from the plans’ ongoing funding liability. Since no future
employer contributions would be made in the hypothetical termination, benefit
payments are secured by risk‐free assets. For the Miscellaneous plan, a 2.5% termination
return rate results in a $117.4 million termination liability. For the Safety plan, a 2.5%
termination return rate results in a $112.2 million termination liability.
o For detailed information about the Town employees’ retirement plan please refer to
Note 9 of the Notes to Basic Financial Statements Section.
Requests for Information
This financial report is designed to provide residents, taxpayers, customers, investors, and
creditors with a general overview of the Town’s finances and to demonstrate the Town’s
accountability for the money it receives. Questions about this report or requests for any
additional information, should be directed to Stephen Conway, Director of Finance, at 110 East
Main Street, Los Gatos, California, 95030; email at sconway@losgatosca.gov; or phone at (408)
354‐6828.
36Draft 12/16/2021
Basic Financial Statements
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38Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
GOVERNMENT WIDE FINANCIAL STATEMENTS
STATEMENT OF NET POSITION AND STATEMENT OF ACTIVITIES
The Statement of Net Position, Statement of Activities, fund financial statements and the notes to financial
statements comprise the Basic Financial Statements of the Town.
The purpose of the Statement of Net Position and the Statement of Activities is to summarize the entire financial
activities and financial position of the Town. They are prepared on the same basis of accounting (accrual) used
by most businesses, which means they include all the Town’s assets and liabilities, as well as its revenues and
expenses. The effect is the entire Town’s transactions are accounted for, regardless of when cash changes
hands, and all material internal transactions between funds have been eliminated.
The Statement of Net Position reports the Town’s total assets, deferred outflows of resources, liabilities, and
deferred inflows of resources, including capital assets and longterm debt, and presents similar information to
the old balance sheet format while focusing on the composition of the Town’s net position (assets minus
liabilities). The Statement of Net Position summarizes the financial position of the Town’s governmental
activities in a single column.
The Town’s governmental activities include the activities of the General Fund, Special Revenue Funds, Capital
Projects Funds and Debt Service Funds. These funds are serviced by the Town’s Internal Service Funds; therefore
internal service activities are consolidated with governmental activities after eliminating interfund transactions
and balances.
The Statement of Activities reports increases and decreases in the Town’s net position and is prepared on the
full accrual basis of accounting, which means it includes all the Town’s revenues and expenses regardless of
when cash changed hands. This differs from the “modified accrual” basis of accounting used in the fund financial
statements, which reflect only current assets, current liabilities, available revenues and measurable
expenditures.
The format of the Statement of Activities presents the Town’s expenses before revenues and by program.
Program revenues (revenues generated directly by specific programs) are deducted from program expenses to
arrive at the net expense of each governmental program, which is offset by general revenues as listed before
the change in net position. From these components, the change in net position is computed and reconciled to
the Statement of Net Position.
Both of these statements include the financial activities of the Town.
39Draft 12/16/2021
Governmental
Activities
ASSETS
Cash and investments 66,528,737$
Restricted cash and investments 85,724
Receivables:
Accounts 1,939,600
Interest 244,671
Intergovernmental 3,104,661
Materials, supplies and deposits 123,946
Long term notes receivables 237,752
Longterm prepaid pension obligations
Capital Assets:
Nondepreciable 25,706,997
Depreciable, net of accumulated depreciation 85,709,267
Total Assets 183,681,355
DEFERRED OUTFLOWS OF RESOURCES
Pension contributions subsequent to measurement date 12,014,444
Pension related amounts 5,253,582
OPEB contributions subsequent to measurement date 2,096,847
OPEB related amounts 381,722
Total Deferred Outflows of Resources 19,746,595
LIABILITIES
Accounts payable 2,476,829
Accrued payroll and benefits 1,662,094
Due to other governments 41,291
Unearned Revenue 4,231,781
Deposits 6,226,770
Claims payable 1,696,072
Longterm liabilities:
Due within one year:
Loans payable 156,034
Compensated absences 370,921
Due in more than one year:
Loans payable 1,365,294
Net OPEB liability 8,495,214
Net pension liabilities 58,023,249
Compensated absences 2,928,914
Total Liabilities 87,674,463
DEFERRED INFLOWS OF RESOURCES
Pension related amounts 1,433,785
OPEB related amounts 801,602
Total Deferred Inflows of Resources 2,235,387
NET POSITION
Net investment in capital assets 109,894,936
Restricted for:
Capital projects 7,544,097
Library 552,877
Lighting and landscape repairs and maintenance 172,356
Total Restricted Net Position 8,269,330
Unrestricted (4,646,166)
Total Net Position 113,518,100$
TOWN OF LOS GATOS
STATEMENT OF NET POSITION
JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
40Draft 12/16/2021
Net (Expense)
Revenues and
Changes in
Net Position
Operating Capital
Charges for Grants and Grants and Governmental
Functions/Programs Expenses Services Contributions Contributions Activities
Governmental Activities:
General government ,452,136$ 7 1,505,899$ 388,181$ 2,365$ (5,555,691)$
Public safety 19,808,230 1,275,731 1,073,971 (17,458,528)
Parks and public works 13,141,034 4,209,048 1,547,102 843,980 (6,540,904)
Community development 6,481,075 4,063,776 223,129 (2,194,170)
Library services 3,496,153 55,181 (3,440,972)
Sanitation 185,981 299,478 113,497
Total Governmental Activities 50,564,609$ 11,353,932$ 3,287,564$ 846,345$ (35,076,768)
General revenues:
Taxes:
Property taxes 19,878,835
Sales taxes 7,933,604
Franchise taxes 2,499,463
Other taxes 1,126,887
Motor vehicle in lieu 23,058
Investment earnings 227,136
Miscellaneous 1,528,039
Total general revenues 33,217,022
Change in Net Position (1,859,746)
Net Position Beginning, as restated 115,377,846
Net Position Ending 113,518,100$
TOWN OF LOS GATOS
STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Program Revenues
The notes to the financial statements are an integral part of this statement.
41Draft 12/16/2021
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42Draft 12/16/2021
TOWN OF LOS GATOS
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
FUND FINANCIAL STATEMENTS &
MAJOR GOVERNMENTAL FUNDS
______________________________________________________________________________
Fund Financial Statements
The Fund Financial Statements only present major funds individually while nonmajor funds are combined in a
single column. Major funds are generally defined as having significant activities or balances in the current year.
Major Governmental Funds:
The Town determined that the following funds were major funds for the year ended June 30, 2021. Individual
nonmajor funds can be found in the supplemental section.
General Fund is the general operating fund of the Town and is used to account for all financial resources except
those required to be accounted for in another fund.
Appropriated Reserves Fund is used to account for resources provided for capital projects not fully funded from
other sources.
43Draft 12/16/2021
Other
Nonmajor Total
Appropriated Governmental Governmental
General Reserves Funds Funds
ASSETS
Cash & Investments 30,102,793$ 18,477,294$ 8,586,389$ 57,166,476$
Receivables:
Accounts 1,159,677 691,115 57,904 1,908,696
Interest 244,672 244,672
Intergovernmental 2,739,088 365,573 3,104,661
Other assets 123,946 123,946
Due from other funds 79,177 121,256 200,433
Long term notes 159,000 78,752 237,752
Total Assets 34,608,353$ 19,289,665$ 9,088,618$ 62,986,636$
LIABILITIES
Accounts payable 1,053,910$ 1,239,614$ 10,833$ 2,304,357$
Accrued payroll and benefits 1,657,348 4,747 1,662,095
Due to other governments 41,159 50 41,209
Unearned revenue 1,714,548 2,452,438 64,855 4,231,841
Deposits 6,226,770 6,226,770
Due to Other Funds 200,911 200,911
Total Liabilities 10,693,735 3,692,052 281,396 14,667,183
DEFERRED INFLOWS OF RESOURCES
Unavailable Revenue 481,701 481,701
Total deferred inflows of resources 481,701 481,701
FUND BALANCE
Nonspendable 159,000 159,000
Restricted for:
Capital Outlay 7,544,097 7,544,097
Library 552,877 552,877
Repairs and Maintenance 172,356 172,356
VTA 293,323 293,323
Committed to:
Budget Stabilization and Catastrophic 10,920,970 10,920,970
Pension/OPEB 300,000 300,000
Assigned to:
Open Space 410,000 152,000 562,000
Parking 1,460,210 1,460,210
Sustainability 140,553 140,553
Capital/Special Projects 6,965,355 13,160,379 20,125,734
Comcast PEG 50,000 50,000
Sale of Property 1,200,000 1,200,000
Market Fluctuations 438,333 438,333
Compensated Absences 1,649,917 1,649,917
Measure G 2018 District Sales Tax 1,730,490 1,730,490
Special Revenue Funds 537,892 537,892
Total Fund Balances 23,914,618 15,115,912 8,807,222 47,837,752
Total Liabilities and Fund Balances 34,608,353$ 19,289,665$ 9,088,618$ 62,986,636$
TOWN OF LOS GATOS
GOVERNMENTAL FUNDS
JUNE 30, 2021
BALANCE SHEET
The notes to the financial statements are an integral part of this statement.
44Draft 12/16/2021
47,837,752$
111,416,264
7,610,801
481,701
17,268,026
(1,433,785)
2,478,569
(801,602)
Loans payable (1,521,328)$
Net Pension Liability (58,023,249)
Net OPEB Liability (8,495,214)
Compensated absences (3,299,835) (71,339,626)
113,518,100$ Net Position Governmental Activities
LONGTERM LIABILITIES
Longterm liabilities are not due and payable in the current
period and, therefore, are not reported in the Governmental Funds.
over a period of time, however, in the governmental funds no transactions are recorded.
included in the calculation of the Town's net OPEB liability or expenses for the plan year included
in this report and have been deferred and reported as deferred outflows of resources.
DEFERRED INFLOWS OF RESOURCES
In the GovernmentWide financial statements certain OPEB amounts are deferred and amortized
In the GovernmentWide financial statements certain pension amounts are deferred and amortized
over a period of time, however, in the governmental funds no transactions are recorded.
DEFERRED OUTFLOWS OF RESOURCES
Contributions subsequent to the measurement date and certain other expenses will not be
Contributions subsequent to the measurement date and certain other expenses will not be
included in the calculation of the Town's net pension liability and expenses for the plan year
included in this report and have been deferred and reported as deferred outflows of resources.
DEFERRED INFLOWS OF RESOURCES
certain activities such as insurance, central services and maintenance to individual
governmental funds. The net current assets of the internal service funds are therefore
included as Governmental Activities in the Statement of Net Position.
DEFERRED OUTFLOWS OF RESOURCES
DEFERRED INFLOWS OF RESOURCES
Revenues from grants that are funded in this fiscal year that will not be collected for several
months after the Town's fiscal year end are not considered available and are classified as
deferreed inflows of resources in the governmental funds.
Capital assets used in the Governmental Activities are not financial resources and,
therefore, are not reported in the Governmental Funds.
ALLOCATION OF INTERNAL SERVICE FUND NET POSITION
Internal service funds are used by management to charge the cost of management of
CAPITAL ASSETS
TOWN OF LOS GATOS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO
THE GOVERNMENTWIDE STATEMENT OF NET POSITIONGOVERNMENTAL ACTIVITIES
JUNE 30, 2021
Fund Balance Total Governmental Funds
Amounts reported for Governmental Activities in the Statement of Net Position are
different from those reported in the Governmental Funds because of the following:
The notes to the financial statements are an integral part of this statement.
45Draft 12/16/2021
Other
Nonmajor Total
Appropriated Governmental Governmental
General Reserves Funds Funds
REVENUES
Property Taxes 19,878,835$ $ 38,593$ 19,917,428$
Sales Taxes 7,933,604 7,933,604
Other Taxes 1,059,741 67,146 1,126,887
Licenses & Permits 4,386,654 473,427 352,750 5,212,831
Intergovernmental 1,573,697 630,035 1,542,855 3,746,587
Charges for Services 4,835,962 1,199,697 6,035,659
Fines and Forfeitures 103,467 1 103,468
Franchise Fees 2,499,463 2,499,463
Interest 96,061 35,312 96,567 227,940
Use of Property 36,372 4,000 40,372
Other 335,905 48,818 38,392 423,115
Total Revenues 42,739,761 2,391,289 2,136,304 47,267,354
EXPENDITURES
Current:
General Government 14,040,134 14,040,134
Public Safety 16,570,836 16,570,836
Parks and Public Works 8,175,987 53,957 8,229,944
Community Development 4,994,391 200,911 5,195,302
Library Services 2,828,873 19,115 2,847,988
Sanitation and Other 166,173 166,173
Capital Outlay 2,365 5,675,604 68,478 5,746,447
Total Expenditures 46,612,586 5,675,604 508,634 52,796,824
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,872,825) (3,284,315) 1,627,670 (5,529,470)
OTHER FINANCING SOURCES (USES)
Proceeds from sales of assets 1,201,369 1,201,369
Proceeds from issuance of debt 1,560,336 1,560,336
Transfers in 652,056 3,401,479 4,053,535
Transfers (out)(3,401,479) (427,616) (110,920) (3,940,015)
Total Other Financing Sources (Uses)(1,548,054) 4,534,199 (110,920) 2,875,225
NET CHANGES IN FUND BALANCES (5,420,879) 1,249,884 1,516,750 (2,654,245)
BEGINNING FUND BALANCES, AS RESTATED 29,335,497 13,866,028 7,290,472 50,491,997
ENDING FUND BALANCES 23,914,618$ 15,115,912$ 8,807,222$ 47,837,752$
TOWN OF LOS GATOS
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
46Draft 12/16/2021
NET CHANGE IN FUND BALANCES TOTAL GOVERNMENTAL FUNDS (2,654,245)$
Amounts reported for Governmental Activities in the Statement of Activities are
different because of the following:
CAPITAL ASSET TRANSACTIONS
Governmental funds report capital outlays as expenditures. However, in the Statement of
Activities the cost of those assets is capitalized and allocated over their estimated useful
lives and reported as depreciation expense.
Expenditures for capital assets (additions) 4,347,099$
Proceeds from sale of assets (1,201,369)
Gain on sale of assets 1,161,508
Current Year Depreciation (4,591,199) (283,961)
LONGTERM DEBT PROCEEDS AND PAYMENTS
Debt proceeds provide current financial resources to governmental funds, but issuing debt
increases longterm liabilities in the Statement of Net Position. (1,560,336)
Repayment of debt principal is an expenditure in the governmental funds, but the repayment
reduces longterm liabilities in the Statement of Net Position.
Loan payable 39,008
UNAVAILABLE REVENUES
276,001
OPEB PLAN CONTRIBUTIONS AND EXPENSE
In governmental funds, actual contributions to OPEB plans are reported as expenditures in the year
incurred. However, in the GovernmentWide Statement of Activities, only the current year OPEB
expense as noted in the plans' valuation reports is reported as an expense, as adjusted for deferred
inflows and outflows of resources.428,728
PENSION PLAN CONTRIBUTIONS AND EXPENSE
In governmental funds, actual contributions to pension plans are reported as expenditures in the year
incurred. However, in the GovernmentWide Statement of Activities, only the current year pension
expense as noted in the plans' valuation reports is reported as an expense, as adjusted for deferred
inflows and outflows of resources.2,207,470
ALLOCATION ON INTERNAL SERVICE FUND ACTIVITY
Internal service funds are used by management to charge the costs of certain activities to
individual funds. The net expense of the internal service fund is reported with governmental activities. (120,279)
COMPENSATED ABSENCES EXPENSE
In governmental funds, compensated absences such as vacations and sick leave are expenditures
when taken. However, in the GovernmentWide Statement of Activities, the current year change in
the compensated absences liability is reported. (192,132)
CHANGE IN NET POSITION GOVERNMENTAL ACTIVITIES (1,859,746)$
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
TOWN OF LOS GATOS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES TO
THE GOVERNMENTWIDE STATEMENT OF ACTIVITIES GOVERNMENTAL ACTIVITIES
Revenues from grants that are funded in this fiscal year that will not be collected for several
months after the Town's fiscal year end are not considered available and are classified as
deferreed inflows of resources in the governmental funds.
The notes to the financial statements are an integral part of this statement.
47Draft 12/16/2021
Variance With
Final Budget
Original Final Positive
Budget Budget Actual (Negative)
REVENUES
Property Taxes 18,652,039$ 18,705,325$ 19,878,835$ 1,173,510$
Sales Taxes 7,987,247 7,301,869 7,933,604 631,735
Other Taxes 2,294,671 714,723 1,059,741 345,018
Franchise Fees 2,532,289 2,532,289 2,499,463 (32,826)
Licenses & Permits 4,296,898 4,211,898 4,386,654 174,756
Intergovernmental 970,885 4,342,588 1,573,697 (2,768,891)
Charges for Services 4,178,212 4,014,619 4,835,962 821,343
Fines and Forfeitures 434,950 94,950 103,467 8,517
Interest 626,409 626,409 96,061 (530,348)
Use of Property 35,793 35,793 36,372 579
Other 253,351 253,351 335,905 82,554
Total Revenues 42,262,744 42,833,814 42,739,761 (94,053)
EXPENDITURES
Current:
General Government:
Town Council 243,486 243,486 192,280 51,206
Town Attorney 645,303 658,831 537,296 121,535
Administrative Services 4,974,616 4,995,847 4,667,995 327,852
NonDepartmental 6,841,510 7,602,517 8,642,563 (1,040,046)
Total General Government 12,704,915 13,500,681 14,040,134 (539,453)
Public Safety 17,587,825 17,487,761 16,570,836 916,925
Community Development 5,517,030 5,589,807 4,994,391 595,416
Parks & Public Works 8,152,045 8,206,080 8,175,987 30,093
Library Services 2,946,509 2,957,531 2,828,873 128,658
Capital Outlay 2,365 (2,365)
Total Expenditures 46,908,324 47,741,860 46,612,586 1,129,274
EXCESS (DEFICIT) OF REVENUES
OVER EXPENDITURES (4,645,580) (4,908,046)(3,872,825)1,035,221
OTHER FINANCING SOURCES (USES)
Proceeds from sale of assets 1,000 1,201,000 1,201,369 369
Transfers In 616,834 652,056 652,056
Transfers Out (3,401,479) (3,401,479) (3,401,479)
Total Other Financing Sources (Uses)(2,784,645) (2,749,423) (1,548,054)369
NET CHANGES IN FUND BALANCES (7,430,225)$ (7,657,469)$ (5,420,879)1,035,590$
BEGINNING FUND BALANCE 29,335,497
ENDING FUND BALANCE $ 23,914,618
BUDGET AND ACTUAL (GAAP)
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
TOWN OF LOS GATOS
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
The notes to the financial statements are an integral part of this statement.
48Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
PROPRIETARY FUNDS – INTERNAL SERVICE FUNDS
Internal service funds account for Town operations financed and operated in a manner similar to a private
business enterprise. The intent of the Town is that the cost of providing goods and services to other Town funds
be financed through user charges to those funds.
The concept of major funds does not extend to internal service funds because they are used for internal activities
only. In the GovernmentWide Statement of Activities, the net revenues and expenses of the internal service
funds are allocated to the Town Departments or programs that generated them, thus eliminating internal service
funds.
