CO. AUD.

Annual Comprehensive Financial Report - FY 2023-2024

County Auditors · los-angeles-2025-annual-comprehensive-financial-report-fy-2023-2024 · Cafr · 2025-01-15 · Los Angeles

County of Los Angeles, California Annual Comprehensive Financial Report Fiscal Year Ended June 30, 2024 Prepared by the Office of Auditor-Controller Oscar Valdez • Auditor-Controller COUNTY OF LOS ANGELES, CALIFORNIA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 TABLE OF CONTENTS Page I. INTRODUCTORY SECTION: Auditor-Controller’s Letter of Transmittal ....................................................................................... i Certificate of Achievement for Excellence in Financial Reporting ............................................... xi Board of Supervisors and Principal County Officials .................................................................. xii Organization Chart ...................................................................................................................... xiii II. FINANCIAL SECTION: Independent Auditor’s Report ....................................................................................................... 1 Management’s Discussion and Analysis (Unaudited) ................................................................... 4 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position ................................................................................................ 29 Statement of Activities ..................................................................................................... 30 Fund Financial Statements: Balance Sheet - Governmental Funds ............................................................................ 32 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position .......................................................................................... 34 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds ................................................................................................. 36 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ..................... 38 Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual on Budgetary Basis: General Fund ....................................................................................................... 39 Fire Protection District ......................................................................................... 40 Flood Control District ............................................................................................ 41 LA County Library ................................................................................................. 42 Regional Park and Open Space District .............................................................. 43 Mental Health Services Act .................................................................................. 44 Statement of Net Position - Proprietary Funds ................................................................ 46 Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Funds ...................................................................................................... 48 Statement of Cash Flows - Proprietary Funds ................................................................ 50 Statement of Fiduciary Net Position - Fiduciary Funds ................................................... 54 Statement of Changes in Fiduciary Net Position - Fiduciary Funds ................................ 55 Statement of Net Position - Discretely Presented Component Units .............................. 56 Statement of Activities - Discretely Presented Component Units .................................... 57 Notes to the Basic Financial Statements .............................................................................. 59 Required Supplementary Information (Unaudited): Schedule of the County’s Proportionate Share of the Net Pension Liability and Related Ratios - Last Ten Fiscal Years .................................................................... 174 Schedule of County’s Pension Contributions - Last Ten Fiscal Years ........................... 174 Schedule of Changes in Net RHC OPEB Liability and Related Ratios - Last Ten Fiscal Years ............................................................................................... 176 COUNTY OF LOS ANGELES, CALIFORNIA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 TABLE OF CONTENTS Page Schedule of County’s RHC OPEB Contributions - Last Ten Fiscal Years ..................... 177 Schedule of Changes in the Total LTD OPEB Liability and Related Ratios - Last Ten Fiscal Years ............................................................................................... 178 Combining and Individual Fund Statements and Schedules: Major Governmental Fund - General Fund - Schedule of Expenditures - Budget and Actual on Budgetary Basis ............................. 181 Nonmajor Governmental Funds: Combining Balance Sheet - Nonmajor Governmental Funds - Summary ..................... 183 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds - Summary ............................................................ 184 Combining Balance Sheet - Nonmajor Governmental Funds - Special Revenue ......... 186 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds - Special Revenue ................................................ 190 Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual on Budgetary Basis - Nonmajor Governmental Funds - Special Revenue: Totals .................................................................................................................. 193 Road ................................................................................................................... 194 Other Streets, Highways, Roads, and Bridges .................................................. 195 Street Lighting Districts ..................................................................................... 196 Garbage Disposal Districts ................................................................................. 197 Sewer Maintenance Districts .............................................................................. 198 Health Services Measure B ................................................................................ 199 Health and Sanitation ......................................................................................... 200 Safe, Clean Water Program Measure W ............................................................ 201 Other Public Protection ...................................................................................... 202 Public Assistance ............................................................................................... 203 Homeless and Housing Measure H .................................................................. 204 Recreation .......................................................................................................... 205 Courthouse Temporary Construction ................................................................. 206 Criminal Justice Temporary Construction ........................................................... 207 Registrar-Recorder Improvement ...................................................................... 208 Other Special Revenue ...................................................................................... 209 Combining Balance Sheet - Nonmajor Governmental Funds - Debt Service ............... 210 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds - Debt Service ....................................................... 211 Combining Balance Sheet - Nonmajor Governmental Funds - Capital Projects ........... 212 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds - Capital Projects .................................................. 213 Combining Balance Sheet - Nonmajor Governmental Funds - Permanent Funds ....... 214 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds - Permanent Funds ............................................... 215 COUNTY OF LOS ANGELES, CALIFORNIA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 TABLE OF CONTENTS Page Internal Service Funds: Combining Statement of Net Position - Internal Service Funds .................................... 217 Combining Statement of Revenues, Expenses and Changes in Fund Net Position - Internal Service Funds ............................................................................................. 218 Combining Statement of Cash Flows - Internal Service Funds ..................................... 219 Fiduciary Funds: Combining Statement of Fiduciary Net Position - Fiduciary Funds - Pension and Other Postemployment Benefit Trust Funds ....................................... 221 Combining Statement of Changes in Fiduciary Net Position - Fiduciary Funds - Pension and Other Postemployment Benefit Trust Funds ....................................... 222 Combining Statement of Fiduciary Net Position - Fiduciary Funds - Custodial - External Investment Pools ..................................................................... 223 Combining Statement of Changes in Fiduciary Net Position - Fiduciary Funds - Custodial - External Investment Pools ..................................................................... 224 Combining Statement of Fiduciary Net Position - Fiduciary Funds - Custodial - Other Custodial ...................................................................................... 225 Combining Statement of Changes in Fiduciary Net Position - Fiduciary Funds - Custodial - Other Custodial ...................................................................................... 226 III. STATISTICAL SECTION (Not covered by Independent Auditor’s Report): Statistical Section - Contents .................................................................................................... 227 Schedules of Financial Trends Information: Net Position by Category - Last Ten Fiscal Years ............................................................... 229 Changes in Net Position - Last Ten Fiscal Years ................................................................ 230 Fund Balances, Governmental Funds - Last Ten Fiscal Years ........................................... 232 Changes in Fund Balances, Governmental Funds - Last Ten Fiscal Years ........................ 234 Bar Chart-Governmental Funds Expenditures and Revenues - Last Ten Fiscal Years ...... 235 Schedules of Revenue Capacity Information: Assessed Value and Actual Value of Taxable Property - Last Ten Fiscal Years ................. 236 Property Tax Rates - Direct and Overlapping Rates for Tax Area #4 - Last Ten Fiscal Years ..................................................................................................... 237 Principal Property Taxpayers - Current Year and Nine Years Ago ...................................... 238 Property Tax Levies and Collections - Last Ten Fiscal Years .............................................. 239 COUNTY OF LOS ANGELES, CALIFORNIA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 TABLE OF CONTENTS Page Schedules of Debt Capacity Information: Ratio of Outstanding Debt by Type - Last Ten Fiscal Years ................................................ 240 Ratio of Net General Bonded Debt - Last Ten Fiscal Years ................................................ 241 Estimated Direct and Overlapping Bonded Debt ................................................................ 242 Computation of Legal Debt Margin - Last Ten Fiscal Years ................................................ 244 Pledged-Revenue Coverage - Last Ten Fiscal Years ......................................................... 245 Schedules of Demographic and Economic Information: Demographic and Economic Statistics - Last Ten Fiscal Years .......................................... 246 Ten Largest Industries – Current Year and Nine Years Ago ................................................ 247 Schedules of Operating Information: Full-Time Equivalent County Employees by Function/Program - Last Ten Fiscal Years .... 248 Operating Indicators by Function/Program - Last Ten Fiscal Years .................................... 249 Capital Asset Statistics by Function/Program - Last Ten Fiscal Years ................................ 250 INTRODUCTORY SECTION COUNTY OF LOS ANGELES DEPARTMENT OF AUDITOR-CONTROLLER KENNETH HAHN HALL OF ADMINISTRATION 500 WEST TEMPLE STREET, ROOM 525 LOS ANGELES, CALIFORNIA 90012-3873 PHONE: (213) 974-8301 FAX: (213) 626-5427 OSCAR VALDEZ ASSISTANT AUDITOR-CONTROLLERS AUDITOR-CONTROLLER MAJIDA ADNAN CONNIE YEE RACHELLE ANEMA CHIEF DEPUTY AUDITOR-CONTROLLER ROBERT G. CAMPBELL December 12, 2024 The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles 383 Kenneth Hahn Hall of Administration 500 West Temple Street Los Angeles, California 90012 Members of the Board and Citizens of County of Los Angeles: In accordance with Section 25253 of the Government Code of California, I hereby submit the Annual Comprehensive Financial Report (ACFR) of the County of Los Angeles for the year ended June 30, 2024. The report contains financial statements that have been prepared in accordance with generally accepted accounting principles (GAAP) prescribed for governmental entities and provides a comprehensive overview of the County’s financial operations and financial position. The accuracy, completeness and fairness of the presentation of all information in this report are the responsibility of the County. The Independent Auditor’s Report is presented at the front of the financial section of this report. Management’s Discussion and Analysis (MD&A), immediately follows the Independent Auditor’s Report and provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A complements this letter of transmittal and should be read in conjunction with it. The report includes financial data for all County funds. Additionally, the following entities are considered part of the County for purposes of meeting the reporting entity requirements prescribed by the Governmental Accounting Standards Board: Fire Protection District Waterworks Districts Flood Control District Los Angeles County Capital Asset Leasing Corporation Garbage Disposal Districts Various Joint Powers Authorities Improvement Districts Los Angeles County Employees Retirement Association Regional Park and Open Los Angeles County Securitization Corporation Space District Los Angeles County Facilities, Inc. Sewer Maintenance Districts Los Angeles County Development Authority Street Lighting Districts First 5 LA Help Conserve Paper – Print Double-Sided “To Enrich Lives Through Effective and Caring Service” i The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 2 These entities are component units of the County and are included in the County’s basic financial statements because the County Board of Supervisors is financially accountable for them. All component units are blended into the basic financial statements, except for the Los Angeles County Employees Retirement Association, which is reported as a fiduciary component unit, and the Los Angeles County Development Authority and First 5 LA, which are discretely presented. Note 1 to the basic financial statements contains additional information regarding the relationship between the County and these entities. Other local governmental entities provide public or specialized services to the residents of the County, including over eighty cities, one hundred school districts, and numerous special districts. The operations of these entities are not included in the County’s reporting entity since each entity is responsible for conducting its own day-to-day operations and is compelled to answer to its own separately elected governing board. Significant entities that do not meet the criteria for inclusion in this report include the Los Angeles County Office of Education, Los Angeles Unified School District, and Los Angeles County Sanitation Districts. Also, the Los Angeles County Superior Court is not included due to legislation (AB 233), which transferred oversight responsibilities for Court operations to the State in 1997-98. However, AB 233 requires the County to continue to fund certain Court-related expenditures, and the County continues to receive certain Court collections. Accordingly, the County’s financial statements include various Court-related financial transactions. LOS ANGELES COUNTY AND ITS SERVICES Los Angeles County was established by an act of the State Legislature on February 18, 1850, as one of California’s original 27 counties. Located in the southern portion of the State, the County covers 4,083 square miles. With a population of over 9.8 million, its population is the largest of any county in the nation. Los Angeles County was a general law county until 1913 when it became a charter county, as a result of local election. The County is governed by a five-member Board of Supervisors (Board), each of whom is elected by residents from their respective supervisorial district to serve a four- year term, with the potential to serve two additional four-year terms if re-elected by voters. The other elected officials of the County are the Assessor, District Attorney, and Sheriff. On March 5, 2002, County voters approved two charter amendments that introduced mandatory term limits for the elected officials of the County. As a result, each Supervisor is now limited to serving a maximum of three consecutive terms commencing as of December 2002. On July 7, 2015, the Board approved a new governance structure, pursuant to which all non- elected department heads report directly to the Board. County departments continue to report to the Chief Executive Officer (CEO) for day-to-day operations, and for administrative and budget matters. The CEO continues to function as the Board’s agent to manage Countywide policy objectives and departmental performance management. The governance structure is designed to streamline the County governance by improving communications with County departments and facilitating more effective decision making in response to the Board’s policy objectives. There are over one million residents in the unincorporated areas of the County. These residents receive all municipal services from the County, including law enforcement, fire protection, land use and zoning, building and business permits, local road building and maintenance, animal care ii The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 3 and control, and public libraries. In addition, the County provides a wide range of services to all County residents. The County also provides municipal services to many incorporated cities within its boundaries under the Contract Services Plan (Plan). Established in 1954, the Plan allows cities to provide municipal services without incurring the cost of creating numerous city departments and facilities by having the County provide, at cost, any or all municipal services within a city at the same level as provided in unincorporated areas, or at any higher level the city may choose. Although the Plan was developed to assist new cities, the great majority of the cities in the County now contract for one or more services. The County’s principal functions include seven major areas as required under the County’s charter, County ordinances, or by State or federal mandate: general government, public protection, public ways and facilities, health and sanitation, public assistance, education and recreation, and cultural services. The State and federal governments mandate certain minimum levels of services in the public assistance and health areas. ECONOMIC OVERVIEW With a Gross Domestic Product of $807 billion in 2023, Los Angeles County’s economy is larger than that of 44 states and all but 21 countries. The County serves as the central trade district for the western United States and the gateway to the Asian economies, as it has evolved into a leader in international commerce and investments. The County’s economy experienced strong growth in 2023, with an increase in economic output of 2.2%, as measured by Gross Domestic Product and decreases in taxable sales of 3%. During Fiscal Year (FY) 2016-17, voters approved various State and local ballot measures that could generate approximately $151 billion in funding for capital infrastructure and public services in the County. In the June and November 2016 elections, the voters in school and community college districts passed over $9.4 billion in general obligation bond measures supported by ad valorem taxes to finance new capital construction and improvement projects. As of December 31, 2023, K-12 school and community college districts had approximately $24.1 billion of previously authorized, but unissued bond capacity. In 2008, voters approved Measure R, a 30-year increase of one-half cent in sales tax to fund major public transit projects, including extending light rail to the Los Angeles International Airport (LAX), and a subway to Westwood. Revenues will also fund street and sidewalk repairs throughout the County, new bike paths, and earthquake retrofits for bridges. Measure M, approved by voters in 2016 provides an indefinite extension of Measure R and is projected to generate $120 million of sales tax revenue annually over the next 40 years for the Los Angeles County Metropolitan Transit Authority to finance new transportation infrastructure projects. On March 7, 2017, voters approved Measure H, commonly known as the Homeless Initiative. The measure authorized the implementation of a one-quarter cent sales tax for a duration of 10 years, with a primary objective of addressing the pressing issues of homelessness by providing essential services and prevention measures. The Homeless Initiative is projected to generate approximately $537 million annually. iii The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 4 On November 6, 2018, voters approved Measure W, the Safe, Clean Water Program, which is expected to generate approximately $300 million for the County’s Flood Control District through a parcel tax. Revenues will be used to modernize the County’s 100-year old water system to protect public health, our environment, and maximize a cleaner, locally controlled water supply. On November 8, 2022, voter approved Measure C, a general tax measure that would allow the County to tax cannabis businesses that are in the unincorporated areas of the County. Currently, the Office of Cannabis Management in the County’s Department of Consumer and Business Affairs is developing an equitable commercial cannabis program that includes permitting and resources for eligible applicants. The Cannabis Business Tax is projected to generate approximately $10.3 million annually. In addition, hospitals throughout the County are engaged in building programs to meet stricter earthquake standards and other regulatory requirements. These major construction projects, combined with terminal expansions under way at the two primary seaports (Port of Los Angeles and Port of Long Beach), LAX, and the Metro Light Rail System have provided continued support to the job market in the County. The County enjoys a diverse industrial base, with employment in wholesale and retail trade, health care, manufacturing, and leisure and hospitality being the leading employment sectors in the private economy. The two major seaports in the County, located in the cities of Los Angeles and Long Beach, encompass the largest port complex in the nation as measured by cargo tonnage and the number of containers handled, and on a combined basis rank ninth largest among the world’s port facilities. The Los Angeles region is the largest manufacturing center in the nation, with 318,500 workers employed in this sector in 2023. INTERNAL AND BUDGETARY CONTROLS The County has developed a system of internal accounting controls designed to provide reasonable, but not absolute, assurance to safeguard assets against loss from unauthorized use. It also provides reliable records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes that the costs of a system of internal accounting controls should not outweigh related benefits. Also, the evaluation of costs and benefits requires estimates and judgments by management. All internal accounting control evaluations occur within the above framework. We believe that the County’s system of internal accounting controls adequately safeguards assets and also provides reasonable assurance of proper recording of financial transactions. In accordance with the provisions of Section 29000-29144 of the Government Code, commonly known as the County Budget Act, the County prepares and adopts a budget on or before October 2 of each fiscal year. Except for capital assets, expenditures are controlled at the following object levels for all budget units: salaries and employee benefits, services and supplies, other charges, and other financing uses. Amounts are budgeted and controlled for capital assets at the following sub-object levels: land, buildings and improvements, infrastructure, and equipment. The County uses encumbrance accounting to ensure effective budgetary control and accountability. Unencumbered appropriations lapse at year-end and encumbrances outstanding iv The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 5 at the time are reported as restricted, committed, or assigned fund balance for subsequent year expenditures. After the original budget is adopted, the Board of Supervisors must approve all transfers of appropriations between budget units and transfers exceeding $250,000 within budget units. The Board must also approve necessary supplemental appropriations, normally financed by unanticipated revenues earned during the year. In addition to these procedural controls, the Auditor-Controller’s (A-C) Audit Division performs periodic internal control, operational, and management audits of various County departments. On an annual basis, an audit plan is recommended by the A-C and approved by the County’s Audit Committee, an oversight group appointed by the Board of Supervisors. These audits help to ensure that prescribed procedures are followed and that operations are conducted in an efficient manner. The A-C’s Countywide Contract Monitoring Division conducts fiscal and compliance reviews of the County’s social and health services contract providers, provide training on fiscal compliance, and works with County departments to enhance accountability and performance effectiveness over the contracts. A fraud hotline provides County employees and citizens with a way to anonymously report perceived fraudulent activities by County employees, vendors, contractors, inspectors, etc. Allegations reported to the hotline are evaluated and investigated, as appropriate, by the Office of County Investigations within the A-C. BUDGET OUTLOOK AND MAJOR INITIATIVES The FY 2024-25 Budget of $49.2 billion assumes increases from outside County sources, primarily from the State, federal funding, and anticipated prior year savings. NEWLY FUNDED PROGRAM INITIATIVES Outlined below are examples of significant program initiatives that were funded or augmented by the FY 2024-25 Budget process:  $171.9 million to the Care First, Jails Last Community Investment Initiative to, among other things, provide permanent supportive housing, community operated youth centers, reentry services, violence prevention and gang intervention services, felony incompetent to stand trial program services, free phone calls for individuals in custody, acute mental health non- carceral care services, indigent defense services, and other applicable programs to address negative outcomes caused by racially driven criminal justice inequities and long- term community economic disinvestment.  $840.9 million to fund the County’s New Framework to combat homelessness. The New Framework is divided into five categories of action to sustain momentum and drive results: o Coordinate – Create a coordinated system that links critical infrastructure and drives best practices; o Prevent – Provide targeted prevention services to avoid entry or a return to homelessness; o Connect – Link and navigate everyone to an exit pathway; v The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 6 o House – Rapidly rehouse using temporary and permanent housing; and o Stabilize – Scale services critical to rehousing and stabilization.  $18.8 million to the Department of Public Social Services (DPSS) to support the increases in CalWORKs caseloads.  $32 million for 154 positions in DPSS to ensure that the County draws down all available CalFresh State and federal revenue to support individuals and families in need of food benefits.  $16.5 million to DPSS for General Relief caseload increases.  $15.6 million to the Assessor’s Office to continue the Assessor Modernization Project, to replace the outdated legacy property assessment systems.  $7.3 million to the Department of Registrar-Recorder/County Clerk for project maintenance and implementation services for the Election Management System. CAPITAL ASSET AND DEFERRED MAINTENANCE INITIATIVES The County continues to plan for, and fund high priority capital asset projects that address health, public safety, recreation, and infrastructure needs. Many capital asset initiatives are multi-year in nature and the FY 2024-25 Budget provides one-time funding of over $2.46 billion for initiatives in progress as well as new projects. During FY 2023-24, nineteen capital projects were completed at a total cost over $186.9 million, including the Crossroads Parkway, Walnut Park Pocket Park Stormwater Project, Harbor-UCLA Medical Center, UCLA Medical Center Fire Alarm and Nurse Call Systems Projects, and Rancho Los Amigos Interim Housing Facility Refurbishment Project. The County continues to invest in deferred maintenance to meet performance requirements and expectations for its facilities. The FY 2024-25 Budget earmarks $49 million for high priority repairs, maintenance, and accessibility modifications needs at County facilities, including juvenile halls, animal shelters, beaches, parks, and for various roof repairs. NEWLY VOTER APPROVED COUNTY BALLOT MEASURES On November 5, 2024, voters approved Measure A, commonly known as the Homelessness Services and Affordable Housing Ordinance. This measure authorizes the implementation of a permanent one-half cent sales tax to reduce and prevent homelessness, as well as to provide mental health and addiction treatment, and affordable housing. Additionally, this measure repeals the one-quarter cent sales tax enacted by Measure H in 2017, which would have otherwise expired in 2027. Measure A is projected to generate approximately $1.076 billion annually. On November 5, 2024, voters approved Measure E, commonly known as the Consolidated Fire Protection District of Los Angeles County Emergency Response and Infrastructure Ordinance. This measure authorizes the levy of 6 cents per square foot of certain parcel improvements to ensure timely emergency response times by local firefighters and paramedics. Measure E is projected to generate approximately $152 million annually. vi The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 7 On November 5, 2024, voters approved Measure G, commonly known as the Los Angeles County Government Structure, Ethics and Accountability Charter Amendment. This measure amends the Los Angeles County Charter to create and elect a County Executive Officer by 2028; to create and establish an independent Ethics Commission by 2026 to increase restriction on lobbying and investigate misconduct; establishes a nonpartisan Legislative Analyst to review proposed County policies; and increases the Board of Supervisors from five to nine elected members following the 2030 census. STRATEGIC PLANNING INITIATIVES On March 6, 2024, the Board approved the County of Los Angeles FY 2024-2030 Strategic Plan, representing the County’s commitment to its constituents, the community, and County government. The approved plan includes an updated vision, mission, and values, with three North Star goals, seventeen focus area goals, and sixty strategies and objectives with a focus on Board priorities and initiatives. The strategic plan’s underlying North Star goals and focus area goals are summarized as follows: Make Investments that Transform Lives by investing in solutions that address our most complex societal challenges (health, jobs, housing, food insecurity, and recidivism) affecting our most vulnerable communities – one person at a time. A. Healthy Individuals and Families: Investing in County health systems to expand care capacity supporting the physical and mental health of individuals while addressing the social determinants that affect the residents’ well-being. B. Employment of Sustainable Wages: Supporting mobility, economic and workforce development, job training, meaningful connections, and access employment opportunities with sustainable wages for County residents, with an emphasis on those who are experiencing barriers. Additionally, supporting small and large businesses growth to maintain job supply. C. Housing and Homelessness: Supporting efforts that prevent displacement, increase access to housing stability, develop more affordable housing, sustain homeownership opportunities, and enhance the effectiveness of the County’s homeless rehousing system. D. Support Vulnerable Populations: Addressing conditions which drive interactions with the County’s child welfare, homeless rehousing, carceral, law enforcement and justice systems. Foster Vibrant and Resilient Communities by investing in the lives of the County residents and leveraging the support from networks that include public/private partnerships, faith-based organizations, community-based organizations, philanthropic organizations, and local governments, the County will foster vibrant and resilient communities. A. Public Health: Addressing community-wide issues, social determinants of health, risk and conditions that contribute to health disparities and threaten healthy lifestyles, and environmental and community health. B. Care First, Jails Last: Implementing a new vision of community safety in Los Angeles County one centered on health solutions and services provided in the community so that jail is the last option rather than the first and only response. vii The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 8 C. Public Safety: Enhancing the safety of the public and our communities by addressing the risks, danger, harm, and conditions that cause, drive, or can help mitigate unlawful activity and crime, and support law enforcement accountability and transparency. D. Sustainability: Focusing on environmental justice, particularly in communities that have long endured industrial contamination, and “Our County” Sustainability Plan’s 12 board, aspirational, and cross-cutting goals, that embrace positive change and address sustainability issues regionally. E. Economic Health: Deploying and diffusing community resources and investments through partnership with community-based institutions, organizations, corporations, and small business to enhance the economic health of all communities. F. Community Connections: Investing in our communities and create public spaces and programs that are welcoming, accessible, where all residents can easily build relationships, create social networks, feel connected and can access opportunities. Realize Tomorrow’s Government Today by pursuing and addressing public needs and expectations through innovative, flexible, effective, transparent partnerships that focus on advancing the common good while ensuring fiscal responsibility. A. Communication and Public Access: Providing increased transparency and accessibility to government services and communication, including information that is easy to understand and available in multiple languages and format. B. Diverse and Inclusive Workforce: Striving to meet the highest standards and promote a more diverse and inclusive County workforce that seeks to be representative of County residents. C. Equity-Centered Policies and Practices: Institutionalizing the use of an equity lens in County policies and practices. D. Streamlined and Equitable Contracting and Procurement: Implementing streamlined and more equitable contracting systems and opportunities. E. Data-Driven Decision Making: Using equity and data as a tool to continually assess and strengthen our efficiency and effectiveness, maximize and leverage resources, ensure fiscal responsibility, and hold ourselves accountable. F. Flexible and Efficient Infrastructure: Using lessons learned from the recent pandemic to implement flexible and efficient administrative, technological, and physical infrastructures to meet the needs of our constituents. G. Internal Controls and Processes: Strengthening our internal controls and processes while being cognizant of efficiency to continue good stewardship of the public trust and fiscal responsibility. LONG-TERM FINANCIAL PLANNING The Board has adopted policies, which guide the County’s CEO in financial planning and recommending budget proposals. Key policy elements include:  Ongoing costs should be funded with ongoing revenues. Aligning continuing expenditures with continuing revenues, on a level that can be reasonably sustained, will foster stability, predictability, and long-range planning, while avoiding volatility in service levels. Before expanding services, use new, ongoing revenues to meet current obligations and reduce reliance on one-time funding. New programs should not be proposed without identifying specific and continuous funding sources. viii The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 9  Budget decisions should be considered within the context of revenues and expenditures projected beyond a single fiscal year. A long-range forecast should be developed and maintained to reflect continuing programs, anticipated new initiatives, revenue changes, cost increases, potential problem issues, and other factors that may impact strategies for maintaining a balanced budget over several years. On June 22, 2009, the Board established a “Reserve for Rainy Day” (Reserve) account within the County’s General Fund, which is intended to protect essential County programs against unforeseen emergencies and economic downturns. On May 3, 2022, the Board increased the Reserve cap from 10% to 17% of on-going locally generated revenue. Transfers, at a minimum of 10% of excess fund balance, less Board approved carryover balances, are required to be set aside in the Reserve until the 17% cap is met. For the year ended June 30, 2011, the County implemented Governmental Accounting Standards Board Statement No. 54 (GASB 54), “Fund Balance Reporting and Governmental Fund Type Definitions.” The County’s policies for use of the Reserve are not within the GASB 54 definition of a stabilization arrangement. Therefore, the Reserve is classified as General Fund unassigned fund balance in the GAAP financial statements. As of June 30, 2024, the Reserve balance was $978.6 million, and was increased to $978.6 million as part of the FY 2024-25 Final Budget. OTHER INFORMATION INDEPENDENT AUDIT The basic financial statements have been audited by Macias Gini & O’Connell LLP (MGO). In accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), MGO is also in the process of completing an annual financial and compliance audit of federal funds received by the County in FY 2023-24. The County’s single audit for FY 2022-23 has been completed. AWARDS The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the County of Los Angeles for its ACFR for the past forty-two fiscal years. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized ACFR, whose contents conform to program standards. The report must satisfy both GAAP and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to conform to Certificate of Achievement Program requirements, and we are submitting it to GFOA to determine its eligibility for another certificate. ix The Honorable Members of the Board of Supervisors and Citizens of County of Los Angeles December 12, 2024 Page 10 ACKNOWLEDGMENTS I would like to express my appreciation to my Accounting Division, the various County departments who assisted in the preparation of this report, and also acknowledge the efforts of our independent auditor. Sincerely, AuditorController x Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to County of Los Angeles California For its Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2023 Executive Director/CEO xi COUNTY OF LOS ANGELES BOARD OF SUPERVISORS AND PRINCIPAL COUNTY OFFICIALS AS OF JUNE 30, 2024 BOARD OF SUPERVISORS Lindsey P. Horvath, Chair Third District Hilda L. Solis Holly J. Mitchell First District Second District Janice Hahn Kathryn Barger Fourth District Fifth District Edward Yen Executive Officer Board of Supervisors PRINCIPAL COUNTY OFFICIALS Jeffrey Prang Assessor George Gascón Robert G. Luna District Attorney Sheriff _________________ Fesia A. Davenport Chief Executive Officer Elizabeth Buenrostro Ginsberg Oscar Valdez Treasurer and Tax Collector Auditor-Controller Dawyn R. Harrison County Counsel xii COUNTY OF LOS ANGELES LEGEND APPOINTIVE ■ REQUIRED BY COUNTY CHARTER o REQUIRED OR AUTHORIZED BY STATE LAW ELECTORATE H ESTABLISHED BY ORD I N A N C E OF THE BOARD OF SUPERVISORS s ESTABLISHED BY ORDER OF THE BOARD OF SUPERVISORS ELECTIVE l l l l o DISTRICT BOARD OF GRAND l REQUIRED BY COUNTY CHARTER ASSESSOR SHERIFF ATTORNEY SUPERVISORS JURY o EMPLOYEES RETIREMENT ■ O ED F U FI C C A E T O IO F N H REGIONAL o o A B S O S A O R C D I A O T F I O R N ETIREMENT B ED O U A C R A D T O IO F N C P O L M A M N I N S I S N I G ON EXECU O T F IV T E H O E FFICE BOARD OF SUPERVISORS o BOARD OF INVESTMENTS ■ H ■ H o H ■ CHIEF ASSESSMENT AUDITOR- CHILDREN & COUNTY BOARD ADVISORY CIVIL SERVICE EXECUTIVE APPEALS CONTROLLER FAMILY SERVICES COUNSEL COMMISSIONS & COMMISSION OFFICER BOARD COMMITTEES ■ H LOS ANGELES ■ H COUNTYWIDE H H EMPLOYEE INFORMATION COUNTY EQUITY FIRE PROBATION RELATIONS SYSTEMS DEVELOPMENT OVERSIGHT COMMISSION ADVISORY BODY AUTHORITY PANEL H ■ AGRICULTURAL H H s H H H SHERIFF OFFICE OF OFFICE OF PROBATION AGING & COMMISSIONER/ ALTERNATE ANIMAL CARE & CIVILIAN CHILD INSPECTOR OVERSIGHT DISABILITIES WEIGHTS & PUBLIC DEFENDER CONTROL OVERSIGHT PROTECTION GENERAL COMMISSION MEASURES COMMISSION H H o H H H ■ H ■ CONSUMER & ARTS & BEACHES & CHILD SUPPORT ECONOMIC HEALTH HEALTH MENTAL PUBLIC BUSINESS CULTURE HARBORS SERVICES OPPORTUNITY AGENCY SERVICES HEALTH HEALTH AFFAIRS H H H o ■ H H H MILITARY & MUSEUM HUMAN INTERNAL JUSTICE, CARE & LA COUNTY MEDICAL MUSEUM VETERANS OF NATURAL RESOURCES SERVICES OPPORTUNITIES LIBRARY EXAMINER OF ART AFFAIRS HISTORY H ■ ■ o o ■ ■ H PUBLIC REGISTRAR- PARKS & PUBLIC PUBLIC REGIONAL TREASURER & YOUTH SOCIAL RECORDER/ RECREATION DEFENDER WORKS PLANNING TAX COLLECTOR DEVELOPMENT SERVICES COUNTY CLERK xiii xiv FINANCIAL SECTION 23456534537(cid:9)894:7;<=>(cid:9)?56;<7(cid:9) @AB(cid:9)CDEDFGHIB(cid:9)JDGFK(cid:9)DL(cid:9)MNOBFPQRDFR(cid:9)(cid:9) 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B(cid:0)(cid:26)(cid:27)(cid:29),)(cid:28)+(cid:25)(cid:0)-(cid:24)(cid:25)(cid:30)(cid:24)(cid:25)&1(cid:0)%(cid:29)(cid:0)(cid:27)(cid:28)&(cid:0)<(cid:28)+$"(cid:25)(cid:29)(cid:30)1(cid:0)(cid:30)(cid:24)(cid:25)&(cid:25)(cid:0)#&(cid:25)(cid:0),(cid:27)(cid:29)+%(cid:30)%(cid:27)(cid:29)!(cid:0)(cid:27)&(cid:0)(cid:25)2(cid:25)(cid:29)(cid:30)!1(cid:0),(cid:27)(cid:29)!%+(cid:25)&(cid:25)+(cid:0)%(cid:29)(cid:0)(cid:30)(cid:24)(cid:25)(cid:0)#$$&(cid:25)$#(cid:30)(cid:25)1(cid:0) (cid:30)(cid:24)#(cid:30)(cid:0)&#%!(cid:25)(cid:0)!(cid:28)(!(cid:30)#(cid:29)(cid:30)%#)(cid:0)+(cid:27)(cid:28)((cid:30)(cid:0)#((cid:27)(cid:28)(cid:30)(cid:0)(cid:30)(cid:24)(cid:25)(cid:0)(cid:26)(cid:27)(cid:28)(cid:29)(cid:30)(cid:31) !(cid:0)#(%)%(cid:30)(cid:31)(cid:0)(cid:30)(cid:27)(cid:0),(cid:27)(cid:29)(cid:30)%(cid:29)(cid:28)(cid:25)(cid:0)#!(cid:0)#(cid:0)$(cid:27)%(cid:29)$(cid:0),(cid:27)(cid:29),(cid:25)&(cid:29)(cid:0)*(cid:27)&(cid:0)#(cid:0) &(cid:25)#!(cid:27)(cid:29)#()(cid:25)(cid:0)’(cid:25)&%(cid:27)+(cid:0)(cid:27)*(cid:0)(cid:30)%"(cid:25)3(cid:0) (cid:0) D(cid:25)(cid:0)#&(cid:25)(cid:0)&(cid:25)5(cid:28)%&(cid:25)+(cid:0)(cid:30)(cid:27)(cid:0),(cid:27)""(cid:28)(cid:29)%,#(cid:30)(cid:25)(cid:0)-%(cid:30)(cid:24)(cid:0)(cid:30)(cid:24)(cid:27)!(cid:25)(cid:0),(cid:24)#&$(cid:25)+(cid:0)-%(cid:30)(cid:24)(cid:0)$(cid:27)2(cid:25)&(cid:29)#(cid:29),(cid:25)(cid:0)&(cid:25)$#&+%(cid:29)$1(cid:0)#"(cid:27)(cid:29)$(cid:0)(cid:27)(cid:30)(cid:24)(cid:25)&(cid:0)"#(cid:30)(cid:30)(cid:25)&!1(cid:0)(cid:30)(cid:24)(cid:25)(cid:0) ’)#(cid:29)(cid:29)(cid:25)+(cid:0)!,(cid:27)’(cid:25)(cid:0)#(cid:29)+(cid:0)(cid:30)%"%(cid:29)$(cid:0)(cid:27)*(cid:0)(cid:30)(cid:24)(cid:25)(cid:0)#(cid:28)+%(cid:30)1(cid:0)!%$(cid:29)%*%,#(cid:29)(cid:30)(cid:0)#(cid:28)+%(cid:30)(cid:0)*%(cid:29)+%(cid:29)$!1(cid:0)#(cid:29)+(cid:0),(cid:25)&(cid:30)#%(cid:29)(cid:0)%(cid:29)(cid:30)(cid:25)&(cid:29)#)(cid:0),(cid:27)(cid:29)(cid:30)&(cid:27))E&(cid:25))#(cid:30)(cid:25)+(cid:0)"#(cid:30)(cid:30)(cid:25)&!(cid:0) 2 (cid:30)(cid:24)#(cid:30)(cid:0)-(cid:25)(cid:0)%+(cid:25)(cid:29)(cid:30)%*%(cid:25)+(cid:0)+(cid:28)&%(cid:29)$(cid:0)(cid:30)(cid:24)(cid:25)(cid:0)#(cid:28)+%(cid:30)3(cid:0) (cid:0) (cid:0) (cid:0) (cid:3)(cid:4)(cid:5)(cid:6)(cid:7)(cid:8)(cid:4)(cid:9)(cid:0)(cid:10)(cid:6)(cid:11)(cid:11)(cid:12)(cid:4)(cid:13)(cid:4)(cid:14)(cid:15)(cid:16)(cid:8)(cid:17)(cid:0)(cid:18)(cid:14)(cid:19)(cid:20)(cid:8)(cid:13)(cid:16)(cid:15)(cid:7)(cid:20)(cid:14)(cid:0) (cid:0) (cid:21)(cid:22)(cid:22)(cid:23)(cid:24)(cid:25)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)(cid:29)(cid:30)(cid:27)(cid:25)(cid:22)(cid:27)(cid:29)(cid:31) !(cid:0)(cid:28) (cid:25) (cid:30)"(cid:31)(cid:31)#(cid:0)"(cid:22)(cid:22) (cid:29)(cid:26) $(cid:0)(cid:27)(cid:25)(cid:0)(cid:26)% (cid:0)&(cid:25)(cid:27)(cid:26) $(cid:0)’(cid:26)"(cid:26) !(cid:0)(cid:23)((cid:0)(cid:21)) (cid:30)(cid:27)(cid:22)"(cid:0)(cid:30) *(cid:24)(cid:27)(cid:30) (cid:0)(cid:26)%"(cid:26)(cid:0)(cid:26)% (cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)+!(cid:0) $(cid:27)!(cid:22)(cid:24)!!(cid:27)(cid:23)(cid:25)(cid:0)"(cid:25)$(cid:0)"(cid:25)"(cid:31)#!(cid:27)!,(cid:0)(cid:26)% (cid:0)!(cid:22)% $(cid:24)(cid:31) (cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)-(cid:23)(cid:24)(cid:25)(cid:26)#+!(cid:0)(cid:29)(cid:30)(cid:23)(cid:29)(cid:23)(cid:30)(cid:26)(cid:27)(cid:23)(cid:25)"(cid:26) (cid:0)!%"(cid:30) (cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)(cid:25) (cid:26)(cid:0)(cid:29) (cid:25)!(cid:27)(cid:23)(cid:25)(cid:0)(cid:31)(cid:27)".(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)"(cid:25)$(cid:0)(cid:30) (cid:31)"(cid:26) $(cid:0) (cid:30)"(cid:26)(cid:27)(cid:23)!,(cid:0)(cid:26)% (cid:0)!(cid:22)% $(cid:24)(cid:31) (cid:0)(cid:23)((cid:0)-(cid:23)(cid:24)(cid:25)(cid:26)#+!(cid:0)(cid:29) (cid:25)!(cid:27)(cid:23)(cid:25)(cid:0)(cid:22)(cid:23)(cid:25)(cid:26)(cid:30)(cid:27).(cid:24)(cid:26)(cid:27)(cid:23)(cid:25)!,(cid:0)(cid:26)% (cid:0)!(cid:22)% $(cid:24)(cid:31) (cid:0)(cid:23)((cid:0)(cid:22)%"(cid:25)(cid:28) !(cid:0)(cid:27)(cid:25)(cid:0)(cid:25) (cid:26)(cid:0)/0-(cid:0)1234(cid:0)(cid:31)(cid:27)".(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)"(cid:25)$(cid:0) (cid:30) (cid:31)"(cid:26) $(cid:0)(cid:30)"(cid:26)(cid:27)(cid:23)!,(cid:0)(cid:26)% (cid:0)!(cid:22)% $(cid:24)(cid:31) (cid:0)(cid:23)((cid:0)-(cid:23)(cid:24)(cid:25)(cid:26)#+!(cid:0)/0-(cid:0)1234(cid:0)(cid:22)(cid:23)(cid:25)(cid:26)(cid:30)(cid:27).(cid:24)(cid:26)(cid:27)(cid:23)(cid:25)!,(cid:0)"(cid:25)$(cid:0)(cid:26)% (cid:0)!(cid:22)% $(cid:24)(cid:31) (cid:0)(cid:23)((cid:0)(cid:22)%"(cid:25)(cid:28) !(cid:0)(cid:27)(cid:25)(cid:0)(cid:26)% (cid:0)(cid:26)(cid:23)(cid:26)"(cid:31)(cid:0) 567(cid:0)1234(cid:0)(cid:31)(cid:27)".(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)"(cid:25)$(cid:0)(cid:30) (cid:31)"(cid:26) $(cid:0)(cid:30)"(cid:26)(cid:27)(cid:23)!(cid:0)"!(cid:0)(cid:31)(cid:27)!(cid:26) $(cid:0)(cid:23)(cid:25)(cid:0)(cid:26)% (cid:0)(cid:26)".(cid:31) (cid:0)(cid:23)((cid:0)(cid:22)(cid:23)(cid:25)(cid:26) (cid:25)(cid:26)!(cid:0). (cid:0)(cid:29)(cid:30) ! (cid:25)(cid:26) $(cid:0)(cid:26)(cid:23)(cid:0)!(cid:24)(cid:29)(cid:29)(cid:31) ) (cid:25)(cid:26)(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!8(cid:0)’(cid:24)(cid:22)%(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:27)!(cid:0)(cid:26)% (cid:0)(cid:30) !(cid:29)(cid:23)(cid:25)!(cid:27).(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)(cid:23)((cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)(cid:0)"(cid:25)$,(cid:0)"(cid:31)(cid:26)%(cid:23)(cid:24)(cid:28)%(cid:0)(cid:25)(cid:23)(cid:26)(cid:0)"(cid:0)(cid:29)"(cid:30)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!,(cid:0)(cid:27)!(cid:0)(cid:30) *(cid:24)(cid:27)(cid:30) $(cid:0).#(cid:0)(cid:26)% (cid:0)9(cid:23): (cid:30)(cid:25)) (cid:25)(cid:26)"(cid:31)(cid:0)(cid:21)(cid:22)(cid:22)(cid:23)(cid:24)(cid:25)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)’(cid:26)"(cid:25)$"(cid:30)$!(cid:0)4(cid:23)"(cid:30)$(cid:0);%(cid:23)(cid:0)(cid:22)(cid:23)(cid:25)!(cid:27)$ (cid:30)!(cid:0)(cid:27)(cid:26)(cid:0)(cid:26)(cid:23)(cid:0). (cid:0)"(cid:25)(cid:0) !! (cid:25)(cid:26)(cid:27)"(cid:31)(cid:0)(cid:29)"(cid:30)(cid:26)(cid:0)(cid:23)((cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)(cid:30) (cid:29)(cid:23)(cid:30)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)((cid:23)(cid:30)(cid:0)(cid:29)(cid:31)"(cid:22)(cid:27)(cid:25)(cid:28)(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)(cid:27)(cid:25)(cid:0)"(cid:25)(cid:0)"(cid:29)(cid:29)(cid:30)(cid:23)(cid:29)(cid:30)(cid:27)"(cid:26) (cid:0)(cid:23)(cid:29) (cid:30)"(cid:26)(cid:27)(cid:23)(cid:25)"(cid:31),(cid:0) (cid:22)(cid:23)(cid:25)(cid:23))(cid:27)(cid:22),(cid:0)(cid:23)(cid:30)(cid:0)%(cid:27)!(cid:26)(cid:23)(cid:30)(cid:27)(cid:22)"(cid:31)(cid:0)(cid:22)(cid:23)(cid:25)(cid:26) <(cid:26)8(cid:0)= (cid:0)%": (cid:0)"(cid:29)(cid:29)(cid:31)(cid:27) $(cid:0)(cid:22) (cid:30)(cid:26)"(cid:27)(cid:25)(cid:0)(cid:31)(cid:27))(cid:27)(cid:26) $(cid:0)(cid:29)(cid:30)(cid:23)(cid:22) $(cid:24)(cid:30) !(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)(cid:30) *(cid:24)(cid:27)(cid:30) $(cid:0)!(cid:24)(cid:29)(cid:29)(cid:31) ) (cid:25)(cid:26)"(cid:30)#(cid:0) (cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:27)(cid:25)(cid:0)"(cid:22)(cid:22)(cid:23)(cid:30)$"(cid:25)(cid:22) (cid:0);(cid:27)(cid:26)%(cid:0)9(cid:21)(cid:21)’,(cid:0);%(cid:27)(cid:22)%(cid:0)(cid:22)(cid:23)(cid:25)!(cid:27)!(cid:26) $(cid:0)(cid:23)((cid:0)(cid:27)(cid:25)*(cid:24)(cid:27)(cid:30)(cid:27) !(cid:0)(cid:23)((cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)(cid:0)".(cid:23)(cid:24)(cid:26)(cid:0)(cid:26)% (cid:0)) (cid:26)%(cid:23)$!(cid:0)(cid:23)((cid:0) (cid:29)(cid:30) (cid:29)"(cid:30)(cid:27)(cid:25)(cid:28)(cid:0)(cid:26)% (cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)"(cid:25)$(cid:0)(cid:22)(cid:23))(cid:29)"(cid:30)(cid:27)(cid:25)(cid:28)(cid:0)(cid:26)% (cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)((cid:23)(cid:30)(cid:0)(cid:22)(cid:23)(cid:25)!(cid:27)!(cid:26) (cid:25)(cid:22)#(cid:0);(cid:27)(cid:26)%(cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)+!(cid:0)(cid:30) !(cid:29)(cid:23)(cid:25)! !(cid:0)(cid:26)(cid:23)(cid:0)(cid:23)(cid:24)(cid:30)(cid:0) (cid:27)(cid:25)*(cid:24)(cid:27)(cid:30)(cid:27) !,(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!,(cid:0)"(cid:25)$(cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)>(cid:25)(cid:23);(cid:31) $(cid:28) (cid:0); (cid:0)(cid:23).(cid:26)"(cid:27)(cid:25) $(cid:0)$(cid:24)(cid:30)(cid:27)(cid:25)(cid:28)(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)"(cid:24)$(cid:27)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!8(cid:0)= (cid:0)$(cid:23)(cid:0)(cid:25)(cid:23)(cid:26)(cid:0) <(cid:29)(cid:30) !!(cid:0)"(cid:25)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25)(cid:0)(cid:23)(cid:30)(cid:0)(cid:29)(cid:30)(cid:23):(cid:27)$ (cid:0)"(cid:25)#(cid:0)"!!(cid:24)(cid:30)"(cid:25)(cid:22) (cid:0)(cid:23)(cid:25)(cid:0)(cid:26)% (cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0). (cid:22)"(cid:24)! (cid:0)(cid:26)% (cid:0) (cid:31)(cid:27))(cid:27)(cid:26) $(cid:0)(cid:29)(cid:30)(cid:23)(cid:22) $(cid:24)(cid:30) !(cid:0)$(cid:23)(cid:0)(cid:25)(cid:23)(cid:26)(cid:0)(cid:29)(cid:30)(cid:23):(cid:27)$ (cid:0)(cid:24)!(cid:0);(cid:27)(cid:26)%(cid:0)!(cid:24)(((cid:27)(cid:22)(cid:27) (cid:25)(cid:26)(cid:0) :(cid:27)$ (cid:25)(cid:22) (cid:0)(cid:26)(cid:23)(cid:0) <(cid:29)(cid:30) !!(cid:0)"(cid:25)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25)(cid:0)(cid:23)(cid:30)(cid:0)(cid:29)(cid:30)(cid:23):(cid:27)$ (cid:0)"(cid:25)#(cid:0)"!!(cid:24)(cid:30)"(cid:25)(cid:22) 8(cid:0) (cid:0) (cid:10)(cid:6)(cid:11)(cid:11)(cid:12)(cid:4)(cid:13)(cid:4)(cid:14)(cid:15)(cid:16)(cid:8)(cid:17)(cid:0)(cid:18)(cid:14)(cid:19)(cid:20)(cid:8)(cid:13)(cid:16)(cid:15)(cid:7)(cid:20)(cid:14)(cid:0) (cid:0) 1(cid:24)(cid:30)(cid:0)"(cid:24)$(cid:27)(cid:26)(cid:0);"!(cid:0)(cid:22)(cid:23)(cid:25)$(cid:24)(cid:22)(cid:26) $(cid:0)((cid:23)(cid:30)(cid:0)(cid:26)% (cid:0)(cid:29)(cid:24)(cid:30)(cid:29)(cid:23)! (cid:0)(cid:23)((cid:0)((cid:23)(cid:30))(cid:27)(cid:25)(cid:28)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25)!(cid:0)(cid:23)(cid:25)(cid:0)(cid:26)% (cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)(cid:26)%"(cid:26)(cid:0)(cid:22)(cid:23)(cid:31)(cid:31) (cid:22)(cid:26)(cid:27): (cid:31)#(cid:0) (cid:22)(cid:23))(cid:29)(cid:30)(cid:27)! (cid:0)(cid:26)% (cid:0)-(cid:23)(cid:24)(cid:25)(cid:26)#+!(cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!8(cid:0)6% (cid:0)(cid:22)(cid:23)).(cid:27)(cid:25)(cid:27)(cid:25)(cid:28)(cid:0)"(cid:25)$(cid:0)(cid:27)(cid:25)$(cid:27):(cid:27)$(cid:24)"(cid:31)(cid:0)((cid:24)(cid:25)$(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)"(cid:25)$(cid:0) !(cid:22)% $(cid:24)(cid:31) !(cid:0)"(cid:30) (cid:0)(cid:29)(cid:30) ! (cid:25)(cid:26) $(cid:0)((cid:23)(cid:30)(cid:0)(cid:29)(cid:24)(cid:30)(cid:29)(cid:23)! !(cid:0)(cid:23)((cid:0)"$$(cid:27)(cid:26)(cid:27)(cid:23)(cid:25)"(cid:31)(cid:0)"(cid:25)"(cid:31)#!(cid:27)!(cid:0)"(cid:25)$(cid:0)"(cid:30) (cid:0)(cid:25)(cid:23)(cid:26)(cid:0)"(cid:0)(cid:30) *(cid:24)(cid:27)(cid:30) $(cid:0)(cid:29)"(cid:30)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!8(cid:0)’(cid:24)(cid:22)%(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:27)!(cid:0)(cid:26)% (cid:0)(cid:30) !(cid:29)(cid:23)(cid:25)!(cid:27).(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)(cid:23)((cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)(cid:0)"(cid:25)$(cid:0);"!(cid:0)$ (cid:30)(cid:27): $(cid:0)((cid:30)(cid:23))(cid:0)"(cid:25)$(cid:0) (cid:30) (cid:31)"(cid:26) !(cid:0)$(cid:27)(cid:30) (cid:22)(cid:26)(cid:31)#(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)(cid:24)(cid:25)$ (cid:30)(cid:31)#(cid:27)(cid:25)(cid:28)(cid:0)"(cid:22)(cid:22)(cid:23)(cid:24)(cid:25)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)"(cid:25)$(cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:30) (cid:22)(cid:23)(cid:30)$!