HomeMy WebLinkAbout2022-10-24 - Financing Authority Meeting Agenda Packet
AGENDA
YORBA LINDA WATER DISTRICT
FINANCING AUTHORITY REGULAR MEETING
Monday, October 24, 2022, 5:30 PM
1717 E Miraloma Ave, Placentia CA 92870
1. PARTICIPATION INSTRUCTIONS
Due to the continuing state of emergency declared by the California Governor related to preventing the
spread of Coronavirus (COVID-19), and pursuant to California Government Code Section 54953(e), this
meeting will be facilitated in a hybrid format. As such, Directors and members of the public may choose
to participate in person or by video/teleconference. Information for accessing this meeting by telephone
or internet-based service is provided below. For questions regarding participation, please call the Board
Secretary at (714) 701-3020.
Computer/Mobile Device: https://us06web.zoom.us/j/81128021800
Telephone: (669) 900-6833 or (346) 248-7799
Meeting ID: 811 2802 1800
2. CALL TO ORDER
2.1. NOTE: This meeting will be called to order following consideration of Item No.
7.1. on the agenda for the Regular Board of Directors Meeting on Monday,
October 24, 2022 at 5:30 p.m.
3. ROLL CALL
J. Wayne Miller, PhD, President
Brooke Jones, Vice President
Trudi DesRoches, Director
Phil Hawkins, Director
Tom Lindsey, Director
4. PUBLIC COMMENTS
Any individual wishing to address the Board (or Committee) is requested to identify themselves and state
the matter on which they wish to comment. If the matter is on the agenda, the Chair will recognize the
individual for their comment when the item is considered. No action will be taken on matters not listed on
the agenda. Comments are limited to three minutes and must be related to matters of public interest
within the jurisdiction of the Water District. (GC 54954.3)
5. CONSENT CALENDAR
All items on the consent calendar are considered routine and may be approved by a single motion. There
will be no discussion of these items unless a member of the Board, staff, or public requests separate
consideration.
5.1. Minutes of the Financing Authority Regular Meeting Held July 12, 2022
Recommendation: That the Board of Directors approve the minutes as
presented.
6. ACTION CALENDAR
This portion of the agenda is for items where staff presentations and Board (or Committee) discussions
are needed prior to formal action.
Page 1 of 21
6.1. Audit Report for Fiscal Year Ended June 30, 2022
Recommendation: That the Board of Directors receive and file the Yorba Linda
Water District Financing Authority Comprehensive Annual Financial Report for
the Fiscal Year Ended June 30, 2022.
7. ADJOURNMENT
7.1. The next regular meeting of the Financing Authority is scheduled to be held
Tuesday, December 13, 2022 at 6:30 p.m.
Items Distributed to the Board Less Than 72 Hours Prior to the Meeting
Non-exempt materials related to open session agenda items that are distributed to a majority of the Board of
Directors (or Committee Members) less than seventy-two (72) hours prior to the meeting will be available for
public inspection in the lobby of the District’s Administrative building located at 1717 E Miraloma Ave, Placentia
CA 92870 during regular business hours. When practical, these materials will also be posted on the District’s
website at https://ylwd.com/. (GC 54957.5)
Accommodations for the Disabled
Requests for disability-related modifications or accommodations, including auxiliary aids or services, required for
participation in the above-posted meeting should be directed to the Board Secretary at (714) 701-3020 at least 24
hours in advance. (GC 54954.2(a))
Page 2 of 21
ITEM NO. 5.1.
AGENDA REPORT
MEETING DATE: October 24, 2022
TO: Board of Directors
FROM: Mark Toy, General Manager
STAFF CONTACTS: Annie Alexander, Senior Executive Assistant / Board Secretary
SUBJECT: Minutes of the Financing Authority Regular Meeting Held July 12, 2022
RECOMMENDATION:
That the Board of Directors approve the minutes as presented.
ATTACHMENTS:
1. Draft Meeting Minutes
Page 3 of 21
Minutes of the Financing Authority Regular Meeting Held July 12, 2022 at 6:30 p.m. 1
FA-2022-XXX
MINUTES OF THE
YORBA LINDA WATER DISTRICT
FINANCING AUTHORITY REGULAR MEETING
Tuesday, July 12, 2022, 6:30 p.m.