49Draft 12/16/2021
Governmental
Activities
Internal Service
Funds
ASSETS
Cash & investments 9,362,261$
Restricted cash & investments 85,724
Accounts receivable 30,964
Due from other funds 478
Total Assets 9,479,427
LIABILITIES
Current Liabilities:
Accounts payable 172,471
Due to other governments 83
Total current liabilities 172,554
Noncurrent liabilities:
Claims payable 1,696,072
Total noncurrent liabilities 1,696,072
Total Liabilities 1,868,626
Restricted for workers compensation claims 85,724
Unrestricted 7,525,077
Total Net Position 7,610,801$
TOWN OF LOS GATOS
PROPRIETARY FUNDS
STATEMENT OF NET POSITION
JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
50Draft 12/16/2021
Governmental
Activities
Internal Service
Funds
OPERATING REVENUES
Charges for services 3,382,212$
Interest 5
Use of money and property 232,474
Other local taxes 67,146
Intergovernmental 0
Other 421,650
Total Operating Revenues 4,103,487
OPERATING EXPENSES
Insurance expenses 1,169,839
Services and Supplies 2,940,407
Total Operating Expenses 4,110,246
Operating Expense (6,759)
Transfers in (Note 4)33,000
Transfers out (Note 4)(146,520)
Net transfers (113,520)
Change in Net Position (120,279)
BEGINNING NET POSITION 7,731,080
ENDING NET POSITION 7,610,801$
TOWN OF LOS GATOS
PROPRIETARY FUNDS
STATEMENT OF REVENUE, EXPENSES
AND CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
51Draft 12/16/2021
Governmental
Activities
Internal Service
Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 4,101,076$
Payments to suppliers (3,016,880)
Claims paid (722,178)
Net cash provided (used) by operating activities 362,018
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Transfers In/(Out)(113,520)
Net cash provided (used) by noncapital financing activities (113,520)
Net Increase(Decrease) in Cash and Investments 248,498
Cash and investments beginning of year 9,199,965
Cash and investments end of year 9,448,463$
FINANCIAL STATEMENT PRESENTATION
Cash & investments 9,362,261$
Restricted cash & investments 85,724
Total 9,447,985$
Reconciliation of Operating Income to Cash Flows
from Operating Activities:
Operating Income (6,759)$
Change in assets and liabilities:
Receivables, net (2,411)
Accounts payable (76,556)
Claims payable 447,661
Due to other government 83
Cash Flows From Operating Activities 362,018$
TOWN OF LOS GATOS
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
52Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
FIDUCIARY FUNDS
Trust funds are used to account for assets held by the Town as a trustee agent for individuals, private
organizations and other governments. The financial activities of these funds are excluded from the government
wide financial statements, but are presented in separate Fiduciary Fund financial statements.
RDA Successor Agency Private Purpose Trust Fund was established to account for the assets and liabilities
transferred from the dissolution of the Town’s former Redevelopment Agency and the continuing operations
related to existing Redevelopment Agency obligations.
53Draft 12/16/2021
RDA
Successor
Agency
ASSETS
Cash and investments (Note 2) 1,863,433$
Restricted cash and investments (Note 2)1,984,487
Loans receivable (Note 3)598,754
Capital assets (Note 5):
Nondepreciable 5,257,422
Depreciable, net of accumulated depreciation 1,322,008
Total Assets 11,026,104
LIABILITIES
Accounts payable 63
Interest payable 263,355
Longterm debt (Note 6):
Due within one year 1,300,000
Due in more than one year 13,123,890
Total Liabilities 14,687,308
NET POSITION
Held in trust (3,661,204)
Total Net Position (3,661,204)$
TOWN OF LOS GATOS
FIDUCIARY FUNDS
STATEMENT OF FIDUCIARY NET POSITION
JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
54Draft 12/16/2021
RDA
Successor
Agency
ADDITIONS
Property taxes 1,946,787$
Investment earnings 28,297
Total Additions 1,975,084
DEDUCTIONS
Program expenses of former RDA 5,399
Interest and fiscal agency expenses of RDA 598,804
Depreciation expense 101,693
Total Deductions 705,896
CHANGE IN NET POSITION 1,269,188
NET POSITION BEGINNING OF YEAR, AS RESTATED (4,930,392)
NET POSITION END OF YEAR (3,661,204)$
$
TOWN OF LOS GATOS
FIDUCIARY FUNDS
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
The notes to the financial statements are an integral part of this statement.
55Draft 12/16/2021
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56Draft 12/16/2021
Notes to Basic Financial Statements
57Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Description of the Financial Reporting Entity
The Town of Los Gatos (the “Town”) operates under a CouncilManager form of government and provides
the following services: public safety (including police and emergency management), parks and public works,
community development, library, public improvements, planning and zoning, and general administration
services. Redevelopment services were provided primarily through the Redevelopment Agency of the Town
which was dissolved on February 1, 2012.
The Town is largely a residential community located in the foothills of the Santa Cruz Mountains and was
incorporated as a municipal corporation in 1887. The Town’s population as of January 1, 2021 was 30,836.
As required by generally accepted accounting principles, these financial statements present the Town as the
Primary Government and any component units for which the Town is considered financially accountable.
B. Description of Blended Component Units
The Town did not report any component units as a part of the primary government because the Town
Council was not the governing body of any entities and no separate entity provided services solely to the
Town.
C. Description of Joint Ventures and Public Entity Risk Pool
As described in Note 11, the Town participates in two joint ventures and public entity risk pool activities
through formally organized separate legal entities. The financial activities of the Pooled Liability Assurance
Network Joint Powers Authority (PLAN JPA) and the Local Agency Workers’ Compensation Excess Joint
Powers Authority (LAWCX) are not included in the accompanying basic financial statements as these boards
are separate from and independent of the Town administration.
D. Basis of Presentation
The Town’s Basic Financial Statements are prepared in conformity with accounting principles generally
accepted in the United States of America. The Government Accounting Standards Board (“GASB”) is the
acknowledged standard setting body for establishing accounting and financial reporting standards followed
by governmental entities in the U.S.A.
The accompanying financial statements are presented on the basis set forth in Government Accounting
Standards Board Statements No. 34, Basic Financial Statements—and Management’s Discussion and
Analysis—for State and Local Governments, No. 36, Recipient Reporting for Certain Nonexchange Revenues,
an Amendment of GASB Statement No. 33, No. 37, Basic Financial Statements—and Management’s
Discussion and Analysis—for State and Local Governments; Omnibus, and No. 38, Certain Financial
Statement Note Disclosures.
These Statements require that the financial statements described below be presented.
58Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Government-wide Statements: The Statement of Net Position and the Statement of Activities display
information about the primary government (the Town). These statements include the financial activities of
the overall Town government, except for fiduciary activities. Eliminations have been made to minimize the
double counting of internal activities. However, interfund services provided and used are not eliminated in
the process of consolidation. These statements present governmental activities of the Town. Governmental
activities generally are financed through taxes, intergovernmental revenues, and other nonexchange
transactions.
The Statement of Activities presents a comparison between direct expenses and program revenues for each
function of the Town’s governmental activities. Direct expenses are those that are specifically associated
with a program or function and, therefore, are clearly identifiable to a particular function. Program revenues
include (a) charges paid by the recipients of goods or services offered by the programs, (b) grants and
contributions that are restricted to meet the operational needs of a particular program and (c) fees, grants
and contributions that are restricted to financing the acquisition or construction of capital assets. Revenues
that are not classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the Town's funds,
including fiduciary funds and blended component units. Separate statements for each fund category—
governmental, proprietary and fiduciary—are presented. The emphasis of fund financial statements is on
major individual governmental funds, each of which is displayed in a separate column. All remaining
governmental funds are aggregated funds and reported as nonmajor funds.
Internal service funds of the Town (which provide services primarily to other funds of the Town) are
presented, in summary form, as part of the proprietary fund financial statements. Since the principal users
of the internal services are the Town’s governmental activities, financial activities of the internal service
funds are presented in the governmental activities column when presented at the governmentwide level.
The costs of these services are allocated to the appropriate function/program in the Statement of Activities.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions
associated with the principal activity of the fund. Exchange transactions are those in which each party
receives and gives up essentially equal values. Nonoperating revenues, such as subsidies and investment
earnings, result from nonexchange transactions or ancillary activities.
E. Major Funds
GASB defines major funds and requires that the Town’s major governmental funds be identified and
presented separately in the fund financial statements. All other funds, called nonmajor funds, are
combined and reported in a single column, regardless of their fundtype.
Major funds are defined as funds that have assets, deferred outflows of resources, liabilities, deferred
inflows of resources, revenues or expenditures/expenses equal to ten percent of their fundtype total and
five percent of the grand total. The General Fund is always a major fund. The Town may also select other
funds it believes should be presented as major funds.
59Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
The Town reported the following major governmental funds in the accompanying financial statements:
General Fund is the general operating fund of the Town and is used to account for all financial resources
except those required to be accounted for in another fund.
Appropriated Reserves Fund is used to account for resources provided for capital projects not fully
funded from other sources.
The Town also reports the following fund types:
Internal Service Funds are used to account for services, which are provided to other departments on a cost
reimbursement basis. Those services include workers compensation, selfinsurance, facilities maintenance,
information technology, and equipment replacement.
Fiduciary Funds includePrivatePurpose Trust Funds used to account for assets held by the Town as an agent
for individuals, private organizations, and other governments. The financial activities of this fund are
excluded from the governmentwide financial statement but are presented in a separate Fiduciary Fund
financial statement.
The Town reported the following Fiduciary Fund in the accompanying financial statements:
RDA Successor Agency Private Purpose Trust Fund accounts for the assets, liabilities and operations
transferred from the dissolution of the Town’s Redevelopment Agency in 2012, which includes the
following:
x Certificates of Participation issued to finance several capital improvement projects throughout
the Town.
x Redevelopment projects and related property tax revenue.
x Affordable Housing SetAside Program obligations.
x Repayment of obligations incurred by the Town’s Redevelopment Agency prior to its dissolution.
F. Basis of Accounting
The governmentwide, proprietary and fiduciary fund financial statements are reported using the economic
resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned
and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take
place.
60Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Governmental funds are reported using the current financial resources measurement focus and the modified
accrual basis of accounting. Under this method, revenues are recognized when measurable and available.
The Town considers property tax revenues reported in the governmental funds to be available if the
revenues are collected or are reasonably expected to be collected within sixty days after yearend. For
revenues other than property taxes, the Town generally applies the sixtyday period rule but would make
exceptions considering the measurable and available criteria. Expenditures are recorded when the related
fund liability is incurred, except for principal and interest on general longterm debt, which is recognized
upon becoming due and payable; and except for claims, judgments and compensated absences, which are
recognized when estimable and probable. Governmental capital asset acquisitions are reported as
expenditures in governmental funds. Proceeds of governmental longterm debt and acquisitions under
capital leases are reported as other financing sources.
Those revenues susceptible to accrual are property and sales taxes, certain intergovernmental revenues,
and interest revenue. Fines, forfeitures, licenses and permits, and charges for services are not susceptible to
accrual because they are not measurable until received in cash.
Nonexchange transactions, in which the Town gives or receives value without directly, receiving or giving
equal value in exchange, include taxes, grants, entitlements, and donations. On the accrual basis, revenue
from taxes is recognized in the fiscal year for which the taxes are levied or assessed. Revenue from grants,
entitlements, and donations is recognized in the fiscal year in which all eligibility requirements have been
satisfied.
The Town may fund programs with a combination of costreimbursement grants, categorical block grants
and/or general revenues. Thus, both restricted and unrestricted net position may be available to finance
program expenditures. The Town’s policy is to first apply restricted grant resources to such programs
followed by general revenues as necessary.
Certain indirect costs are included in program expenses reported for individual functions and activities.
The Town applies all applicable GASB pronouncements for certain accounting and financial reporting
guidance including those applicable to accounting and reporting for proprietary operations. In December of
2010, GASB issued GASBS No. 62, Codification of Accounting and Financial Reporting Guidance Contained in
PreNovember 30, 1989 FASB and AICPA Pronouncements. This statement incorporates pronouncements
issued on or before November 30, 1989 into GASB authoritative literature. This includes pronouncements
by the Financial Accounting Standards Board (FASB), Accounting Principles Board Opinions (APB), and the
Accounting Research Bulletins of the American Institute of Certified Public Accountants' (AICPA) Committee
on Accounting Procedure, unless those pronouncements conflict with or contradict with GASB
pronouncements.
61Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Pension For purposes of measuring the net pension liability and deferred outflows/inflows of resources
related to pensions, and pension expense, information about the fiduciary net position of the Town’s
California Public Employees’ Retirement System (CalPERS) plans (the 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.
Generally accepted accounting principles require that the reported results must pertain to liability and asset
information within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date June 30, 2019
Measurement Date June 30, 2020
Measurement Period July 1, 2019 to June 30, 2020
Other Postemployment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of
resources related to OPEB, and OPEB expense, information about the fiduciary net position of the Town’s
plan (OPEB Plan) and additions to/deductions from the OPEB Plan’s fiduciary net position have been
determined on the same basis. For this purpose, benefit payments are recognized when currently due and
payable in accordance with the benefit terms. Investments are reported at fair value. Generally accepted
accounting principles require that the reported results must pertain to liability and asset information within
certain defined timeframes. For this report, the following timeframes are used:
Valuation Date June 30, 2019
Measurement Date June 30, 2020
Measurement Period July 1, 2019 to June 30, 2020
Cash and Cash Equivalents The Town’s cash and cash equivalents are considered to be cash on hand,
demand deposits, and shortterm investments with original maturities of three months or less from the date
of acquisition.
State of California statutes and the Town’s investment policy authorize the Town to invest in obligations of
the U.S. Treasury, its agencies and instrumentalities, collateralized, nonnegotiable certificates of deposits,
commercial paper rated A1/P1, mediumterm corporate notes rated A or its equivalent or better by
Moody’s or Standard & Poor’s, asset backed corporate notes, bankers’ acceptances, mutual funds, and the
State Treasurer’s investment pool (Local Agency Investment Fund).
The Town does not enter into repurchase or reverse repurchase agreements.
Investments 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.
62Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
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:
x 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.
x 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.
x 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.
Materials, Supplies and Deposits These assets are held for consumption and are stated at cost using the
firstin, firstout method. The costs are recorded as expenditures at the time the item is consumed.
Interfund Receivables and Payables Transactions between funds that are representative of
lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as “advances
to/advances from other funds”. All other outstanding balances between funds are reported as “due to/from
other funds”.
Advances Advances between funds are offset by a nonspendable fund balance in applicable Town funds to
indicate the extent to which they are not available for appropriation and are not expendable available
financial resources.
Capital Assets Capital assets are valued at historical cost or estimated historical cost if actual historical cost
is not available. Contributed capital assets are valued at their acquisition value on the date contributed.
Donated capital assets, donated works of art and similar items, and capital assets received in a service
concession arrangement are reported at acquisition value. Capital assets, including infrastructure, are
recorded if acquisition or construction costs exceed $10,000.
As required by GASB, the Town depreciates capital assets with limited useful lives over their estimated useful
lives. The purpose of depreciation is to spread the cost of capital assets equitably among all users over the
life of these assets. The amount charged to depreciation expense each year represents that year’s pro rata
share of the cost of capital assets. The Town depreciates using the straight line method which means the
cost of the asset is divided by its expected useful life in years and the result is charged to expense each year
until the asset is fully depreciated.
63Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
The Town has assigned the useful lives listed below to capital assets:
Buildings 2540 years
Improvements 2540 years
Machinery and equipment 220 years
Furniture and fixtures 512 years
Software 57 years
Infrastructure 2040 years
Major capital outlay for capital assets and improvements are capitalized as projects are constructed.
Capital assets may be acquired using federal and state grants, contributions from developers, and
contributions or grants from other governments. GASB 34 requires that these contributed assets be
accounted for as revenue at the time they are contributed.
Deferred Compensation Plan The Town established a deferred compensation plan created in accordance
with California Government Code Section 53212 and Internal Revenue Code Section 457. The plan, available
to all Town employees, permits them to defer a portion of their salary until future years. The deferred
compensation is not available to employees until termination, retirement, death, or unforeseeable
emergency. Deferred compensation plans are not reported as part of the Town’s assets or liabilities, as the
deferred compensation plan trustees hold those funds in trust on behalf of employees until the employees
are eligible to receive the benefits.
Compensated Absences Accumulated Vacation, Sick Pay and Other Employee Benefits are accrued as
earned. Upon termination, employees are paid for all unused vacation at their current hourly rates. Sick
leave earned is cashed out based on the following schedule for employees with at least 150 hours accrued
and up to a maximum amount as specified under labor contract provisions:
For employees under contract 159 months 25.0%
For employees under contract 60119 months 37.5%
For employees under contract 120 months or more 50.0%
The Town’s liability for compensated absences is determined annually. For all governmental funds, amounts
expected to be paid out of current financial resources are recorded as liabilities of each fund; the longterm
portion is recorded in the Statement of Net Position. The changes of the compensated absences were as
follows:
Compensated absences are liquidated by the fund that has recorded the liability. The longterm portion of
governmental activities compensated absences is liquidated primarily by the General fund. Only
compensated absences liabilities related to retirements as of the end of the fiscal year are reported in the
fund financial statements.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Unearned Revenue Unearned revenue arises when assets are received before revenue recognition criteria
have been satisfied. Grants and entitlements received before eligibility requirements are met are recorded
as unearned revenue. In the governmental fund financial statements, receivables associated with non
exchange transactions that will not be collected within the availability period have been recorded as
deferred inflows from unavailable revenue.
LongTerm Liabilities In the governmentwide financial statements and privatepurpose trust funds long
term debt and other longterm obligations are reported as liabilities in the applicable statement of net
position. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life
of the bonds using the straightline method. Bonds payable are reported net of the applicable bond premium
or discount.
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
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
Deferred Outflows/Deferred Inflows of Resources Deferred outflows of resources is a consumption of net
position by the Town that is applicable to a future reporting period, for example, contributions to pension
and OPEB plans that are after the actuarial measurement date.
Deferred inflows of resources is an acquisition of net position by the Town that is applicable to a future
reporting period, for example, unavailable revenue.
Net Position In the governmentwide 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 is 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 "net
investment in capital assets" or "restricted net position."
Fund Balances The Town does not have a policy identifying a minimum unassigned fund balance. Because
amounts in the nonspendable, restricted, committed, and assigned categories are subject to varying
constraints on their use, the remaining fund balances are otherwise unassigned.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
In accordance with Government Accounting Standards Board 54, Fund Balance Reporting and Governmental
Fund Type Definitions, the Town classifies governmental fund balances as follows:
Nonspendable includes fund balance amounts that cannot be spent either because it is not in spendable
form or because of legal or contractual constraints.
Restricted includes fund balance amounts that are constrained for specific purposes which are externally
imposed by providers, such as creditors or amounts constrained due to constitutional provisions or
enabling legislation.
Committed includes fund balance amounts that are constrained for specific purposes that are internally
imposed by the government through Council Resolution which is a formal action of the highest level of
decision making authority and does not lapse at yearend. Committed fund balances are imposed by the
Town Council.
Assigned includes fund balance amounts that are intended to be used for specific purposes that are
neither considered restricted or committed. Fund balance may be assigned by the Town Manager or the
Finance Director.