(cid:0)(cid:24)! $(cid:0)(cid:26)(cid:23)(cid:0)(cid:29)(cid:30) (cid:29)"(cid:30) (cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0) !(cid:26)"(cid:26) ) (cid:25)(cid:26)!8(cid:0)6% (cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)%"!(cid:0). (cid:25)(cid:0)!(cid:24).? (cid:22)(cid:26) $(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)"(cid:24)$(cid:27)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)(cid:29)(cid:30)(cid:23)(cid:22) $(cid:24)(cid:30) !(cid:0)"(cid:29)(cid:29)(cid:31)(cid:27) $(cid:0)(cid:27)(cid:25)(cid:0)(cid:26)% (cid:0)"(cid:24)$(cid:27)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)"(cid:25)$(cid:0)(cid:22) (cid:30)(cid:26)"(cid:27)(cid:25)(cid:0)"$$(cid:27)(cid:26)(cid:27)(cid:23)(cid:25)"(cid:31)(cid:0)(cid:29)(cid:30)(cid:23)(cid:22) $(cid:24)(cid:30) !,(cid:0)(cid:27)(cid:25)(cid:22)(cid:31)(cid:24)$(cid:27)(cid:25)(cid:28)(cid:0)(cid:22)(cid:23))(cid:29)"(cid:30)(cid:27)(cid:25)(cid:28)(cid:0)"(cid:25)$(cid:0)(cid:30) (cid:22)(cid:23)(cid:25)(cid:22)(cid:27)(cid:31)(cid:27)(cid:25)(cid:28)(cid:0)!(cid:24)(cid:22)%(cid:0) (cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)$(cid:27)(cid:30) (cid:22)(cid:26)(cid:31)#(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)(cid:24)(cid:25)$ (cid:30)(cid:31)#(cid:27)(cid:25)(cid:28)(cid:0)"(cid:22)(cid:22)(cid:23)(cid:24)(cid:25)(cid:26)(cid:27)(cid:25)(cid:28)(cid:0)"(cid:25)$(cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:30) (cid:22)(cid:23)(cid:30)$!(cid:0)(cid:24)! $(cid:0)(cid:26)(cid:23)(cid:0)(cid:29)(cid:30) (cid:29)"(cid:30) (cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0) !(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)(cid:23)(cid:30)(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)(cid:26)% )! (cid:31): !,(cid:0)"(cid:25)$(cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)"$$(cid:27)(cid:26)(cid:27)(cid:23)(cid:25)"(cid:31)(cid:0)(cid:29)(cid:30)(cid:23)(cid:22) $(cid:24)(cid:30) !(cid:0)(cid:27)(cid:25)(cid:0)"(cid:22)(cid:22)(cid:23)(cid:30)$"(cid:25)(cid:22) (cid:0) ;(cid:27)(cid:26)%(cid:0)9(cid:21)(cid:21)’8(cid:0)@(cid:25)(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25),(cid:0)(cid:26)% (cid:0)(cid:22)(cid:23)).(cid:27)(cid:25)(cid:27)(cid:25)(cid:28)(cid:0)"(cid:25)$(cid:0)(cid:27)(cid:25)$(cid:27):(cid:27)$(cid:24)"(cid:31)(cid:0)((cid:24)(cid:25)$(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)"(cid:25)$(cid:0)!(cid:22)% $(cid:24)(cid:31) !(cid:0)"(cid:30) (cid:0)("(cid:27)(cid:30)(cid:31)#(cid:0)!(cid:26)"(cid:26) $,(cid:0)(cid:27)(cid:25)(cid:0) "(cid:31)(cid:31)(cid:0))"(cid:26) (cid:30)(cid:27)"(cid:31)(cid:0)(cid:30) !(cid:29) (cid:22)(cid:26)!,(cid:0)(cid:27)(cid:25)(cid:0)(cid:30) (cid:31)"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:26)(cid:23)(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)"!(cid:0)"(cid:0);%(cid:23)(cid:31) 8(cid:0) (cid:0) A(cid:15)B(cid:4)(cid:8)(cid:0)(cid:18)(cid:14)(cid:19)(cid:20)(cid:8)(cid:13)(cid:16)(cid:15)(cid:7)(cid:20)(cid:14)(cid:0) (cid:0) 6% (cid:0)-(cid:23)(cid:24)(cid:25)(cid:26)#+!(cid:0))"(cid:25)"(cid:28) ) (cid:25)(cid:26)(cid:0)(cid:27)!(cid:0)(cid:30) !(cid:29)(cid:23)(cid:25)!(cid:27).(cid:31) (cid:0)((cid:23)(cid:30)(cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:27)(cid:25)(cid:22)(cid:31)(cid:24)$ $(cid:0)(cid:27)(cid:25)(cid:0)(cid:26)% (cid:0)"(cid:25)(cid:25)(cid:24)"(cid:31)(cid:0)(cid:22)(cid:23))(cid:29)(cid:30) % (cid:25)!(cid:27): (cid:0) ((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)(cid:30) (cid:29)(cid:23)(cid:30)(cid:26)8(cid:0)6% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:22)(cid:23))(cid:29)(cid:30)(cid:27)! !(cid:0)(cid:26)% (cid:0)(cid:27)(cid:25)(cid:26)(cid:30)(cid:23)$(cid:24)(cid:22)(cid:26)(cid:23)(cid:30)#(cid:0)"(cid:25)$(cid:0)!(cid:26)"(cid:26)(cid:27)!(cid:26)(cid:27)(cid:22)"(cid:31)(cid:0)! (cid:22)(cid:26)(cid:27)(cid:23)(cid:25)!(cid:0).(cid:24)(cid:26)(cid:0)$(cid:23) !(cid:0)(cid:25)(cid:23)(cid:26)(cid:0) (cid:27)(cid:25)(cid:22)(cid:31)(cid:24)$ (cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)"(cid:25)$(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)"(cid:24)$(cid:27)(cid:26)(cid:23)(cid:30)+!(cid:0)(cid:30) (cid:29)(cid:23)(cid:30)(cid:26)(cid:0)(cid:26)% (cid:30) (cid:23)(cid:25)8(cid:0)1(cid:24)(cid:30)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25)!(cid:0)(cid:23)(cid:25)(cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0) !(cid:26)"(cid:26) ) (cid:25)(cid:26)!(cid:0)$(cid:23)(cid:0)(cid:25)(cid:23)(cid:26)(cid:0)(cid:22)(cid:23): (cid:30)(cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25),(cid:0)"(cid:25)$(cid:0); (cid:0)$(cid:23)(cid:0)(cid:25)(cid:23)(cid:26)(cid:0) <(cid:29)(cid:30) !!(cid:0)"(cid:25)(cid:0)(cid:23)(cid:29)(cid:27)(cid:25)(cid:27)(cid:23)(cid:25)(cid:0)(cid:23)(cid:30)(cid:0)"(cid:25)#(cid:0)((cid:23)(cid:30))(cid:0)(cid:23)((cid:0)"!!(cid:24)(cid:30)"(cid:25)(cid:22) (cid:0) (cid:26)% (cid:30) (cid:23)(cid:25)8(cid:0) (cid:0) @(cid:25)(cid:0)(cid:22)(cid:23)(cid:25)(cid:25) (cid:22)(cid:26)(cid:27)(cid:23)(cid:25)(cid:0);(cid:27)(cid:26)%(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)"(cid:24)$(cid:27)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!,(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)(cid:30) !(cid:29)(cid:23)(cid:25)!(cid:27).(cid:27)(cid:31)(cid:27)(cid:26)#(cid:0)(cid:27)!(cid:0)(cid:26)(cid:23)(cid:0)(cid:30) "$(cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0) (cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)"(cid:25)$(cid:0)(cid:22)(cid:23)(cid:25)!(cid:27)$ (cid:30)(cid:0);% (cid:26)% (cid:30)(cid:0)"(cid:0))"(cid:26) (cid:30)(cid:27)"(cid:31)(cid:0)(cid:27)(cid:25)(cid:22)(cid:23)(cid:25)!(cid:27)!(cid:26) (cid:25)(cid:22)#(cid:0) <(cid:27)!(cid:26)!(cid:0). (cid:26); (cid:25)(cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)"(cid:25)$(cid:0)(cid:26)% (cid:0) ."!(cid:27)(cid:22)(cid:0)((cid:27)(cid:25)"(cid:25)(cid:22)(cid:27)"(cid:31)(cid:0)!(cid:26)"(cid:26) ) (cid:25)(cid:26)!,(cid:0)(cid:23)(cid:30)(cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0)(cid:23)(cid:26)% (cid:30);(cid:27)! (cid:0)"(cid:29)(cid:29) "(cid:30)!(cid:0)(cid:26)(cid:23)(cid:0). (cid:0))"(cid:26) (cid:30)(cid:27)"(cid:31)(cid:31)#(cid:0))(cid:27)!!(cid:26)"(cid:26) $8(cid:0)@(,(cid:0)."! $(cid:0)(cid:23)(cid:25)(cid:0) (cid:26)% (cid:0);(cid:23)(cid:30)>(cid:0)(cid:29) (cid:30)((cid:23)(cid:30)) $,(cid:0); (cid:0)(cid:22)(cid:23)(cid:25)(cid:22)(cid:31)(cid:24)$ (cid:0)(cid:26)%"(cid:26)(cid:0)"(cid:25)(cid:0)(cid:24)(cid:25)(cid:22)(cid:23)(cid:30)(cid:30) (cid:22)(cid:26) $(cid:0))"(cid:26) (cid:30)(cid:27)"(cid:31)(cid:0))(cid:27)!!(cid:26)"(cid:26) ) (cid:25)(cid:26)(cid:0)(cid:23)((cid:0)(cid:26)% (cid:0)(cid:23)(cid:26)% (cid:30)(cid:0)(cid:27)(cid:25)((cid:23)(cid:30))"(cid:26)(cid:27)(cid:23)(cid:25)(cid:0) <(cid:27)!(cid:26)!,(cid:0) ; (cid:0)"(cid:30) (cid:0)(cid:30) *(cid:24)(cid:27)(cid:30) $(cid:0)(cid:26)(cid:23)(cid:0)$ !(cid:22)(cid:30)(cid:27). (cid:0)(cid:27)(cid:26)(cid:0)(cid:27)(cid:25)(cid:0)(cid:23)(cid:24)(cid:30)(cid:0)(cid:30) (cid:29)(cid:23)(cid:30)(cid:26)8(cid:0) (cid:0) 3 (cid:0) 5(cid:23)!(cid:0)(cid:21)(cid:25)(cid:28) (cid:31) !,(cid:0)-"(cid:31)(cid:27)((cid:23)(cid:30)(cid:25)(cid:27)"(cid:0)(cid:0) 7 (cid:22) ). (cid:30)(cid:0)CD,(cid:0)DEDF(cid:0) COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) FOR THE YEAR ENDED JUNE 30, 2024 This section of the County’s Annual Comprehensive Financial Report (ACFR) presents a narrative overview and analysis of financial activities for the year ended June 30, 2024. We recommend that this information be used in conjunction with additional information contained in the letter of transmittal. Financial Highlights At the end of the current year, the net position (total assets and deferred outflows of resources, reduced by total liabilities and deferred inflows of resources) of the County was negative $10.447 billion. Net position is classified into three categories and the unrestricted component was negative $35.141 billion. During the current year, the County’s net position increased by $1.412 billion. Net position related to governmental activities increased by $1.090 billion, while net position related to business-type activities increased by $322 million. At the end of the current year, the County’s General Fund reported a total fund balance of $7.693 billion. The fund balance categories and amounts consisted of nonspendable fund balance of $294 million, restricted fund balance of $89 million, committed fund balance of $1.070 billion, assigned fund balance of $1.345 billion, and $4.895 billion of unassigned fund balance. The County’s capital asset balances were $23.606 billion at year-end and increased by $537 million during the year. During the current year, the County’s long-term debt related to bonds, notes and loans from direct borrowings and direct placements increased by $131 million. Newly issued and accreted long-term debt of $476 million was less than the long-term debt maturities of $345 million. Overview of the Basic Financial Statements This discussion and analysis are intended to serve as an introduction to the County’s basic financial statements, which are comprised of the following three components: • Government-wide financial statements • Fund financial statements • Notes to the basic financial statements This report also includes other supplementary information in addition to the basic financial statements. 4 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 GOVERNMENT-WIDE FINANCIAL STATEMENTS The government-wide financial statements are designed to provide readers with a broad overview of the County’s finances, in a manner similar to a private-sector business. The Statement of Net Position presents information on all County assets and deferred outflows of resources reduced by liabilities and deferred inflows of resources, which represent net position. Over time, increases and decreases in net position may serve as an indicator of whether the financial position of the County is improving or deteriorating. The Statement of Activities presents information that indicates how the County’s net position changed during the fiscal year. All changes in net position are reported as soon as the underlying events giving rise to the changes occur, regardless of the timing of related cash flows. Therefore, revenues and expenses are reported in these statements for some items that affect cash flows in future periods. For example, property tax revenues have been recorded that have been earned but not yet collected and pension and other postemployment benefits (OPEB) expenses have been accrued but not yet paid. The government-wide financial statements report the following different types of programs or activities: • Governmental Activities - The majority of County services are reported under this category. Taxes and intergovernmental revenues are the major revenue sources that fund these activities, which include general government, public protection, public ways and facilities, health and sanitation, public assistance, education, recreation and cultural services, and interest on long-term debt. • Business-type Activities - County services that are intended to recover costs through user charges and fees are reported under this category. The County Hospitals, Waterworks Districts, and Aviation Funds represent the County’s business activities. • Discretely Presented Component Units - Component units are separate entities for which the County is financially accountable. The Los Angeles County Development Authority and First 5 LA are displayed as discretely presented in the financial statements. 5 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 FUND FINANCIAL STATEMENTS The fund financial statements contain information regarding major individual funds. A fund is a fiscal and accounting entity with a balanced set of accounts. The County uses separate funds to ensure compliance with fiscal and legal requirements. The County’s funds are classified into the following three categories: • Governmental Funds - These funds are used to account for essentially the same services that were previously described as governmental activities above. However, the fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating the County’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental funds balance sheet and the governmental funds statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. Governmental funds include the General Fund, as well as Special Revenue Funds, Debt Service Funds, Capital Projects Funds, and Permanent Funds. • Proprietary Funds - These Enterprise Funds are used to account for functions that are classified as “business-type activities” in the government-wide financial statements. The County’s Internal Service Funds are also reported within the proprietary fund section. The County’s four Hospital Funds and Waterworks Fund are all considered major funds for presentation purposes. There is one nonmajor Enterprise Fund (Aviation Fund) and it is displayed with the other major enterprise funds. • Fiduciary Funds - These funds are used to account for resources held for the benefit of parties outside the County. The Fiduciary Funds category are reported in the Pension and Other Postemployment Benefit (OPEB) Trust Funds, the Investment Trust Fund, and Custodial Funds using the economic resources measurement focus and the accrual basis of accounting. Since the resources of these funds are not available to support the County's own programs, they are not reflected in the government-wide financial statements. NOTES TO THE BASIC FINANCIAL STATEMENTS The notes to the basic financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and the fund financial statements. 6 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 REQUIRED SUPPLEMENTARY INFORMATION In addition to the basic financial statements and accompanying notes, this report presents certain required supplementary information concerning the County’s proportionate share of the net pension liability and related ratios, the County’s contributions to pension benefits, the County's schedule of changes in net Retiree Healthcare (RHC) OPEB liability and related ratios, the County's contributions to RHC OPEB, and the schedule of changes in the total Long-Term Disability OPEB liability and related ratios. Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the County, liabilities and deferred inflows of resources exceeded assets and deferred outflows of resources by $10.447 billion at the close of the most recent fiscal year. Summary of Net Position As of June 30, 2024 and 2023 (in thousands) Governmental Business-type Activities Activities Total 2024 2023 2024 2023 2024 2023 Current and other assets $ 24,777,388 $ 22,643,936 $ 5,028,768 $ 4,663,966 $ 29,806,156 $ 27,307,902 Capital assets 20,093,030 19,709,385 3,513,144 3,359,596 23,606,174 23,068,981 Total assets 44,870,418 42,353,321 8,541,912 8,023,562 53,412,330 50,376,883 Deferred outflows of resources 10,817,024 10,817,003 1,658,774 1,634,388 12,475,798 12,451,391 Current and other liabilities 7,952,565 7,719,806 1,072,810 958,829 9,025,375 8,678,635 Long-term liabilities 48,032,219 46,002,627 7,993,020 7,682,704 56,025,239 53,685,331 Total liabilities 55,984,784 53,722,433 9,065,830 8,641,533 65,050,614 62,363,966 Deferred inflows of resources 9,655,293 10,490,505 1,629,595 1,832,739 11,284,888 12,323,244 Net position: Net investment in capital assets 16,229,559 15,833,971 2,590,331 2,525,430 18,819,890 18,359,401 Restricted 5,788,406 5,083,496 85,492 84,718 5,873,898 5,168,214 Unrestricted (deficit) (31,970,600) (31,960,081) (3,170,562) (3,426,470) (35,141,162) (35,386,551) Total net position $ (9,952,635) $ (11,042,614) $ (494,739) $ (816,322) $ (10,447,374) $ (11,858,936) 7 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Significant changes in assets, deferred outflows of re sources, liabilities, and deferred inflows of resources included the following: Current and Other Assets Current and other assets increased by $2.133 billion for governmental activities. There was an increase of $1.797 billion in pooled cash and investments, largely due to the improved cash position of the County's General Fund, Mental Health Services Act (MHSA) fund and the nonmajor special revenue funds of $986 million, $456 million and $286 million, respectively, $366 million in other receivables primarily from mental health, social services, and General Fund health programs, and $42 million in taxes receivable accrued at year-end. This was offset by a decrease of $112 million in internal receivables from the prior year. For business-type activities, current and other assets increased by $365 million. The business-type activities other receivables and internal receivables increased by $299 million and $112 million, respectively, from the prior year. This was offset by a decrease of $46 million in accounts receivables from the prior year. Deferred Outflows of Resources In the current year, the County's deferred outflows of resources balances were $12.476 billion. The deferred outflows of resources were $10.817 billion and $1.659 billion for governmental and business- type activities, respectively. The total deferred outflows of resources amounts and net increases of $24 million were mostly related to pension and OPEB RHC. The total pension related deferred outflows increased by $210 million and $57 million for governmental and business-type activities, respectively, from the prior year. The total OPEB RHC related deferred outflows decreased by $208 million and $32 million for governmental and business-type activities, respectively, from the prior year. The pension and OPEB RHC amounts vary from year to year due to differences between projected and actual experience, assumption changes and changes in proportion. Liabilities Current and other liabilities increased by $233 million for governmental activities primarily from an increase in advances payable of $251 million, accounts payable of $82 million, and accrued payroll of $37 million at year-end. This was offset by a decrease in other payables of $137 million for amounts owed at year-end. For business-type activities, a net increase of $114 million in current and other liabilities was largely associated with an increase in accounts payable of $105 million for amounts owed at year-end. Long-term liabilities increased by $2.030 billion and $310 million for governmental and business-type activities, respectively. Net pension liabilities significantly increased in the current year by $767 million and $146 million for governmental and business-type activities, respectively. Net OPEB liabilities increased by $353 million and $32 million for governmental and business-type activities, respectively. Net Pension and OPEB liabilities changes were due to the projected and actual experience, assumption changes and changes in proportion, offset by the increase in plan fiduciary net position due to improved investment performance. 8 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Liabilities-Continued For governmental activities, litigation and self-insurance liabilities increased by approximately $612 million primarily from the Child Victims Act (AB 218) cases. AB 218, which became effective January 1, 2020, among other things, extended the statute of limitations for commencing an action for recovery of damages suffered as a result of childhood sexual assault to 22 years from the date the plaintiff attains the age of majority or within five years of the date the plaintiff discovers or reasonably should have discovered that the psychological injury or illness occurring after the age of majority was caused by sexual assault, whichever is later. In addition, AB 218 provided for the revival of certain claims from the procedures set forth in the Government Claims Act for a three-year window. AB 218 potential liabilities are preliminary estimates based upon a number of factors, including, but not limited to, the County's early assessment of the claims based on the limited information currently available, the number of total claims the County anticipated would be filed, the estimated fees and costs the County will incur to investigate and defend the claims, and the resources the County can responsibly agree to devote to the claims. The amount and timing of payments are dependent upon the outcome of the lawsuits, which are in their early stages. For business-type activities, liabilities for accrued compensated absences and workers’ compensation were higher by $21 million and $10 million, respectively. For business-type activities, bonds, notes and loans from direct placements were higher by $117 million. Amounts owed to third party payors by the County's hospitals were higher by $5 million as discussed in Note 14. Specific disclosures related to pension liabilities, OPEB liabilities, lease liabilities, subscription liabilities, and other changes in long-term liabilities are discussed and referenced in Notes 7, 8, 9, 10 and 11 to the basic financial statements, respectively. Deferred Inflows of Resources In the current year, the County's deferred inflows of resources were $11.285 billion. Deferred inflows of resources decreased by $835 million and $203 million for governmental and business-type activities, respectively. The total OPEB RHC and LTD related deferred inflows decreased by $634 million and $153 million for governmental and business-type activities, respectively, from the prior year. Pension related deferred inflows of resources decreased by $211 million and $49 million for governmental and business- type activities, respectively. The OPEB RHC and pension changes in deferred inflows of resources will vary from year to year due to differences between projected and actual experience, assumption changes and changes in proportion. Pension and OPEB matters are discussed in more detail in Notes 7 and 8, respectively, to the basic financial statements. Deferred inflows of resources for leases increased by $12 million in governmental activities. For Public- Private and Public-Public Partnerships (PPPs), there were $83 million of related deferred inflows of resources recognized in the current year, which represents a decrease of $2 million from the prior year in governmental activities. This amount represents the present value of installment payments associated with private operators of twenty County golf courses, as discussed in Note 6. 9 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 The County’s total net position consists of the followin g three components: Net Investment in Capital Assets The largest portion of the County’s net position, $18.820 billion, represents its investment in capital assets (i.e., land and easements, buildings and improvements, infrastructure, software, equipment, lease and subscription assets, net of related depreciation and amortization), less any related debt and related deferred outflows of resources used to acquire those assets that is still outstanding. The County uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the County’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. Restricted Net Position The County’s restricted net position at year-end was $5.874 billion. Asset restrictions are primarily due to external restrictions imposed by State legislation and bond covenants. Net position that pertains to the various separate legal entities included in the basic financial statements is also generally restricted because the entities’ funding sources require that funds be used for specific purposes. Unrestricted Net Position (Deficit) The County’s total unrestricted net position is negative $35.141 billion. Both governmental and business- type activities reported deficits in this category of $31.971 billion and $3.170 billion , respectively. OPEB related liabilities of $25.126 billion, along with pension liabilities totaling $14.074 billion, continued to be the most significant factors associated with the reported deficits. 