1717 E Miraloma Ave, Placentia CA 92870
1. PARTICIPATION INSTRUCTIONS
Were included on the agenda.
2. CALL TO ORDER
The meeting was called to order at 6:43 p.m.
3. ROLL CALL
DIRECTORS PRESENT STAFF PRESENT
J. Wayne Miller, PhD, President Doug Davert, Interim General Manager
Brooke Jones, Vice President John DeCriscio, Operations Manager
Trudi DesRoches Gina Knight, Human Resources and Risk Manager
Phil Hawkins Delia Lugo, Finance Manager
Tom Lindsey Rosanne Weston, Engineering Manager
Alison Martin, Public Affairs Manager
Annie Alexander, Board Secretary
Ariel Bacani, Assistant Engineer III
ALSO PRESENT
Andrew Gagen, General Counsel, Kidman Gagen Law LLP
4. PUBLIC COMMENTS
None.
5. CONSENT CALENDAR
Director Hawkins made a motion, seconded by Director Lindsey, to approve the
Consent Calendar. Motion carried 5-0-0-0 on a roll call vote.
5.1.Minutes of the Financing Authority Regular Meeting Held December 14, 2021
Recommendation: That the Board of Directors approve the minutes as
presented.
Page 4 of 21
Minutes of the Financing Authority Regular Meeting Held July 12, 2022 at 6:30 p.m. 2
FA-2022-XXX
6. ACTION CALENDAR
6.1.Authorizing the Sale of Revenue Bonds, Series 2022A
Lora Carpenter, Vice President for Fieldman Rolapp & Associates,
reviewed the progress made to date, key components of the revenue bonds
and refunding plan, estimated aggregate debt profile, and the financing
schedule.
Kristina Huhn, Vice President for Barclays, briefly reviewed the status of
municipal bond markets.
Cyrus Torabi, Bond Counsel for Stradling Yocca Carlson & Rauth, provided
an overview of the associated legal documents for both the District and the
Financing Authority.
Director Lindsey inquired about making a minor revision to his biography in
one of the documents and Director DesRoches requested a correction to
her first name in another document. Staff indicated that these revisions
would be forwarded to Mr. Torabi at the end of the evening.
President Miller opened the floor to public comment on this matter for which
there was none.
Director Jones made a motion, seconded by Director Hawkins, to adopt
Resolution No. FA-2022-01 approving the sale of Revenue Bonds, Series
2022A in an aggregate principal amount not to exceed $35,000,000 and
approving the execution of certain documents in connection therewith and
certain other matters. Motion carried 5-0-0-0 on a roll call vote.
7. ADJOURNMENT
7.1.Director Hawkins made a motion, seconded by Director Lindsey, to adjourn
the meeting at 7:13 p.m. Motion carried 5-0-0-0 on a roll call vote.
Annie Alexander
Board Secretary
Page 5 of 21
ITEM NO. 6.1.
AGENDA REPORT
MEETING DATE: October 24, 2022
TO: Board of Directors
FROM: Mark Toy, General Manager
STAFF CONTACTS: Delia Lugo, Finance Manager
SUBJECT: Audit Report for Fiscal Year Ended June 30, 2022
RECOMMENDATION:
That the Board of Directors receive and file the Yorba Linda Water District Financing Authority
Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2022.
BACKGROUND
Staff is pleased to present the Board of Directors with the Yorba Linda Water District Financing
Authority Annual Comprehensive Financial Report (ACFR) for the Fiscal Year Ended June 30, 2022.
Lance, Soll & Lunghard, LLP, the District's external auditing firm, has completed its annual audit of
the Yorba Linda Water District Financing Authority for the fiscal year ended June 30, 2022. Mr. Ryan
Domino, Partner of Lance, Soll & Langhard, LLP, will be available via video conference to present
the ACFR.