Unassigned includes fund balances within the funds which have not been classified within the above
mentioned categories. The general fund is the only fund that reports a positive unassigned fund balance
amount. In other governmental funds it is not appropriate to report a positive unassigned fund balance
amount. However, in governmental funds other than the general fund, if expenditures incurred for specific
purposes exceed the amounts that are restricted, committed, or assigned to those purposes, it may be
necessary to report a negative unassigned fund balance in that fund.
The Town uses restricted/committed amounts to be spent first when both restricted and unrestricted fund
balance is available unless there are legal documents/contracts that prohibit doing this, such as a grant
agreement requiring dollar for dollar spending. Additionally, the Town would first use committed, then
assigned, and lastly unassigned amounts of unrestricted fund balance when expenditures are made.
Use of Estimates The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent asset and liabilities at the dates of the financial statements
and the reported amounts of revenues and expenditures/expenses during the reporting periods. Actual
results could differ from those estimates.
Subsequent Events Management has considered subsequent events through December xx, 2021, the date
which the financial statements were available to be issued. The financial statements include all events or
transactions, including estimates, required to be recognized in accordance with generally accepted
accounting principles. Management has determined that there are no nonrecognized subsequent events
that require additional disclosure.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Property Tax Levy, Collection and Maximum Rates State of California Constitution Article XIII A provides
that the combined maximum property tax rate on any given property may not exceed 1% of its assessed
value unless an additional amount for general obligation debt has been approved by voters. Assessed value
is calculated at 100% of market value as defined by Article XIII A and may be adjusted by no more than 2%
per year unless the property is sold, transferred, or substantially improved. The State Legislature has
determined the method of distribution of receipts from a 1% tax levy among the counties, cities, school
districts and other districts.
The County of Santa Clara assesses properties, bills and collects property taxes on the following schedule:
Secured Unsecured
Valuation/lien dates January 1 January 1
Levy dates January 1 January 1
Due dates (delinquent as of) 50% on November 1 (December 10) March 1 (August 31)
50% on February 1 (April 10)
The term "unsecured" refers to taxes on personal property other than land and buildings. These taxes are
secured by liens on the property being taxed. Property taxes levied are recorded as revenue and receivables
when they are collected during the fiscal year of levy or within 60 days of yearend.
Budgets and Budgetary Accounting The Town follows the procedures below when establishing the
budgetary data reflected in the financial statements:
1. The Town Manager submits to the Town Council a proposed operating and capital improvement budget
for the fiscal year commencing the following July 1. The budgets include the proposed expenditures and
the means of financing them.
2. Public hearings are conducted to obtain taxpayer comments.
3. The budget is legally enacted through adoption of Town resolution by Council.
4. The Town Manager is authorized to implement the programs as approved in the adopted budget. Within
a specific fund, the Town Manager may transfer appropriations between categories, departments,
projects and programs as needed to implement the adopted budget, whereas the Town Council must
authorize budget increases and decreases, and transfers between funds.
5. Budgets are adopted on a basis consistent with generally accepted accounting principles except for
proprietary funds which budget for capital outlays but not depreciation. Budgets were adopted for the
General Fund, Special Revenue Funds, Internal Service Funds and Capital Projects Funds.
6. Budgeted amounts are as originally adopted or as amended by Town Council. Individual budget
adjustments or amendments were not material in relation to original appropriations, except for an
increase in nondepartmental expenditures related to a discretionary lumpsum payment to CalPERS for
the pension liability.
Excess of Expenditures over Appropriations There were no significant expenditures in excess of budget
during the year ended June 30, 2021.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Encumbrances Under encumbrance accounting, purchase orders, contract and other commitments for
expenditures are recorded in order to reserve that portion of the applicable appropriation. Encumbrance
accounting is employed as an extension of formal budgetary integration in all funds. Encumbrances
outstanding at yearend are reported as restrictions, commitments or assignments of fund balances since
they do not constitute expenditures or liabilities; unexpended and unencumbered appropriations lapse at
year end in all funds. Encumbered appropriations are carried forward to the following year.
Reclassifications Certain accounts in the prioryear financial statements have been reclassified for the
presentation in the currentyear financial statements.
G. Accounting and Reporting Changes
The Town adopted new accounting standards in order to conform to the following Governmental Accounting
Standards Board Statements:
¾GASB Statement No. 90, Majority Equity Interests – The primary objectives of this Statement are to
improve the consistency and comparability of reporting a government’s majority equity interest in
a legally separate organization and to improve the relevance of financial statement information for
certain component units. The requirements of this statement did not apply to the Town for the
current fiscal year.
¾GASB Statement No. 93, Interbank offered rates (except LIBOR removal and lease modifications) –
The objective of this Statement is to address those and other accounting and financial reporting
implications that result from the replacement of an interbank offered rate. The requirements of this
statement did not apply to the Town for the current fiscal year.
¾GASB Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting
for Internal Revenue Code Section 457 Deferred Compensation Plans – The primary objectives of
this Statement are to (1) increase consistency and comparability related to the reporting of
fiduciary component units in circumstances in which a potential component unit does not have a
governing board and the primary government performs the duties that a governing board typically
would perform; (2) mitigate costs associated with the reporting of certain defined contribution
pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee
benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary
component units in fiduciary fund financial statements; and (3) enhance the relevance,
consistency, and comparability of the accounting and financial reporting for Internal Revenue Code
(IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a
pension plan and for benefits provided through those plans. The requirements of this statement
did not apply to the Town for the current fiscal year.
¾GASB Statement No. 98, The Annual Comprehensive Financial Report – The objective of this
Statement is to address references in authoritative literature to the term comprehensive annual
financial report. The Town implemented this statement by referring to the report as an Annual
Comprehensive Financial Report and using the ACFR acronym.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2 CASH AND INVESTMENTS
The Town pools cash from all sources and all funds except Restricted Cash and Restricted Investments so that it
can be invested at the maximum yield, consistent with the primary objectives of safety and liquidity, while
ensuring existing funds have cash available for expenditures.
Cash and Investments Defined The Town includes only cash deposits in banks as cash. Investments in LAIF and
government securities mutual funds are next in the order of liquidity, since they may be withdrawn without
penalty. U.S. Treasuries, U.S. Agencies and Certificates of Deposit are the Town’s least liquid investments, since
they must be held to maturity.
Cash Deposits with Banks and Custodial Credit Risk California Law requires banks and savings and loan
institutions to pledge government securities with a fair value of 110% of the Town’s cash on deposit, first trust
deed mortgage notes with a value of 150% of the deposit, or letters of credit issued by the Federal Home Loan
Bank of San Francisco with a value of 100% of the deposit as collateral. Under California Law this collateral is
held in the Town’s name and places the Town ahead of general creditors of the institution. The Town’s cash
deposits are collateralized under this law.
The bank balance of the Town’s cash deposits was $12,455,161 and the carrying amount was $12,308,688 as of
June 30, 2021. The bank balance and the carrying amount differed due to deposits in transit and outstanding
checks.
Investments The Town and its fiscal agent invest in individual investments and in investment pools. Individual
investments are evidenced by specific identifiable pieces of paper called “securities instruments,” or by an
electronic entry registering the owner in the records of the institution issuing the security, called the book entry
system. In order to maximize security, the Town employs the Trust department of a bank as the custodian of all
its investments, regardless of their form.
Fair Value Measurements - GASB 72 established a hierarchy of inputs to the valuation techniques above. This
hierarchy has three levels:
x Level 1 inputs are quoted prices in active markets for identical assets or liabilities.
x 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
x Level 3 inputs are unobservable inputs, such as a property valuation or an appraisal.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2 CASH AND INVESTMENTS, CONTINUED
Local Agency Investment Fund (LAIF) The Town invests in the California State Treasurer’s Local Agency
Investment Fund. LAIF, established in 1977, is regulated by California Government Code Section 16429 and is
under the daytoday administration of the State Treasurer. As of June 30, 2021, the Town had approximately
$11.9 million in LAIF and used a fair value factor of 1.00008297 to calculate the fair value of the investments in
LAIF. Of that amount, 97.69% is invested in nonderivative financial products and 2.31% in structured notes and
assetbacked securities. These investments are described as follows:
1. Structured Notes are debt securities (other than assetbacked 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.
2. AssetBacked Securities, the bulk of which are mortgagebacked 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 Collateralized Mortgage Obligations) or credit card receivables.
Risk Disclosures
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 maturity of an investment, the greater the sensitivity of its fair value to
the changes in market interest rates. One of the ways that the Town manages its exposure to interest rate risk
is by purchasing a combination of shorter term and longerterm investments and by timing cash flows from
maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary
to provide the cash flow and liquidity needed for operations. Information about the sensitivity of the fair values
of the Town's investments to market interest rate fluctuations is provided in the summary of cash and
investments table on the following page that shows the distribution of the Town's investments by maturity.
Credit Risk is the risk of loss due to the failure of the security issuer. This risk is measured by the assignment of
a rating by a nationally recognized statistical rating organization. The summary of cash and investments table on
the following page shows the minimum rating under the actual rating of the Town’s investments at year end.
Custodial Credit Risk is the risk that in the event of the failure of the counterparty (e.g., brokerdealer) to a
transaction, a government will not be able to recover the value of its investment or collateral securities that are
in the possession of another party. The Town’s money market fund and investment in LAIF are not categorized
as to custodial credit risk. Its U.S. Government Agency Securities investment is held by a thirdparty financial
institution under the third party’s trust department’s name and thus not exposed to custodial credit risk.
Concentration of Credit Risk is the risk that the Town’s investments are exposed because the types of
investments have been too limited. The Town’s Policy states that, with the exception of US Treasury securities
and LAIF, no more than 50% of the Town’s total investment portfolio will be invested in one single security type
or with a single financial institution. The Town was in compliance with this policy as of June 30, 2021.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 2 CASH AND INVESTMENTS, CONTINUED
Risk Disclosures, Continued
The following table summarizes the Town’s policy related to maturities and concentration of investments:
The following is a summary of the Town’s Cash and Investments (stated at fair value) as of June 30, 2021:
Cash and investments are classified in the financial statements as shown below, based on whether or not their
use is restricted by Town debt or Agency agreements.
Investment Type/Cash Deposit
Available for
Operations Restricted Total
Concentration
of Credit Risk
Minimum
Rating
Input
level
Time to
Mature
(Years)
Weighted
Average
Maturity
US Treasury Securities 7,892,169$ $ 7,892,169$ 13.58% n/a 2 14 1.87 years
US Instrumentality Security 22,313,521 22,313,521 38.38% n/a 2 04 1.80 years
Corporate Securities 15,742,984 15,742,984 27.08% A3 2 04 1.95 years
Market Mutual funds 305,797 305,797 0.53% Not Rated 2 n/a n/a
LAIF 11,879,232 11,879,232 20.43% Not Rated n/a n/a n/a
Total investments 58,133,703 58,133,703 100.00%
Cash Deposit with Banks 10,238,478 2,070,211$ 12,308,689
Money Market Accounts 17,389 17,389
Cash on hand at Town 2,600 2,600
Town Cash and Investments 68,392,170$ 2,070,211$ 70,462,381$
Investment Type
Maximum
Maturity
Maximum
Portfolio
Percentage
US Treasury Obligations 5 years None
US Agency Obligations 5 years None
Bankers Acceptances 180 days 30%
Commercial Paper 270 days 25%
Medium Term Notes 5 years 30%
Collateralized CD's 5 years 30%
CA LAIF N/A $65 million
Money Market Funds N/A 20%
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 3 LONGTERM NOTES RECEIVABLE
The Town had the following longterm notes receivable as of June 30, 2021:
Active Home Loans and Housing Conservation Loans The Town used CDBG Funds (funded through federal
grants) to assist low and moderate income homeowners to improve their homes and to fund low income housing
rental properties acquisition and rehabilitation. These loans are secured by deeds of trust.
Project Match The Successor Agency has a loan agreement with Project Match, a nonprofit benefit corporation,
to acquire and rehabilitate four or fivebedroom singlefamily homes. The property is to provide affordable
housing rental to very low income senior households. The loan receivable is evidenced by a promissory note and
secured by a deed of trust. From inception of the loan through June 30, 2021, no interest or principal payments
have been made.
NOTE 4 INTERFUND TRANSACTIONS
Interfund Receivables and Payables Amounts due to or due from other funds reflect interfund balances for
services rendered or shortterm loans expected to be repaid in the next fiscal year. Advances to or from other
funds are longterm loans between funds that are to be repaid in their entirety over several years.
Transfers With Council approval resources may be transferred from one fund to another. Transfers pay for
capital projects or capital outlays, lease or debt service payments, operating expenses and low and moderate
income housing projects. Transfers between funds during the fiscal year ended June 30, 2021 were as follows:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 5 CAPITAL ASSETS
Changes in the Town’s capital assets during the fiscal year are shown as follows:
Depreciation expense is charged to functions and programs based on their usage of the related assets. The
amount allocated to each function or program is as follows:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 5 CAPITAL ASSETS, CONTINUED
Changes in the RDA Successor Agency trust fund capital assets during the fiscal year are shown as follows:
NOTE 6 LONGTERM OBLIGATIONS
The Town generally incurs longterm debt to finance projects or purchase assets, which will have useful lives
equal to or greater than the related debt. Below is a summary of Town indebtedness:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 6 LONGTERM OBLIGATIONS, CONTINUED
On August 7, 2020, the Town entered into an agreement with PG&E for a loan in the amount of $1,560,336 for
costs related to various energy upgrades the Town performed during the fiscal years ended June 30, 2019 and
June 30, 2020. The loan is to be repaid over the course of 12 years with an interest rate of 0% and a monthly
amount of $13,003 billed through the Town's energy bill. Future debt service requirements for the PG&E loan
are as follows:
As of February 1, 2012, the Town transferred longterm debt issued by the Redevelopment Agency to the
Successor Agency trust as a part of the RDA dissolution. The following summarizes the changes in longterm debt
in the Successor Agency trust fund during the fiscal year ended June 30, 2021:
2002 Certificates of Participation (2002 COPs) On July 18, 2002, the Town and the Los Gatos Redevelopment
Agency issued $10,725,000 in 2002 COPs, Series A, to finance the acquisition, construction, rehabilitation,
equipping and improvement of several capital improvement projects. The Town had pledged lease payments of
real property and facilities comprised of the Parks and Public Works Service Center and Baseball Field, as well as
Parking Lot No. 1, 2, and 3, as collateral for the repayment of the Certificates. Principal payments are due
annually on August 1st, with interest payments due semiannually on February 1st and August 1st.
2010 Certificates of Participation (2010 COPs) On June 1, 2010, $15,675,000 of 2010 COPs were issued to
finance the acquisition, construction, and improvement of a library on the Town’s Civic Center campus, to be
owned and operated by the Town. Principal payments are due annually on August 1, with interest payments due
semiannually on February 1 and August 1.
To assist the Town in paying the cost of acquisition and construction of various projects, the Town and its
Redevelopment Agency entered into lease and reimbursement agreements in 2002 and 2010. Under the
agreements, the Agency will use available net tax increment revenues resulting from the projects’ effect on land
values to repay the Town for all lease payments made by the Town to the Agency under the lease agreements
for the projects. Net tax increment revenues are all taxes allocated to and paid into the Successor Agency private
purpose trust fund.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 6 LONGTERM OBLIGATIONS, CONTINUED
Future debt service requirements of the 2002 and 2010 Certificates of Participation are as follows:
The Successor Agency must maintain a required amount of cash and investments with the trustee under the
terms of the COPs’ debt agreements. These funds are pledged as reserves to be used if the Successor Agency
fails to meet its obligations under the debt agreements and totaled $1,984,487 as of June 30, 2021. The California
Government Code requires these funds to be invested in accordance with Town ordinances, bond indentures or
State statues. All these funds have been invested as permitted under the Code.
NOTE 7 SPECIAL ASSESSMENT DISTRICT DEBT WITHOUT COMMITMENT
Special assessment districts are established in various parts of the Town to provide improvements to properties
located in those districts. Properties are assessed for the cost of the improvements. These assessments are
payable over the term of the debt issued to finance the improvements and are used to pay debt service on debt
issued to fund the improvements.
The Town is acting only as an agent and has no legal liability with respect to the payment of any indebtedness
of the Downtown Parking Assessment District. There was no nonobligated debt outstanding as of June 30, 2021.
NOTE 8 FUND BALANCES
Fund balance for governmental funds is reported in classifications (nonspendable, restricted, committed,
assigned, and unassigned) that comprise a hierarchy based primarily on the extent to which the government is
bound to honor constraints on the specific purposes for which amounts in those funds can be spent.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8 FUND BALANCES, CONTINUED
As of June 30, 2021, fund balances were classified as follows:
Restricted
Capital Outlay funded from storm drain fees, construction taxes and debt proceeds are legally restricted for
major capital projects.
Library reflects fund balance from donations and bequests held in trust for the benefit of the Town’s library.
Repairs and Maintenance reflects legally restricted balances for repairs and maintenance of lighting and
landscape property and open space property that are financed with special tax assessments on the benefiting
property.
VTA are funds provided by the Valley Transportation Authority’s Measure B restricted for the pavement/crack
seal rehabilitation project
Beginning
Balance Adjustments
Adjusted
Beginning
Balance Additions Deletions
Ending
Balance
Nonspendable 159,000 159,000 159,000
Restricted for:
Capital Outlay 6,257,756$ $ 6,257,756$ 1,286,341$ $ 7,544,097$
Pension 669,978 669,978 (669,978)
Library 526,815 526,815 45,177 (19,115) 552,877
Repairs and Maintenance 190,250 190,250 (17,894) 172,356
VTA 293,323 293,323
Total Restricted 8,562,653
Committed to:
Budget Stabilization 5,427,603 5,427,603 32,882 5,460,485
Catastrophic 5,427,603 5,427,603 32,882 5,460,485
Pension/OPEB Reserve 4,532,500 4,532,500 300,000 (4,532,500) 300,000
Total Committed 11,220,970
Assigned to:
Open Space 410,000 410,000 152,000 562,000
Parking 1,460,210 1,460,210 1,460,210
Sustainability 140,553 140,553 140,553
Capital/Special Projects 8,787,958 (159,000) 8,628,958 (1,663,603) 6,965,355
Comcast PEG 50,000 50,000 50,000
Market Fluctuations 1,218,732 1,218,732 438,333 (1,218,732) 438,333
Sale of Property 1,200,000 1,200,000
Compensated Absences 1,539,408 1,539,408 110,509 1,649,917
Capital Projects 12,266,881 12,266,881 893,498 13,160,379
Measure G 2018 District Sales Tax
Operational 1,181,162 1,181,162 (590,581) 590,581
Capital 1,139,909 1,139,909
Special Revenue Funds 404,588 404,588 299,477 (166,173) 537,892
Total Assigned 27,895,129
Total Fund Balance All
Governmental Funds 49,965,182$ 526,815$ 50,491,997$ 6,224,331$ (8,878,576)$ 47,837,752$
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8 FUND BALANCES, CONTINUED
Committed
Stabilization Arrangements
The Town Council has established by resolution the budget stabilization arrangement and the catastrophe
arrangement. The total balances in these arrangements are to be maintained at 25% of annual General Fund
ongoing, operating expenditures, excluding onetime expenditures, divided equally between both
arrangements. When either arrangement is used, Town Council will develop a 1 to 5 year reserve replenishment
plan to meet the minimum threshold of 25% of General Fund ongoing, operating expenditures, excluding one
time expenditures. The arrangements can be used when:
x Unforeseen emergencies, such as a disaster or catastrophic event occur
x Significant decrease in property or sales tax, or other economically sensitive revenues
x Loss of businesses considered to be significant sales tax generators
x Reductions in revenue due to actions by the state /federal government
x Workflow /technical system improvements to reduce ongoing, personnel costs and enhance customer
service
x One time maintenance of service levels due to significant economic /budget constraints
x One time transitional costs associated with organizational restructuring to secure longterm personnel
cost savings.