10 11 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 The following table details and identifies changes i n net position for governmental and business-type activities: Summary of Changes in Net Position For the Years Ended June 30, 2024 and 2023 (in thousands) Governmental Business-type Activities Activities Total 2024 2023 2024 2023 2024 2023 Revenues: Program revenues: Charges for services $ 4,757,465 $ 4,342,851 $ 5,367,328 $ 5,018,952 $ 10,124,793 $ 9,361,803 Operating grants and contributions 15,578,862 14,134,795 185,668 182,601 15,764,530 14,317,396 Capital grants and contributions 58,660 64,023 326 1,193 58,986 65,216 General revenues: Taxes 10,811,926 10,297,844 9,101 8,368 10,821,027 10,306,212 Unrestricted grants and contributions 679,353 632,188 966 114 680,319 632,302 Investment income 863,672 347,504 53,810 22,949 917,482 370,453 Miscellaneous 253,977 278,413 303 59 254,280 278,472 Total revenues 33,003,915 30,097,618 5,617,502 5,234,236 38,621,417 35,331,854 Expenses: General government 1,884,559 1,626,902 1,884,559 1,626,902 Public protection 10,040,684 10,535,212 10,040,684 10,535,212 Public ways and facilities 585,307 543,472 585,307 543,472 Health and sanitation 8,032,810 6,906,927 8,032,810 6,906,927 Public assistance 9,426,531 10,390,815 9,426,531 10,390,815 Education 173,303 154,258 173,303 154,258 Recreation and cultural services 534,164 588,735 534,164 588,735 Interest on long-term debt 178,369 161,604 178,369 161,604 Hospitals 6,215,647 5,560,504 6,215,647 5,560,504 Waterworks 118,530 113,074 118,530 113,074 Aviation 19,951 19,677 19,951 19,677 Total expenses 30,855,727 30,907,925 6,354,128 5,693,255 37,209,855 36,601,180 Excess (deficiency) before transfers 2,148,188 (810,307) (736,626) (459,019) 1,411,562 (1,269,326) Transfers (1,058,209) (1,117,417) 1,058,209 1,117,417 Change in net position 1,089,979 (1,927,724) 321,583 658,398 1,411,562 (1,269,326) Net position - beginning (11,042,614) (9,114,890) (816,322) (1,474,720) (11,858,936) (10,589,610) Net position - ending $ (9,952,635) $ (11,042,614) $ (494,739) $ (816,322) $ (10,447,374) $ (11,858,936) 12 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued REVENUES BY SOURCE – ALL ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2024 Operating grants and contributions 41% Taxes 28% Charges for services Other 26% 5% EXPENSES BY TYPE – ALL ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2024 General government Other 5% 4% Public assistance 25% Health and sanitation 22% Hospitals Public protection 17% 27% 13 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Governmental Activities Revenues from governmental activities increased by $2.906 billion (9.7%) when compared with the prior year. The most significant changes in specific revenue sources were experienced in the following areas: • Program revenues recognized from operating grants and contributions increased by $1.444 billion, which was primary attributable to an increase in health and sanitation and public assistance from State and federal revenues. Health and sanitation revenues grew by $1.027 billion primarily from higher MHSA State revenues of $450 million, higher reimbursable costs associated with mental health services of $522 million and public health programs of $179 million and offset by lower State realignment revenues of $27 million. Revenues for public assistance programs grew by $293 million as there were higher administrative and program reimbursable costs of $445 million for public social services, children and family services, and homeless and housing programs which was offset by a reduction of COVID-19 revenues of $166 million. General government revenues grew by $57 million primarily from $33 million of State revenues to fund capital projects and $25 million for the Internal Services Department energy grant and American Rescue Plan (ARP) Digital Divide program. Revenues for public protection programs increased by $53 million primarily due to the State 2011 Realignment revenues in the Probation department. • Taxes, the County's largest general revenue source, were $514 million higher than the prior year and were mostly attributable to property taxes and sales and other taxes, which grew by $498 million and $16 million, respectively. The County's total taxable assessed property tax value is $2.024 trillion, which grew by 5.92% in the current year and property tax revenue increased by $436 million from the prior year. Property tax revenues were also recognized in conjunction with the dissolution of redevelopment agencies “pass through”. Payments from redevelopment dissolution were $532 million and increased by $27 million from the prior year. Redevelopment dissolution also provides residual property taxes to local governments, including the County. The County's share of such residual tax revenues in the current year was $469 million, an increase of $4 million compared to the prior year. Other general revenues also increased by $11 million from the Homeless and Housing Measure H sales tax and $2 million from the local generated sales tax due to higher prices and increased consumer spending. This was offset by a decrease in deed transfer tax revenue of $8 million due to the decline in real estate sales. • Program revenues recognized from charges for services increased by $415 million which was primary attributable to an increase in health and sanitation and public protection functional categories by $342 million and $73 million, respectively. Health and sanitation increase was due to an increase in health services administration and health community programs of $256 million and $76 million, respectively. The public protection increase was due to an increase in Sheriff law enforcement and Justice, Care Opportunities department (JCOD) programs by $51 million and $17 million, respectively. • Investment income increased by $516 million due to an increase in interest income of $269 million and a change in the fair value in investments at year-end of $247 million, which was primarily from changes in market yields throughout the fiscal year. 14 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Governmental Activities-Continued Expenses related to governmental activities decreased by $52 million (0.2)%) during the current year. This was attributable to an increase in salaries and employee benefit (S&EB) expenses of $1.262 billion and a decrease in operating expenses of $1.314 billion. The S&EB increase was largely attributable for general salary increases by $909 million, an increase in pension expenses by $610 million, and a decrease in OPEB expenses by $241 million, in all functional categories. The decrease in the operating expenses of $1.314 billion was primarily from public assistance and public protection by $1.219 billion and $1.084 billion, respectively. In addition, health and sanitation, general government and public ways and facilities operating expenses increased by $818 million, $101 million and $46 million, respectively. Public assistance operating expenses were higher from public social services programs by $328 million, higher children and family services programs by $85 million, and lower affordable and homeless housing programs by $114 million. In addition, litigation and self- insurance expenses were lower by $1.502 billion primarily from the AB 218 prior year estimates. Public protection operating expenses were higher from Consumer and Business Affairs and Public Works programs by $66 million and $51 million, respectively. In addition, litigation and self-insurance expenses were lower by $1.123 billion primarily from the AB 218 prior year estimates. Health and sanitation operating expenses were higher by $818 million primarily for mental health and health administration and community programs of $478 million and $343 million, respectively. General government operating expenses were higher by $101 million primarily from the Public Works and Economic Development departments of $24 million and $68 million, respectively. Public ways and facilities were primarily higher due to increased costs for road operations, maintenance, safety, and improvements of unincorporated area municipal streets and highways of $46 million. Interest on long-term debt was $178 million, an increase of $17 million from the prior year. Depreciation/ amortization expense was $674 million in the current year, an increase of $90 million from the prior year amount of $584 million in all functional categories. Business-type Activities Revenues from business-type activities for the current year were $5.618 billion, an increase of $383 million (7.3%) from the previous year. The most significant increase was in charges for services to the County's hospitals by $338 million primarily associated with an increase in Global Payment Program and Managed Care Rate Supplement revenues by $149 million and $155 million, respectively. As discussed in Note 14 to the basic financial statements, County hospital revenues are derived from a wide range of federal and State funding sources. Business-type activities for investment income increased by $31 million due to an increase in interest income of $13 million and a change in the fair value in investments at year-end of $18 million, which was primarily from changes in market yields throughout the fiscal year. Expenses related to business-type activities increased from the previous year by a net total of $661 million (11.6%), and were associated primarily with the County’s hospitals, where expenses increased by $655 million. The hospital expenses for S&EB consisted of an increase from general salary increases and pension expenses of $143 million and $95 million, respectively. The S&EB increase was offset by a decrease in OPEB expenses of $46 million. In addition, there was an increase of $204 million for services and supplies and professional services expenses related to an increase in patient care services and an increase in the County's hospital intergovernmental transfer expense of $242 million primarily for the Managed Care Rate Supplement, Enhanced Payment, and Global Payment programs. 15 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Financial Analysis of the County’s Funds As noted earlier, the County uses fund accounting to ensure and demonstrate compliance with finance- related legal requirements. Governmental Funds The focus of the County’s governmental funds is to provide information on near-term inflows, outflows, and balances of resources that are available for spending. Such information is useful in assessing the County’s financing requirements. Types of governmental funds reported by the County include the General Fund, Special Revenue Funds, Debt Service Funds, Capital Projects Funds, and the Permanent Funds. As of the end of the current fiscal year, the County’s governmental funds reported combined total fund balances of $14.015 billion, an increase of $1.860 billion in comparison with the prior year. Of the total fund balances, $394 million is nonspendable to indicate the extent that funds are not in spendable form or are required to remain intact. An additional $5.857 billion is classified as restricted, $1.240 billion as committed, and $1.629 billion as assigned. The remaining balance of $4.895 billion is classified as unassigned and is entirely associated with the General Fund. Revenues from all governmental funds for the current year were $32.912 billion, an increase of $2.802 billion (9.3%) from the previous year. Expenditures for all governmental funds in the current year were $30.361 billion, an increase of $2.040 billion (7.2%) from the previous year. In addition, net other financing uses were $692 million, an increase of $81 million (13.3%) as compared to $611 million in the prior year. The General Fund is the County’s principal operating fund. During the current year, the fund balance in the General Fund increased by $1.210 billion (18.7%). At the end of the current fiscal year, the General Fund’s total fund balance was $7.693 billion. Of this amount, $294 million is classified as nonspendable, $89 million as restricted, $1.070 billion as committed, $1.345 billion as assigned and the remaining $4.895 billion is classified as unassigned. General Fund revenues during the current year were $27.263 billion, an increase of $2.042 billion (8.1%) from the previous year. General Fund expenditures during the current year were $26.396 billion, an increase of $1.782 billion (7.2%) from the previous year. Net other financing sources/uses was positive $342 million in the current year as compared to positive $258 million in the prior year. Following are significant changes in General Fund revenues and expenditures: • Intergovernmental revenues increased by $861 million overall, and were primarily associated with an increase in State revenue by $380 million, federal revenue by $456 million and other governmental agencies revenue by $24 million. State and federal revenues related to the COVID-19 federal and State grants funds decreased by $583 million and were offset by an increase of $178 million from the ARP funds. Health Services Realignment State sales tax and vehicle license fees were higher by $52 million primarily due to higher prices and consumer spending. Other State and federal revenue growth was attributable to higher levels of reimbursable program and administrative costs in the mental health, social services, public health, probation, and sheriff programs of $522 million, $431 million, $179 million, $59 million, and $27 million, respectively. This was offset by lower levels of reimbursable programs and administrative costs in health services administration and diversion reentry programs of $110 million and $73 million, respectively. 16 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Governmental Funds-Continued • Charges for services increased by $444 million. The significant increases were primarily associated in the health services administration, ambulatory care and community health programs of $256 million, $76 million and $38 million, respectively, which was associated with the Global Payment Program and community support services. Also, there was an increase in charges for services for public health programs of $24 million. The Sheriff's department law enforcement services revenues and JCOD programs for court services increased by $50 million and $17 million, respectively. This was offset by $29 million in lower election services from the Registrar- Recorder from the prior year. • Revenues from taxes increased by $378 million and were primarily associated with an increase in property taxes of $385 million and a decrease in other taxes of $7 million. The property taxes increase was primarily associated with $369 million of revenue from a growth in assessed property values. Residual property tax revenues, which are associated with redevelopment dissolution, were $391 million in the current year, $1 million higher than the prior year. Property tax was also reflected in “pass through” property tax revenues, which were $23 million higher in the current year. Documentary transfer taxes decreased other taxes by $8 million fueled by higher interest rates in the real estate market and the County median home sales slowed down in this fiscal year. Sales, use and utility tax increased other taxes by $1 million from increased consumer spending and higher prices. • Investment income resulted in an increase of $330 million due to an increase of $176 million in interest earnings and an increase of $154 million in the fair value change in investments at year- end, which was primarily from changes in market yields throughout the fiscal year. • General Fund expenditures increased by a total of $1.782 billion, or 7.2%. Current expenditures increased by $1.900 billion, and debt service and capital outlay expenditures decreased by $118 million. • Health and sanitation expenditures increased by $1.033 billion. This was primarily due to an increase of $479 million in mental health expenditures and $474 million in the general fund heath services administration, ambulatory care, correctional health, and community health programs. There was also an increase of $237 million for general salary increase for S&EB costs. This was offset by a decrease of $69 million in expenditures for public health programs. • Public assistance expenditures increased by $389 million. This was primarily due to an increase of expenditures of $325 million for public social services, $86 million for children and family services, and $32 million for homeless and housing programs. There was also an increase of $196 million for general salary increase for S&EB costs. This was offset by a decrease in affordable housing and aging and disabilities programs of $200 million and $27 million, respectively. • Public protection program costs were higher by $315 million, and were primarily associated with an increase in S&EB expenditures of $260 million and an increase in law enforcement expenditures of $65 million for consumer and business affairs programs. 17 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Governmental Funds-Continued • General government spending increased by $151 million and was primarily associated with increased expenditures of $68 million for the Economic Opportunity department, $57 million for the Care First and Community Investment (CFCI) program, and $47 million for costs associated with capital improvements. This was offset by a decreased expenditures of $64 million for judgments and damages, $28 million for the Internal Services Department, and $31 million in rent expense. There was a net increase of $108 million for general salary increases in S&EB. The Fire Protection District reported a year-end fund balance of $259 million, which represented an increase of $43 million compared to the previous year increase of $27 million, resulting in a net difference of $16 million. The Fire Protection District responds to a number of major incidents and emergencies and provides essential fire protection and emergency medical services during the fiscal year. Revenues increased by $73 million, of which $49 million was related to property taxes and primarily associated with growth in assessed property values, $14 million in charges for services, and $10 million in investment income. Expenditures were higher by $30 million, of which S&EB were higher by $61 million for general salary increases and and offset by lower services and supplies cost of $29 million. The Flood Control District reported a year-end fund balance of $270 million, which represented a decrease of $94 million in fund balance compared to the previous year's decrease of $42 million, resulting in a net difference of $52 million. The change in fund balance was primarily due to higher services and supplies and capital assets infrastructure expenditures of $35 million for infrastructure improvement projects to support flood protection and water conservation. Revenues declined by $6 million due to a decrease in charges of services of $15 million, $9 million from higher property taxes due to growth in assessed valuation, $10 million from higher interest revenue due to favorable interest rates. There was also a net increase of other financing uses of $12 million. The LA County Library Fund reported a year-end fund balance of $168 million, which represented a decrease of $1 million in fund balance compared to the previous year increase of $38 million, resulting in a net difference of $39 million. Revenues increased by $11 million, of which $6 million was related to property taxes associated with growth in assessed valuation, $4 million lower State and federal revenues and $9 million higher investment income. Expenditures were $11 million higher than the previous year and other financing sources were lower by $39 million. The Regional Park and Open Space District reported a year-end fund balance of $791 million, which represented an increase of $115 million in fund balance compared to the previous year increase of $101 million, resulting in a net difference of $14 million. The net change in fund balance was primarily attributable to an increase in investment income of $23 million from higher interest rates. Property tax increased by $7 million from the previous year due to growth in assessed valuation. Expenditures were higher by $16 million due to an increase in program awards to empower communities and preserve parks and open space from the previous year. The MHSA Fund reported a year-end fund balance of $1.549 billion, which represented a decrease of $316 million in fund balance compared to the previous decrease of $46 million, resulting in a net difference of $362 million. Current year revenues were higher by $486 million, primarily from an increase of $450 million in State revenues and investment income of $36 million, while transfers out increased by $124 million to support the five MHSA program components (Community Services and Supports; Prevention and Early Intervention; Innovation; Workforce Education and Training; and Capital Facilities and Technological Needs). 18 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Proprietary Funds The County’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. The County’s principal proprietary funds consist of four hospital enterprise funds and each one is reported as a major fund. All of the four hospital funds had a net deficit as discussed in Note 3. The County is legally required to provide local matching funds to the health care system in order to remain eligible for federal and State assistance. Such funds were provided to the hospitals as operating subsidies from the County General Fund during the year as discussed in Note 15 to the basic financial statements. The amount of subsidy, per facility, ranged from $92 million for the Rancho Los Amigos National Rehabilitation Center to $442 million for the Los Angeles General Medical Center. The total subsidy amount was $954 million and is reflected in the Statement of Revenues, Expenses and Changes in Fund Net Position as “transfers in.” By comparison, the total General Fund subsidy in the prior year was $906 million. During the current year, the County’s hospital operations experienced higher levels of patient care revenues and operating expenses in comparison to the prior year as previously discussed. An additional source of local funding for the Hospitals is the Health Services Measure B Special Revenue Fund (Measure B Fund). The Measure B Fund receives voter approved property taxes for trauma and emergency services. In the current year, the Measure B Fund provided transfers to the Los Angeles General Medical Center ($101 million), Harbor-UCLA Medical Center ($68 million), and Olive-View UCLA Medical Center ($40 million). The total current year amount of $209 million in Measure B transfers increased by $16 million from the prior year. Waterworks Fund reported year-end net position of $764 million, which was $2 million higher than the previous year, resulting in a net difference of $11 million from the prior year. Revenues of $101 million were slightly higher by $10 million than the previous year's amount of $91 million. Current year operating expenses of $118 million were slightly higher by $6 million than the previous year. Net nonoperating revenues increased by $7 million primarily from higher investment income of $5 million. General Fund Budgetary Highlights The accompanying basic financial statements include a Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual on Budgetary Basis for the County’s General Fund. The County’s budgetary basis of accounting is discussed in Notes 1 and 16 to the basic financial statements. There are approximately 160 separate budget units within the General Fund, excluding capital improvement projects, which are individually budgeted. The data presented below represents the net budgetary changes for the General Fund in a highly summarized format. Accordingly, in certain instances, budgets have been increased for programs within a category even though actual amounts have not been realized for the category in its entirety. Under the budgetary basis, there was a net increase of $452 million in the General Fund’s available (unassigned) fund balance from the previous year. 19 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Budgetary Summary - Revenues/Financing Sources Following is a summary of current year budgetary changes and actual results (on the County’s budgetary basis) for General Fund revenues and other financing sources (in thousands): Increase (Decrease) Variance- From Original Final Budget Actual Positive Category Budget Amount Amount (Negative) Taxes $ 5,422 $ 7,859,100 $ 8,025,301 $ 166,201 Intergovernmental revenues 780,208 16,354,894 14,709,603 (1,645,291) Charges for services 494,398 3,456,959 3,361,713 (95,246) All other revenues 59,269 829,001 1,170,676 341,675 Other sources and transfers in 192,882 2,038,225 1,347,823 (690,402) Total $ 1,532,179 $ 30,538,179 $ 28,615,116 $ (1,923,063) Changes from Amounts Originally Budgeted During the year, net increases in budgeted revenues and other financing sources were approximately $1.532 billion. The changes occurred in the following areas: • The budget for "Taxes" increased by $6 million. The $6 million increase was primarily associated with year-end budgetary changes that are designed to demonstrate compliance with legal provisions related to the appropriations of revenues from property taxes and certain other tax related revenues. • The estimated revenue for "Intergovernmental revenues" increased by $780 million. The increase is primarily from COVID-19 federal ARP revenues, which is associated with $463 million for a variety of ARP programs and $336 million under the ARP Revenue Loss Provision. On November 6, 2023, the County identified revisions to its ARP spending plan and reallocated funds for housing and homelessness programs, affordable housing, support the health and public health response to COVID-19, direct community investments and grants, support for tenants and landlords, workforce development services, economic support for small businesses and nonprofits, and programs targeting people who need assistance. The remaining net budget decreases of $19 million were related to a variety of federal and State funded programs. • The estimated revenue for "Charge for services" increased by $494 million. The increase is primarily from $284 million for health services administration services, $163 million for the ambulatory care network services, $32 million for the Sheriff's department contracted services and $8 million for Public Health services. There were $7 million of net budget increases in charges for services from a variety of programs. • The budget for "All other revenues" increased by $59 million primarily from $38 million in investment income due to higher interest rates and $11 million for increases in Public Works licenses, permits, and franchises revenues. There were $10 million in net budget increases for miscellaneous revenues. • The budget for "Other sources and transfers in" increased by $193 million from transfers of $124 million from the Nonmajor Other Special Revenue for capital projects, $54 million from the MHSA fund for General Fund mental health programs and $15 million in other transfers for a variety of programs. 20 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Actual Revenues/Financing Sources Compared with Final Budget Amounts Actual revenues and other financing sources recognized by the General Fund were approximately $28.615 billion. This amount was $1.923 billion, or 6.3%, lower than budget. As discussed below, the changes occurred in the following areas. • Actual "Taxes" were higher by $166 million from the amount budgeted. Of this increase, $149 million increase was associated with property tax revenue due to a growth in assessed property values. Other taxes increased primarily from an increase in aircraft assessment, transient occupancy tax, and local sales revenue by $15 million, $13 million, and $7 million, respectively. There were net decrease in deed transfer taxes of $18 million due to a decline in real estate transactions. • Actual "Intergovernmental revenues" were $1.645 billion lower than the amount budgeted. The ARP programs in various departments accounted for $238 million as these program costs were not completed prior to year-end. Approximately $439 million of intergovernmental revenues were associated with social services and child and family programs, where reimbursable costs were lower than anticipated due to delays in hiring and promoting staff, reduced contractual spending for services and child care provider payments, and delays in implementing new systems. Health, correctional, and community health program, Public health, Mental health, Economic opportunity, and Homeland Security grants, accounted for approximately $177 million, $173 million, $72 million, $32 million, and $23 million, respectively, which experienced lower than anticipated reimbursable costs and correspondingly lower than expected revenues. Budgeted intergovernmental revenues of $366 million were not realized for various capital improvements and disaster recovery programs, as these initiatives were not completed prior to year-end. Homeless and housing program revenue of $25 million experienced lower than anticipated revenue for State funded homeless and housing initiatives. Probation and Sheriff budgeted intergovernmental revenues were lower by $25 million, which experienced lower than anticipated reimbursable operating expenditures and staffing vacancies. Programs that support criminal justice reform in the Office of Diversion and Reentry, JCOD, and Youth Development budgeted intergovernmental revenues were lower by $46 million as new programs and initiatives were still being developed prior to year-end. There were net decreases of $29 million from a variety of programs. • Actual "Charges for services" were $95 million lower than the amount budgeted. The decrease was primarily attributable to $32 million, $20 million and $16 million of costs associated with ambulatory care network, community health services, and public health programs, respectively, which experienced lower than anticipated reimbursable costs for charges for services due to the transition to a post-pandemic environment. In addition, JCOD programs were $13 million lower than the budgeted amount as they develop and continue to ramp up services. Registrar-Recorder experienced a $19 million decline of revenue from election services. There were net increases of $5 million from a variety of programs. • Actual "All other revenues" were $341 million higher than budgeted. Interest revenue was higher by $254 million due to a changes in the market yields throughout the fiscal year. Miscellaneous revenues were primarily higher from the Rent Expense, Health Services Administration and Community Health Services programs by $45 million. Fine and penalties were higher by $49 million. License Permits and Franchise revenues were higher by $4 million. There were net decreases of $11 million from other revenues for the remaining variance. 