ATTACHMENTS:
1. YLWD Financing Authority Audit Report
Page 6 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
(A COMPONENT UNIT OF YORBA LINDA WATER DISTRICT)
YEAR ENDED JUNE 30, 2022 FINANCIAL STATEMENTS
Page 7 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
(A COMPONENT UNIT OF YORBA LINDA WATER DISTRICT)
FINANCIAL STATEMENTS
YEAR ENDED JUNE 30, 2022
TABLE OF CONTENTS
Page
Number
Independent Auditors’ Report ............................................................................................................... 1
Management’s Discussion and Analysis ............................................................................................... 4
Basic Financial Statements
Statement of Net Position ............................................................................................................... 6
Statement of Revenues, Expenses, and Changes in Net Position ................................................ 7
Statement of Cash Flows ............................................................................................................... 8
Notes to Financial Statements ........................................................................................................ 9
OTHER REPORT
Independent Auditors’ Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards ............................................................ 12
Page 8 of 21
203 N. Brea Blvd., Suite 203 Brea, CA 92821 Lance, Soll & Lunghard, LLP Phone: 714.672.0022
INDEPENDENT AUDITORS’ REPORT
To the Board of Directors
Yorba Linda Water District Financing Authority
Placentia, California
Report on the Financial Statements
Opinions
We have audited the accompanying financial statements of the Yorba Linda Water District Financing
Authority (the “Authority”), a component unit of the Yorba Linda Water District (the “District) as of and for
the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise
the Authority’s basic financial statements as listed in the table of contents.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial
position of the Authority as of June 30, 2022, and the changes in financial position and, cash flows thereof
for the year then ended in accordance with accounting principles generally accepted in the United States
of America.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States
of America (GAAS), the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States, and the State Controller’s Minimum
Audit Standards for California Special Districts. Our responsibilities under those standards are further
described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We are required to be independent of the Authority and to meet our other ethical responsibilities, in
accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Emphasis of Matter
Yorba Linda Water District Financing Authority Financial Statements
As discussed in Note 1, the financial statements of the Authority, are intended to present the financial
position, the changes in financial position, and, where applicable, cash flows of only that portion of the
District that is attributable to the transactions of the Authority. They do not purport to, and do not, present
fairly the financial position of the District, as of June 30, 2022, the changes in its financial position, or, where
applicable, its cash flows for the year then ended in accordance with accounting principles generally
accepted in the United States of America. Our opinion is not modified with respect to this matter.
Page 9 of 21
To the Board of Directors
Yorba Linda Water District Financing Authority
Placentia, California
Responsibilities of Management 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; and for the
design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or
events, considered in the aggregate, that raise substantial doubt about the Authority’s ability to continue as
a going concern for twelve months beyond the financial statement date, including any currently known
information that may raise substantial doubt shortly thereafter.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore
is not a guarantee that an audit conducted in accordance with GAAS, Government Auditing Standards,
and the State Controller’s Minimum Audit Standards will always detect a material misstatement when it
exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control. Misstatements are considered material if, there is a substantial likelihood that,
individually or in the aggregate, they would influence the judgment made by a reasonable user based on
the financial statements.
In performing an audit in accordance with GAAS, Government Auditing Standards, and the
State Controller’s Minimum Audit Standards we:
Exercise professional judgment and maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, and design and perform audit procedures responsive to those risks. Such procedures
include examining, on a test basis, evidence regarding the amounts and disclosures in the financial
statements.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Authority’s internal control. Accordingly, no such opinion is expressed.
Evaluate the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluate the overall presentation of the
financial statements.
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate,
that raise substantial doubt about the Authority’s ability to continue as a going concern for a
reasonable period of time.
2
Page 10 of 21
To the Board of Directors
Yorba Linda Water District Financing Authority
Placentia, California
We are required to communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit, significant audit findings, and certain internal control-related matters
that we identified during the audit.
Other Reporting Responsibilities
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis as listed on the table of contents, be presented to supplement the basic financial
statements. Such information is the responsibility of management and, 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 Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated
October 10, 2022 on our consideration of the Authority’s internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and
other matters. The purpose of that report is solely to describe the scope of our testing of internal control
over financial reporting and compliance and the results of that testing, and not to provide an opinion on the
effectiveness of the Authority’s financial reporting or on compliance. That report is an integral part of an
audit performed in accordance with Government Auditing Standards in considering the Authority’s
internal control over financial reporting and compliance.