Should any of the events listed above occur that require the expenditure of Town resources beyond those
provided for in the annual budget, the Town Manager or designee shall have authority to approve catastrophic
or budget stabilization arrangement appropriations. The Town Manager or designee shall then present to the
Town Council a budget amendment confirming the nature of the event and authorizing the appropriation of
reserve funds.
Pension/OPEB Reserve committed fund balance will be used to fund net pension liabilities for the Town's
Miscellaneous and Safety pension plans administered by CALPERS. In the fiscal year ending June 30, 2018 the
Town approved an update to its General Fund reserve policy providing to the extent possible that additional
annual deposits be calculated and placed into this reserve with the goal of moving the payment of the unfunded
pension liability from a 29year to a 20year amortization period.
Assigned
Open Space assigned fund balance will be used to make selective open space acquisitions.
Parking assigned fund balance will be used to mitigate parking issues within the Town.
Sustainability assigned fund balance will be used to fund ongoing sustainability initiatives and programs.
Capital/Special Projects assigned fund balance will be used for the acquisition and construction of capital
facilities as well as special projects or activities as directed by the Town Council.
Comcast PEG assigned fund balance will be used to fund capital improvements linked to the televising of council
and planning commission meetings.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 8 FUND BALANCES, CONTINUED
Market Fluctuations assigned fund balance is used to represent fund balance amounts for unrealized investment
gains that have been recorded as investment income in the financial statements in accordance with the
requirements of GASB 31.
Sale of Property is intended to be spent on capital projects
Compensated Absences assigned fund balance will be used for vacation and sickpay benefits owed to employees
as of June 30, 2021 that were not an obligation of the General Fund because of their longterm nature.
Measure G 2018 District Sales Tax assigned fund balances for operational and capital will be used to track receipt
and use of the 1/8 cents District tax funds collected by the Town for operational and capital expenditures.
Special Revenue Fund assigned fund balance will be used for the activities of the respective revenue funds.
NOTE 9 EMPLOYEES' RETIREMENT PLAN
(a) General Information about the Pension Plans
Plan Description All qualified employees are eligible to participate in the Town’s pooled Safety Plan, a cost
sharing multipleemployer defined benefit pension plan and the Town’s Miscellaneous (all other) Plan, an agent
multipleemployer defined benefit pension plan administered by the California Public Employees' Retirement
System (CalPERS), which acts as a common investment and administrative agent for its participating member
employers. Benefit provisions under the Plans are established by State statute and Town resolution. CalPERS
issues publicly available reports that include a full description of the pension plans regarding benefit provisions,
assumptions and membership information that can be found on the CalPERS website. Audited financial
statements of CalPERS can be obtained from its website https://www.calpers.ca.gov/page/formspublications.
The Town relies upon actuarial and investment data provided by CalPERS for inclusion and analysis in this report.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(a) General Information about the Pension Plan, Continued
Benefits Provided CalPERS provides service retirement and disability benefits, annual cost of living adjustments
and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on
years of credited service, equal to one year of full time employment. Members with five years of total service
are eligible to retire at age 50 with statutorily reduced benefits. All members are eligible for nonduty disability
benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, Lump Sum,
or the 1959 Survivor Benefit. The cost of living adjustments for each plan are applied as specified by the Public
Employees’ Retirement Law.
The Plan’s provisions and benefits in effect at June 30, 2021, are summarized as follows:
Employees Covered
At June 30, 2021, the following employees were covered by the benefit terms for the Miscellaneous and Safety
Plans:
Contributions – Section 20814 (c) of the California Public Employees’ Retirement Law requires that the employer
contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective
on the July 1 following notice of a change in the rate. Funding contributions for both Plans 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 cost of benefits earned by employees during the year. The Town is required to
contribute the difference between the actuarially determined rate and the contribution rate of employees. In
addition, the Town is solely responsible for any annual costs associated with payments toward any unfunded
accrued liability.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(b) Net Pension Liability
Governmental Accounting Standards Board (GASB) Statement No. 68, Accounting and Financial Reporting for
Pensions, an amendment of GASB Statement No. 27 (GASB 68), requires public employers to comply with
accounting and financial reporting standards related to the recognition and calculation of pension obligations.
Under GASB 68, employers that participate in a defined benefit pension plan administered as a trust or
equivalent arrangement are required to record their portion of the net pension liability, pension expense, and
deferred outflows/deferred inflows of resources related to pensions in their financial statements as part of their
financial position.
The Town’s net pension liability for the Miscellaneous Plan is measured as the total pension liability, less the
pension plan's fiduciary net position.
GASB 68 requires that the reported results must pertain to liability and asset information within certain defined
timeframes. For this report, the following timeframes are used. For the Safety Plan, net pension liability is
measured as the proportionate share of the net pension liability. The net pension liability of each of the Plans is
measured as of June 30, 2020, using an annual actuarial valuation as of June 30, 2019 rolled forward to June 30,
2020 using standard update procedures. The Town’s proportion of the net pension liability (Safety Plan) was
based on a projection of the Town’s longterm share of contributions to the pension plans relative to the
projected contributions of all participating employers, actuarially determined. The Town’s proportionate share
of the net pension liability for the Safety Plan as of the measurement date June 30, 2020 was as follows:
A summary of principal assumptions and methods used to determine the net pension liability is shown below.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(b) Net Pension Liability, continued
Actuarial Assumptions The June 30, 2019 valuation was rolled forward to determine the June 30, 2020 total
pension liability, based on the following actuarial methods and assumptions:
Discount Rate The discount rate used to measure the total pension liability was 7.15% for the Plan and reflects
the longterm expected rate for the Plan net of investment expenses and without reduction for administrative
expenses. To determine whether the municipal bond rate should be used in the calculation of a discount rate
for each plan, CalPERS conducted cash flow projections for plans with a higher likelihood of running out of
assets with too high of a 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 plans
in the Public Employees Retirement Fund (PERF). The stress test results are presented in a detailed report
that can be obtained from the CalPERS website.
Longterm Expected Rate of Return – Every four years, CalPERS performs an Asset Liability Management (ALM)
review of possible asset allocation alternatives for the Public Employees’ Retirement Fund (PERF) investment
portfolio. The review examines potential new investment policy portfolios and their impact on the CalPERS Fund.
The ALM review also incorporates actuarialbased information to reflect the implications of the various asset
allocation alternatives on parameters such as the employer contribution rate. This periodic review is the primary
process by which the PERF investment portfolio and actuarial assumptions evolve to reflect the market
opportunity set, demographic assumptions and experience, and plan status.
The last ALM was performed in 2017 and the longterm expected rate of return on pension plan investments
was determined using a buildingblock method in which expected future real rates of return (expected returns,
net of pension plan investment expense and inflation) are developed for each major asset class.
Miscellaneous Agent
Multiple Employer Plan Safety Cost Sharing Plan
Valuation Date June 30, 2019 June 30, 2019
Measurement Date June 30, 2020 June 30, 2020
Actuarial Cost Method
Actuarial Assumptions:
Discount Rate 7.15%7.15%
Inflation 2.50%2.50%
Salary Increases
Mortality Rate Table1
Post Retirement Benefit Increase
EntryAge Normal Cost Method
Varies by Entry Age and Service
Derived using CalPERS' Membership Data for all Funds
Contract COLA up to 2.50% until Purchasing Power
Protection Allowance Floor on Purchasing Power
applies
1. The mortality table used was developed based on CalPERSspecific data. The table includes 15 years of
mortality improvements using the Society of Actuaries Scale 90% of scale MP 2016. For more details on this
table, please refer to the December 2017 experience study report that can be found on the CalPERS
website.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(b) Net Pension Liability, continued
In determining the longterm expected rate of return, CalPERS took into account both shortterm and longterm
market return expectations as well as the expected pension fund cash flows. Using historical returns of all the
funds’ asset classes, expected compound (geometric) returns were calculated over the shortterm (first 10 years)
and the longterm (11+ years) using a buildingblock approach. Using the expected nominal returns for both
shortterm and longterm, 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 shortterm and longterm returns. The expected rate
of return was then set equivalent to the single equivalent rate calculated above and adjusted to account for
administrative expenses.
The table below reflects the longterm 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.
In addition to the expected returns by asset class, the table below reflects the shortterm, longterm, and
blended expected rate of return for the total PERF asset allocation as of the 2017 ALM.
Expected Compound Return (110 years) 6.10%
Long Term Expected Return (1160 years) 8.30%
Blended Return (160 years) 7.00%
New
Strategic Real Return Real Return
Asset Class Allocation Years 1 10(a) Years 11+(b)
Global Equity 50.00%4.80%5.98%
Global Fixed Income 28.00%1.00%2.62%
Inflation Sensitive 0.77%1.81%
Private Equity 8.00%6.30%7.23%
Real Estate 13.00%3.75%4.93%
Liquidity 1.00%0.92%
Total 100%
(a) An expected inflation of 2.00% used for this period.
(b) An expected inflation of 2.92% used for this period.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(b) Net Pension Liability, continued
The table below shows historical compound annual returns of the Public Employees Retirement Fund for various
time periods ending on June 30, 2020 (figures are reported as gross of fees). The compound annual return is the
average rate per year compounded over the indicated number of years. It should be recognized that in any given
year the rate of return is volatile. The portfolio has an expected volatility of 11.4 percent per year based on the
most recent Asset Liability Modelling study. The volatility is a measure of the risk of the portfolio expressed in
the standard deviation of the fund’s total return distribution, expressed as a percentage. Consequently, when
looking at investment returns, it is more instructive to look at returns over longer time horizons.
CalPERS reported a preliminary 21.3% net return on investments for the 12month period ended June 30, 2021.
The preliminary fiscal year 202021 return brings total fund performance to 10.3% for the fiveyear time period,
8.5% for the 10year time period, and 6.9% for the 20year time period. Over the past 30 years, the PERF has
returned an average of 8.4% annually. Under the CalPERS Funding Risk Mitigation Policy, the 21.3% return will
trigger a reduction in the discount rate to 6.8% from the current 7.0%.
(c) Changes in the Net Pension Liability
The change in the Net Pension Liability for the Miscellaneous Plan is as follows:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(c) Changes in the Net Pension Liability, Continued
For the measurement period ended June 30, 2020, the Town contributed $2,565,205 for the safety CostSharing
Plan.
As of June 30, 2021, the Town reported net pension liabilities for its proportionate share of the net pension
liability of the safety CostSharing Plan of $27,149,916.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net
pension liability of the Town for each plan, calculated using the discount rate for the Plan, as well as what
the Local Government’s net pension liability would be if it were calculated using a discount rate that is 1
percentage point lower or 1percentage point higher than the current rate:
Pension Plan Fiduciary Net Position – Detailed information about the pension plan’s fiduciary net position is
available in a separately issued CalPERS financial report.
(d) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
For the year ended June 30, 2021, the Town recognized pension expense of $5,170,412 for the Miscellaneous
Agent Multiple Employer Plan and $4,636,562 for the Safety Cost Sharing Plan. The Town recognized total
pension expense for all plans of $9,806,974.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(d) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
At June 30, 2021, the Town reported deferred outflows of resources and deferred inflows of resources related
to pension from the following sources for the Miscellaneous Agent Multiple Employer Plan:
$9,160,680 reported as deferred outflows of resources related to contributions subsequent to the measurement
date will be recognized as a reduction of the net pension liability in the year ended June 30, 2022. Other amounts
reported as deferred outflows of resources and deferred inflows of resources related to pensions will be
recognized as pension expense as follows:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(d) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions, Continued
At June 30, 2021, the Town reported deferred outflows of resources and deferred inflows of resources related
to pensions from the following sources for the Safety CostSharing Plan:
$2,853,764 reported as deferred outflows of resources related to contributions subsequent to the measurement
date will be recognized as a reduction of the net pension liability in the fiscal year ending June 30, 2022. Other
amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will
be recognized as pension expense as follows:
(e) Payable to the Pension Plan
At June 30, 2021, the Town reported a payable of $106,634 and $91,870 for the outstanding amount of
contributions to the Miscellaneous Agent MultipleEmployer Plan and the Safety CostSharing Plan.
Deferred
Outflows of
Resureces
Deferred Inflows
of Resources
Pension contributions subsequent to
measurement date 2,853,764$ $
Changes in assumptions 90,437
Difference between expected and actual experiences 2,105,338
Changes in employer's proportion 923,111
Differences between the employer's contributions and
the employer's proportionate share of contributions 1,343,348
Net differences between projected and actual
earnings on plan investments 590,082
Totals 6,472,295$ 1,433,785$
Safety
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 9 EMPLOYEES' RETIREMENT PLAN, CONTINUED
(f) IRS Section 115 Trust
During the fiscal year ending June 30, 2020, the Town established an IRS Section 115 Trust with the CalPERS
California Employer’ Pension Prefunding Trust (CEPPT) program. In fiscal year 2021, the Town used the balance
of $706,988 to contribute an additional amount to CalPERS for the Miscellaneous Plan. This payment is included
in the deferred outflows amount of $6,872,036 for contributions made after the measurement date for the
Miscellaneous Plan.
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS
Plan Description The Town makes contributions to California Employer’s Retiree Benefit Trust (CERBT), an
agent multipleemployer defined benefit healthcare plan administered by CalPERS. The purpose of the CERBT
Fund is to provide California government employers with a trust through which they may prefund retiree medical
costs and Other PostEmployment Benefits (OPEB). The Town uses CERBT 1 as its investment vehicle and
requests disbursements on an as needed basis to reimburse the Town for the cost of retiree health insurance
benefits. Benefit provisions and all other requirements are established by state statute and Town ordinance.
Copies of PERS' annual financial report may be obtained from their Executive Office, 400 P Street, Sacramento,
CA 95814.
In accordance with the Public Employees' Medical and Hospital Care Act (PEMHCA), employees qualify for retiree
health benefits upon five (5) years of service if they meet the vesting requirements as set forth by CalPERS and
take a service or disability retirement from Town employment. Additionally, the employee must actually draw a
CalPERS pension within ninety (90) days of separation from the Town, provided the employee remains with the
Town's health plan through COBRA. For employees who retire on or after February 1, 2016, at Medicare
eligibility, the Town will align contributions to the full cost of the employee’s enrollment, including enrollment
of family members, in a health benefits plan or plans up to a maximum of 100% Single Party and 90% Dependents
for Kaiser Bay Area Basic/Medicare/Combo per month. During negotiations in fiscal year 2018/19, the Town’s
discretionary retiree medical benefit contribution was eliminated for all future hires.
Upon retirement, employees have the option to roll over their sick leave accrual into a Townmanaged fund.
Employees can request reimbursement of medical expenses from the fund up to the value of their sick leave at
retirement.
Contributions The contribution requirements of plan members and the Town are established and may be
amended by the Town. The required contribution is based on projected payasyougo financing requirements,
with an additional amount to prefund benefits as determined by the Town. For the measurement period July 1,
2019June 30, 2020, the Town contributed $2,508,306 to the plan which included $1,198,608 of cash benefit
payments, administrative fees of $8,373, and $201,325 of implied subsidy benefit payments. All related
obligations are paid from the Town’s General Fund.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS, CONTINUED
Covered Participants
Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the
substantive plan (the plan as understood by the employer and the plan members) and include the types of
benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between
the employer and plan members to that point. Actuarially determined amounts are subject to continual revision
as actual results are compared with past expectations and new estimates are made about the future. The
actuarial methods and assumptions used include techniques that are designed to reduce the effects of short
term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the longterm
perspective of the calculations.
For the June 30, 2019 actuarial valuation, the actuarial assumptions used are as follows:
Valuation Date June 30, 2019
Measurement Date June 30, 2020
Actuarial Cost Method EntryAge Normal Cost Method
Actuarial Assumptions:
Discount Rate 6.75%
Inflation 2.75%
Contribution Policy Prefunded through CERBT with the Strategy 1 asset allocation
Town contributes at least the ADC
Salary Increases Aggregate 3% annually
Merit CalPERS 19972015 Experience Study
Projected Salary Increase 3.00%
Investment Rate of Return 6.75%
Mortality, Retirement,
Disability, Termination
CalPERS 19972015 Experience Study
Mortality Improvement Postretirement mortality projected fully generational with
Scale MP2019
Healthcare Trend NonMedicare 7.25% for 2021, decreasing to an ultimate rate
of 4.0% in 2076
Medicare 6.3% for 2021, decreasing to an ultimate rate of
4.0% in 2076
Participation at Retirement Tier 1 Actives in insurance program: 100%
Tier 1 Actives in cash allocation program: 80%
Tier 2 Actives in insurance program: 60%
Tier 2 Actives in cash allocation program:
Agency service < 3 months: 60%
Agency service >= 3 months: 40%
Waived retirees aged <65: 20%
Waived retirees aged ≥65: 0%
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS, CONTINUED
The longterm expected rate of return on OPEB plan investments in CERBT 1 was determined using a building
block method in which expected future real rates of return (expected returns, net of OPEB plan investment
expense and inflation) are developed for each major asset class. These ranges are combined to produce the long
term expected rate of return by weighting the expected future real rates of return by the target asset allocation
percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of
return for each major asset class are summarized in the following table:
Discount Rate The discount rate used to measure the total OPEB liability was 6.75 percent. The projection of
cash flows used to determine the discount rate assumed that Town contributions will be made equal to the
actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position
was projected to be available to make all projected OPEB payments for current active and inactive employees
and beneficiaries. Therefore, the longterm expected rate of return on OPEB plan investments was applied to
all periods of projected benefit payments to determine the total OPEB liability.
Target Expected Real
Asset Class Allocation* Rate of Return
Public Equity 59%4.82%
Fixed Income 25%1.47%
TIPS 5%1.29%
Commodities 3%0.84%
REITs 8%3.76%
Assumed LongTerm Rate of Inflation 2.75%
Expected LongTerm Net Rate of Return, Rounded 6.75%
* Policy target effective October 1, 2018.
The longterm expected real rates of return are presented as geometric means
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS, CONTINUED
Net OPEB Liability – The net OPEB liability is calculated by subtracting the fiduciary net position (FNP) of the
Plan from the total OPEB liability as determined by the actuary. The table that follows displays the changes that
applied to the total OPEB liability, FNP, and Net OPEB liability during the measurement period of July 1, 2019
through June 30, 2020.
Due to these changes, the Town achieved an OPEB Plan funding status of 70.3% for the June 30, 2020
measurement date.
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
Balance at June 30, 2020
(6/30/19 measurement date) $ 27,497,929 $ 18,371,542 $ 9,126,387
Changes in the year:
Service cost 1,159,152 1,159,152
Interest 1,887,105 1,887,105
Differences between actual and
expected experience
Changes in assumptions (533,825) (533,825)
Changes in benefit terms
Contributions employer 2,508,306 (2,508,306)
Contributions employee
Net investment income 652,656 (652,656)
Administrative expenses (17,357) 17,357
Benefit payments , including refunds
of employee contributions (1,399,933) (1,399,933)
Net changes 1,112,499 1,743,672 (631,173)
Balance at June 30, 2021
(6/30/20 measurement date) $ 28,610,428 $ 20,115,214 $ 8,495,214
Increase (Decrease)
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS, CONTINUED
Sensitivity of Actuarial Assumptions – The following tables indicate how much the net OPEB liability varies if
the discount rate and healthcare trend rate used to calculate the liability are increased or decreased by one
percentage point.