21 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Actual Revenues/Financing Sources Compared with Final Budget Amounts-Continued • The actual amount of “Other sources and transfers in” was $690 million lower than the amount budgeted. Of this amount, mental health programs funded by the MHSA Fund did not fully materialize at the budgeted level and “transfers in” were $371 million lower than budgeted. The Homeless and Housing Measure H costs were $165 million less than budgeted for General Fund programs. Costs associated with Consumer protection, Probation, Sheriff, JCOD, and Youth development departmental programs funded by the Other Public Protection Special Revenue Funds were $54 million less than budgeted. Costs associated with the public health programs funded by the Health and Sanitation Special Revenue funds were $13 million less than budgeted. In addition, “transfers in” totaling $66 million were assumed in the budget for capital improvements and extraordinary building maintenance projects, which did not incur expected costs. There were various other sources and transfers that comprised the remaining variance of $21 million. Budgetary Summary - Expenditures/Other Financing Uses Following is a summary of current year budgetary changes and actual results (on the County’s budgetary basis) for General Fund expenditures, transfers out, and changes in fund balance components (in thousands): Increase (Decrease) From Original Final Budget Actual Variance- Category Budget Amount Amount Positive General government $ (20,685) $ 3,821,756 $ 1,879,693 $ 1,942,063 Public protection 344,601 7,552,904 7,185,630 367,274 Health and sanitation 258,447 8,802,606 7,791,294 1,011,312 Public assistance 26,403 10,001,015 9,097,590 903,425 All other expenditures 414,518 2,682,484 982,445 1,700,039 Transfers out 302,598 1,072,368 1,069,312 3,056 Contingencies (77,561) (185) (185) Fund balance changes-net 283,858 369,720 157,576 212,144 Total $ 1,532,179 $ 34,302,668 $ 28,163,540 $ 6,139,128 Changes from Amounts Originally Budgeted During the year, net increases in General Fund appropriations and fund balance component changes were approximately $1.532 billion. The most significant changes occurred in the following areas: • "Public protection" appropriations increased by $345 million. An increase of $24 million of S&EB was appropriated to reflect the general S&EB increases. Law enforcement appropriations increased by $197 million which was funded by provisional financing uses and other revenues for the Sheriff's department operations costs which include increases in services and supplies, contracts, legal settlements, and costs for federal grant programs. The Consumer and Business Affairs appropriations increased by $47 million for ARP programs to provide mortgage relief, expand the income tax assistance program, financial coaching, landlord-tenant mediation, and rent relief. District attorney appropriations increased by $26 million to pay for operation costs in services and supplies, insurance, litigation, and settlements costs. Probation appropriations were increased by $31 million to fund the department operation costs which include increases in services and supplies, contracts, equipment purchases, insurance, and legal settlements. There were net increases of $20 million for other public protection programs. 22 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Changes from Amounts Originally Budgeted-Continue d • "Health and sanitation" appropriations were increased by $258 million. General Fund health services operations that support Administration, Ambulatory care network, and Correctional health appropriations increased by $305 million to fund increased costs related to intergovernmental transfers, registry staffing, medical supplies, pharmaceuticals, and equipment purchases which was offset by a decrease in S&EB appropriations of $59 million. Mental health appropriations increased by $48 million to fund the innovative interim housing outreach program, temporary mental health shelter beds, and mental health contract providers. Public health appropriations increased by $149 million primarily for the expansion of substance use disorder contracted services and ARP funded programs for COVID-19 community testing. Community health programs, a newly established budget, provides comprehensive services for the patient populations that are also experiencing non-medical factors that influence a patient health outcomes appropriations decreased by $189 million. There were net increases of $4 million for other health and sanitation programs. • Appropriations for "All other expenditures" were increased by $415 million. The increase was primarily attributable to the continued development, design, and construction of capital projects to support the long-term goals to sustain and/or rehabilitate County facilities. • Appropriations for "transfers out" were increased by $303 million. The increase was primarily attributable to augmenting the amount of fund transfers from the General Fund to the various Hospital Enterprise Funds. • Net fund balance budgetary changes of $284 million had the effect of reducing the available (unassigned) fund balance component. The changes were largely attributable to increasing the reserve for rainy day funds and committed for American Rescue Plan for capital programs by $124 million and $209 million, respectively. The remaining variance of $49 million was attributable to various other fund balance accounts. Actual Expenditures/Other Financing Uses Compared with Final Budget Amount Actual expenditures/other financing uses for the current year were $6.139 billion (17.9%) lower than the final total budget of $34.303 billion. There were budgetary savings in all functional expenditure categories. Following are the functional areas that recognized the variations from the final budget: • General government expenditures were $1.942 billion less than the budgeted amount. Of this amount, the budgetary savings was largely attributable to appropriations not associated with specific County departments, such as provisional appropriations and central non-departmental appropriations by $1.249 billion. The CFCI Program not associated with a specific County department had budgetary savings of $197 million as they continue to design, develop, launch and implement Board-approved CFCI programs. The Board of Supervisors had budgetary savings of $127 million to be spent in future years for various community projects. S&EB savings for general government operations of $122 million were due to vacancies and hiring delays. The Department of Economic Opportunity had budgetary savings of $100 million to be spent in future years for economic development initiatives within the County. Chief Executive Office had budgetary savings of $47 million due to lower than anticipated operational costs. Judgments and damages had budgetary savings of $32 million due to lower than anticipated legal settlements costs. The remaining net budgetary savings of $68 million was spread across the general government departments and was mostly related to savings in the areas of services and supplies. 23 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Actual Expenditures/Other Financing Uses Compared with Final Budget Amount-Continued • Overall expenditures for the "health and sanitation" category were $1.011 billion less than the budgeted amount. Specifically, the budgetary savings were from the mental health, community health programs, CFCI health programs, public health programs, and health services administration of $289 million, $240 million, $116 million, $75 million, $17 million, respectively, due to lower than anticipated costs for professional, contracted, and information technology services, and implementing new programs. There was also $265 million from S&EB savings due to staffing vacancies and hiring delays. The remaining variance of $9 million was related to other health and sanitation programs. • Actual "public assistance" expenditures were $903 million lower than the final budget. The variance of $309 million was related to affordable housing and homeless programs due to delays in carrying out multi-year projects. Social services and children and family were lower than budgeted by $231 million and $253 million, respectively. Cost savings in these areas were due to lower than anticipated costs in implementing new assistance programs, General Relief Guaranteed Income Pilot Program, Anti-Homelessness subsidy program, and Family First Prevention Services Act programs. There were also direct program savings associated with lower than anticipated caseloads. The Aging and Disabilities department was lower than budgeted by $13 million due to lower than anticipated costs to support older adults, adults with disabilities and community programs. In addition, there were S&EB savings of $95 million due to the hiring delays and vacancies. The remaining variance of $2 million was related to other public assistance programs. • The category referred to as “all other expenditures” reflected actual spending of $1.700 billion less than the budgeted amount. Of this variance, $1.672 billion was in the capital outlay category and was related to numerous capital improvements anticipated in the budget that remained in the planning and development stages and did not incur expenditures during the year. Most of the unused balance has been re-established in the following year’s budget to ensure the continuity of the projects, many of which are multi-year in nature. Capital Assets The County’s capital assets for its governmental and business-type activities as of June 30, 2024, were $23.606 billion (net of depreciation and amortization). Capital assets include land and easements, buildings and improvements, infrastructure, equipment, software, capital assets, in progress, lease assets, and subscription assets. The major infrastructure network elements are roads, sewers, water, flood control, and aviation. Specific capital asset changes during the current year are presented in Note 5 to the basic financial statements. 24 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 The total increase in the County’s capital assets (ne t of depreciation/amortization) for the current fiscal year was $537.19 million as shown in the following table. Changes in Capital Assets, Net of Depreciation/Amortization Primary Government - All Activities (in thousands) Current Prior Increase Year Year (Decrease) Land and easements $ 7,840,427 $ 7,815,091 $ 25,336 Buildings and improvements 6,319,349 6,141,339 178,010 Infrastructure 3,740,931 3,856,261 (115,330) Equipment 635,142 599,197 35,945 Software 133,770 166,611 (32,841) Capital assets, in progress 3,340,491 2,876,906 463,585 Lease assets 1,498,670 1,526,637 (27,967) Subscription assets 97,394 86,939 10,455 $ 23,606,174 $ 23,068,981 $ 537,193 The County’s major capital asset initiatives during the current year continued to focus on new facilities and major improvements. The most significant increase in capital assets was in capital assets, in progress, which increased by $464 million. Governmental activities for capital assets, in progress, increased by $403 million which included major buildings and improvements construction-in-progress for general government of $67 million, public protection of $104 million, health and sanitation of $62 million, public assistance of $16 million, and recreation and cultural services of $130 million. The major projects include $53 million for various deferred maintenance projects under the Facility Reinvestment Program, $41 million for the Natural History Museum Commons Renovation, $22 million for the Hall of Administration retrofit and repairs, and $20 million for the Natural History Museum La Brea Tar Pits. In addition, there were capitalized software- in-progress costs of $18 million for the Assessor’s Modernization Project Phase 4 and $10 million for the Registrar-Recorder/County Clerk’s Voting System for all People Tally System and Ballot Marking Devices and Manager Enhancement. There was also a net increase in buildings and improvements totaling $73 million. Completed major capital projects processed in the current year included $30 million for the East Los Angeles Sustainable Median Stormwater Capture project, $12 million for the Rancho Los Amigos South Campus Sports Center, $12 million for Tenant Improvements, $10 million for the Hall of Records 7th Floor Renovation, $11 million for the Santa Clarita Fire Station No. 104, $10 million for the Park to Playa Trail: Stoneview Nature Center to Kenneth Hahn State Recreational Area Segment, $5 million for the Harbor-UCLA Medical Center Mental Health Adult Outpatient Program Interim Facility project, $5 million for the Harbor-UCLA Medical Center Mental Health Children's Outpatient Clinic project. Business-type activities capital assets, in progress, increased by $61 million which included major buildings and improvements construction-in-progress of $245 million for the Harbor-UCLA Medical Center Replacement Program and $10 million for the Olive View-UCLA Medical Center Fire Alarm and Nurse Call Systems project. Completed major capital projects included $75 million for various projects within the Harbor-UCLA Medical Center Replacement Program and $72 million for the Olive View-UCLA Medical Center Fire Alarm and Nurse Call Systems project. As of June 30, 2024, there were $923.63 million of capital asset commitments outstanding. Major capital asset commitments include $905.98 million for the Harbor-UCLA Medical Center Replacement Program and $15.39 million for various deferred maintenance projects under the Facility Reinvestment Program. 25 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Debt Admin istration During the current year, the County’s liabilities for long-term debt related to bonds, notes and loans from direct borrowings and direct placements, including accreted interest, increased by $131 million, as newly issued debt and accretions of $476 million were more than the debt maturities of $345 million. Specific changes related to governmental and business-type activities are presented in Note 11 to the basic financial statements. During the current year, significant long-term debt transactions related to bonds, notes and loans from direct borrowings and direct placements were as follows: • Lease Revenue Obligation Notes (LRON) of $460 million were issued for governmental and business-type activities in the amounts of $205 million and $255 million, respectively. For governmental activities, debt was issued to finance renovations for public health centers, social service, probation buildings, beach and park facilities, libraries and various general government buildings. For business-type activities, debt was issued to finance hospital facilities improvements. Lease liabilities slightly decreased by $2 million, as newly issued leases of $152 million were lower than the lease maturities of $154 million related to governmental and business-type activities. Subscription liabilities slightly decreased by $2 million from the prior year. There were eight outstanding financed purchase obligations, where the asset transfers ownership to the County by the end of the agreement. Financed purchase obligations balance for governmental activities was $16 million as of June 30, 2024. In addition to the above borrowing, the County continued to finance General Fund cash flow shortages occurring periodically during the fiscal year by selling $700 million in tax and revenue anticipation notes. The notes matured and were redeemed on June 28, 2024. Bond Ratings The County's debt is rated by Moody's, S&P Global Ratings (S&P), and Fitch. The following is a schedule of ratings assigned by the respective rating agencies: Moody's S&P Fitch Certificates of Participation Aa3 AA+ AA+ Equipment/Non-Essential Leases Aa2 AA+ AA+ Operating/Non-Essential Leases Aa2 AA+ AA+ Short-Term MIG1 SP-1+ F1+ During the current year, the County’s bond ratings assigned by Fitch for Certificates of Participation, Equipment Leases, and Operating Leases were upgraded from the previous year. 26 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 Economic Condit ions and Outlook Los Angeles County's FY 2024-2025 budget makes major investments in mental health services complemented by substantial funding to sustain the County's accelerated emergency response to the homelessness crisis, along with programs to create jobs, expand food resources, support families, and advance the Board of Supervisors' Care First, Jails Last vision. The County’s 2024-2025 Budget represents a balanced plan, devoting limited resources to the highest priority programs while maintaining the County's safety net, other basic services, and recent innovations aimed at alleviating poverty, such as the County's expanding the guaranteed income programs. The County budget also seeks to ensure we are prepared for challenges ahead, including safeguarding the County against both economic and cybersecurity threats. The County's budget continues to reflect the County's long-standing commitment to responsible and sustainable fiscal practices. The Board of Supervisors adopted the County’s 2024-2025 Budget on June 24, 2024. The Budget was adopted based on estimated fund balances that would be available at the end of 2023-2024. The Board updated the Budget on October 8, 2024 to reflect final 2023-2024 fund balances and other pertinent financial information. For the County’s General Fund, the 2024-2025 Budget utilized $4.216 billion of fund balance, which exceeded the previously estimated fund balance of $2.776 billion. Of the additional fund balance of $1.440 billion, $505 million was used to carryover lapsed appropriations and ensure the continuity of funded program initiatives. The remaining $935 million was primarily used for the continued momentum for Care First, Jails Last initiative, respond to the local emergency for homelessness and affordable housing, changes in the Mental Health and Public Health services delivery system, provide immigrant assistance services, help children and families, older adults and people with disabilities, address public assistance cost increases, promote jobs, workforce and business development, make community and equity investments, invest in information technology, invest in sustainability and energy efficiencies, provide transparency and public accountability, provide for public safety protection, and invest in the County's public assets. The County faces multiple challenges that are expected to significantly affect its fiscal outlook over the next several years, including slower growth of its locally generated revenues, expiration of hundreds of millions in COVID-19 related federal funding as well as homelessness funding, and potentially outsized legal settlements and judgments resulting from Assembly Bill (AB) 218, which allowed plaintiffs to file sexual assault lawsuits against the County that were previously time-barred. These budgetary pressures are likely to limit our ability to fund new and expanded programs in future years and will inhibit the growth that mandates CFCI funding, among other impacts. The County will continue to advocate for additional federal and State funding. The economic outlook and growth remains mostly positive from continued strength in the jobs market and consumption, which help drive modest economic growth. Conversely, the economy still faces challenges even though inflation is easing from the post-pandemic highs, federal reserve lowering interest rates and the housing market. In September 2024 and November 2024, the Federal Reserve board lowered the federal funds rate by 0.50% and 0.25% percentage points, respectively. While housing prices remain high, the easing of the interest rates should lower mortgage rates which can encourage prospective buyers to borrow and increase the homeowners' willingness to purchase a new home within their affordability. We will closely monitor key economic indicators to guide our efforts in the development of future budget recommendations that will impact the County's revenues, support the needs of County residents and advance the Board's priorities. The County’s budget outlook continues to be influenced by the fiscal condition and outlook of the State of California. The State Legislative Analyst’s Office (LAO) issued their fiscal outlook on November 20, 2024 27 COUNTY OF LOS ANGELES MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED)-Continued FOR THE YEAR ENDED JUNE 30, 2024 and reports that the State of California legislators ap proved a balanced budget for FY 2024-25 and also proactively, addressed the anticipated budget problems for FY 2025-26. The LAO reports three key challenges: 1) Revenues running ahead of the broader economy; 2) 2025-26 Budget roughly balanced; and 3) No capacity for new commitments on the State budget. Income tax revenues are being driven by the recent stock market rally, which call into question the sustainability in the absence of improvements to the State's broader economy. Although the revenue improvements are ahead of the budget estimates, this is offset by the spending increases to balance the budget. The LAO provides a cautious outlook and the State continues to face a double-digit operating deficit in the years to come. The State does not have the capacity to add new commitments, particularly ones that are ongoing. The State legislature will need to address these future deficits. Health and human services programs are subject to considerable challenges and uncertainty as the County depends on funding from the State and federal government. The results of the November 5, 2024 nationwide election will bring transition to the United States presidency and federal administration. The County receives substantial federal revenues and operates many programs which are subject to federal rules and regulations. Federal assistance is especially critical to the County's ability to operate its four County hospitals, health care and public health network and public assistance programs, including services to our immigrant population. The County will be carefully monitoring federal policy developments to determine the future impacts, if any, on its ability to administer federal programs and deliver County services that rely upon federal funding. In addition, on November 5, 2024, the voters of Los Angeles County successfully passed three ballot measures: 1) Homeless Services and Affordable Housing Ordinance (Measure A) which is estimated to generate $1.076 billion in annual sales tax revenue; 2) Consolidated Fire Protection District of Los Angeles County Emergency Response and Infrastructure Ordinance (Measure E) is estimated to generate $152 million in revenue; and 3)) Los Angeles County Government Structure, Ethics, and Accountability Charter Amendment (Measure G) with the fiscal impact not determinable. Details of the measures are further discussed in the subsequent event note 23. Obtaining Additional Information This financial report is designed to provide a general overview of the County’s finances for all interested parties. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Los Angeles County Auditor-Controller, 500 West Temple Street, Room 525, Los Angeles, CA 90012-3873. 28 BASIC FINANCIAL STATEMENTS COUNTY OF LOS ANGELES STATEMENT OF NET POSITION JUNE 30, 2024 (in thousands) PRIMARY GOVERNMENT DISCRETELY GOVERNMENTAL BUSINESS-TYPE PRESENTED ACTIVITIES ACTIVITIES TOTAL COMPONENT UNITS ASSETS Pooled cash and investments: (Notes 1 and 4) Operating $ 11,288,085 1,019,842 $ 12,307,927 $ 267,354 Other 6,488,947 38,473 6,527,420 — Total pooled cash and investments 17,777,032 1,058,315 18,835,347 267,354 Other investments (Note 4) 62,549 — 62,549 814,333 Taxes receivable 419,180 939 420,119 — Accounts receivable - net (Note 14) — 2,521,430 2,521,430 25,991 Interest receivable 71,410 4,418 75,828 1,140 Lease receivable (Note 9) 1,885,346 19,718 1,905,064 7,040 Other receivables 4,544,444 1,103,849 5,648,293 55,589 Internal balances (Note 15) (154,434) 154,434 — — Inventories 166,742 37,957 204,699 10,305 Restricted assets (Note 4) 5,119 127,708 132,827 14,470 Net pension asset — — 0 3,493 Capital assets: (Notes 1, 5, 9 and 10) Capital assets, not being depreciated 10,376,968 803,950 11,180,918 93,292 Capital assets, net of accumulated depreciation/ amortization 9,716,062 2,709,194 12,425,256 109,876 Total capital assets 20,093,030 3,513,144 23,606,174 203,168 TOTAL ASSETS 44,870,418 8,541,912 53,412,330 1,402,883 DEFERRED OUTFLOWS OF RESOURCES (Note 20) 10,817,024 1,658,774 12,475,798 33,153 LIABILITIES Accounts payable 900,669 922,873 1,823,542 79,496 Accrued payroll 642,706 123,704 766,410 — Other payables 33,257 12,423 45,680 13,834 Accrued interest payable 13,999 12,630 26,629 — Advances payable 6,361,934 1,180 6,363,114 3,652 Long-term liabilities: (Note 11) Due within one year 1,589,073 464,968 2,054,041 7,256 Due in more than one year 46,443,146 7,528,052 53,971,198 123,238 TOTAL LIABILITIES 55,984,784 9,065,830 65,050,614 227,476 DEFERRED INFLOWS OF RESOURCES (Note 20) 9,655,293 1,629,595 11,284,888 15,560 NET POSITION Net investment in capital assets 16,229,559 2,590,331 18,819,890 162,479 Restricted for: 0 Capital projects 35,808 — 35,808 — Debt service 201,214 85,492 286,706 — Permanent funds - nonspendable 2,179 — 2,179 — General government 293,753 — 293,753 — Public protection 885,937 — 885,937 — Public ways and facilities 1,081,710 — 1,081,710 — Health and sanitation 1,910,667 — 1,910,667 — Public assistance 551,382 — 551,382 Education 3,138 — 3,138 Recreation 822,618 — 822,618 — Community development — — 690,890 First 5 LA — — 274,451 Unrestricted (deficit) (31,970,600) (3,170,562) (35,141,162) 65,180 TOTAL NET POSITION (DEFICIT) (Note 3) $ (9,952,635) (494,739) $ (10,447,374) $ 1,193,000 The notes to the basic financial statements are an integral part of this statement. 29 COUNTY OF LOS ANGELES STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) PROGRAM REVENUES OPERATING CAPITAL FUNCTIONS CHARGES FOR GRANTS AND GRANTS AND PRIMARY GOVERNMENT: EXPENSES SERVICES CONTRIBUTIONS CONTRIBUTIONS Governmental activities: General government $ 1,884,559 689,191 255,612 28,005 Public protection 10,040,684 1,778,350 2,296,089 7,308 Public ways and facilities 585,307 33,822 347,057 4,665 Health and sanitation 8,032,810 2,086,480 4,883,315 18,682 Public assistance 9,426,531 13,232 7,779,377 — Education 173,303 3,625 6,034 — Recreation and cultural services 534,164 152,765 11,378 — Interest on long-term debt 178,369 — — — Total governmental activities 30,855,727 4,757,465 15,578,862 58,660 Business-type activities: Hospitals 6,215,647 5,250,557 184,346 — Waterworks 118,530 101,020 977 176 Aviation 19,951 15,751 345 150 Total business-type activities 6,354,128 5,367,328 185,668 326 Total primary government $ 37,209,855 10,124,793 15,764,530 58,986 DISCRETELY PRESENTED COMPONENT UNITS $ 1,011,529 37,580 1,006,679 9,260 GENERAL REVENUES: Taxes: Property taxes Utility users taxes Voter approved taxes Documentary transfer taxes Other taxes Sales and use taxes, levied by the State Grants and contributions not restricted to special programs Investment income Miscellaneous TRANSFERS - NET Total general revenues and transfers CHANGE IN NET POSITION NET POSITION (DEFICIT), JULY 1, 2023 NET POSITION (DEFICIT), JUNE 30, 2024 The notes to the basic financial statements are an integral part of this statement. 