Brea, California
October 10, 2022
3
Page 11 of 21
YORBA LINDA WATER DISTIRCT FINANCING AUTHORITY
MANAGEMENT’S DISCUSSION AND ANALYSIS
For the Year Ended June 30, 2022
This section of the Authority's annual financial report presents our analysis of the Authority's financial
performance during the fiscal year that ended on June 30, 2022. Please read it in conjunction with the
financial statements, which follow this section.
FINANCIAL HIGHLIGHTS
The Authority's net position did not change, as the revenue and interest earned on the money market equaled
the expenditures and interest expense on the bonds payable.
OVERVIEW OF THE FINANCIAL STATEMENTS
The discussion and analysis are intended to serve as an introduction to the Yorba Linda Water District
Financing Authority's basic financial statements. The Authority's basic financial statements consist of
two components: (I) financial statements and (2) notes to the financial statements. The Authority is a
self-supporting entity and follows the enterprise fund reporting. Accordingly, the financial statements are
presented using the accrual basis of accounting.
FINANCIAL ANALYSIS OF THE AUTHORITY
Our analysis of the Authority begins on page 6 of the financial statements. The goal of the Authority is to
have the installment contract and interest income receivables remain equal to the amount of outstanding
debt in order that its proceeds are available to pay the debt. Thus, net position of the Authority
(the difference between the interest income received and the unpaid debt) should be zero. Since the
Authority is a financing entity, all of the revenues and principal collected on the investment in Yorba Linda
Water District’s Financing Authority's Revenue Bonds, Series 2017A is used to pay the interest and
principal on the Bonds resulting in no change in net position.
NET POSITION
To begin our analysis a summary of the Authority's Statement of Net Position as June 30, 2022 is as follows:
Fiscal Year Fiscal Year
2022 2021
ASSETS:
Interest receivable 293,511$ 305,323$
Installment contract receivable:
Due in one year 990,000 945,000
Due in more than one year 23,870,000 24,860,000
TOTAL ASSETS 25,153,511 26,110,323
LIABILITIES:
Interest payable 293,511 305,323
Long-term Liabilities
Due in one year 990,000 945,000
Due in more than one year 23,870,000 24,860,000
TOTAL LIABILITIES 25,153,511 26,110,323
NET POSITION -$ -$
4
Page 12 of 21
YORBA LINDA WATER DISTIRCT FINANCING AUTHORITY
MANAGEMENT’S DISCUSSION AND ANALYSIS
For the Year Ended June 30, 2022
REVENUES, EXPENSES AND CHANGES IN NET POSITION
The interest income of $1,185,857 and $1,232,481 was used to pay the interest expense on the bonds as of
June 30, 2022 and June 30, 2021, respectively.
BUDGETARY HIGHLIGHTS
The Authority's Board of Directors is not required to adopt a budget.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets - The Authority does not own any capital assets.
Long-term Debt - At year-end, the Authority had $24,860,000 and $25,805,000 in long-term debt
as of June 30, 2022 and June 30, 2021, respectively. More detailed information about the
Authority's long-term debt is presented on pages 10-11 in the Notes to the Financial Statements.
CONTACTING THE AUTHORITY’S FINANCIAL MANAGER
This financial report is designed to provide our citizens, customers, investors, and creditors with a general
overview of the Authority's finances and to demonstrate the Authority's accountability for the money it
receives. If you have questions about the report or need additional financial information, please contact the
District at 1717 E. Miraloma Avenue, Placentia, California 92807 or the Finance Department at
(714) 701-3040.