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB – Gains and losses related to
changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over
time. Partial amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining
amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be
recognized in future OPEB expense. The recognition period differs depending on the source of the gain or loss.
Investment gains and losses are spread evenly over a 5year period. All other deferred outflows and inflows
created during the measurement period are recognized over a 5.9year period. The total OPEB expense
recognized in the fiscal year ending June 30, 2021 was $1,668,119 and the Town reported deferrals from the
following sources:
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 10 OTHER POSTEMPLOYMENT BENEFITS, CONTINUED
The $2,096,847 reported as deferred outflows of resources related to contributions subsequent to the June 30,
2020 measurement date will be recognized as a reduction of the net OPEB liability during the fiscal year ending
June 30, 2022. Other amounts reported as deferred outflows of resources related to OPEB will be recognized as
expense as follows:
NOTE 11 RISK MANAGEMENT
The Town participates in the following public entity risk pools through formally organized and separate legal
entities. The Town does not have an equity interest in the joint ventures. These entities exercise full powers and
authorities within the scope of the related agreements including the preparation of annual budgets,
accountability for all funds, the power to make and execute contracts and the right to sue and be sued.
Obligations and liabilities of the separate entities are not those of the Town, although the Town retains an
ongoing financial interest or an ongoing financial responsibility.
Pooled Liability Assurance Network Joint Powers Authority (PLAN JPA) The Town participates in PLAN, which
covers general liability claims in the amount up to $5,000,000 plus $25,000,000 in excess liability for total
coverage of $30,000,000 per occurrence. The Town has a deductible or uninsured liability of up to $50,000 per
claim. PLAN also provides all risk property coverage of $1,000,000,000, excluding flood and earthquake
coverage. The Town has a $5,000 deductible for property and vehicle damage. Once the Town’s deductible is
met, PLAN becomes responsible for payment of all claims up to the limit. Financial statements may be obtained
from PLAN at 1750 Creekside Drive, Suite 200, Sacramento, CA, 95833.
Local Agency Workers’ Compensation Joint Powers Authority (LAWCX) The Town is a member of LAWCX for
coverage of workers’ compensation claims. The Town has a $250,000 selfinsured retention level or uninsured
liability for all employees. Once the Town’s deductible is met, LAWCX becomes responsible for claims up to
$5,000,000. For claims greater than $5,000,000, LAWCX has a commercial policy providing coverage. Financial
statements may be obtained from LAWCX at 1750 Creekside Oaks Dr., Suite 200, Sacramento, California, 95833.
The Town has not significantly reduced its insurance coverage from the prior year and settlements have not
exceeded insurance coverage for the past three years.
Liability for Uninsured Claims The Town is required to record its liability for uninsured claims and to reflect the
current portion of this liability as an expenditure in its financial statements. As discussed above, the Town has
coverage for such claims, but it has retained the risk for the deductibles, or uninsured portion of these claims.
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 11 RISK MANAGEMENT, CONTINUED
The change in Workers’ Compensation and SelfInsurance Service Funds’ claims liabilities, is based on historical
trend information provided by its third party administrator and was computed as follows as of June 30, 2021:
NOTE 12 COMMITMENTS AND CONTINGENCIES
Federal and State Grants The Town participates in several federal and state grant programs. These are subject
to examination by grantors and the amount, if any, of disallowed expenditures cannot be determined at this
time. The Town expects such amounts, if any, to be immaterial.
Litigation The Town is subject to litigation arising from the normal course of business. The Town Attorney
believes there is no pending litigation which is likely to have a material adverse effect on the financial position
of the Town.
Successor Agency As of June 30, 2021, the Successor Agency Trust fund reported a net deficit of $3,661,204.
Encumbrances As of June 30, 2021, the Town had the following encumbered balances that were carried into
the next fiscal year:
NOTE 13 TOWN/SUCCESSOR AGENCY GRANTS, COOPERATIVE AGREEMENTS
Public Improvement Grants and Cooperative Agreements
In January of 2011, the Redevelopment Agency entered into a public improvement grant and cooperative
agreement with the Town for the purpose of funding the acquisition of public land and designing and
constructing various public improvements to be owned by the Town provided that the projects were in
accordance with the Redevelopment Agency’s five year implementation plan and redevelopment plan.
Workers'Self
Compensation Insurance
Internal Internal
Service Fund Service Fund Total
Claims payable balance June 30, 2019 1,052,195$ 56,038$ 1,108,233$
Claims incurred 1,007,872 2,786 1,010,658
Claims paid (868,681) (1,799) (870,480)
Claims payable balance June 30, 2020 1,191,386 57,025 1,248,411
Claims incurred (207,704) 143,565 (64,139)
Claims paid 511,800 511,800
Claims payable balance June 30, 2021 1,495,482$ 200,590$ 1,696,072$
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TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 13 TOWN/SUCCESSOR AGENCY GRANTS, COOPERATIVE AGREEMENTS, CONTINUED
The improvement plan, as identified in the agreement, called for approximately $24 million to be granted to the
Town for the following projects:
a. Expansion and improvement of current and new downtown parking
b. Highway 9 improvements from Highway 17 to Monte Sereno
c. Almond Grove Area street, sidewalk and other improvements
d. Downtown Los Gatos gateways, signage, banners and art
e. Storm drain, retaining wall, street and other improvements
f. New Los Gatos library building
During the fiscal year ended June 30, 2012, the rights and obligations resulting from this cooperative agreement
were transferred to the Successor Agency Trust Fund as a part of the Town’s dissolution of its Redevelopment
Agency.
Affordable Housing Cooperative Agreement
In March of 2011, the Redevelopment Agency entered into an affordable housing cooperative agreement with
the Town for the purpose of funding affordable housing projects and programs to be developed and/or
administered by the Town in accordance with the Redevelopment Agency’s five year implementation plan and
redevelopment plan. The improvement plan, as identified in the agreement, called for approximately $16
million to be granted to the Town for the following projects:
a. Development of affordable housing at 224 Main St.
b. Development of affordable housing at Dittos Lane
c. Partnership with Senior Housing Solutions for the creation of senior housing in Los Gatos
d. Partnerships for the conversion of existing residential developments dedicated to affordable housing
e. Grants to the Santa Clara County Housing Trust for the development of affordable housing.
During the fiscal year ended June 30, 2012, the rights and obligations resulting from this cooperative agreement
were transferred to the Successor Agency Trust Fund as a part of the Town’s dissolution of its Redevelopment
Agency.
95Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
NOTE 14 – PRIOR PERIOD ADJUSTMENTS
Beginning fund balances of $526,817 of Library Trust funds formerly reported as private purpose trust funds
were reclassified to be reported as part of the special revenue governmental funds. This reclassification is in
recognition of the criteria established by GASB Statement 84 and further authoritative guidance regarding the
restrictions on the use of private purpose trust fund classifications, resulting in a restatement of net position:
NOTE 15 – COVID19 PANDEMIC PROGRAMS
A balance of $200,901 is reported as Due to Other Funds in the Governmental Funds Balance Sheet. The entire
balance of$200,901 represents amounts due to the General Fund from the American Rescue Plan Act (ARPA)
Special Revenue fund.
Due to the unprecedented economic dislocations associated with the pandemic the Federal government
initiated two federal relief programs designed to provide direct funding to states and cities.
The first program, the Coronavirus Aid, Relief, and Economic Security (CARES) Act established a $150 billion
Coronavirus Relief Fund. Federal law specifies that these funds may only be used for unbudgeted costs incurred
between March 1, 2020 and December 31, 2020. Control Section 11.90 of the 2021 Budget Act extended the
expenditures deadline for cities, counties and community colleges to September 1, 2021. The Budget Act
authorized the California Department of Finance to allocate $1,289,065,000 to address the public health and
public safety impacts of COVID19, including homelessness. Pursuant to the provisions of Control Section 11.90,
cities with populations between 300,000 and 500,000 were allocated $225 million and cities with populations
less than 300,000 were allocated $275 million. Allocations Generally for cities were derived using the
proportional share of the State population. The Town of Los Gatos nonrecurring allocation of $388,181 was
received in July 2020.
The CARES Act established six eligible expense categories, as follows:
(A) Medical Expenses;
(B) Public Health Expenses;
(C) Substantially Dedicated Payroll Expenses;
(D) Comply with Public Health Measures and Mitigate the Effects of COVID19;
(E) Economic Support; or
(F) Other
96Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2021
The entire CARES Act amount of the $388,181 was recognized as revenue in FY 2020/21 and categorized as
Operating Grants and Contributions in the Statement of Activities Schedule, and Intergovernmental Revenues
in the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balance Schedule.
On March 11, 2021, the second program, the American Rescue Plan Act (ARPA) was signed into law by President
Biden. The $1.9 trillion package (the Act) provides financial aid to families, governments, businesses, schools,
nonprofits and others impacted by the COVID19 public health crisis. Of the $1.9 trillion, $350 billion is being
directed toward state and local governments. All 19,000 municipal governments are entitled to a direct, non
competitive federal formula grant from the U.S. Treasury Department. The portion allocated to cities, towns,
and villages totals $65.1 billion of which $19.5 billion is obligated toward cities with less than 50,000 residents.
The Act will allocate $7,229,744 to the Town over a two year period. The first tranche payment of $3,614,872
was received on July 13, 2021, and the second payment no earlier than 12 months after the first payment.
Section 603. CORONAVIRUS LOCAL FISCAL RECOCERY FUND of the Act identified four eligible uses for funding,
as follows:
(A) to respond to the public health emergency with respect to the Coronavirus Disease 2019 (COVID–
19) or its negative economic impacts, including assistance to households, small businesses, and
nonprofits, or aid to impacted industries such as tourism, travel, and hospitality;
(B) to respond to workers performing essential work during the COVID–19 public health emergency by
providing premium pay to eligible workers of the metropolitan city, nonentitlement unit of local
government, or county that are performing such essential work, or by providing grants to eligible
employers that have eligible workers who perform essential work;
(C) for the provision of government services to the extent of the reduction in revenue of such
metropolitan city, nonentitlement unit of local government, or county due to the COVID–19 public
health emergency relative to revenues collected in the most recent full fiscal year of the
metropolitan city, nonentitlement unit of local government, or county prior to the emergency; or
(D) to make necessary investments in water, sewer, or broadband infrastructure.
Initial budgetary estimates programmed approximately $1.4 million in ARPA funding to close anticipated
revenue shortfalls in FY 2020/21. With actual revenues performing better in several areas and expenditure
savings being better than projected, ARPA funding was not required for revenue loss. For FY 2020/21 $200,901
of ARPA proceeds was recognized as revenue to reimburse the Town for qualifying expenditures under the
provisions of the Act including boosting economic recovery and providing rent forgiveness and direct grants to
nonprofit organizations. The $200,901 was categorized as Operating Grants and Contributions in the Statement
of Activities Schedule, and Intergovernmental Revenues in the Governmental Funds Statement of Revenues,
Expenditures, and Changes in Fund Balance Schedule. The remainder of ARPA proceeds will be recognized as
revenues in the current and future fiscal years with eligible expenses. The proceeds not spent remain in the
Town deposit account.
97Draft 12/16/2021
Required Supplementary Information
98Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Schedule of Proportionate Share of Net Pension Liability – CalPERS Misc. AgentMultiple Employer Plan*
Measurement Date 6/30/2020 6/30/2019 6/30/2018
Total Pension Liablity
Service Cost 1,930,090$ 1,771,368$ 1,700,438$
Interest on total pension liability 7,729,269 7,381,846 7,073,843
Difference between expected and actual
experience 1,465,653 1,082,289 994,994
Changes in assumptions (655,541)
Changes in benefits
Benefit payments, including refunds of employee
contributions (5,958,101) (5,720,232) (5,448,374)
Net change in total pension liability 5,166,911 4,515,271 3,665,360
Total pension liability - beginning 108,650,008 104,134,737 100,469,377
Total pension liability - ending (a)113,816,919$ 108,650,008$ 104,134,737$
Plan fiduciary net position
Contributions employer 8,146,791 3,049,748 2,669,104
Contributions employee 834,145 846,125 761,705
Plan to plan resource movement (170)
Projected Earnings on Plan Investments
Recognized Difference between Projected and Actual Earnings
Net Investment Income 3,913,294 4,759,034 5,883,868
Net Difference between Projected and Actual Earnings
Benefit payments, including refunds of employee contribution (5,958,101) (5,720,232) (5,448,374)
Administrative Expenses (107,303) (52,260) (108,582)
Other Miscellaneous Income/(Expense)1 170 (206,199)
Net change in plan fiduciary net position 6,828,826 2,882,585 3,551,352
Plan fiduciary net position - beginning 76,114,760 73,232,175 69,680,823
Plan fiduciary net position - ending (b)82,943,586$ 76,114,760$ 73,232,175$
Net pension liability ending (a) (b)30,873,333$ 32,535,248$ 30,902,562$
Plan fiduciary net position as a percentage of the
total pension liability 72.87% 70.05% 70.32%
Covered payroll 11,743,677 10,211,967 9,576,157
Net pension liability as a percentage of covered payroll 262.89% 318.60% 322.70%
* Fiscal Year 2015 was the first year of implementation, therefore only seven years are shown
1. During Fiscal Year 201718, as a result of GASB No.75, CalPERS reported its proportionate share of activity related to postemployment
benefit for participation in the State of California's agent OPEB plan. Accordingly, CalPERS recorded a onetime expense as a result of the
adoption of GASB75. Additionally, CalPERS employees participate in various State of California agent pension plans and during FY201718,
CalPERS recorded a correction to previously reported financial statements to properly reflect its proportionate share of activity related to
99Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
6/30/2017 6/30/2016 6/30/2015 6/30/2014
1,651,550$ 1,560,679$ 1,491,925$ 1,579,547$
6,820,536 6,697,247 6,483,032 6,268,015
(892,479) (357,870) (623,495)
5,481,432 (1,513,132)
(5,138,083) (4,953,756) (4,748,786) (4,241,487)
7,922,956 2,946,300 1,089,544 3,606,075
92,546,421 89,600,121 88,510,577 84,904,502
100,469,377$ 92,546,421$ 89,600,121$ 88,510,577$
2,407,496 2,223,782 1,941,765 1,796,079
682,891 691,770 679,796 668,167
(28,866) 22,561
4,328,173
1,166,344
7,171,443 369,185 1,470,873
4,665,374
(5,138,083) (4,953,756) (4,748,786) (4,241,487)
(95,455) (40,462) (74,706)
5,028,292 (1,738,347) (708,497) 8,382,650
64,652,531 66,390,878 67,099,375 58,716,725
69,680,823$ 64,652,531$ 66,390,878$ 67,099,375$
30,788,554$ 27,893,890$ 23,209,243$ 21,411,202$
69.36% 69.86% 74.10% 75.81%
9,024,370 9,198,318 8,487,940 8,406,315
341.17% 303.25% 273.44% 254.70%
100Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Schedule of Proportionate Share of Net Pension Liability – CalPERS Safety CostSharing Plan
101Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Schedule of Pension Plan Contributions – Miscellaneous Agent MultipleEmployer Plan*
102Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Schedule of Pension Plan Contributions – Safety CostSharing Plan*
103Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Actuarial Methods and Assumptions used for Pension Contractually Required Contributions for FY2021
104Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Schedule of Changes in Net OPEB Liability and Related Ratios*
Schedule of Employer Contributions*
105Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
Actuarial Methods and Assumptions used for 2020/21 OPEB Actuarially Determined Contribution
106Draft 12/16/2021
Supplementary Information
107Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
MAJOR GOVERNMENTAL FUND BUDGET SCHEDULES
(OTHER THAN THE GENERAL FUND) AND
NONMAJOR GOVERNMENTAL FUNDS
Schedule of Revenue, Expenditures and Changes in Fund Balances – Budget and Actual (GAAP):
Appropriated Reserves Fund is used to account for resources provided for capital projects not fully funded from
other sources.
Capital Projects Funds:
Storm Drain Basin Funds were established to account for fees paid in conjunction with the development in
specified drainage areas.
Construction Tax Funds were established to account for tax levies on building additions or alterations including
capital improvements, underground utilities and parks.
Gas Tax Fund was established to account for revenue and expenditures under the State of California Streets and
Highways Code Sections 2106, 2107 and 2107.5, as well as for the Roads Maintenance Rehabilitation Act. The
revenues must be used for the maintenance and construction of streets.
Special Revenue Funds:
Community Development Block Grant Fund was established to account for grant funds received and expended
under the Community Development Act of 1974.
Non-Point Source Maintenance Fund was established to comply with obligations under the National Pollutant
Discharge Elimination system permit issued by the California Regional Water Quality Control Board.
Lighting and Landscape Fund was established to account for maintenance of trees, landscaping, irrigation
systems and lighting within the boundaries of Tract No. 8439.
ARPA Fund was established to account for monies received under the American Rescue Plan Act of 2021 to
respond to the COVID19 emergency.
Library Trust Fund was established to provide for the servicing of donations and bequests to the Town's Library
Program.