30 NET (EXPENSES) REVENUES AND CHANGES IN NET POSITION DISCRETELY PRESENTED COMPONENT PRIMARY GOVERNMENT UNITS GOVERNMENTAL BUSINESS-TYPE FUNCTIONS ACTIVITIES ACTIVITIES TOTAL PRIMARY GOVERNMENT: Governmental activities: $ (911,751) $ (911,751) General government (5,958,937) (5,958,937) Public protection (199,763) (199,763) Public ways and facilities (1,044,333) (1,044,333) Health and sanitation (1,633,922) (1,633,922) Public assistance (163,644) (163,644) Education (370,021) (370,021) Recreation and cultural services (178,369) (178,369) Interest on long-term debt (10,460,740) (10,460,740) Total governmental activities Business-type activities: (780,744) (780,744) Hospitals (16,357) (16,357) Waterworks (3,705) (3,705) Aviation (800,806) (800,806) Total business-type activities (10,460,740) (800,806) (11,261,546) Total primary government $ 41,990 DISCRETELY PRESENTED COMPONENT UNITS GENERAL REVENUES: Taxes: 9,341,988 9,101 9,351,089 — Property taxes 57,422 — 57,422 — Utility users taxes 557,745 — 557,745 — Voter approved taxes 76,595 — 76,595 — Documentary transfer taxes 49,437 — 49,437 — Other taxes 728,739 — 728,739 Sales and use taxes, levied by the State Grants and contributions not restricted to special 679,353 966 680,319 — programs 863,672 53,810 917,482 42,969 Investment income 253,977 303 254,280 389 Miscellaneous (1,058,209) 1,058,209 — — TRANSFERS - NET 11,550,719 1,122,389 12,673,108 43,358 Total general revenues and transfers 1,089,979 321,583 1,411,562 85,348 CHANGE IN NET POSITION (11,042,614) (816,322) (11,858,936) 1,107,652 NET POSITION (DEFICIT), JULY 1, 2023 $ (9,952,635) (494,739) $ (10,447,374) $ 1,193,000 NET POSITION (DEFICIT), JUNE 30, 2024 31 COUNTY OF LOS ANGELES BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2024 (in thousands) REGIONAL FIRE FLOOD PARK AND GENERAL PROTECTION CONTROL LA COUNTY OPEN SPACE FUND DISTRICT DISTRICT LIBRARY DISTRICT ASSETS Pooled cash and investments: (Notes 1 and 4) Operating $ 4,537,551 262,836 347,792 161,477 785,314 Other 6,382,186 15,307 3,163 4,316 3,913 Total pooled cash and investments 10,919,737 278,143 350,955 165,793 789,227 Other investments (Note 4) 2,152 — — 113 — Taxes receivable 305,769 62,148 15,941 8,941 2,083 Interest receivable 51,507 915 1,103 509 2,204 Lease receivable (Note 9) 1,846,351 34,055 Other receivables 4,140,119 49,944 3,732 2,271 1,713 Due from other funds (Note 15) 1,132,681 1,367 32,714 12,956 4 Advances to other funds (Note 15) 17,806 — 6,141 — — Inventories 142,429 12,173 1,101 8 — TOTAL ASSETS 18,558,551 404,690 445,742 190,591 795,231 DEFERRED OUTFLOWS OF RESOURCES (Note 20) — — TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES $ 18,558,551 404,690 445,742 190,591 795,231 LIABILITIES Accounts payable $ 762,224 7,351 11,266 4,089 37 Accrued payroll 555,409 56,032 — 4,921 — Other payables 27,020 2,794 — 564 — Due to other funds (Note 15) 619,244 24,358 43,902 6,278 3,225 Advances payable 6,224,093 — 75,948 — — Third party payor (Notes 11 and 14) 215,649 — — — — TOTAL LIABILITIES 8,403,639 90,535 131,116 15,852 3,262 DEFERRED INFLOWS OF RESOURCES (Note 20) 2,462,203 55,012 44,695 6,336 1,455 FUND BALANCES (Note 21) Nonspendable 293,753 12,173 1,101 8 — Restricted 88,654 246,970 268,731 88,616 790,514 Committed 1,070,313 — — — — Assigned 1,345,188 — 99 79,779 — Unassigned 4,894,801 — — — — TOTAL FUND BALANCES 7,692,709 259,143 269,931 168,403 790,514 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES $ 18,558,551 404,690 445,742 190,591 795,231 The notes to the basic financial statements are an integral part of this statement. 32 MENTAL HEALTH NONMAJOR TOTAL SERVICES GOVERNMENTAL GOVERNMENTAL ACT FUNDS FUNDS ASSETS Pooled cash and investments: (Notes 1 and 4) $ 1,896,049 3,259,160 $ 11,250,179 Operating 7,588 62,171 6,478,644 Other 1,903,637 3,321,331 17,728,823 Total pooled cash and investments — 60,284 62,549 Other investments (Note 4) — 24,298 419,180 Taxes receivable 5,954 9,079 71,271 Interest receivable 4,940 1,885,346 Lease receivable (Note 9) — 250,496 4,448,275 Other receivables — 48,136 1,227,858 Due from other funds (Note 15) — 11,307 35,254 Advances to other funds (Note 15) — 1 155,712 Inventories 1,909,591 3,729,872 26,034,268 TOTAL ASSETS — 175,088 175,088 DEFERRED OUTFLOWS OF RESOURCES (Note 20) TOTAL ASSETS AND DEFERRED OUTFLOWS OF $ 1,909,591 3,904,960 $ 26,209,356 RESOURCES LIABILITIES $ — 108,260 $ 893,227 Accounts payable — 109 616,471 Accrued payroll — — 30,378 Other payables 360,866 428,714 1,486,587 Due to other funds (Note 15) — 61,752 6,361,793 Advances payable — 246 215,895 Third party payor (Notes 11 and 14) 360,866 599,081 9,604,351 TOTAL LIABILITIES — 20,843 2,590,544 DEFERRED INFLOWS OF RESOURCES (Note 20) FUND BALANCES (Note 21) — 86,758 393,793 Nonspendable 1,548,725 2,824,551 5,856,761 Restricted — 169,772 1,240,085 Committed — 203,955 1,629,021 Assigned — — 4,894,801 Unassigned 1,548,725 3,285,036 14,014,461 TOTAL FUND BALANCES TOTAL LIABILITIES, DEFERRED INFLOWS OF $ 1,909,591 3,904,960 $ 26,209,356 RESOURCES, AND FUND BALANCES 33 COUNTY OF LOS ANGELES RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION JUNE 30, 2024 (in thousands) Fund balances - total governmental funds (page 33) $ 14,014,461 Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not reported in governmental funds: Land and easements - net $ 7,672,751 Construction in progress 2,704,891 Buildings and improvements - net 5,807,526 Equipment - net 368,691 Intangible software - net 230,350 Infrastructure - net 3,185,109 19,969,318 Deferred outflows and inflows of resources reported in the statement of net position, but not recognized in the governmental funds: Deferred outflows from losses on refunding of debt $ 6,220 Deferred outflows from OPEB 4,755,417 Deferred outflows from pension 5,598,667 Deferred inflows from gains on refunding of debt (10,595) Deferred inflows from private-public partnerships (82,577) Deferred inflows from OPEB (7,141,551) Deferred inflows from pension (222,602) 2,902,979 Deferred outflows and inflows of resources reported in the balance sheet, but not recognized in the statement of net position: Deferred outflows from tobacco settlement revenues $ (175,088) Deferred inflows from tobacco settlement revenues 175,088 Deferred inflows from property taxes 281,849 Deferred inflows from long-term receivables 248,261 530,110 Other long-term asset transactions are not available for the current period and are not recognized in governmental funds: Receivables related to capital assets 546 Installment receivables from public-private and public-public partnerships 82,577 Accrued interest payable is not recognized in governmental funds (13,658) Long-term liabilities, including bonds and notes payable, are not due and payable in the current period and, therefore, are not reported in the governmental funds: Bonds and notes $ (2,246,661) Unamortized premiums on bonds (282,828) Accreted interest on bonds (19,533) Lease liability (1,574,321) Subscription liability (83,867) Financed purchase obligations (15,572) Accrued compensated absences (2,176,141) Workers' compensation (3,223,497) Litigation and self-insurance (4,344,298) Pollution remediation obligation (55,136) Net pension liability (11,670,248) Net OPEB liability (20,390,697) Third party payor liability (133,635) (46,216,434) Assets and liabilities of internal service funds are included in governmental activities in the accompanying statement of net position. (1,222,534) Net position (deficit) of governmental activities (page 29) $ (9,952,635) The notes to the basic financial statements are an integral part of this statement. 34 35 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) REGIONAL FIRE FLOOD PARK AND GENERAL PROTECTION CONTROL LA COUNTY OPEN SPACE FUND DISTRICT DISTRICT LIBRARY DISTRICT REVENUES Taxes $ 8,022,298 1,168,396 212,445 127,085 117,108 Licenses, permits and franchises 85,169 21,112 1,779 1 — Fines, forfeitures and penalties 187,773 3,716 1,071 584 588 Revenue from use of money and property: Investment income (Note 4) 575,960 8,421 23,007 8,716 32,765 Rents and concessions (Note 9) 60,513 21 6,840 7 — Lease revenue (Note 9) 68,055 1,360 Royalties 15 — 653 — — Intergovernmental revenues: Federal 5,822,358 12,043 5,425 3,221 — State 8,802,375 11,794 7,163 3,183 — Other 40,779 2,593 1,563 149 — Charges for services 3,352,030 310,916 119,528 2,718 96 Miscellaneous 246,157 1,187 404 3,397 — TOTAL REVENUES 27,263,482 1,540,199 381,238 149,061 150,557 EXPENDITURES Current: General government 2,021,666 — — — — Public protection 7,035,302 1,530,380 462,770 — — Public ways and facilities — — — — — Health and sanitation 7,501,812 — — — — Public assistance 8,938,477 — — — — Education — — — 170,070 — Recreation and cultural services 488,624 — — — 35,766 Debt service: Principal 145,767 7,549 1,376 811 — Interest and other charges 71,855 903 56 318 — Capital outlay 192,659 1,429 — 651 — TOTAL EXPENDITURES 26,396,162 1,540,261 464,202 171,850 35,766 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES 867,320 (62) (82,964) (22,789) 114,791 OTHER FINANCING SOURCES (USES) Transfers in (Note 15) 1,354,882 55,284 — 44,913 — Transfers out (Note 15) (1,206,296) (14,079) (11,500) (23,768) — Issuance of debt (Note 11) — — — — — Sales of capital assets 1,087 134 71 1 — Leases (Notes 5 and 9) 146,917 1,429 651 Subscriptions (Notes 5 and 10) 45,742 — TOTAL OTHER FINANCING SOURCES (USES) 342,332 42,768 (11,429) 21,797 — NET CHANGE IN FUND BALANCES 1,209,652 42,706 (94,393) (992) 114,791 FUND BALANCES, JULY 1, 2023 6,483,057 216,437 364,324 169,395 675,723 FUND BALANCES, JUNE 30, 2024 $ 7,692,709 259,143 269,931 168,403 790,514 The notes to the basic financial statements are an integral part of this statement. 36 MENTAL HEALTH NONMAJOR TOTAL SERVICES GOVERNMENTAL GOVERNMENTAL ACT FUNDS FUNDS REVENUES $ 1,021,125 $ 10,668,457 Taxes — 26,127 134,188 Licenses, permits and franchises — 33,984 227,716 Fines, forfeitures and penalties Revenue from use of money and property: 75,840 137,901 862,610 Investment income (Note 4) — 46,834 114,215 Rents and concessions (Note 9) 283 69,698 Lease revenue (Note 9) — 4 672 Royalties Intergovernmental revenues: — 13,988 5,857,035 Federal 1,021,826 497,099 10,343,440 State — 15,604 60,688 Other — 439,980 4,225,268 Charges for services — 97,343 348,488 Miscellaneous 1,097,666 2,330,272 32,912,475 TOTAL REVENUES EXPENDITURES Current: — 13,045 2,034,711 General government — 302,624 9,331,076 Public protection — 551,752 551,752 Public ways and facilities — 230,668 7,732,480 Health and sanitation — 248,042 9,186,519 Public assistance — 2,047 172,117 Education — 11,658 536,048 Recreation and cultural services Debt service: — 200,018 355,521 Principal — 109,920 183,052 Interest and other charges — 82,757 277,496 Capital outlay — 1,752,531 30,360,772 TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER 1,097,666 577,741 2,551,703 EXPENDITURES OTHER FINANCING SOURCES (USES) — 230,240 1,685,319 Transfers in (Note 15) (781,814) (741,660) (2,779,117) Transfers out (Note 15) — 205,589 205,589 Issuance of debt (Note 11) — 252 1,545 Sales of capital assets 148,997 Leases (Notes 5 and 9) 45,742 Subscriptions (Notes 5 and 10) (781,814) (305,579) (691,925) TOTAL OTHER FINANCING SOURCES (USES) 315,852 272,162 1,859,778 NET CHANGE IN FUND BALANCES 1,232,873 3,012,874 12,154,683 FUND BALANCES, JULY 1, 2023 $ 1,548,725 3,285,036 $ 14,014,461 FUND BALANCES, JUNE 30, 2024 37 COUNTY OF LOS ANGELES RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Net change in fund balances - total governmental funds (page 37) $ 1,859,778 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlay as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation/amortization expense: Expenditures for general capital assets, infrastructure and other related capital asset adjustments $ 847,820 Less - current year depreciation expense (477,292) Expenditures for right-to-use lease and subscription assets 194,739 Less - current year amortization expense (177,013) 388,254 In the statement of activities, only the gain or loss on the disposal and impairment of capital assets is reported, whereas in the governmental funds, the proceeds from the sale are reported as an increase in financial resources. Thus, the change in net position differs from the change in fund balance. (22,412) Contribution of capital assets is not recognized in the governmental funds. 30,655 Amortization of gain or loss on refunding of debt are reported as interest expense in the governmental activities, but not reported for governmental funds. (1,454) Changes in unavailable revenues are reported as changes in deferred inflows of resources for governmental funds, but were recognized when earned for governmental activities. 997 Timing differences result in more or less revenues and expenses in the statement of activities. Change in accrued interest on long-term receivables $ (328) Change in unamortized premiums 6,258 5,930 Issuance of long-term debt provides resources in the governmental funds, but increases long-term liabilities in the statement of net position. (400,328) Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position: Bonds $ 64,549 Notes, loans, and lease revenue obligation notes 136,653 Other long-term notes, loans, leases and subscriptions 154,319 355,521 Some expenses reported in the accompanying statement of activities do not require (or provide) the use of current financial resources and, therefore, are not reported as expenditures in governmental funds: Change in workers' compensation $ (175,100) Change in litigation and self-insurance (612,135) Change in pollution remediation obligation (17,970) Change in accrued compensated absences (83,836) Change in net pension liability, net of related deferred outflows of resources and deferred inflows of resources (331,526) Change in net OPEB liability, net of related deferred outflows of resources and deferred inflows of resources 73,129 Change in third party payor liability 2,988 Change in accrued interest payable 452 Change in accretion of tobacco settlement bonds (5,306) Transfer of capital assets between governmental fund and enterprise fund 34,541 (1,114,763) Internal service funds that are reported with governmental activities. (12,199) Change in net position of governmental activities (page 31) $ 1,089,979 The notes to the basic financial statements are an integral part of this statement. 38 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) GENERAL FUND ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 7,853,678 7,859,100 8,025,301 166,201 Licenses, permits and franchises 70,832 81,661 85,694 4,033 Fines, forfeitures and penalties 138,706 138,842 187,773 48,931 Revenue from use of money and property: Investment income 230,021 267,855 524,189 256,334 Rents and concessions 137,083 137,893 128,042 (9,851) Royalties — — 15 15 Intergovernmental revenues: Federal 6,000,430 6,507,867 5,887,797 (620,070) State 9,521,478 9,777,171 8,791,888 (985,283) Other 52,778 69,856 29,918 (39,938) Charges for services 2,962,561 3,456,959 3,361,713 (95,246) Miscellaneous 193,090 202,750 244,963 42,213 TOTAL REVENUES 27,160,657 28,499,954 27,267,293 (1,232,661) EXPENDITURES Current: General government 3,842,441 3,821,756 1,879,693 1,942,063 Public protection 7,208,303 7,552,904 7,185,630 367,274 Health and sanitation 8,544,159 8,802,606 7,791,294 1,011,312 Public assistance 9,974,612 10,001,015 9,097,590 903,425 Recreation and cultural services 544,223 544,489 516,297 28,192 Debt service- Interest 22,701 22,701 22,701 Capital outlay 1,701,042 2,115,294 443,447 1,671,847 TOTAL EXPENDITURES 31,837,481 32,860,765 26,936,652 5,924,113 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (4,676,824) (4,360,811) 330,641 4,691,452 OTHER FINANCING SOURCES (USES) Sales of capital assets 811 811 1,087 276 Transfers in 1,844,532 2,037,414 1,346,736 (690,678) Transfers out (769,770) (1,072,368) (1,069,312) 3,056 Appropriations for contingencies (77,376) 185 — (185) Changes in fund balance (85,862) (369,720) (157,576) 212,144 TOTAL OTHER FINANCING SOURCES (USES) 912,335 596,322 120,935 (475,387) NET CHANGE IN FUND BALANCE (3,764,489) (3,764,489) 451,576 4,216,065 FUND BALANCE, JULY 1, 2023 3,764,489 3,764,489 3,764,489 FUND BALANCE, JUNE 30, 2024 (Note 16) $ 4,216,065 4,216,065 The notes to the basic financial statements are an integral part of this statement. 39 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS FIRE PROTECTION DISTRICT FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) FIRE PROTECTION DISTRICT ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 1,137,160 1,161,582 1,168,916 7,334 Licenses, permits and franchises 23,161 23,161 21,112 (2,049) Fines, forfeitures and penalties 3,231 3,231 3,716 485 Revenue from use of money and property: Investment income 824 4,945 6,543 1,598 Rents and concessions 90 90 21 (69) Intergovernmental revenues: Federal 35,780 35,982 11,969 (24,013) State 15,899 15,899 11,794 (4,105) Other — — 2,593 2,593 Charges for services 314,826 319,623 310,916 (8,707) Miscellaneous 612 612 1,187 575 TOTAL REVENUES 1,531,583 1,565,125 1,538,767 (26,358) EXPENDITURES Current-Public protection: Salaries and employee benefits 1,357,912 1,362,832 1,349,165 13,667 Services and supplies 194,517 196,396 164,703 31,693 Other charges 29,274 38,439 20,493 17,946 Capital assets 7,046 11,041 4,095 6,946 TOTAL EXPENDITURES 1,588,749 1,608,708 1,538,456 70,252 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (57,166) (43,583) 311 43,894 OTHER FINANCING SOURCES (USES) Sales of capital assets 133 133 134 1 Transfers in 51,434 57,779 55,284 (2,495) Transfers out (11,442) (11,641) (11,641) — Appropriations for contingencies (8,814) (28,543) — 28,543 Changes in fund balance (44,999) (44,999) (39,506) 5,493 TOTAL OTHER FINANCING SOURCES (USES) (13,688) (27,271) 4,271 31,542 NET CHANGE IN FUND BALANCE (70,854) (70,854) 4,582 75,436 FUND BALANCE, JULY 1, 2023 70,854 70,854 70,854 FUND BALANCE, JUNE 30, 2024 (Note 16) $ 75,436 75,436 The notes to the basic financial statements are an integral part of this statement. 40 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS FLOOD CONTROL DISTRICT FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) FLOOD CONTROL DISTRICT ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 207,355 210,588 212,522 1,934 Licenses, permits and franchises 1,542 1,542 1,779 237 Fines, forfeitures and penalties 1,171 1,171 1,071 (100) Revenue from use of money and property: Investment income 5,783 11,056 15,310 4,254 Rents and concessions 7,765 7,765 8,200 435 Royalties 625 625 653 28 Intergovernmental revenues: Federal — — 5,425 5,425 State 712 712 7,163 6,451 Other 266 266 1,563 1,297 Charges for services 119,654 119,654 119,563 (91) Miscellaneous 677 677 404 (273) TOTAL REVENUES 345,550 354,056 373,653 19,597 EXPENDITURES Current-Public protection: Services and supplies 394,367 401,867 399,255 2,612 Other charges 6,539 6,539 1,621 4,918 Capital assets 1,540 1,540 547 993 Capital outlay 51,620 36,620 33,629 2,991 TOTAL EXPENDITURES 454,066 446,566 435,052 11,514 DEFICIENCY OF REVENUES OVER EXPENDITURES (108,516) (92,510) (61,399) 31,111 OTHER FINANCING SOURCES (USES) Sales of capital assets 187 187 71 (116) Transfers in 2,000 2,000 — (2,000) Transfers out (9,819) (17,319) (11,500) 5,819 Appropriations for contingencies — (8,506) — 8,506 Changes in fund balance 47,000 47,000 63,254 16,254 TOTAL OTHER FINANCING SOURCES (USES) 39,368 23,362 51,825 28,463 NET CHANGE IN FUND BALANCE (69,148) (69,148) (9,574) 59,574 FUND BALANCE, JULY 1, 2023 69,148 69,148 69,148 FUND BALANCE, JUNE 30, 2024 (Note 16) $ 59,574 59,574 The notes to the basic financial statements are an integral part of this statement. 41 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS LA COUNTY LIBRARY FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) LA COUNTY LIBRARY ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 120,692 126,104 127,173 1,069 Licenses, permits and franchises — — 1 1 Fines, forfeitures and penalties 375 375 584 209 Revenue from use of money and property: Investment income 1,200 4,756 6,714 1,958 Rents and concessions 15 15 7 (8) Intergovernmental revenues: Federal — 2,900 3,221 321 State 3,947 3,947 3,183 (764) Other 130 130 149 19 Charges for services 1,728 1,728 2,718 990 Miscellaneous 584 584 3,397 2,813 TOTAL REVENUES 128,671 140,539 147,147 6,608 EXPENDITURES Current-Education: Salaries and employee benefits 133,117 133,117 109,783 23,334 Services and supplies 117,119 93,746 63,757 29,989 Other charges 1,913 4,513 4,214 299 Capital assets 1,094 1,094 301 793 TOTAL EXPENDITURES 253,243 232,470 178,055 54,415 DEFICIENCY OF REVENUES OVER EXPENDITURES (124,572) (91,931) (30,908) 61,023 OTHER FINANCING SOURCES (USES) Sales of capital assets 13 13 1 (12) Transfers in 52,268 51,421 44,913 (6,508) Transfers out (150) (22,976) (22,976) — Appropriations for contingencies — (8,968) — 8,968 Changes in fund balance (6,579) (6,579) (4,713) 1,866 TOTAL OTHER FINANCING SOURCES (USES) 45,552 12,911 17,225 4,314 NET CHANGE IN FUND BALANCE (79,020) (79,020) (13,683) 65,337 FUND BALANCE, JULY 1, 2023 79,020 79,020 79,020 FUND BALANCE, JUNE 30, 2024 (Note 16) $ 65,337 65,337 The notes to the basic financial statements are an integral part of this statement. 42 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS REGIONAL PARK AND OPEN SPACE DISTRICT FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) REGIONAL PARK AND OPEN SPACE DISTRICT ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 109,764 114,064 117,108 3,044 Fines, forfeitures and penalties 329 847 588 (259) Revenue from use of money and property- Investment income 3,342 3,342 30,030 26,688 Charges for services — — 161 161 TOTAL REVENUES 113,435 118,253 147,887 29,634 EXPENDITURES Current-Recreation and cultural services: Services and supplies 22,656 18,680 8,704 9,976 Other charges 529,959 156,012 51,193 104,819 TOTAL EXPENDITURES 552,615 174,692 59,897 114,795 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (439,180) (56,439) 87,990 144,429 OTHER FINANCING SOURCES (USES) Transfers in 116,951 117,469 121,561 4,092 Transfers out (116,951) (121,769) (121,561) 208 Changes in fund balance (32,310) (410,751) (408,922) 1,829 TOTAL OTHER FINANCING SOURCES (USES) (32,310) (415,051) (408,922) 6,129 NET CHANGE IN FUND BALANCE (471,490) (471,490) (320,932) 150,558 FUND BALANCE, JULY 1, 2023 471,490 471,490 471,490 FUND BALANCE, JUNE 30, 2024 (Note 16) $ — 150,558 150,558 The notes to the basic financial statements are an integral part of this statement. 43 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS MENTAL HEALTH SERVICES ACT FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) MENTAL HEALTH SERVICES ACT ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Revenue from use of money and property- Investment income $ 20,753 20,753 78,162 57,409 Intergovernmental revenues- State 1,094,934 1,094,934 1,021,826 (73,108) TOTAL REVENUES 1,115,687 1,115,687 1,099,988 (15,699) OTHER FINANCING USES Transfers out (1,080,130) (1,153,254) (781,814) 371,440 Changes in fund balance (190,627) (117,503) (117,504) (1) TOTAL OTHER FINANCING USES (1,270,757) (1,270,757) (899,318) 371,439 NET CHANGE IN FUND BALANCE (155,070) (155,070) 200,670 355,740 FUND BALANCE, JULY 1, 2023 155,070 155,070 155,070 FUND BALANCE, JUNE 30, 2024 (Note 16) $ 355,740 355,740 The notes to the basic financial statements are an integral part of this statement. 44 45 COUNTY OF LOS ANGELES STATEMENT OF NET POSITION PROPRIETARY FUNDS JUNE 30, 2024 (in thousands) BUSINESS-TYPE ACTIVITIES - Los Angeles Harbor-UCLA Olive View- General Rancho Los Medical UCLA Medical Medical Amigos National Center Center Center Rehab Center ASSETS Current assets: Pooled cash and investments: (Notes 1 and 4) Operating $ 266,061 172,855 348,888 79,510 Other 11,250 5,989 14,670 3,284 Total pooled cash and investments 277,311 178,844 363,558 82,794 Taxes receivable — — — — Accounts receivable - net (Note 14) 779,380 475,365 1,038,956 209,760 Interest receivable 1,442 485 1,641 380 Lease receivable (Note 9) Other receivables 19,166 11,517 28,183 5,277 Due from other funds (Note 15) 402,749 237,968 1,286,039 314,286 Advances to other funds (Note 15) — — — — Inventories 14,080 5,796 15,807 2,089 Total current assets 1,494,128 909,975 2,734,184 614,586 Noncurrent assets: Restricted assets (Note 4) 108,239 8,158 1,814 9,497 Lease receivable (Note 9) Other receivables 348,714 161,878 403,267 122,083 Capital assets: (Notes 1, 5, 9 and 10) Land and easements 1,671 1,894 16,194 217 Buildings and improvements, equipment, and intangible software 1,192,595 411,440 1,259,892 582,892 Infrastructure — — — — Construction in progress 490,906 — — 69,247 Lease assets 3,223 389 988 291 Subscription assets Less accumulated depreciation/amortization (418,424) (223,089) (482,704) (200,947) Total capital assets - net 1,269,971 190,634 794,370 451,700 Total noncurrent assets 1,726,924 360,670 1,199,451 583,280 TOTAL ASSETS 3,221,052 1,270,645 3,933,635 1,197,866 DEFERRED OUTFLOWS OF RESOURCES (Note 20) 504,513 277,272 704,088 172,901 LIABILITIES Current liabilities: Accounts payable 280,452 188,078 286,741 162,914 Accrued payroll 39,044 21,453 52,859 10,348 Other payables 4,638 2,291 4,139 1,295 Accrued interest payable 10,006 1,888 43 679 Due to other funds (Note 15) 428,084 254,239 1,030,673 352,553 Advances from other funds (Note 15) 4,735 2,554 6,401 1,265 Advances payable 612 101 442 1 Current portion of long-term liabilities (Note 11) 300,518 34,923 86,422 42,369 Total current liabilities 1,068,089 505,527 1,467,720 571,424 Noncurrent liabilities: Accrued compensated absences (Note 11) 95,399 52,870 117,848 22,495 Bonds and notes (Note 11) 456,048 71,612 14,872 207,692 Lease liability (Note 9 and 11) 1,499 148 411 108 Workers' compensation (Notes 11 and 18) 113,651 46,405 171,145 33,077 Litigation and self-insurance (Notes 11 and 18) 761 162 5,210 — Net pension liability (Notes 7 and 11) 596,627 336,909 808,414 182,508 Net OPEB liability (Notes 8 and 11) 1,126,856 629,593 1,658,832 362,570 Third party payor (Notes 11 and 14) 108,561 64,524 208,750 23,100 Total noncurrent liabilities 2,499,402 1,202,223 2,985,482 831,550 TOTAL LIABILITIES 3,567,491 1,707,750 4,453,202 1,402,974 DEFERRED INFLOWS OF RESOURCES (Note 20) 452,057 325,944 689,290 142,586 NET POSITION Net investment in capital assets 670,003 121,093 779,366 222,987 Restricted - Debt service 37,153 563 2,739 45,037 Unrestricted (deficit) (1,001,139) (607,433) (1,286,874) (442,817) TOTAL NET POSITION (DEFICIT) (Note 3) $ (293,983) (485,777) (504,769) (174,793) The notes to the basic financial statements are an integral part of this statement. 