5
Page 13 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
STATEMENT OF NET POSITION
JUNE 30, 2022
ASSETS
Interest Receivable 293,511$
Installment Contract Receivable:
Due in One Year 990,000
Due in More Than One Year 23,870,000
Total Assets 25,153,511
LIABILITIES
Interest Payable 293,511
Long-Term Liabilities:
Due in One Year 990,000
Due in More Than One Year 23,870,000
Total Liabilities 25,153,511
NET POSITION -$
See Notes to Financial Statement.6
Page 14 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET POSITION
YEAR ENDED JUNE 30, 2022
OPERATING REVENUES -$
OPERATING EXPENSES -
OPERATING INCOME -
NONOPERATING INCOME (EXPENSES)
Interest Income 1,185,857
Interest Expense (1,185,857)
Total Nonoperating Income (Expenses) -
CHANGE IN NET POSITION -
Net Position - Beginning of Year -
NET POSITION - END OF YEAR -$
See Notes to Financial Statement.7
Page 15 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
STATEMENT OF CASH FLOWS
YEAR ENDED JUNE 30, 2022
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Principal Paid on 2017A Revenue Bonds (945,000)$
Interest Paid on 2017A Revenue Bonds (1,185,857)
Contract Receivable Installment Payments Received 2,130,857
Net Cash provided by Capital and Related Financing Activities -
NET CHANGE IN CASH AND CASH EQUIVALENTS -
Cash and Cash Equivalents at Beginning of Year -
CASH AND CASH EQUIVALENTS - END OF YEAR -$
See Notes to Financial Statement.8
Page 16 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED JUNE 30, 2022
Note 1: Summary of Significant Accounting Policies
Organization
The Yorba Linda Water District Financing Authority (the Authority) was organized pursuant
to a Joint Exercise of Powers Agreement (the JPA Agreement) between the Yorba Linda
Water District (the District) and California Municipal Finance Authority, dated April 11, 2017.
The Authority is statutorily authorized by Article 4 of Chapter 5 of Division 7 of Title 1 of the
California Government Code and is empowered under the JPA Agreement to issue its
bonds for, among other things, the purposes of the plan of financing described herein.
The Authority is an integral part of the reporting entity of the District. The financial activity of
the Authority has been included within the scope of the basic financial statements of the
District because the board of directors of the District is the governing board over the
operations of the Authority. Only the financial activity of the Authority is included herein;
therefore, these financial statements do not purport to represent the financial position or
results of operations of the District.
Basic Financial Statements
The basic financial statements are composed of the statement of net position, the statement
of revenues, expenses, and changes in net position, the statement of cash flows, and the
notes to the basic financial statements.
Basis of Presentation
The accounts of the Authority are that of an enterprise fund. An enterprise fund is a
proprietary type fund used to account for operations (a) that are financed and operated in a
manner similar to private business enterprises where the intent of the governing body is that
the costs (expenses) of providing goods or services to the general public on a continuing
basis be financed or recovered primarily through user charges; or (b) where the governing
body has decided that periodic determination of revenues earned, expenses incurred,
and/or net income is appropriate for capital maintenance, public policy, management
control, accountability, or other purposes.
Measurement Focus and Basis of Accounting
Measurement focus is a term used to describe which transactions are recorded within the
financial statements. Basis of accounting refers to when transactions are recorded
regardless of the measurement focus applied. The accompanying financial statements are
reported using the economic resources measurement focus and the accrual basis of
accounting. Under the economic measurement focus, all assets and liabilities
(whether current or noncurrent) associated with these activities are included on the
statement of net position. The statement of revenues, expenses, and changes in net
position presents increases (revenues) and decreases (expenses) in total net position.
Under the accrual basis of accounting, revenues are recorded when earned and expenses
are recorded when a liability is incurred, regardless of the timing of related cash flows.
Cash and Investments
The Authority considers all highly liquid investments with a maturity of three months or less
at the time of purchase to be cash equivalents.
Investments
Investments are stated at fair value, which is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market participants at
the measurement date. Changes in fair value that occur during a fiscal year are recognized
as investment income reported for that fiscal year. Investment income includes interest
earnings, changes in fair value, and any gains or losses realized upon the liquidation or sale
of investments.
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Page 17 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED JUNE 30, 2022
Note 1: Summary of Significant Accounting Policies (Continued)
Use of Estimates
The financial statements are prepared in accordance with accounting principles generally
accepted in the United States of America and, accordingly, include amounts that are based
on management’s best estimates and judgments. Accordingly, actual results could differ
from the estimates.