108Draft 12/16/2021
Variance
Original Final Positive
Budget Budget Actual (Negative)
REVENUES
Licenses & permits 110,000$ 110,000$ 473,427$ 363,427$
Intergovernmental 2,239,863 7,547,085 630,035 (6,917,050)
Charges for services 1,429,080 2,837,369 1,199,697 (1,637,672)
Interest 35,312 35,312
Use of Property 48,000 4,000 (44,000)
Other 20,755 48,818 28,063
Total Revenues 3,778,943 10,563,209 2,391,289 (8,171,920)
EXPENDITURES
Capital outlay 7,371,447 25,386,926 5,675,604 19,711,322
Total Expenditures 7,371,447 25,386,926 5,675,604 19,711,322
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,592,504) (14,823,717) (3,284,315) 11,539,402
OTHER FINANCING SOURCES (USES)
Proceeds from issuance of debt 1,439,995 1,560,336 120,341
Transfers in 3,401,479 3,436,479 3,401,479 (35,000)
Transfers (out) (427,616) (427,616) (427,616)
Total Other Financing Sources (Uses) 2,973,863 4,448,858 4,534,199 85,341
CHANGE IN FUND BALANCE (618,641)$ (10,374,859)$ 1,249,884 11,624,743$
BEGINNING FUND BALANCE 13,866,028
ENDING FUND BALANCE 15,115,912$
BUDGET AND ACTUAL (GAAP)
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
TOWN OF LOS GATOS
APPROPRIATED RESERVES FUND
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
109Draft 12/16/2021
Total
Storm Construction Gas Capital
Drains Tax Tax Projects
Funds Fund Fund Funds
ASSETS
Cash & Investments 2,917,690$ 3,203,736$ 1,318,887$ 7,440,313$
Receivables:
Accounts
Intergovernmental Receivable 106,209 106,209
Long Term Notes Receivable
Total Assets 2,917,690$ 3,203,736$ 1,425,096$ 7,546,522$
LIABILITIES
Accounts Payable $ 2,425$ $ 2,425$
Accrued Payroll and Benefits
Due to other governments
Unearned revenue
Due to other funds
Total Liabilities 2,425 2,425
FUND BALANCE
Restricted for:
Repairs and Maintenance
Library
Capital Projects 2,917,690 3,201,311 1,425,096 7,544,097
Committed to:
Repairs and Maintenance
Assigned for:
Special Revenue Funds
Unassigned
Total Fund Balances 2,917,690 3,201,311 1,425,096 7,544,097
Total Liabilities and Fund Balances 2,917,690$ 3,203,736$ 1,425,096$ 7,546,522$
$ $ (Continued)
CAPITAL PROJECTS FUNDS
TOWN OF LOS GATOS
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2021
110Draft 12/16/2021
Total
Community NonPoint Total Nonmajor
Development Source Lighting and ARPA Library Special Revenue Governmental
Fund Maintenance Landscaping Fund Trust Funds Funds
94,412$ 321,481$ 175,457$ $ 554,726$ 1,146,076$ 8,586,389$
57,904 57,904 57,904
58,344 109 200,911 259,364 365,573
78,752 78,752 78,752
231,508$ 379,385$ 175,566$ 200,911$ 554,726$ 1,542,096$ 9,088,618$
$ 3,399$ 3,210$ $ 1,799$ 8,408$ 10,833$
4,747 4,747 4,747
50 50 50
64,855 64,855 64,855
200,911 200,911 200,911
64,855 8,146 3,210 200,911 1,849 278,971 281,396
172,356 172,356 172,356
552,877 552,877 552,877
7,544,097
166,653 371,239 537,892 537,892
166,653 371,239 172,356 552,877 1,263,125 8,807,222
231,508$ 379,385$ 175,566$ 200,911$ 554,726$ 1,542,096$ 9,088,618$
(Concluded)
SPECIAL REVENUE FUNDS
111Draft 12/16/2021
Total
Storm Construction Gas Capital
Drain Tax Tax Projects
Funds Fund Fund Funds
REVENUES
Property Taxes $ $ $ $
Other Taxes 67,146 67,146
License and permits 121,428 121,428
Intergovernmental 1,273,789 1,273,789
Fines and Forfeitures
Interest 36,597 40,618 10,178 87,393
Other
Total Revenues 158,025 107,764 1,283,967 1,549,756
EXPENDITURES
Current:
Parks and Public Works
Community Development
Sanitation and Other
Library
Capital Outlay 611 24,626 43,241 68,478
Total Expenditures 611 24,626 43,241 68,478
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 157,414 83,138 1,240,726 1,481,278
OTHER FINANCING SOURCES (USES)
Transfers (out)(106,000) (106,000)
Total Other Financing Sources (Uses)(106,000) (106,000)
Changes in Fund Balances 157,414 83,138 1,134,726 1,375,278
Fund Balances Beginning of year, as restated 2,760,276 3,118,173 290,370 6,168,819
Fund Balances End of year 2,917,690$ 3,201,311$ 1,425,096$ 7,544,097$
(Continued)
CAPITAL PROJECTS FUNDS
TOWN OF LOS GATOS
NONMAJOR GOVERNMENTAL FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
112Draft 12/16/2021
Total
Community NonPoint Total Nonmajor
Development Source Lighting and ARPA Library Special Revenue Governmental
Fund Maintenance Landscaping Fund Trust Funds Funds
$ $ 38,593$ $ $ 38,593$ 38,593$
67,146
231,322 231,322 352,750
68,155 200,911 269,066 1,542,855
1 11
2,389 6,785 9,174 96,567
38,392 38,392 38,392
299,477 40,983 200,911 45,177 586,548 2,136,304
53,957 53,957 53,957
200,911 200,911 200,911
166,173 166,173 166,173
19,115 19,115 19,115
68,478
166,173 53,957 200,911 19,115 440,156 508,634
133,304 (12,974)26,062 146,392 1,627,670
(4,920)(4,920) (110,920)
(4,920)(4,920) (110,920)
133,304 (17,894)26,062 141,472 1,516,750
166,653 237,935 190,250 526,815 1,121,653 7,290,472
166,653$ 371,239$ 172,356$ $ 552,877$ 1,263,125$ 8,807,222$
(Concluded)
SPECIAL REVENUE FUNDS
113Draft 12/16/2021
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)
REVENUES
Property taxes $ $ $ $ $ $
Other taxes 30,000 67,146 37,146
License and permits 92,500 121,428 28,928
Intergovernmental
Charges for services 3,810,558 (3,810,558)
Fines and Forfeitures
Interest 11,840 36,597 24,757 22,490 40,618 18,128
Other
Total Revenues 104,340 158,025 53,685 3,863,048 107,764 (3,755,284)
EXPENDITURES
Parks and public works
Community development
Sanitation and other
Library
Capital outlay 485,058 611 484,447 6,836,204 24,626 6,811,578
Total Expenditures 485,058 611 484,447 6,836,204 24,626 6,811,578
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (380,718) 157,414 538,132 (2,973,156) 83,138 3,056,294
OTHER FINANCING SOURCES (USES)
Operating transfers (out)
Total Other Financing Sources (Uses)
CHANGE IN FUND BALANCE (380,718)$ 157,414 538,132$ (2,973,156)$ 83,138 3,056,294$
BEGINNING FUND BALANCE 2,760,276 3,118,173
ENDING FUND BALANCE 2,917,690$ 3,201,311$
(Continued)
STORM DRAIN FUNDS CONSTRUCTION TAX
TOWN OF LOS GATOS
BUDGETED NONMAJOR FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL (GAAP)
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
114Draft 12/16/2021
Variance Variance Variance
Positive Positive Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative)
$ $ $ $ $ $ $ $ $
231,323 231,322 (1)
1,232,107 1,273,789 41,682 68,155 68,155
1,210 10,178 8,968
1,233,317 1,283,967 50,650 231,323 299,477 68,154
205,850 166,173 39,677
1,291,952 43,241 1,248,711
1,291,952 43,241 1,248,711 205,850 166,173 39,677
(58,635) 1,240,726 1,299,361 25,473 133,304 107,831
(106,000) (106,000)
(106,000) (106,000)
(164,635)$ 1,134,726 1,299,361$ $ $ 25,473$ 133,304 107,831$
290,370 166,653 237,935
1,425,096$ 166,653$ 371,239$
(Continued)
BLOCK GRANT
NONPOINT
SOURCE MAINTANENCEGAS TAX
COMMUNITY DEVELOPMENT
115Draft 12/16/2021
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)
REVENUES
Property taxes 38,220$ 38,593$ 373$ $ $ $
Other taxes
License and permits
Intergovernmental 200,911 200,911
Charges for services
Fines and Forfeitures 1 1
Interest 1,460 2,389 929
Other
Total Revenues 39,680 40,983 1,303 200,911 200,911
EXPENDITURES
Parks and public works 48,906 53,957 (5,051)
Community services 200,911 200,911
Sanitation and other
Library
Capital outlay
Total Expenditures 48,906 53,957 (5,051) 200,911 200,911
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (9,226) (12,974) (3,748)
OTHER FINANCING SOURCES (USES)
Operating transfers (out)(4,920) (4,920)
Total Other Financing Sources (Uses)(4,920) (4,920)
CHANGE IN FUND BALANCE (14,146)$ (17,894) (3,748)$ $ $
BEGINNING FUND BALANCE 190,250
ENDING FUND BALANCE 172,356$ $
(Continued)
LIGHTING AND LANDSCAPING ARPA Fund
TOWN OF LOS GATOS
BUDGETED NONMAJOR FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL (GAAP)
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
116Draft 12/16/2021
Variance Variance
Positive Positive
Budget Actual (Negative) Budget Actual (Negative)
$ $ $ 38,220$ 38,593$ 373$
30,000 67,146 37,146
323,823 352,750 28,927
1,433,018 1,542,855 109,837
3,810,558 (3,810,558)
1 1
4,100 6,785 2,685 41,100 96,567 55,467
38,392 38,392 38,392 38,392
4,100 45,177 41,077 5,676,719 2,136,304 (3,540,415)
48,906 53,957 (5,051)
200,911 200,911
205,850 166,173 39,677
28,200 19,115 9,085 28,200 19,115 9,085
20,755 20,755 8,633,969 68,478 8,565,491
48,955 19,115 29,840 9,117,836 508,634 8,609,202
(44,855) 26,062 70,917 (3,441,117) 1,627,670 5,068,787
(110,920) (110,920)
(110,920) (110,920)
(44,855)$ 26,062 70,917$ (3,552,037)$ 1,516,750 5,068,787$
526,815 7,290,472
552,877$ 8,807,222$
TOTALSLIBRARY TRUST
(Concluded)
117Draft 12/16/2021
TOWN OF LOS GATOS, CALIFORNIA
ANNUAL COMPREHENSIVE FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
PROPRIETARY FUNDS
INTERNAL SERVICE FUNDS
Internal Service Funds are used to finance and account for special activities and service performed by a
designated department for other departments in the Town on a cost reimbursement basis.
The concept of major funds does not extend to internal service funds because they are used for internal activities
only. In the GovernmentWide Statement of Activities, the net revenues and expenses of the internal service
funds are allocated to the Town departments or programs that generated them, thus eliminating internal service
funds
However, internal service funds are still presented separately in the fund financial statements and include the
following funds:
Equipment Replacement Fund was established to account for the replacement of major Town equipment and
all vehicle replacement.
Workers’ Compensation Fund was established to account for future claims that may occur related to workers
compensation injuries.
Self-Insurance Fund was established to account for future general liability claims against the Town.
Information Technology Fund was established to account for the replacement of management information
computer systems and components.
Facilities Maintenance Fund was established to account for preventative maintenance and repair for all Town
buildings.
118Draft 12/16/2021
Equipment Workers' Self Information Facilities
Replacement Comp Insurance Technology Maintenance Total
ASSETS
Cash & Investments 1,887,680$ 3,105,307$ 1,223,213$ 2,906,098$ 239,963$ 9,362,261$
Restricted Cash &
Investments 85,724 85,724
Receivables:
Accounts 1,856 4,255 24,853 30,964
Due from Other Funds 478 478
Total Assets 1,889,536 3,191,031 1,223,213 2,910,831 264,816 9,479,427
LIABILITIES
Accounts Payable 22,529 1,540 40,009 108,393 172,471
Due to Other
Governments 83 83
Claims Payable 1,495,482 200,590 1,696,072
Total Liabilities 1,518,011 202,130 40,009 108,476 1,868,626
NET POSITION
Restricted for:
Workers comp
ensation claims 85,724 85,724
Unrestricted 1,889,536 1,587,296 1,021,083 2,870,822 156,340 7,525,077
Total Net Position 1,889,536$ 1,673,020$ 1,021,083$ 2,870,822$ 156,340$ 7,610,801$
TOWN OF LOS GATOS
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET POSITION
JUNE 30, 2021
119Draft 12/16/2021
Equipment Workers'Self Information Facilities
Replacement Comp Insurance Technology Maintenance Total
OPERATING REVENUES
Charges for services 267,545$ 917,555$ 376,964$ 972,775$ 847,373$ 3,382,212$
Interest 5 5
Use of money and
property 232,474 232,474
Other local taxes 67,146 67,146
Intergovernmental
Other 59,852 327,768 34,030 421,650
Total Operating Revenues 327,397 1,245,328 376,964 972,775 1,181,023 4,103,487
OPERATING EXPENSES
Insurance expenses 596,665 573,174 1,169,839
Services and supplies 254,194 784,384 73,321 668,356 1,160,152 2,940,407
Total Operating Expenses 254,194 1,381,049 646,495 668,356 1,160,152 4,110,246
Operating Income (loss)73,203 (135,721) (269,531) 304,419 20,871 (6,759)
Transfers in 33,000 33,000
Transfers out (108,720)(37,800)(146,520)
Net Transfers (108,720)(37,800) 33,000 (113,520)
Change in Net Position (35,517) (135,721) (269,531) 266,619 53,871 (120,279)
BEGINNING NET POSITION 1,925,053 1,808,741 1,290,614 2,604,203 102,469 7,731,080
ENDING NET POSITION 1,889,536$ 1,673,020$ 1,021,083$ 2,870,822$ 156,340$ 7,610,801$
TOWN OF LOS GATOS
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF REVENUE, EXPENSES AND CHANGES IN NET POSITION
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
120Draft 12/16/2021
Equipment Worker's Self Information Facilities
Replacement Comp Insurance Technology Maintenance Total
CASH FLOWS FROM
OPERATING ACTIVITIES
Receipts from customers 325,541$ 1,245,328$ 376,964$ 970,485$ 1,182,280$ 4,100,598$
Payments to suppliers (254,194) (764,499) (71,781) (758,972) (1,167,434) (3,016,880)
Claims paid (292,569) (429,609)(722,178)
Net Cash Provided (Used)
by Operating Activities 71,347 188,260 (124,426) 211,513 14,846 361,540
CASH FLOWS FROM
NONCAPITAL FINANCING
ACTIVITIES
Transfers In/(Out) (108,720)(37,800) 33,000 (113,520)
Net Cash Provided (Used)
by Noncapital Financing
Activities (108,720)(37,800) 33,000 (113,520)
Net Increase(Decrease) in Cash and
Investments (37,373) 188,260 (124,426) 173,713 47,846 248,020
Cash and investments beginning of
year 1,925,053 3,002,771 1,347,639 2,732,385 192,117 9,199,965
Cash and investments end of year 1,887,680$ 3,191,031$ 1,223,213$ 2,906,098$ 239,963$ 9,447,985$
$
Reconciliation of Operating
Income to Cash Flows
from Operating Activities:
Operating Income 73,203$ (135,721)$ (269,531)$ 304,419$ 20,871$ (6,759)$
Change in assets and liabilities:
Receivables, net (1,856)(2,290) 1,257 (2,889)
Accounts payable 19,885 1,540 (90,616) (7,365) (76,556)
Claims payable 304,096 143,565 447,661
Due to other government 83 83
Cash Flows From Operating Activities 71,347$ 188,260$ (124,426)$ 211,513$ 14,846$ 361,540$
TOWN OF LOS GATOS
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE FISCAL YEAR ENDED JUNE 30, 2021
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122Draft 12/16/2021
STATISTICAL SECTION
123Draft 12/16/2021
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124Draft 12/16/2021
STATISTICAL (UNAUDITED)
This part of the Town of Los Gatos Annual Comprehensive Financial Report (“ACFR”) presents the detailed
information as a context for understanding what the information in the financial statements, note disclosures,
and required supplementary information says about the Town’s overall financial health.
Financial Trends
These schedules contain trend information to help the reader understand how Town’s financial
performance and wellbeing have changed over time. (Schedule 1, Schedule 2, Schedule 3, and Schedule
4).
Revenue Capacity
These schedules contain information to help the reader assess one of the Town’s most significant local
revenue source, the property tax (Schedule 5, Schedule 6, Schedule 7, and Schedule 8).
Debt Capacity
These schedules present information to help the reader assess the affordability of the Town’s current
levels of outstanding debt and its ability to issue additional debt in the future (Schedule 9, Schedule 10,
and Schedule 11)
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the Town’s financial activities take place (Schedule 12, Schedule 13, and
schedule 14).
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the
information in the Town’s ACFR relates to the services the Town provides and activities it performs
(Schedule 15 and Schedule 16).
125Draft 12/16/2021
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126Draft 12/16/2021
Town of Los Gatos Schedule 1
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Fiscal Net Investment Total
Year in Capital Assets Restricted Unrestricted Net Position
2012 90,333,451 5,167,236 37,192,210 132,692,897
2013 92,558,523 3,949,583 41,480,377 137,988,483
2014 93,251,117 4,485,246 44,393,265 142,129,628
2015 93,687,029 5,663,182 7,180,919 106,531,130 (2)
2016 93,383,855 6,386,014 12,744,637 112,514,506
2017 96,265,652 5,627,707 15,134,420 117,027,779
2018 102,098,729 8,199,598 170,590 110,468,917 (4)
2019 107,542,588 11,918,688 4,642,167 114,819,109 (3)
2020 111,700,225 7,117,984 3,967,178 114,851,031
2021 109,894,936 8,358,267 4,735,103 113,518,100
(1) The decrease in Restricted Net Position from FY 2010 to FY 2011 was primarily due to the issuance of the $15.7 million
Certificates of Participation in FY 2010.
(2) The decrease in Restricted Net Position GASB 68 Implementation of Unfunded Pension Liability of Statement of Net
Position.
(3) The decrease in unrestricted net position resulted largely from the use of approximately $8.0 million in unrestricted
cash balances in the Town’s GFAR fund during the year to invest in the Town’s infrastructure and equipment.
(4) Net position was restated for FY 2018 for amounts placed into fiduciary funds, reclassified to General Fund Restricted
Asset.