46 GOVERNMENTAL ENTERPRISE FUNDS ACTIVITIES Internal Nonmajor Service Waterworks Aviation Total Funds ASSETS Current assets: Pooled cash and investments: (Notes 1 and 4) $ 140,316 12,212 $ 1,019,842 $ 37,906 Operating 3,093 187 38,473 10,303 Other 143,409 12,399 1,058,315 48,209 Total pooled cash and investments 939 — 939 Taxes receivable 17,183 786 2,521,430 Accounts receivable - net (Note 14) 432 38 4,418 139 Interest receivable 862 862 Lease receivable (Note 9) 3,764 — 67,907 13,046 Other receivables 2,584 340 2,243,966 146,552 Due from other funds (Note 15) 1,444 257 1,701 Advances to other funds (Note 15) — 185 37,957 11,030 Inventories 169,755 14,867 5,937,495 218,976 Total current assets Noncurrent assets: — — 127,708 5,119 Restricted assets (Note 4) 18,856 18,856 Lease receivable (Note 9) — 1,035,942 Other receivables Capital assets: (Notes 1, 5, 9 and 10) 13,682 134,692 168,350 — Land and easements 124,527 43,818 3,615,164 281,800 Buildings and improvements, equipment, and intangible software 1,228,087 96,755 1,324,842 — Infrastructure 75,318 129 635,600 — Construction in progress — 4,891 1,224 Lease assets 613 Subscription assets (824,368) (86,171) (2,235,703) (159,925) Less accumulated depreciation/amortization 617,246 189,223 3,513,144 123,712 Total capital assets - net 617,246 208,079 4,695,650 128,831 Total noncurrent assets 787,001 222,946 10,633,145 347,807 TOTAL ASSETS — — 1,658,774 456,720 DEFERRED OUTFLOWS OF RESOURCES (Note 20) LIABILITIES Current liabilities: 4,338 350 922,873 7,442 Accounts payable — 123,704 26,235 Accrued payroll — 60 12,423 2,879 Other payables — 14 12,630 341 Accrued interest payable 9,799 930 2,076,278 55,511 Due to other funds (Note 15) — 14,955 22,000 Advances from other funds (Note 15) 24 — 1,180 141 Advances payable 616 120 464,968 18,658 Current portion of long-term liabilities (Note 11) 14,777 1,474 3,629,011 133,207 Total current liabilities Noncurrent liabilities: — — 288,612 76,428 Accrued compensated absences (Note 11) 8,201 944 759,369 10,000 Bonds and notes (Note 11) — 2,166 301 Lease liability (Note 9 and 11) — 364,278 58,123 Workers' compensation (Notes 11 and 18) 250 — 6,383 — Litigation and self-insurance (Notes 11 and 18) — 1,924,458 479,257 Net pension liability (Notes 7 and 11) — 3,777,851 957,123 Net OPEB liability (Notes 8 and 11) — 404,935 Third party payor (Notes 11 and 14) 8,451 944 7,528,052 1,581,232 Total noncurrent liabilities 23,228 2,418 11,157,063 1,714,439 TOTAL LIABILITIES — 19,718 1,629,595 312,622 DEFERRED INFLOWS OF RESOURCES (Note 20) NET POSITION 608,723 188,159 2,590,331 113,223 Net investment in capital assets — — 85,492 — Restricted - Debt service 155,050 12,651 (3,170,562) (1,335,757) Unrestricted (deficit) $ 763,773 200,810 $ (494,739) $ (1,222,534) TOTAL NET POSITION (DEFICIT) (Note 3) 47 COUNTY OF LOS ANGELES STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) BUSINESS-TYPE ACTIVITIES - Los Angeles Harbor-UCLA Olive View- General Rancho Los Medical UCLA Medical Medical Amigos National Center Center Center Rehab Center OPERATING REVENUES: Net patient service revenues (Note 14) $ 1,802,919 886,032 2,122,344 439,262 Charges for services — — — — Other (Note 14) 65,503 26,656 86,484 7,181 TOTAL OPERATING REVENUES 1,868,422 912,688 2,208,828 446,443 OPERATING EXPENSES: Salaries and employee benefits 905,707 476,263 1,177,603 240,262 Services and supplies 296,927 130,818 343,794 53,412 Other professional services 408,347 213,381 570,478 82,818 Depreciation and amortization (Note 5) 30,874 12,782 32,292 18,913 TOTAL OPERATING EXPENSES 1,641,855 833,244 2,124,167 395,405 OPERATING INCOME (LOSS) 226,567 79,444 84,661 51,038 NONOPERATING REVENUES (EXPENSES): Taxes — — — — Investment income 24,768 1,824 9,547 9,177 Gain (loss) on disposal of property (633) (19,045) (19,201) (15,566) Interest revenue Interest expense (34,811) (5,420) (584) (11,935) Intergovernmental transfers expense (Note 14) (362,770) (191,349) (440,566) (173,541) Intergovernmental revenues: State — — — — Federal — — — — Other — — — — TOTAL NONOPERATING REVENUES (EXPENSES) (373,446) (213,990) (450,804) (191,865) INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS (146,879) (134,546) (366,143) (140,827) Capital contributions 2,774 2,476 13,005 20 Transfers in (Note 15) 464,569 287,346 1,099,473 226,508 Transfers out (Note 15) (262,987) (56,329) (421,589) (244,029) CHANGE IN NET POSITION 57,477 98,947 324,746 (158,328) NET POSITION (DEFICIT), JULY 1, 2023 (351,460) (584,724) (829,515) (16,465) NET POSITION (DEFICIT), JUNE 30, 2024 $ (293,983) (485,777) (504,769) (174,793) The notes to the basic financial statements are an integral part of this statement. 48 GOVERNMENTAL ENTERPRISE FUNDS ACTIVITIES Internal Nonmajor Service Waterworks Aviation Total Funds OPERATING REVENUES: $ $ 5,250,557 $ Net patient service revenues (Note 14) 101,020 4,478 105,498 788,999 Charges for services 263 191 186,278 Other (Note 14) 101,283 4,669 5,542,333 788,999 TOTAL OPERATING REVENUES OPERATING EXPENSES: — 2,799,835 632,489 Salaries and employee benefits 90,872 14,461 930,284 62,498 Services and supplies 3,669 2,119 1,280,812 92,337 Other professional services 23,822 3,337 122,020 20,052 Depreciation and amortization (Note 5) 118,363 19,917 5,132,951 807,376 TOTAL OPERATING EXPENSES (17,080) (15,248) 409,382 (18,377) OPERATING INCOME (LOSS) NONOPERATING REVENUES (EXPENSES): 9,101 — 9,101 Taxes 7,794 700 53,810 1,390 Investment income — (54,445) 686 Gain (loss) on disposal of property 11,273 11,273 3,569 Interest revenue (167) (34) (52,951) (515) Interest expense — (1,168,226) Intergovernmental transfers expense (Note 14) Intergovernmental revenues: 817 40 857 State 191 305 496 — Federal 935 — 935 Other 18,671 12,284 (1,199,150) 5,130 TOTAL NONOPERATING REVENUES (EXPENSES) 1,591 (2,964) (789,768) (13,247) INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS 176 150 18,601 Capital contributions — — 2,077,896 4,857 Transfers in (Note 15) (198) (14) (985,146) (3,809) Transfers out (Note 15) 1,569 (2,828) 321,583 (12,199) CHANGE IN NET POSITION 762,204 203,638 (816,322) (1,210,335) NET POSITION (DEFICIT), JULY 1, 2023 $ 763,773 200,810 $ (494,739) $ (1,222,534) NET POSITION (DEFICIT), JUNE 30, 2024 49 COUNTY OF LOS ANGELES STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) BUSINESS-TYPE ACTIVITIES - Los Angeles Harbor-UCLA Olive View- General Rancho Los Medical UCLA Medical Medical Amigos National Center Center Center Rehab Center CASH FLOWS FROM OPERATING ACTIVITIES Cash received from patient services $ 1,475,232 776,581 1,435,353 226,509 Cash received from charges for services Other operating revenues 65,503 26,656 86,484 7,181 Cash received for services provided to other funds 99,399 82,391 135,515 542 Cash paid for salaries and employee benefits (906,938) (492,801) (1,176,517) (239,497) Cash (paid) returned for services and supplies 85,135 24,613 127,347 112,801 Other operating expenses (409,264) (222,816) (577,479) (83,167) Cash (paid) returned for services from other funds (52,992) (121,699) 202,200 176,902 Net cash provided by (required for) operating activities 356,075 72,925 232,903 201,271 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Cash advances received from other funds 4,690 — 113,287 — Cash advances paid to other funds (4,691) (25) (113,304) (2) Intergovernmental transfers paid (362,770) (191,349) (440,566) (173,541) Intergovernmental receipts — — — — Transfers in 280,151 287,346 788,534 118,380 Transfers out (262,987) (56,329) (421,589) (244,029) Net cash provided by (required for) noncapital financing activities (345,607) 39,643 (73,638) (299,192) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from taxes Capital contributions — — — — Proceeds from bonds and notes 223,508 3,298 1,057 26,525 Interest paid on capital borrowing (35,720) (5,517) (621) (12,351) Interest revenue Principal payments on bonds and notes (92,430) (12,306) (1,919) (29,550) Leases paid (1,010) (76) (203) (55) Subscriptions paid Acquisition and construction of capital assets (255,795) (17,074) (12,594) (3,203) Net cash required for capital and related financing activities (161,447) (31,675) (14,280) (18,634) CASH FLOWS FROM INVESTING ACTIVITIES Investment income 25,077 1,701 8,310 8,939 Net increase (decrease) in cash and cash equivalents (125,902) 82,594 153,295 (107,616) Cash and cash equivalents, July 1, 2023 511,452 104,408 212,077 199,907 Cash and cash equivalents, June 30, 2024 $ 385,550 187,002 365,372 92,291 The notes to the basic financial statements are an integral part of this statement. 50 GOVERNMENTAL ENTERPRISE FUNDS ACTIVITIES Internal Nonmajor Service Waterworks Aviation Total Funds CASH FLOWS FROM OPERATING ACTIVITIES $ $ 3,913,675 $ Cash received from patient services 99,992 4,542 104,534 72,286 Cash received from charges for services 263 191 186,278 Other operating revenues 317,847 693,618 Cash received for services provided to other funds — (2,815,753) (614,855) Cash paid for salaries and employee benefits (97,811) (15,185) 236,900 (64,958) Cash (paid) returned for services and supplies (3,762) (2,119) (1,298,607) (92,337) Other operating expenses — 204,411 Cash (paid) returned for services from other funds (1,318) (12,571) 849,285 (6,246) Net cash provided by (required for) operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES — 15 117,992 — Cash advances received from other funds (184) — (118,206) (19) Cash advances paid to other funds (1,168,226) Intergovernmental transfers paid 1,943 345 2,288 — Intergovernmental receipts — — 1,474,411 4,857 Transfers in (198) (14) (985,146) (3,809) Transfers out 1,561 346 (676,887) 1,029 Net cash provided by (required for) noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES 9,026 — 9,026 Proceeds from taxes — 150 150 Capital contributions 381 — 254,769 10,000 Proceeds from bonds and notes (167) (36) (54,412) (190) Interest paid on capital borrowing — 3,569 Interest revenue (534) (116) (136,855) — Principal payments on bonds and notes (1,344) (252) Leases paid — (224) Subscriptions paid (20,133) (28) (308,827) (24,405) Acquisition and construction of capital assets (11,427) (30) (237,493) (11,502) Net cash required for capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES 7,697 11,959 63,683 1,409 Investment income (3,487) (296) (1,412) (15,310) Net increase (decrease) in cash and cash equivalents 146,896 12,695 1,187,435 68,638 Cash and cash equivalents, July 1, 2023 $ 143,409 12,399 $ 1,186,023 $ 53,328 Cash and cash equivalents, June 30, 2024 Continued… 51 COUNTY OF LOS ANGELES STATEMENT OF CASH FLOWS - Continued PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) BUSINESS-TYPE ACTIVITIES - Los Angeles Harbor-UCLA Olive View- General Rancho Los Medical UCLA Medical Medical Amigos National Center Center Center Rehab Center RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (REQUIRED FOR) OPERATING ACTIVITIES: Operating income (loss) $ 226,567 79,444 84,661 51,038 Adjustments to reconcile operating income (loss) to net cash provided by (required for) operating activities: Depreciation and amortization 30,874 12,782 32,292 18,913 (Increase) decrease in: Accounts receivable - net 25,496 (13,084) 18,399 15,451 Other receivables (141,516) 36,810 (95,467) (99,734) Due from other funds (86,826) (53,958) (505,065) (127,902) Inventories (1,204) 1,016 404 (147) Increase (decrease) in: Accounts payable 28,947 (28,381) 19,616 85,907 Accrued payroll 2,169 1,633 5,383 580 Other payables (174) (70) (117) (54) Accrued compensated absences 6,223 4,011 10,174 577 Due to other funds 301,327 61,097 653,321 257,355 Advances payable (36) Workers' compensation 2,282 1,699 4,644 1,063 Litigation and self-insurance (4,979) (9,435) (7,001) (349) Net pension liability and related changes in deferred outflows and inflows of resources 13,515 4,328 18,078 4,553 Net OPEB liability and related changes in deferred outflows and inflows of resources (20,186) (27,393) (35,464) (5,589) Third party payor (26,404) 2,426 29,045 (391) TOTAL ADJUSTMENTS 129,508 (6,519) 148,242 150,233 NET CASH PROVIDED BY (REQUIRED FOR) OPERATING ACTIVITIES $ 356,075 72,925 232,903 201,271 SCHEDULE OF NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES: Contributions of capital assets $ 2,774 2,476 13,005 20 Loss on disposal of capital assets (633) (19,045) (19,201) (15,566) RECONCILIATION OF CASH AND CASH EQUIVALENTS TO THE STATEMENT OF NET POSITION: Pooled cash and investments $ 277,311 178,844 363,558 82,794 Restricted assets 108,239 8,158 1,814 9,497 TOTAL $ 385,550 187,002 365,372 92,291 The notes to the basic financial statements are an integral part of this statement. 52 GOVERNMENTAL ENTERPRISE FUNDS ACTIVITIES Internal Nonmajor Service Waterworks Aviation Total Funds RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (REQUIRED FOR) OPERATING ACTIVITIES: $ (17,080) (15,248) $ 409,382 $ (18,377) Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by (required for) operating activities: 23,822 3,337 122,020 20,052 Depreciation and amortization (Increase) decrease in: (518) 112 45,856 Accounts receivable - net 1 1 (299,905) (1,509) Other receivables (511) (49) (774,311) (22,825) Due from other funds — 350 419 (648) Inventories Increase (decrease) in: (162) (829) 105,098 (1,586) Accounts payable 9,765 1,044 Accrued payroll — 2 (413) (173) Other payables — 20,985 492 Accrued compensated absences (6,777) (247) 1,266,076 (226) Due to other funds — (36) — Advances payable 9,688 1,834 Workers' compensation (93) (21,857) Litigation and self-insurance Net pension liability and related changes in deferred outflows and — 40,474 14,504 inflows of resources Net OPEB liability and related changes in deferred outflows and (88,632) 1,172 inflows of resources 4,676 — Third party payor 15,762 2,677 439,903 12,131 TOTAL ADJUSTMENTS $ (1,318) (12,571) $ 849,285 $ (6,246) NET CASH PROVIDED BY (REQUIRED FOR) OPERATING ACTIVITIES SCHEDULE OF NONCASH INVESTING, CAPITAL AND FINANCING ACTIVITIES: $ 176 — $ 18,451 Contributions of capital assets — (54,445) Loss on disposal of capital assets RECONCILIATION OF CASH AND CASH EQUIVALENTS TO THE STATEMENT OF NET POSITION: $ 143,409 12,399 $ 1,058,315 $ 48,209 Pooled cash and investments 127,708 5,119 Restricted assets $ 143,409 12,399 $ 1,186,023 $ 53,328 TOTAL 53 COUNTY OF LOS ANGELES STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS JUNE 30, 2024 (in thousands) CUSTODIAL PENSION AND OTHER EXTERNAL POSTEMPLOYMENT INVESTMENT INVESTMENT OTHER BENEFIT TRUST TRUST POOLS CUSTODIAL ASSETS Pooled cash and investments (Note 4) $ 142,381 381,747 35,688,450 1,573,731 Other investments: (Note 4) — 225,653 309 Short-term investments 3,323,894 Equity 31,569,333 — Fixed income 21,590,994 — Private equity 13,075,366 — Real estate 4,409,040 — Real assets 3,376,031 Hedge funds 4,875,300 — Cash collateral on loaned securities 2,359,153 — Taxes receivable 1,043,734 Interest receivable 213,238 855 87,704 Other receivables 1,321,950 — 475,339 Due from other governments 647 TOTAL ASSETS 86,256,680 382,602 36,001,807 3,093,760 LIABILITIES Accounts payable 623,751 3,570 Other payables (Note 4) 2,452,833 — 1,078,765 Due to other governments — 81,603 TOTAL LIABILITIES 3,076,584 — — 1,163,938 NET POSITION Restricted for: Pension 79,202,225 OPEB 3,977,871 Individuals, organizations and other governments 382,602 36,001,807 1,929,822 TOTAL NET POSITION $ 83,180,096 382,602 36,001,807 1,929,822 The notes to the basic financial statements are an integral part of this statement. 54 COUNTY OF LOS ANGELES STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) CUSTODIAL PENSION AND OTHER EXTERNAL POSTEMPLOYMENT INVESTMENT INVESTMENT OTHER BENEFIT TRUST TRUST POOLS CUSTODIAL ADDITIONS Contributions: Pension and OPEB trust contributions: Employer $ 3,825,199 Member 911,297 Contributions to investment trust and custodial funds — 79,551 67,732,030 28,140,496 Total contributions 4,736,496 79,551 67,732,030 28,140,496 Investment earnings: Investment income 4,080,689 24,449 1,391,530 Net increase in the fair value of investments 3,069,544 Securities lending income (Note 4) 134,663 Total investment earnings 7,284,896 24,449 1,391,530 — Less - Investment expenses: Expense from investing activities 187,953 Expense from securities lending activities (Note 4) 116,548 Total net investment expense 304,501 — — — Net investment earnings 6,980,395 24,449 1,391,530 — Other additions 3,005,594 Miscellaneous 5,334 TOTAL ADDITIONS 11,722,225 104,000 69,123,560 31,146,090 DEDUCTIONS Administrative expenses: Salaries and employee benefits 84,481 Services and supplies 35,224 Total administrative expenses 119,705 — — Benefit payments 5,322,157 Distributions from investment trust and custodial funds — 225,669 66,023,866 28,116,639 Other deductions 2,915,317 Miscellaneous 43,993 TOTAL DEDUCTIONS 5,485,855 225,669 66,023,866 31,031,956 CHANGE IN NET POSITION 6,236,370 (121,669) 3,099,694 114,134 NET POSITION, JULY 1, 2023 76,943,726 504,271 32,902,113 1,815,688 NET POSITION, JUNE 30, 2024 $ 83,180,096 382,602 36,001,807 1,929,822 The notes to the basic financial statements are an integral part of this statement. 55 COUNTY OF LOS ANGELES STATEMENT OF NET POSITION DISCRETELY PRESENTED COMPONENT UNITS JUNE 30, 2024 (in thousands) LOS ANGELES COUNTY DEVELOPMENT AUTHORITY FIRST 5 LA TOTAL ASSETS Pooled cash and investments- Operating (Notes 1 and 4) $ 124,060 143,294 $ 267,354 Other investments (Note 4) 680,517 133,816 814,333 Accounts receivable - net 25,991 — 25,991 Interest receivable — 1,140 1,140 Lease receivable 7,040 — 7,040 Other receivables 44,009 11,580 55,589 Inventories 10,305 — 10,305 Restricted assets (Note 4) 14,470 — 14,470 Net pension asset 3,493 — 3,493 Capital assets: (Notes 1 and 5) Capital assets, not being depreciated/amortized 91,253 2,039 93,292 Capital assets, net of accumulated depreciation/amortization 98,643 11,233 109,876 Total capital assets 189,896 13,272 203,168 TOTAL ASSETS 1,099,781 303,102 1,402,883 DEFERRED OUTFLOWS OF RESOURCES 33,153 — 33,153 LIABILITIES Accounts payable 65,091 14,405 79,496 Other payables 13,834 — 13,834 Advances payable 3,652 — 3,652 Long-term liabilities: (Note 11) Due within one year 7,108 148 7,256 Due in more than one year 122,412 826 123,238 TOTAL LIABILITIES 212,097 15,379 227,476 DEFERRED INFLOWS OF RESOURCES 15,560 — 15,560 NET POSITION Net investment in capital assets 149,207 13,272 162,479 Restricted for: Community development 690,890 — 690,890 First 5 LA — 274,451 274,451 Unrestricted 65,180 — 65,180 TOTAL NET POSITION $ 905,277 287,723 $ 1,193,000 The notes to the basic financial statements are an integral part of this statement. 56 COUNTY OF LOS ANGELES STATEMENT OF ACTIVITIES DISCRETELY PRESENTED COMPONENT UNITS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) LOS ANGELES COUNTY DEVELOPMENT AUTHORITY FIRST 5 LA TOTAL PROGRAM (EXPENSES) REVENUES: Expenses $ (924,729) (86,800) $ (1,011,529) Program revenues: Charges for services 37,580 — 37,580 Operating grants and contributions 941,033 65,646 1,006,679 Capital grants and contributions 9,260 — 9,260 Net program (expenses) revenues 63,144 (21,154) 41,990 GENERAL REVENUES: Investment income 26,199 16,770 42,969 Miscellaneous 389 — 389 Total general revenues 26,588 16,770 43,358 CHANGE IN NET POSITION 89,732 (4,384) 85,348 NET POSITION, JULY 1, 2023 815,545 292,107 1,107,652 NET POSITION, JUNE 30, 2024 $ 905,277 287,723 $ 1,193,000 The notes to the basic financial statements are an integral part of this statement. 57 58 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The County of Los Angeles (County), which was established in 1850, is a legal subdivision of the State of California (State) charged with general governmental powers. The County's powers are exercised through an elected five member Board of Supervisors (Board), which, as the governing body of the County, is responsible for the legislative and executive control of the County. As required by generally accepted accounting principles (GAAP), these basic financial statements include both those of the County and its component units. The component units discussed below are included in the County’s reporting entity because of the significance of their operational or financial relationships with the County. The basic financial statements include blended, fiduciary and discretely presented component units. The blended component units, although legally separate entities are, in substance, part of the County’s operations. The data from these units are combined with data of the primary government. The fiduciary component unit is reported under Fiduciary Funds in the basic financial statements. The discretely presented component units, on the other hand, are reported in a separate column in the government-wide financial statements. Blended Component Units While each of the component units is legally separate from the County, the County is financially accountable for these entities. Financial accountability is primarily demonstrated by the County’s Board acting as the governing board for each of the component units and its ability to impose its will or an existence of a financial benefit/burden relationship. County management has determined that the following related entities should be included in the basic financial statements as blended component units: Fire Protection District Waterworks Districts Flood Control District Los Angeles County Capital Asset Leasing Garbage Disposal Districts Corporation (a Not-for-Profit Corporation) (NPC) Improvement Districts Various Joint Powers Authorities (JPAs) Regional Park and Open Space District Los Angeles County Securitization Corporation Sewer Maintenance Districts (LACSC) Street Lighting Districts Los Angeles County Facilities Inc. (LACF) The various districts are included primarily because the Board is also their governing board and the County has operational responsibilities for the districts. As such, the Board establishes policy, appoints management and exercises budgetary control. The NPC and JPAs have been included because their sole purpose is to finance and construct County capital assets and because they are dependent upon the County for funding. The Los Angeles County Capital Asset Leasing Corporation (LACCAL) is organized as a not-for- profit corporation in which the primary government is the sole corporate member, as identified in LACCAL's articles of incorporation or bylaws, and the component unit is included in the financial reporting entity. 59 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Blended Component Units-Continued The LACSC is a California public benefit corporation created by the County Board in January 2006. Three directors, the County’s Auditor-Controller, Treasurer and Tax Collector, and an independent party designated by at least one of the County directors, govern the LACSC. The LACSC purpose is to acquire the County’s rights in relation to future tobacco settlement payments and to facilitate the issuance of long-term bonds secured by the County Tobacco Assets. The LACSC provides service solely to the County and is reported as a blended component unit of the County. LACF is a California nonprofit public benefit corporation and an organization described under Section 501(c)(3) of the Internal Revenue Code of 1986. It was formed on April 25, 2016. On July 26, 2018, LACF issued $302.38 million of lease revenue bonds to be used to finance the construction of the Vermont Corridor County Administration Building and parking structure. LACF is reported as a blended component unit because it provides services solely to the County and it is fiscally dependent on the County. It is reported under Public Buildings Debt Service and Capital Projects funds. Fiduciary Component Unit The County pension plan is administered by the Los Angeles County Employees Retirement Association (LACERA), which was established under the County Employees' Retirement Law of 1937 (CERL). LACERA is a cost-sharing, multi-employer defined benefit plan. LACERA provides retirement, disability, death benefits and cost of living adjustments to eligible members. LACERA also administers an agent multiple-employer Other Postemployment Benefit (OPEB) or Retiree Healthcare Program on behalf of the County. LACERA is reported in the Pension and OPEB Trust Funds on the Statement of Net Position - Fiduciary Funds of the basic financial statements and has been included because its operations are dependent upon County funding and because its operations, almost exclusively, benefit the County. LACERA issues a stand-alone financial report, which is available at its offices located at Gateway Plaza, 300 N. Lake Avenue, Pasadena, California 91101-4199 or at www.LACERA.com. Discretely Presented Component Units Los Angeles County Development Authority The Los Angeles County Development Authority (LACDA) was established on July 1, 1982 under the provisions of Section 34100-34160 of the Health and Safety Code of the State of California. LACDA is responsible for: • Administering the Housing Choice Voucher and other Section 8 programs; • Directing the County’s housing programs, including planning, housing finance, production and conservation, and management of the County’s public housing developments; • Financing community improvements such as resurfacing streets and rehabilitating homes and businesses; • Providing economic development, business revitalization services, and comprehensive planning systems for affordable housing; and • Developing housing, business, and industry in designated areas. 60 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Discretely Presented Component Units-Continued Los Angeles County Development Authority-Continued While its Board members are the same as the County Board, LACDA does not meet the criteria for blending due to the following: 1) there is no financial burden or benefit relationship with the County nor does management of the County have operational responsibilities over it; 2) LACDA does not provide services entirely or almost entirely to the County; and 3) LACDA's total debt outstanding is not expected to be repaid with resources of the County. The financial activity of LACDA is reported within the Discretely Presented Component Units column of the government-wide financial statements. LACDA issues a separate financial report that can be obtained at https://www.lacda.org/ home/about/agency-overview or by writing to the Los Angeles County Development Authority at 700 W. Main Street, Alhambra, California 91801. Los Angeles County Children and Families First - Proposition 10 Commission Los Angeles County Children and Families First - Proposition 10 Commission, also known as First 5 LA, was established by the County as a separate legal entity to administer the County's share of tobacco taxes levied by the State pursuant to Proposition 10. The Board established First 5 LA with nine voting members and four non-voting representatives. Of the nine voting members, one is a member of the Board of Supervisors, three are heads of County Departments (Public Health, Mental Health, and Children and Family Services), and five are public members appointed by the Board. The non-voting representatives are from other County commissions and planning groups. First 5 LA services support programs and services for children ages prenatal through five, and their families, in the areas of health, safety, early education and literacy. First 5 LA is a discretely presented component unit of the County because the County’s Board appoints the voting Commissioners and the County has the ability to impose its will by removing those Commissioners at will. First 5 LA hires its own employees, including an Executive Director and functions independent of the County. It is discretely presented because its governing body is not substantially the same as the County's governing body and it does not provide services entirely or exclusively to the County. The financial activity of First 5 LA is reported within the Discretely Presented Component Units column of the government-wide financial statements. First 5 LA issues a separate financial report that can be obtained at www.first5la.org/our-board/financials or by writing to First 5 LA at 750 N. Alameda Street, Suite 300, Los Angeles, California 90012. Related Organization Los Angeles County Office of Education (LACOE) is a legally separate entity from the County. LACOE is governed by a seven-member Board of Education appointed by the County Board. However, the County’s accountability for LACOE does not extend beyond making appointments and no financial benefit/burden relationship exists between the County and LACOE. LACOE is deemed to be a related organization. LACOE issues a separate financial report that can be obtained by writing to the Los Angeles County Office of Education at 9300 Imperial Highway, Downey, California 90242-2890. 