Note 2: Installment Contract Receivable
In May 2017, the Authority issued $29,335,000 of Revenue Bonds, Series 2017A
(the 2017A Revenue Bonds) (see Note 3) and loaned the proceeds to the District pursuant to
an Installment Purchase Agreement dated May 1, 2017. The loan proceeds were used by
the District to refund the District’s 2008 Revenue Certificates of Participation, as well as
to provide funds for certain improvements to the District’s water system. Under the
Installment Purchase Agreement, the District agrees to pay the Authority installment
payments in an amount sufficient to pay the principal and interest coming due on the
bonds solely from water revenues of the District’s water system that are remaining after
paying operation and maintenance costs. The balance of the receivable from the District at
June 30, 2022, was $24,860,000.
For the year ended June 30, 2022, the receivable of the Authority consists of the following:
Balance
July 1, 2021 Additions Deletions
Balance
June 30, 2022
2017 Installment
Purchase Agreement 25,805,000$ -$ (945,000)$ 24,860,000$
Note 3: Long-Term Liabilities
The following is a summary of changes in long-term liabilities of the Authority for the year
ended June 30, 2022:
Balance
July 1, 2021 Additions Deletions
Balance
June 30, 2022
Due Within
One Year
Due in More
Than One Year
2017A Revenue Bonds 25,805,000$ -$ (945,000)$ 24,860,000$ 990,000$ 23,870,000$
2017A Revenue Bonds
In May 2017, the Authority issued $29,335,000 of 2017A Revenue Bonds to provide funds
for the refunding of the District’s 2008 Revenue Certificates of Participation, as well as to
provide funds to the District for certain improvements to the District’s water system.
The 2017A Revenue Bonds bear interest at rates ranging from 3% to 5%, payable
semiannually on April 1 and October 1. There is no reserve requirement for the 2017A
Revenue Bonds.
The 2017A Revenue Bonds are payable solely from installment payments to be made to the
Authority from the District, with annual principal payments starting October 1, 2017. The
installment payments required from the District are scheduled to provide sufficient monies to
retire the revenue bonds as they become due and payable. The balance outstanding on the
2017A Revenue Bonds at June 30, 2022, was $24,860,000.
10
Page 18 of 21
YORBA LINDA WATER DISTRICT FINANCING AUTHORITY
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED JUNE 30, 2022
Note 3: Long-Term Liabilities (Continued)
The annual debt service requirements for the 2017A Revenue Bonds outstanding at
June 30, 2022, are as follows:
Year Ending June 30, Principal Interest Total
2023 990,000$ 1,149,294$ 2,139,294$
2024 1,045,000 1,098,419 2,143,419
2025 1,095,000 1,044,919 2,139,919
2026 1,145,000 988,919 2,133,919
2027 1,205,000 930,169 2,135,169
2028-2032 6,875,000 3,766,372 10,641,372
2033-2037 8,490,000 2,097,000 10,587,000
2038-2039 4,015,000 202,025 4,217,025
Total 24,860,000$ 11,277,117$ 36,137,117$
11
Page 19 of 21
203 N. Brea Blvd., Suite 203 Brea, CA 92821 Lance, Soll & Lunghard, LLP Phone: 714.672.0022
INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL
OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
To the Board of Directors
Yorba Linda Water District Financing Authority
Placentia, California
We have audited, in accordance with the auditing standards generally accepted in the United States
of America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the Yorba Linda Water
District Financing Authority (the “Authority”), a component unit of the Yorba Linda Water District
(the “District), as of and for the year ended June 30, 2022, and the related notes to the financial statements,
which collectively comprise the Authority’s basic financial statements, and have issued our report thereon
dated October 10, 2022.
Report on Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Authority’s internal
control over financial reporting (internal control) as a basis for designing audit procedures that are
appropriate in the circumstances for the purpose of expressing our opinions on the financial statements,
but not for the purpose of expressing an opinion on the effectiveness of the Authority’s internal control.
Accordingly, we do not express an opinion on the effectiveness of the Authority’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
misstatements, on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity’s
financial statements will not be prevented, or detected and corrected, on a timely basis. A significant
deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a
material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses
or significant deficiencies may exist that were not identified.
Page 20 of 21
To the Board of Directors
Yorba Linda Water District Financing Authority
Placentia, California
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Authority’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
financial statements. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed
no instances of noncompliance or other matters that are required to be reported under
Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the Authority’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the Authority’s internal control and compliance.
Accordingly, this communication is not suitable for any other purpose.
Brea, California
October 10, 2022
13
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