-15,000,000
-10,000,000
-5,000,000
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
40,000,000
45,000,000
50,000,000
55,000,000
60,000,000
65,000,000
70,000,000
75,000,000
80,000,000
85,000,000
90,000,000
95,000,000
100,000,000
105,000,000
110,000,000
115,000,000
120,000,000
Net Investment in Capital Assets Restricted Unrestricted
127Draft 12/16/2021
Town of Los Gatos
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Expenses 2011/12 2012/13 2013/14 2014/15
Governmental Activities:
General Government 6,145,143$ 6,564,768$ 6,955,804$ 6,465,852$
Police Department 14,124,798 13,731,754 14,119,786 12,644,221
Parks and Public Works 7,827,332 7,829,315 8,154,616 8,069,352
Community Development 3,434,551 4,094,188 4,424,040 4,047,738
Community Services
Library Services 1,938,577 2,128,823 2,234,431 2,553,414
Sanitation 158,205 393,205 363,180 491,359
Redevelopment 919,821 1,277,063 21,687
Interest and Fees 1,123,842
Total Governmental Activities 35,672,269$ 36,019,116$ 36,273,544$ 34,271,936$
Program Revenues
Charges for Services:
General Government 1,131,424$ 1,416,593$ 2,179,077$ 1,888,213$
Police Department 2,324,397 2,450,630 3,206,579 3,529,166
Parks and Public Works 1,215,382 3,044,401 1,550,867 2,206,765
Community Development 3,448,433 4,649,444 5,156,061 5,027,497
Community Services
Library Services 37,662 50,696 51,775 53,123
Sanitation 135,000 403,294 328,648 328,868
Operating Grants and Contributions:
General Government 6,453 8,406
Police Department 29,980 91,360 42,661 24,838
Parks and Public Works 993,827 835,724 994,096 907,745
Community Development
Library Services 109 40 14,662 4,062
Sanitation
Capital Grants and Contributions:
General Government 169,270 176,705
Police Department
Parks and Public Works 641,811 2,757,660 2,274,879 2,338,154
Community Development 19,360
Total Program Revenues 9,964,478$ 15,877,518$ 15,818,665$ 16,485,136$
General Revenues 2011/12 2012/13 2013/14 2014/15
Property Taxes 14,088,866$ 11,968,377$ 11,712,312$ 12,931,603$
Sales Taxes 9,889,100 8,757,428 8,029,571 8,202,678
Franchise Taxes 2,215,430
Other Taxes 3,698,753 3,324,791 3,718,405 2,062,893
Motor Vehicle in Lieu 15,238 15,790 13,068
Investment Earnings 331,420 b (133,375)b 772,200 b 428,772
Loss on Disposal of Capital Assets
Sale of Property 54,425
Miscellaneous 2,275,160 1,154,647 350,468 813,324
Extraordinary Gain (Loss) Dissolution of RDA 11,864,453 295,101
Total General Revenues 42,162,990$ 25,437,184$ 24,596,024$ 26,654,700$
Change in Net Position 16,455,199$ 5,295,586$ 4,141,145$ 8,867,900$
128Draft 12/16/2021
Schedule 2
2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
6,993,661$ 6,771,628$ 7,948,918$ 8,163,991$ 7,405,368$ 7,452,136$
12,825,688 14,587,597 15,545,521 16,635,726 20,446,188 19,808,230
8,320,623 9,502,707 10,047,003 10,627,716 11,803,005 13,141,034
3,227,224 5,093,459 4,667,609 5,064,637 5,001,958 6,481,075
2,522,142 2,868,748 3,087,684 3,059,294 3,347,523 3,496,153
528,580 466,762 536,296 684,673 3,041 185,981
34,417,918$ 39,290,901$ 41,833,031$ 44,236,037$ 48,007,083$ 50,564,609$
1,517,012$ 1,669,020$ 1,701,146$ 1,562,683$ 1,470,324$ 1,505,899$
3,278,585 2,076,688 1,888,359 1,745,889 1,549,207 1,275,731
1,516,108 2,155,841 4,150,068 2,910,936 3,674,222 4,209,048
4,359,146 3,803,626 3,456,390 4,155,231 3,351,753 4,063,776
46,192 46,746 14,702 9,476 11,522
368,813 410,626 771,442 966,130 231,323 299,478
15,291 12,290 388,181
98,138 837,329 895,730 826,643 952,045 1,073,971
749,300 665,779 953,294 1,301,152 2,824,638 1,547,102
15,864 223,129
12,228 57,200 47,482 49,351 55,181
8,258 2,365
9,100
1,610,657 770,600 348,437 146,792 832,755 843,980
9,280
13,571,470$ 12,445,535$ 14,236,768$ 13,672,414$ 14,992,652$ 15,487,841$
2015/16 2016/17 0 2017/18 2018/19 2019/20 2020/21
13,763,458$ 14,756,214$ 15,958,406$ 17,321,347$ 18,330,426$ 19,878,835$
7,501,175 8,925,276 7,466,253 8,158,152 7,531,425 7,933,604
2,258,892 2,366,908 2,474,814 2,475,916 2,495,792 2,499,463
1,997,497 2,351,223 2,667,840 2,726,743 1,911,774 1,126,887
12,308 14,056 16,483 14,689 24,526 23,058
698,324 192,260 333,120 1,809,128 2,428,470 227,136
598,170 528,946 622,105 2,407,840 323,940 1,528,039
26,829,824$ 29,134,883$ 29,539,021$ 34,913,815$ 33,046,353$ 33,217,022$
5,983,376$ 2,289,517$ 1,942,758$ 4,350,192$ 31,922$ (1,859,746)$
129Draft 12/16/2021
Town of Los Gatos
Fund Balance, Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2011/12 2012/13 2013/14 2014/15
General Fund
Reserved $ $ $ $
Unreserved
Nonspendable
Restricted
Committed
Assigned 21,992,886 20,758,156 23,791,749 24,121,256
Unassigned 4,019,409 7,502,446 1,363,376
Total General Fund 26,012,295$ 28,260,602$ 25,155,125$ 24,121,256$
All Other Governmental Funds
Reserved $ $ $ $
Unreserved, reported in:
Special Revenue Funds
Capital Project Funds
Debt Service Funds
Nonspendable
Restricted 5,167,236 3,949,583 4,485,246 5,663,182
Committed
Assigned 5,389,674 6,097,182 8,191,823 15,346,558
Unassigned 107,107 157,208 183,045 206,875
Total All Other Governmental Funds 10,664,017$ 10,203,973$ 12,860,114$ 21,216,615$
Total Fund Balances 36,676,312$ 38,464,575$ 38,015,239$ 45,337,871$
Fiscal Year
130Draft 12/16/2021
Schedule 3
2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
$ $ $ $ $ $
159,000
1,206,851 5,015,316 669,978
20,019,187 15,129,925 12,953,399 15,070,944 15,387,706 11,220,970
9,555,085 14,050,699 17,475,285 18,256,895 13,277,813 12,534,648
29,574,272$ 29,180,624$ 31,635,535$ 38,343,155$ 29,335,497$ 23,914,618$
$ $ $ $ $ $
6,386,014 5,627,707 6,992,747 6,903,372 6,448,006 8,562,653
3,696,000 10,354,584 5,571,087 2,579,997
11,099,076 7,928,994 6,361,403 6,180,930 14,181,679 15,360,481
21,181,090$ 23,911,285$ 18,925,237$ 15,664,299$ 20,629,685$ 23,923,134$
50,755,362$ 53,091,909$ 50,560,772$ 54,007,454$ 49,965,182$ 47,837,752$
131Draft 12/16/2021
Town of Los Gatos
Changes in Fund Balances, Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
2011/12 2012/13 2013/14 2014/15
Revenues:
Taxes 27,676,719$ 24,596,799$ 23,475,393$ 23,208,820$
Intergovernmental 1,669,729 2,615,191 2,440,127 2,921,002
Charges for Services 5,550,671 6,529,234 5,837,581 5,794,386
Licenses & Permits 3,242,348 4,015,871 5,343,265 6,467,771
Investment Income 291,484 (133,380) 772,164 428,735
Fines and Forfeitures 809,790 688,125 795,720 868,564
Franchise Fees 2,215,430
Use of Property 38,974 38,910 37,741 32,209
Other 5,412,328 4,577,584 3,648,277 3,130,975
Total Revenues 44,692,043 42,928,334 42,350,268 45,067,892
Expenditures:
Current
Public Safety 13,392,953 13,370,032 13,742,189 13,747,198
Public Works 5,440,960 5,616,197 5,611,283 5,840,097
Community Development 3,226,195 4,235,832 4,335,599 4,218,500
Library Services 1,805,479 2,055,069 2,131,438 2,268,844
Sanitation & Other 116,607 359,725 322,817 411,863
General Government 8,046,794 8,331,444 8,499,854 8,647,451
Redevelopment 3,282,155 1,277,063 21,687
Capital Outlay 10,929,491 6,568,653 4,097,662 3,800,478
Debt Service
Principal Repayment 934,167
Interest and Fiscal Charges 1,143,185
Total Expenditures 48,317,986 41,814,015 38,762,529 38,934,431
Excess (Deficiency) of Revenues
Over (Under) Expenditures (3,625,943) 1,114,319 3,587,739 6,133,461
Other Financing Sources(Uses):
Debt Issuance
Transfers In 3,735,440 2,841,881 3,418,872 8,977,220
Transfers Out (3,661,894) (2,463,850) (2,921,409) (7,788,049)
Proceeds from Sale of Property
Proceeds from Issuance of Debt
Total Other Financing Sources(Uses)73,546 378,031 497,463 1,189,171
Special Item:
Sale of Property
Extraordinary Gain (Loss) RDA Dissolution (5,038,620) 295,913
Prepayment of Pension Obligations (4,534,538)
Net Change in Fund Balances (3,552,397)$ 1,492,350$ 4,085,202$ 7,322,632$
Debt Service as a Percentage
of Non Capital Expenditures 5.56%0.00%0.00%0.00%
Fiscal Year
132Draft 12/16/2021
Schedule 4
2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
23,269,892$ 25,945,129$ 26,253,026$ 28,244,329$ 27,811,665$ 28,977,919$
2,573,475 1,715,580 2,124,903 2,310,655 4,498,153 3,746,587
4,773,001 4,210,174 5,395,057 5,584,504 5,309,470 6,035,659
5,442,133 5,075,503 5,937,044 5,173,876 4,818,671 5,212,831
698,308 192,978 332,938 1,809,164 2,428,453 227,940
879,277 917,105 676,212 510,266 271,117 103,468
2,258,892 2,366,908 2,474,814 2,475,916 2,495,792 2,499,463
31,723 32,096 32,206 32,960 31,039 40,372
2,396,992 1,011,939 640,844 579,755 376,922 423,115
42,323,693 41,467,412 43,867,044 46,721,425 48,041,282 47,267,354
13,763,316 13,251,288 14,423,554 14,945,407 15,793,815 16,570,836
6,307,266 6,633,748 7,125,686 7,962,135 8,168,599 8,229,944
3,695,504 3,793,930 4,192,165 4,577,495 4,473,790 5,195,302
2,332,268 2,508,677 2,529,017 2,493,617 2,700,802 2,847,988
452,726 466,762 521,147 628,240 162,837 166,173
9,144,797 8,390,959 8,770,082 8,004,254 13,024,146 14,040,134
3,241,657 6,867,034 9,778,058 7,888,914 7,861,972 5,746,447
38,937,534 41,912,398 47,339,709 46,500,062 52,185,961 52,796,824
3,386,159 (444,986) (3,472,665) 221,363 (4,144,679) (5,529,470)
3,315,846 7,907,692 3,176,760 4,264,131 8,935,260 4,053,535
(1,284,514) (7,612,012) (3,880,131) (3,323,756) (8,628,719) (3,940,015)
378,219 1,912,316 1,566 1,201,369
4,435 1,560,336
2,031,332 300,115 (325,152) 2,852,691 308,107 2,875,225
5,417,491$ (144,871)$ (3,797,817)$ 3,074,054$ (3,836,572)$ (2,654,245)$
0.00%0.00%0.00%0.00%0.00%0.00%
133Draft 12/16/2021
Town of Los Gatos Schedule 5
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
Utility
and Total
Fiscal Unsecured Percent Secured Percent Total Estimated Direct
Year Property Change Property Change Assessed Full Market Tax Rate
2012 217,297,593 0.03%8,152,459,157 1.34% 8,369,756,750 32,609,836,628 1.0499
2013 211,268,609 2.77%8,465,420,032 3.84% 8,676,688,641 33,861,680,128 1.0508
2014 224,079,502 6.06%9,238,816,900 9.14% 9,462,896,402 36,955,267,600 1.0493
2015 227,331,042 1.45%9,767,782,505 5.73% 9,995,113,547 39,071,130,020 1.0544
2016 217,035,545 4.53%10,417,804,357 6.65% 10,634,839,902 41,671,217,428 1.0533
2017 304,443,013 40.27%11,240,554,198 7.90% 11,544,997,211 44,962,216,792 1.0560
2018 330,504,877 8.56%11,969,049,272 6.48% 12,299,554,149 47,876,197,088 1.0659
2019 359,276,665 8.71%12,795,393,103 6.90% 13,154,669,768 51,181,572,412 1.0607
2020 331,517,212 7.73%13,510,676,336 5.59% 13,842,193,548 54,042,705,344 1.0598
2021 308,749,655 6.87%14,599,669,332 8.06% 14,908,418,987 58,398,677,328 0.0000
Source: Santa Clara County Assessed Value Report
0
2000
4000
6000
8000
10000
12000
14000
16000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Unsecured Property Secured Property
134Draft 12/16/2021
Town of Los Gatos Schedule 6
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
Santa Clara School
Fiscal Basic County County Bonds Valley Water District Bonds
Year Wide Levy and Levies District and Loans Total
2012 1.0000 0.0435 0.0064 0.1393 1.1892
2013 1.0000 0.0439 0.0069 0.1523 1.2031
2014 1.0000 0.0423 0.0070 0.1417 1.1910
2015 1.0000 0.0479 0.0065 0.1442 1.1986
2016 1.0000 0.0476 0.0057 0.1381 1.1914
2017 1.0000 0.0474 0.0086 0.1223 1.1783
2018 1.0000 0.0597 0.0062 0.1177 1.1836
2019 1.0000 0.0565 0.0042 0.1006 1.1613
2020 1.0000 0.0557 0.0041 0.0935 1.1533
2021 1.0000 0.0457 0.0037 0.0959 1.1453
Source: Santa Clara County Book of Tax Rates
0.00
0.25
0.50
0.75
1.00
1.25
Santa Clara Valey Water District County
County Bonds and Levies
School District Bonds and Loans
Basic County Wide Levy
135Draft 12/16/2021
Town of Los GatosSchedule 7Principle Property Tax PayersLast Five Fiscal Years *Percentage Percentage Percentage Percentage Percentage of Total Cityof Total Cityof Total Cityof Total Cityof Total CityTaxable TaxableTaxable TaxableTaxable TaxableTaxable TaxableTaxable TaxableAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedASSESSEE NAMEValueValueValueValueValueValueValueValueValueValue750 University LLC$ 0.00%12,137,999$ 0.14%18,600,000$ 0.20%19,000,000$ 0.19%19,379,620$ 0.19%980 JR LLCAlberto Way Holdings LLC21,034,6230.26%23,145,0640.27%23,607,9640.26%23,715,1410.24%24,188,966 0.23%Ann R. Desantis13,823,7790.15%Boccardo Corporation37,173,8770.46%37,550,368 0.44%38,617,9120.42%38,772,905 0.40%21,617,318 0.21%CH Realty IV Downing LP19,143,068 0.23%19,525,9270.23%19,916,4430.22%CHL Ventures LP20,266,6300.25%20,671,9620.24%0.00%0.00%0.00%D&K Los Gatos LLC15,284,3240.19%15,590,0100.18%15,901,8090.17%15,974,0030.16%16,293,1630.16%David A. and Shari Flick Trustee14,724,4870.18%15,018,9710.18%15,388,8840.16%Donahue Schriber Realty Group LPDS Downing Los Gatos LLC20,006,8610.20%21,980,568 0.21%DS Village SquareEl Camino Hospital20,803,6090.21%26,477,1600.25%Equestrian 3 Investments LLCFox Creek Fund LLCGood Samaritan Hospital LP19,372,795 0.24%19,530,1830.23%19,710,8970.21%19,602,5940.20%19,880,366 0.19%Grade Way Associations VI14,508,4820.18%14,798,6510.17%15,094,6230.16%15,163,1520.16%Green Eyes LLC12,542,555 0.15%12,793,4040.14%Grosvenor USA Ltd.21,066,6300.26%22,437,9620.27%22,886,7200.25%22,990,6240.24%23,449,975 0.23%Health Care REIT Inc,19,869,245 0.24%19,223,348 0.23%20,671,9600.22%20,765,8100.21%20,089,9030.19%Hercules Holding II LLC0.00%0.00%0.00%0.00%0.00%International HotelKay Kaoru and Go Sasaki Sr., Trustees22,752,8090.25%24,744,9830.24%Knowles Los Gatos LLC46,123,468 0.57%47,045,9340.56%47,986,8500.52%48,204,708 0.49%49,167,836 0.47%KSL Capital Partners41,698,7510.51%42,532,7210.50%43,383,3700.47%43,580,326 0.45%30,134,6140.29%Leland E Lester, TrusteeLG Business Park Bldg 3 LLC61,947,2840.59%LG Business Park Bldg 4 LLCLG Business Park LLC18,342,9310.23%47,276,9770.51%39,347,485 0.40%17,507,2610.17%LG Hotel LLC15,448,0570.16%15,497,395 0.15%Los Gatos Hotel Corp.15,683,9790.19%15,617,1340.18%18,134,1820.20%15,573,3140.16%15,676,1130.15%Lyon Baytree Apartments LLC14,177,0390.17%14,430,1230.17%14,674,716 0.16%Paul H. Roskoph12,926,4570.16%13,416,4520.16%0.00%0.00%Preylock Los Gatos LLCSafeway Inc.San Jose Water Works29,369,1370.36%30,882,0090.36%33,626,3810.36%36,693,4530.38%37,081,0490.36%Serramonte Corporate Center LLCSI 32 LLC150,563,1191.54%141,348,8941.36%Sobrato Interests IV LLC157,554,525 1.93%157,559,245 1.86%169,809,676 1.84%20,869,338 0.21%44,930,4820.43%SRI Old Town LLC29,778,7120.37%30,374,286 0.36%30,981,7710.34%31,122,4270.32%31,744,2520.30%Summerhill N40 LLCSummerhill Prospect Avenue LLCToll House Hotel LLC15,696,0890.19%0.00%Wealthcap Los Gatos 121Wealthcap Los Gatos 31Windrose Los Gatos Properties LLCTotal Principal taxpayers583,795,249$ 7.16%584,030,904$ 6.90%650,252,243$ 7.68%394,337,473$ 6.49%1,296,723,012$ 6.37%Total All real properties assessed by the Town (1) $8,151,530,237 $8,464,491,112 $9,237,887,980 $9,766,765,025 $10,416,786,877 (1) Assessed value includes only net secured real properties.(2) Excludes the value of taxexempt propertiesSource Data: California Municipal Statistics, Inc.2014/152011/12 2012/13 2013/14 2015/16136Draft 12/16/2021
Schedule 72016/172017/182018/19Percentage Percentage Percentage Percentage Percentage of Total Cityof Total Cityof Total Cityof Total Cityof Total CityTaxable TaxableTaxable TaxableTaxable TaxableTaxable TaxableTaxable TaxableAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedAssessedASSESSEE NAMEValueValueValueValueValueValueValueValueValueValue750 University LLC19,675,159$ 0.18%25,241,863$ 0.21%25,746,699$ 0.20%26,261,632$ 0.19%26,786,863$ 0.18%980 JR LLC19,277,8790.15%Alberto Way Holdings LLC24,557,845 0.22%25,048,998 0.21%25,549,975 0.20%24,158,3500.18%24,641,5140.17%Ann R. DesantisBoccardo Corporation21,918,9210.20%22,211,6500.19%22,651,7320.18%23,099,3140.17%CH Realty IV Downing LPCHL Ventures LPD&K Los Gatos LLCDavid A. and Shari Flick TrusteeDonahue Schriber Realty Group LP53,872,0830.45%56,370,186 0.44%57,497,5870.43%58,647,535 0.40%DS Downing Los Gatos LLC22,315,7700.20%DS Village Square22,799,5990.20%El Camino Hospital26,880,9330.24%23,353,576 0.20%28,596,1040.22%30,789,155 0.23%42,611,768 0.29%Equestrian 3 Investments LLC29,584,2510.25%28,563,8640.22%25,525,8800.19%26,036,395 0.18%Fox Creek Fund LLC21,558,6640.17%Good Samaritan Hospital LP22,402,756 0.20%22,516,8230.19%22,934,2740.18%23,391,2890.17%23,846,4020.16%Grade Way Associations VIGreen Eyes LLCGrosvenor USA Ltd.Health Care REIT Inc, 20,396,2740.18%Hercules Holding II LLC0.00%0.00%International Hotel30,144,6170.25%30,747,5090.24%31,362,458 0.23%31,989,706 0.22%Kay Kaoru and Go Sasaki Sr., Trustees25,122,1310.22%25,624,0270.21%26,135,9620.20%28,864,9420.21%27,190,9510.19%Knowles Los Gatos LLC49,917,6440.44%50,915,995 0.43%51,934,3130.41%52,972,998 0.39%54,032,455 0.37%KSL Capital Partners30,105,945 0.27%25,893,946 0.22%26,411,8200.21%33,069,058 0.24%33,118,7590.23%Leland E Lester, Trustee29,004,1690.26%LG Business Park Bldg 3 LLC53,465,7240.45%LG Business Park Bldg 4 LLC43,937,8570.37%LG Business Park LLC31,070,5720.28%LG Hotel LLCLos Gatos Hotel Corp.Lyon Baytree Apartments LLCPaul H. Roskoph0.00%0.00%Preylock Los Gatos LLC89,141,4720.66%95,880,0000.66%Safeway Inc.24,394,468 0.20%25,752,2310.19%25,577,0340.18%San Jose Water Works38,710,728 0.34%41,202,805 0.34%46,150,5770.36%47,777,4320.35%49,649,1540.34%Serramonte Corporate Center LLC200,844,6101.57%204,861,5011.52%208,958,7291.43%SI 32 LLC143,442,2691.28%146,317,9441.22%149,208,1821.17%152,166,578 1.13%155,181,7931.06%Sobrato Interests IV LLC42,240,9940.38%43,071,8370.36%43,919,8790.34%44,781,3770.33%45,682,006 0.31%SRI Old Town LLC32,228,3510.29%32,872,9170.27%33,530,3740.26%34,200,9800.25%34,884,9990.24%Summerhill N40 LLC56,244,7820.42%57,369,6610.39%Summerhill Prospect Avenue LLC18,274,508 0.16%Toll House Hotel LLC0.00%0.00%35,043,1800.24%Wealthcap Los Gatos 121109,100,0000.97%111,282,0000.93%113,507,6400.89%115,777,7920.86%118,093,3470.81%Wealthcap Los Gatos 3184,000,0000.75%85,680,0000.72%87,393,6000.68%Windrose Los Gatos Properties LLCTotal Principal taxpayers814,164,568.00$ 7.24%916,633,381.00$ 7.66%1,061,033,843.00$ 8.29%1,127,696,808.00$ 8.35%1,175,222,251.00$ 8.05%Total All real properties assessed by the Town (1) $11,239,536,718 $11,968,031,792 $12,793,751,423 $13,509,034,656 $14,598,027,652 (1) Assessed value includes only net secured real properties.(2) Excludes the value of taxexempt propertiesSource Data: California Municipal Statistics, Inc.2020/212019/20137Draft 12/16/2021
Town of Los Gatos Schedule 8
Property Tax Levies and Collections
Last Ten Fiscal Years
Value of
Redevelopment
Agency Value of
Town Redevelopment Total Property Value of Town Property Property
Property Tax Property Tax Tax Levied Property subject Subject to Subject to
Fiscal Levied and Levied and and to Local Tax Local Local
Year Collected Collected Collected Rate Tax Rate Tax Rate
2012 7,520,265 3,349,254 10,869,519 8,369,756,750 1,109,305,673 9,479,062,423
2013 8,253,442 8,253,442 8,676,688,641 1,167,752,021 9,844,440,662
2014 9,120,626 9,120,626 9,462,896,402 1,249,873,303 10,712,769,705
2015 9,787,519 9,787,519 9,995,113,547 1,318,214,863 11,313,328,410
2016 10,388,424 10,388,424 10,634,839,902 1,395,509,489 12,030,349,391
2017 11,345,588 11,345,588 11,544,997,211 1,537,577,241 13,082,574,452
2018 12,060,228 12,060,228 12,299,554,149 1,650,746,473 13,950,300,622
2019 12,924,592 12,924,592 13,154,669,768 1,717,358,555 14,872,028,323
2020 13,559,587 13,559,587 13,842,193,548 1,715,982,555 15,651,922,606
2021 13,864,271 13,864,271 14,908,418,987 1,809,729,058 16,718,148,045
Sources: Santa Clara County AuditorController Office and the Town of Los Gatos
$7.0$7.5$8.0$8.5$9.0$9.5$10.0$10.5$11.0$11.5$12.0$12.5$13.0$13.5$14.0$14.5$15.0$15.5$16.0$16.5$17.0$17.5
Value of Property
$7.0
$8.0
$9.0
$10.0
$11.0
$12.0
$13.0
$14.0
$15.0
$16.0
$17.0
$18.0
Tax Levied
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Town of Los Gatos Schedule 9
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
1992 2002 2010
Certificate Certificate Certificate Total Total Percentage of
Fiscal of of of Governmental Primary Personal Per
Year Participation Participation Participation Activities Government Income Capita
2012 0.0%1)0.00
2013 0.0% 0.00
2014 0.0% 0.00
2015 0.0% 0.00
2016 0.0% 0.00
2017 0.0% 0.00
2018 0.0% 0.00
2019 0.0% 0.00
2020 0.0% 0.00
2021 0.0% 0.00
1)Debt was transferred to the Successor Agency Trust Fund as a part of the RDA dissolution in FY 2011
Governmental Activities
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Town of Los Gatos Schedule 10
Direct and Overlapping Governmental Activities Debt
As of June 30, 2021
2020/21 Assessed Valuation:$14,908,418,987
Estimated Share
of Direct and
Total Debt at Overlapping Debt
DIRECT AND OVERLAPPING BONDED DEBT:% Applicable (1)June 30, 2021 at June 30, 2021
Overlapping Tax & Assesment Debt
Santa Clara County 2.706% 812,685,000$ 21,991,256$
West ValleyMission Community College District 9.383%589,080,000$ 55,273,376$
Campbell Union High School District 7.774%357,945,000$ 27,826,644$
Los GatosSaratoga Joint Union High School District 36.253%86,585,000$ 31,389,660$
Cambrian School District 0.437%62,324,944$ 272,360$
Campbell Union High School District 7.665%211,274,895$ 16,194,221$
Los Gatos Union School District 74.127%72,185,000$ 53,508,575$
Saratoga Union School District 0.034%19,249,458$ 6,545$
Union School District 20.369%109,815,349$ 22,368,288$
Midpeninsula Regional Open Space District 4.430%86,400,000$ 3,827,520$
Santa Clara Valley Water District Benefit Assessment District 2.706%57,010,000$ 1,542,691$
Total Overlapping Tax and Assesmet Debt 234,201,136$
Overlapping General Fund Debt
Santa Clara County General Fund Obligations 2.706%914,957,860$ 24,758,760$
Santa Clara County Pension Obligations 2.706%341,399,194$ 9,238,262$
Santa Clara County Board of Education Certificates of Participation 2.706%2,670,000$ 72,250$
West ValleyMission Community College District General Fund Obligations 9.383%49,850,000$ 4,677,426$
Campbell Union High School District General Fund Obligations 7.774%20,000,000$ 1,554,800$
Los GatosSaratoga Joint Union High School District Certificates of Participation 36.253%1,709,000$ 619,564$
Campbell Union School District General Fund Obligations 7.665% 2,180,000$ 167,097$
Saratoga Union School District Certificates of Participation 0.034%2,750,000$ 935$
Santa Clara County Vector Control District Certificates of Participation 2.706%1,765,000$ 47,761$
Midpeninsula Regional Open Space Park District General Fund Obligations 4.430%106,000,600$ 4,695,827$
Total Gross Overlapping General Fund Debt 45,832,682$
Less: Santa Clara County Supported Obligations 684,004$
Total Overlapping General Fund Debt 45,148,678$
Overlapping Tax Increment Debt ( Successor Agency)
Town of Los Gatos Certificated of Participations 14,085,000$
Total of Overlapping Tax Increment Debt 14,085,000$
Total Direct Debt $0
Total Gross Overlapping Dept 294,118,818$
Total Net Overlapping Debt 293,434,814$
Gross Combined Total Debt 294,118,818$ (2)
Net Combined Total Debt 293,434,814$
Ratios to 2020/21 Assessed Valuation:
Total Overlapping Tax and Assessment Debt: 1.57%
Total Direct Debt: 0.00%
Gross Combined Total Debt: 1.97%
Net Combined Total Debt: 1.97%
Ratios to Redevelpment Incremental Valuation ( $1,560,073,787):
Total Overlapping Tax Increment Debt: 0.90%
Source Data: California Municipal Statistics, Inc.
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value. Applicable
percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of
the city divided by the distric's total taxable asessed value.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue bonds and nonbonded capital lease obligations.
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Town of Los Gatos
Legal Debt Margin Information,
Last Ten Fiscal Years
(In Thousands of Dollars)
2011/12 2012/13 2013/14 2014/15 2015/16
Debt Limit 1,195,035$ 1,216,131$ 1,263,138$ 1,379,254$ 1,444,943$
Debt Applicable to Limit
Legal Debt Margin 1,195,035$ 1,216,131$ 1,263,138$ 1,379,254$ 1,444,943$
Total Net Debt
Applicable to the Limit
as a Percentage
of Debt Limit 0.00%0.00%0.00%0.00%0.00%
Notes:
(2) Excludes RDA asessed valuation and debt transferred to the Successor Agency trust as a part of the
(1) The Town of Los Gatos is a general law city and has a debt limit of 15%.
Fiscal Year
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Schedule 11
Assessed Value 14,908,418,987$
Debt Limit 2,236,262,848
Debt Applicable to Limit:
Legal Debt Margin 2,236,262,848$
2016/17 2017/18 2018/19 2019/20 2020/21
1,556,252$ 1,679,736$ 1,789,097$ 2,076,329$ 2,236,263$
1,556,252$ 1,679,736$ 1,789,097$ 2,076,329$ 2,236,263$
0.00% 0.00% 0.00% 0.00% 0.00%
Legal Debt Margin Calculation
for Fiscal Year 2020/21
Fiscal Year
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Town of Los Gatos Schedule 12
Demographic and Economic Statistics
Last Ten Fiscal Years
Personal
Income Per Capita Public County
Fiscal (thousands Personal Median School Unemployment
Year Population of dollars)Income Age Enrollment Rate
Ended (1) (2) (3) (4) (5) (6)
2012 29,808 1,854,892 62,228 42.64 6,352 8.7%
2013 30,247 2,140,641 70,772 45.8 6,420 6.8%
2014 30,443 2,267,912 74,497 45.80 6,522 5.7%
2015 30,505 2,197,885 72,050 46.10 6,622 3.8%
2016 31,376 2,286,087 72,861 46.30 6,646 3.5%
2017 31,314 2,281,569 72,861 46.50 6,631 3.8%
2018 30,601 2,290,638 74,855 46.81 6,588 2.6%
2019 30,998 2,365,178 76,301 46.72 6,544 2.6%
2020 31,439 2,546,748 81,006 46.83 6,520 10.7%
2021 30,836 2,686,155 87,111 46.83 6,180 5.2%
Source:
(1) California State Dept. of Finance Population Research Unit (January 2019)
(2) California State Dept. of Finance Estimate equals county per capita average times population
(3) US Census Bureau QuickFacts
(4) Claritas demographic snapshot report
(5) Los Gatos Saratoga Joint Union and Los Gatos Union Elementary School Districts
(6) State of California, Employment Development Dept., Labor Market Info. Div.
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Town of Los Gatos Schedule 13
Principal Employers
Last Ten Fiscal Years
Percentage Percentage Percentage Percentage Percentage
of Total Town of Total Town of Total Town of Total Town of Total Town
Principal Employers Emp. Employment Emp. Employment Emp. Employment Emp. Employment Emp. Employment
Columbia Health Care Assoc/Mission Oaks Hospital 2,000 13.89%2,000 13.29%2,000 13.52%0.00%0.00%
El Camino Hospital, Los Gatos 700 4.86%700 4.65%700 4.73%560 3.73%560 3.53%
Los Gatos Union School District 275 1.91%275 1.83%237 1.60%273 1.82%280 1.76%
Los GatosSaratoga High School District 270 1.88%270 1.79%256 1.73%157 1.05%157 0.99%
Netflix 800 5.56%900 5.98%825 5.58%1,530 10.19%1,976 12.45%
Safeway 250 1.74%250 1.66%250 1.69%314 2.09%314 1.98%
Alain Pinel Realtors 150 1.04%150 1.00%156 1.05%156 1.04%146 0.92%
Courtside Tennis Club 200 1.39%200 1.33%295 1.99%440 2.93%440 2.77%
Town of Los Gatos 136 0.94%138 0.92%144 0.97%157 1.05%158 1.00%
Whole Foods 0.00%0.00%0.00%179 1.19%179 1.13%
Vasona Creek Health Care Center 0.00%0.00%0.00%233 1.55%233 1.47%
Good Samaritan Regional Cancer Center 0.00%0.00%0.00%200 1.33%200 1.26%
Roku 0.00%0.00%0.00%0.00%487 3.07%
Terraces of Los Gatos 0.00%0.00%0.00%0.00%228 1.44%
Source: Town of Los Gatos, Finance Department and Muniservices
2011/12 2012/13 2013/14 2014/15 2015/16
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Schedule 13
Percentage Percentage Percentage Percentage Percentage
of Total Town of Total Town of Total Town of Total Town of Total Town
Principal Employers Emp. Employment Emp. Employment Emp. Employment Emp. Employment Emp. Employment
Columbia Health Care Assoc/Mission Oaks Hospital 0.00%0.00%0.00%0.00%0.00%
El Camino Hospital, Los Gatos 560 3.49%560 3.43%560 3.49%560 3.49%560 3.35%
Los Gatos Union School District 274 1.71%267 1.64%281 1.75%281 1.75%281 1.68%
Los GatosSaratoga High School District 370 2.30%367 2.25%367 2.28%367 2.28%320 1.92%
Netflix 1,864 11.61%2,117 12.98%2,314 14.41%2,314 14.41%2,524 15.11%
Safeway 314 1.95%314 1.92%314 1.95%314 1.95%314 1.88%
Alain Pinel Realtors 148 0.92%131 0.80%131 0.82%131 0.82%0.00%
Courtside Tennis Club 468 2.91%542 3.32%542 3.37%542 3.37%542 3.24%
Town of Los Gatos 160 1.00%159 0.97%160 1.00%160 1.00%161 0.96%
Whole Foods 179 1.11%179 1.10%125 0.78%125 0.78%125 0.75%
Vasona Creek Health Care Center 233 1.45%233 1.43%233 1.45%233 1.45%250 1.50%
Good Samaritan Regional Cancer Center 200 1.25%200 1.23%200 1.25%200 1.25%200 1.20%
Roku 554 3.45%664 4.07%516 3.21%516 3.21%0.00%
Terraces of Los Gatos 228 1.42%228 1.40%228 1.42%228 1.42%228 1.36%
2020/212018/192017/182016/17 2019/20
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Town of Los Gatos Schedule 14
FulltimeEquivalent Employees by Function/Program
Last Ten Fiscal Years
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 20/21
Function/Program
General Government 20.15 20.40 20.73 20.97 20.97 21.35 21.97 22.16 21.80 21.80
Police 60.50 58.00 57.50 60.00 59.00 59.00 59.00 59.00 60.00 60.00
Culture and Recreation
Economic Development 1.00 0.50 0.63 0.63 0.63 0.75 0.75 0.75 0.75
Library 8.60 8.60 10.30 10.80 11.00 12.25 12.25 12.50 12.50 12.50
Planning 16.00 17.50 17.50 19.50 19.00 19.26 19.63 20.08 20.08 20.20
Public Works 32.00 31.00 31.50 32.00 33.50 33.50 34.50 34.50 34.50 34.75
Total 138.75 138.25 135.50 137.53 144.10 145.98 148.10 148.99 149.63 150.00
Fulltime equivalent employment is calculated as one or more employee positions totaling one full year
of service or approximately 2,080 hours a year.
Page C45 of Town Budget 2122
FulltimeEquivalent Employees as of June 30
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Town of Los Gatos
Operating Indicators
Last Ten Fiscal Years
FUNCTION/PROGRAM
General government 2011/12 2012/13 2013/14 2014/15
Building Permits Issued
Residential Permits Issued 747 738 813 805
Residential Permits Value 66,072,341 75,227,889 87,307,822 76,896,111
Commercial Permits Issued 107 137 139 133
Commercial Permits Value 17,663,124 46,855,615 138,676,507 178,195,997
Publically Owned Permits Issued
Publically Owned Permits Value
Residential Parking Permits
Number of Special Event Permits Issued 89 125 133 127
Number of Annual Permits Issued 1,223 1,320 1,376 1,570
City Clerk
Number of Council Resolutions Passed 59 74 86 72
Number of Ordinances Passed 13 20 16 9
Number of Contracts Passed 227 220 196 222
General Services
Number of Purchase Orders Issued 358 318 301 277
Police
Physical Arrests 690 648 641 695
Parking Violations 12,938 11,991 14,421 13,321
Traffic Violations 2,908 3,333 4,747 4,633
DUI Arrests 89 86 62 48
Library
Circulated eaudiobooks 3,388 4,774 2,414 *5,867*
Other Public Works
Street Resurfacing/Overlay/Reconstruction (miles) 8.0 8.0 10.0 1.8
ADA Compliance: Curb Ramps 19 19 19 23
Traffic Circles 11 1
Street Poles 1,611 1,611 1,611 1,609
Planning and Development Department
Building & Safety Inspections Performed 11,738 11,902 12,764 11,652
Redevelopment: Number of active projects 1
Source: Town of Los Gatos, Finance Department
* July 2013 the Library separated from Northern CA Digital Library, Patrons had no longer access to collections of multiple libraries. By 20
patrons access to more materials.
** The Town streamlined the special event application where multiple events require only one permit.
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Schedule 15
2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
899 744 849 814 898 1,128
85,000,754 53,625,891 63,083,249 80,030,846 47,961,529 111,242,724
147 135 105 1229268
20,185,884 50,024,177 16,626,196 13,295,999 12,389,688 37,285,259
107 118 113 78 **
1,363 1,251 1,342 1,395 1,400 1,568
61 69 69 59 57 50
11 5 17 11 24 9
283 240 262 245 242 205
334 331 322 343 359 376
987 1,030 1,164 1,138 616 360
13,975 12,863 11,784 6,817 4,023 1,584
5,400 4,634 4,757 2,877 1,225 764
58 60 51 70 64 23
7,761 10,006 8,844 12,130 57,839 54,614
8.0 10.0 2.6 5.8 16.2 10.0
11 30 68 49 68 91
1 11111
1,609 1,609 1,762 1,830 1,830 1,830
8,655 14,722 13,918 13,966 13,633 13,806
Fiscal Year
014 the Library has expanded its contents giving
149Draft 12/16/2021
Town of Los Gatos Schedule 16
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21
Function/Program
Police
Number of Stations 2 2 2 2 2 2 2 2 2 2
Number of Patrol Units 14 14 14 14 14 14 14 14 14 14
Parking Enforcement Vehicles 2 2 2 2 2 2 2 2 2 2
Other Public Works
Streets (miles)132 132 132 132 132 132 132 132 132 132
Streetlights 2,116 2,116 2,109 1,609 1,609 1,609 1,762 1,830 1,830 1,830
Traffic Signals 29 29 29 29 30 30 30 31 31 31
Parks and Recreation
Number of Parks 12 12 12 12 12 12 12 N/A N/A N/A
Number of Community Centers 1 1 1 1 1 1 1 1 1 1
Number of Parks & Open Spaces N/A N/A N/A N/A N/A N/A N/A 17 17 17
Parking
Number of Parking Garages 1 1 1 1 1 1 1 1 1 1
Number of Parking Lots 22 22 22 22 22 22 22 22 22 22
Number of Off Street Parking Garage Spaces 1,126 1,126 1,126 1,126 1,126 1,126 1,126 N/A N/A N/A
Number of Downtown OffStreet Parking Spaces N/A N/A N/A N/A N/A N/A N/A 1,269 1,269 1,269
Source: Town of Los Gatos, Finance Department
Fiscal Year
150Draft 12/16/2021
Draft 12/16/2021