61 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Basic Financial Statements In accordance with Governmental Accounting Standards Board Statement (GASB) 34, "Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments," the basic financial statements consist of the following: • Government-wide financial statements; • Fund financial statements; and • Notes to the basic financial statements. Government-wide Financial Statements The statement of net position and statement of activities display information about the primary government, the County, and its blended and discretely presented component units. These statements include the financial activities of the overall government, except for fiduciary activities. Eliminations have been made to minimize the double counting of internal activities, except for services provided among funds (other than internal service funds). These statements distinguish between the governmental and business-type activities of the County and between the County and its discretely presented component units. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees charged to external parties. The statement of activities presents a comparison between direct expenses and program revenues for each segment of the business-type activities of the County and for each function of the County’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 charges paid by the recipients of goods or services offered by the programs. Grants and contributions that are restricted to meeting the operational or capital requirements of a particular program are also recognized as program revenues. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues. Net position is classified into the following three components: 1) net investment in capital assets; 2) restricted; and 3) unrestricted. Net position is reported as restricted when it has external restrictions imposed by creditors, grantors, or laws or regulations of other governments and restrictions imposed by law through constitutional provisions or enabling legislation. At June 30, 2024, the restricted net position balances were $5.788 billion and $85.49 million for governmental activities and business- type activities, respectively. For governmental activities, $1.144 billion was restricted by enabling legislation. When both the restricted and unrestricted components of net position are available, restricted resources are used first and then unrestricted resources are used to the extent necessary. 62 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Fund Financial Statements The fund financial statements provide information about the County’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 governmental and enterprise funds, each displayed in a separate column. All remaining governmental and enterprise funds are separately aggregated and reported as nonmajor funds. In accordance with GAAP, the County reports on each major fund. By definition, the General Fund is always considered a major fund. Funds other than the General Fund must be reported as major funds if they meet both the ten percent and five percent criterion, defined respectively, 1) an individual fund reports at least ten percent of any of the following: a) total fund assets and deferred outflows of resources, b) total fund liabilities and deferred inflows of resources, c) total fund revenues, or d) total fund expenditures/expenses; 2) an individual fund reports at least five percent of the aggregated total for both governmental funds and enterprise funds of any one of the items for which it met the ten percent criterion. In addition, a fund may be reported as major if it is believed to be of particular importance to financial statement users. The County reports the following major governmental funds: General Fund The General Fund is available for any authorized purpose and is used to account for and report all financial resources not accounted for and reported in another fund. Fire Protection District The Fire Protection District Fund is used to account for fire prevention and suppression, rescue service, management of hazardous materials incidents, ocean lifeguard services, and acquisition and maintenance of the Fire Protection District property and equipment. Funding comes primarily from the Fire Protection District’s statutory share of the Countywide tax levy, voter-approved taxes and charges for services. Flood Control District The Flood Control District Fund provides flood protection services that incorporate an integrated water resource management approach in providing flood protection; increases local water availability through conservation efforts; increases stormwater capture and reduces stormwater and urban runoff pollution; and provides passive recreational opportunities. The primary sources of revenue for the Flood Control District are property taxes and benefit assessments (charges for services). LA County Library The LA County Library Fund is used to account for free library services to the unincorporated areas of the County and to cities that contract for these services. Funding comes primarily from the Library’s statutory share of the Countywide tax levy and voter-approved taxes. Regional Park and Open Space District The Regional Park and Open Space District Fund is used to account for the programs designed to preserve beaches, parks, and wild lands, to acquire and renovate new and existing recreational facilities, and to restore rivers, streams, and trails in the County. Funding comes primarily from voter-approved special taxes. 63 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Fund Financial Statements-Continued Mental Health Services Act The Mental Health Services Act (MHSA) Fund is used to account for the County's mental health delivery system for children, transition age youth, adults, older adults, and families. Revenues are derived primarily by the passage of State Proposition 63 in November 2004. Proposition 63 generates mental health revenue through a one percent income surcharge on individuals with State taxable incomes over $1.00 million. The County's four Hospital Funds and Waterworks Fund are all considered major funds for presentation purposes. There is one nonmajor enterprise fund (Aviation Fund). The Hospital Enterprise funds provide health services to County residents. Revenues are principally patient service fees. Subsidies are also received from the General Fund. The Waterworks Enterprise Fund provides water services to County residents. Revenues are derived primarily from the sale of water and water service standby charges. The Aviation Enterprise Fund provides airport services for five County airports. Revenues are derived primarily from airport charges and lease payments. A description of each enterprise fund is provided below: Harbor-UCLA Medical Center The Harbor-UCLA Medical Center (H-UCLA) provides acute and intensive care unit medical/ surgical inpatient and outpatient services, trauma and emergency room services, acute psychiatric services, pediatric and obstetric services, and transplants. Olive View-UCLA Medical Center The Olive View-UCLA Medical Center (OV-UCLA) provides acute and intensive care, emergency services, medical/surgical inpatient and outpatient health care services, obstetric and gynecological services, and psychiatric services. Los Angeles General Medical Center The Los Angeles General Medical Center, formerly known as the LAC+USC Medical Center, provides acute and intensive care unit medical/surgical inpatient and outpatient services, trauma and emergency room services, a burn center, psychiatric services, renal dialysis, AIDS services, pediatric and obstetric services, and communicable disease services. Rancho Los Amigos National Rehabilitation Center The Rancho Los Amigos National Rehabilitation Center (Rancho) specializes in the rehabilitation for victims of spinal cord injuries and strokes, pathokinesiology and polio services, services for liver diseases, pediatrics, ortho diabetes, dentistry, and neuro-science. Waterworks The Waterworks Enterprise Fund is used to account for the administration, maintenance, operation and improvement of district water systems. Nonmajor Aviation The Aviation Enterprise Fund is used to account for the administration, maintenance, operation and improvement of the five airports which are owned by the County. 64 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Fund Financial Statements-Continued The following fund types have also been reported: Internal Service Funds The Internal Service Funds (ISFs) are used to account for the financing of services provided by a department or agency to other departments or agencies on a cost-reimbursement basis. The County's principal Internal Service Fund is used to account for the cost of services provided by the Department of Public Works to various other County funds and agencies. Fiduciary Fund Types Pension and Other Postemployment Benefit Trust The Pension Trust Fund is used to account for the fiduciary activities of the County’s Pension Plan administered by LACERA. The OPEB Trust Fund is used to account for the fiduciary activities of the OPEB trust for the purpose of holding and investing assets to pre-fund the Retiree Healthcare Program administered by LACERA. Investment Trust The Investment Trust Fund is used to account for the fiduciary activities from the external portion of the investment pool and individual investment accounts which are administered through a trust agreement or equivalent arrangement in which the County is not a beneficiary. Participants include deposits held on behalf of cities and special districts. Custodial External Investment Pools The External Investment Pools Funds are used to account for the fiduciary activities from the external portion of the investment pool for participants that do not have a trust agreement or equivalent arrangement in which the County is not a beneficiary. The participants primarily consist of deposits held on behalf of school districts, courts, and sanitation districts. Other Custodial The Other Custodial Funds include the property tax funds used to account for the fiduciary activities for the monies received from property and other taxes, which must be held pending authority for distribution. They also are used to account for funds which are held for other governmental agencies, including school districts and community college districts, or individuals in a custodial capacity. 65 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Basis of Accounting The government-wide, proprietary, and fiduciary fund financial statements are reported using the economic resources measurement focus and the 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. Nonexchange transactions, in which the County gives (or receives) value without directly receiving (or giving) equal value in exchange, include property and sales taxes, grants, entitlements and donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the taxes are levied. Revenues from grants and similar items are recognized in the fiscal year in which all eligibility requirements have been satisfied. 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 County considers revenues to be available if collectible within one year after year-end, except for property taxes, which are considered available to the extent that they are collectible within 60 days after year-end. When property taxes are measurable but not available, the collectible portion (taxes levied less estimated uncollectibles) is recorded as deferred inflows of resources in the period when an enforceable legal claim to the assets arises. Expenditures are generally recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims (including workers’ compensation) and judgments are recorded only when payment is due. General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of long-term debt, financed purchase obligations, lease liabilities, and subscription liabilities are reported as other financing sources. For the governmental funds financial statements, revenues are recorded when they are susceptible to accrual. Specifically, ad valorem property taxes (except for redevelopment agency dissolution), sales taxes, investment income (loss), charges for services, and other miscellaneous revenue are all considered to be susceptible to accrual and have been recognized as revenue in the current fiscal period. Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure-driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other eligibility requirements have been met and are recorded at the time of receipt or earlier, if the susceptible to accrual criteria are met. When all eligibility requirements are met, except for the timing requirements, a deferred inflow of resources is reported until the time requirements have passed. All other revenues are not considered susceptible to accrual and are recognized when received, including property tax revenues derived from redevelopment agency dissolution. 66 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Basis of Accounting-Continued Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the County’s four Hospital Enterprise Funds (Hospitals) are from patient services. The principal operating revenues for the Waterworks Enterprise Fund, Nonmajor Aviation Enterprise Fund and Internal Service Funds are charges for services. Operating expenses for all Enterprise Funds and the Internal Service Funds include the cost of sales and services, administrative expenses and depreciation and amortization on capital assets. Medical malpractice expenses, which are self- insured, are classified as operating expenses of the Hospitals. All other revenues and expenses not meeting this definition are reported as nonoperating items. As discussed in Note 14, intergovernmental transfer payments are recorded in the Hospitals and this item is classified as a nonoperating expense. Budgetary Data In accordance with the provisions of Sections 29000-29144 of the Government Code of the State of California (Government Code), commonly known as the County Budget Act, the County prepares and adopts a budget on or before October 2 for each fiscal year. Budgets are adopted for the major governmental funds and certain nonmajor governmental funds on a basis of accounting that is different from GAAP. Annual budgets were not adopted for the JPAs, Public Buildings and the LACSC debt service funds, the capital project funds and the permanent funds. The County budget is organized by budget unit and by expenditure object. Budget units are established at the discretion of the Board. Within the General Fund (with certain exceptions), budget units are generally defined as individual departments. For other funds, each individual fund constitutes a budget unit. Expenditures are controlled at the object level for all budget units within the County, except for capital asset expenditures, which are controlled at the sub-object level. The total budget exceeds $50.065 billion and is currently controlled through the use of approximately 500 separate budget units. There were no excesses of expenditures over the related appropriations within any fund for the year ended June 30, 2024. The County prepares a separate budgetary document, the County Budget, which demonstrates legal compliance with budgetary control. This document is made available to the public on the County’s website at https://ceo.lacounty.gov/budget, or can be obtained from the Auditor-Controller’s office. Transfers of appropriations between budget units must be approved by the Board. Supplemental appropriations financed by unanticipated revenue during the year must also be approved by the Board. Transfers of appropriations between objects of expenditure within the same budget unit must be approved by the Board or the Chief Executive Office, depending upon the amount transferred. The original and final budget amounts are reported in the accompanying basic financial statements. Any excess of budgetary expenditures and other financing uses over revenues and other financing sources is financed by beginning available fund balances as provided for in the County Budget Act. Note 16 describes the differences between the budgetary basis of accounting and GAAP. A reconciling schedule is also presented for the major governmental funds. 67 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Property Taxes All jurisdictions within California derive their taxing authority from the State Constitution and various legislative provisions contained in the Government Code and Revenue and Taxation Code. Property is assessed at 100% of full cash or market value (with some exceptions) pursuant to Article XIIIA of the California State Constitution and statutory provisions by the County Assessor and State Board of Equalization. The total Fiscal Year (FY) 2023-2024 assessed valuation of the County approximated $2.024 trillion. The property tax levy to support general operations of the various jurisdictions is limited to one percent (1%) of full cash value and is distributed in accordance with statutory formulae. Amounts needed to finance the annual requirements of voter-approved debt are excluded from this limitation and are separately calculated and levied each fiscal year. The rates are formally adopted by either the Board or the city councils and, in some instances, the governing board of a special district. The County is divided into 13,153 tax rate areas, which are unique combinations of various jurisdictions servicing a specific geographic area. The rates levied within each tax rate area vary only in relation to levies assessed as a result of voter-approved taxes or indebtedness. Property taxes are levied on both real and personal property. Secured property taxes are levied during September of each year. They become a lien on real property on January 1 preceding the fiscal year for which taxes are levied. These tax payments can be made in two equal installments; the first is due November 1 and delinquent with penalties after December 10; the second is due February 1 and delinquent with penalties after April 10. Secured property taxes, which are delinquent and unpaid as of June 30, are declared to be tax defaulted and are subject to redemption penalties, costs, and interest when paid. If the delinquent taxes are not paid at the end of 5 years, the property may be sold at public auction. The proceeds are used to pay the delinquent amounts due, and any excess is remitted, if claimed, to the taxpayer. Additional tax liens are created when there is a change in ownership of property or upon completion of new construction. Tax bills for these new tax liens are issued throughout the fiscal year and contain various payment and delinquent dates but are generally due within one year. If the new tax liens are lower, the taxpayer receives a tax refund rather than a tax bill. Unsecured personal property taxes are not a lien against real property. These taxes are due on August 1 and become delinquent, if unpaid, on August 31. 68 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Legislation Dissolving Redevelopment Agencies and Affect on Property Taxes State Assembly Bill (AB) x1 26, also referred to as the “Redevelopment Dissolution Act” was approved in 2011. Under AB x1 26, property tax revenues are allocated to pay enforceable legal obligations, pass-through payments and eligible administrative costs. Any remaining property tax revenues, otherwise known as “residual taxes,” are distributed as property tax revenue to the appropriate local government agencies, including the County. In FY 2018-2019, five Oversight Boards were established in the County per Senate Bill 107. The Oversight Boards are required to evaluate and approve the successor agencies’ remaining enforceable legal obligations. The County Auditor-Controller is responsible for disbursing property tax increment revenues in accordance with provisions of AB x1 26 and applicable amendments. For the year ended June 30, 2024, the County’s share of residual property tax revenues was $469.87 million, of which $391.44 million was recognized in the County’s General Fund. Deposits and Investments Deposits and investments as discussed in Note 4 are reflected in the following asset accounts: Pooled Cash and Investments As provided for by the Government Code, the cash balances of substantially all funds are pooled and invested by the County Treasurer for the purpose of increasing interest earnings through investment activities. Interest earned on pooled investments is deposited to participating funds based upon each fund's average daily deposit balance during the allocation period. Each respective fund's share of the total pooled cash and investments is included among asset balances under the caption "Pooled Cash and Investments." Pooled Cash and Investments are identified within the following categories for all County operating funds: Operating Pooled Cash and Investments This account represents amounts reflected in the County’s day-to-day financial records. Such amounts are utilized to determine the availability of cash for purposes of disbursing and borrowing funds. Other Pooled Cash and Investments This account represents amounts identified in various funds as of June 30, 2024, that were owed to or were more appropriately classified in County operating funds. Accordingly, certain cash balances have been reclassified from the custodial funds. Other Investments This account represents Pension and OPEB Trust Fund investments, various JPAs, NPCs and Public Buildings (bond financed capital assets, including leases), and amounts on deposit with the County Treasurer, which are invested separately as provided by the Government Code or by specific instructions from the depositing entities. 69 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Deposits and Investments-Continued Restricted Assets Enterprise Funds’ restricted assets represent cash and investments of certain JPAs and Public Buildings projects restricted in accordance with the provisions of the certificates of participation issued. The Internal Service Funds’ restricted assets represent cash and investments restricted for debt service in accordance with the provisions of the LACCAL bond indenture. All of the above noted assets are included in the various disclosures in Note 4. These restricted assets are presented as noncurrent assets and are generally associated with long-term bonds and certificates of participation payable. Lease Receivable As a lessor, the County recognized a lease receivable and a corresponding deferred inflow of resources based on the payment provisions of the contracts in the government-wide statement of net position and the governmental funds balance sheet as discussed in Note 9. The lease receivable was measured at the present value of lease payments expected to be received during the lease term. The deferred inflows of resources was measured at the value of the lease receivable plus any payments received at or before the commencement of the lease term that relate to future periods. The amount of lease revenue and interest revenue are reflected as program revenues under "Charges for Services" on the statement of activities. Inventories Inventories, which consist of materials and supplies held for consumption, are valued at cost using the first in/first out basis. The inventory costs of the governmental funds are accounted for as expenditures when the inventory items are purchased. Reported inventories are categorized as nonspendable fund balance because these amounts are not available for appropriation and expenditure. Capital Assets Capital assets, which include land and easements, capital assets, in progress, buildings and improvements, equipment, intangible assets, infrastructure, and intangible right-to-use assets, are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Infrastructure assets are divided into the five following networks: road, water, sewer, flood control and aviation. Capital assets are recorded at historical cost or estimated historical cost if purchased or constructed. Intangible right-to-use assets are defined as lease assets and subscription assets with a useful life of more than one year and are recorded at the present value of future lease or subscription payments, including expenses to place the asset into service. In accordance with GASB Statement Nos. 87 and 96, the County has reported intangible right-to-use assets for land, buildings and improvements, equipment, and subscriptions. Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are reported at acquisition value rather than fair value. 70 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Capital Assets-Continued Capital outlay is recorded as expenditures in the governmental fund financial statements and as assets in the government-wide financial statements to the extent the County’s capitalization threshold is met. In accordance with GAAP, in FY 2020-2021, the County changed the accounting for interest cost incurred before the end of a construction period for business-type activities and enterprise funds. It requires that such interest cost be recognized as an expense in the period in which the cost is incurred. Accordingly, such interest costs for business-type activity and enterprise funds are no longer capitalized as part of the historical cost of a capital asset. The County’s capitalization thresholds are $100,000 for buildings and improvements, $5,000 for equipment, $1 million for software intangible assets, $100,000 for non-software intangible assets, $25,000 for infrastructure assets, $500,000 for lease assets, and $5,000 for subscription assets. Maintenance and repairs are charged to operations when incurred. Betterments and major improvements, which significantly increase values, change capacities, or extend useful lives are capitalized subject to the threshold in the affected asset category. Upon sale or retirement of capital assets, the cost and the related accumulated depreciation or amortization, as applicable, are removed from the respective accounts and any resulting gain or loss is included in the results of operations. Specific disclosures related to capital assets appear in Note 5. Amortization for software, other intangible assets, lease assets, and subscription assets is included in the reporting of depreciation. Capital assets are depreciated or amortized using the straight-line method over the following estimated useful lives: Buildings and Improvements 10 to 50 years Equipment 2 to 35 years Software 5 to 25 years Infrastructure 15 to 100 years Lease assets Shorter of the asset's useful life or the lease term, or the asset's useful life if there is a purchase option likely to be exercised Subscription assets Shorter of the asset's useful life or the agreement term Works of art and historical treasures held for public exhibition, education, or research in furtherance of public service, rather than financial gain, are not capitalized. These items are protected, encumbered, conserved, and preserved by the County. It is the County’s policy to utilize proceeds from the sale of these items for the acquisition of other items for collection and display. Deferred Outflows and Inflows of Resources The County recognizes deferred outflows of resources and/or deferred inflows of resources in the government-wide statement of net position, governmental funds balance sheets, and proprietary funds statement of net position. 71 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Deferred Outflows and Inflows of Resources-Continued In addition to assets, the financial statements report a separate section for deferred outflows of resources. Deferred outflows of resources represent a consumption of net assets that applies to future periods and will not be recognized as an outflow of resources (expense/expenditures) until then. In addition to liabilities, the financial statements report a separate section for deferred inflows of resources. Deferred inflows of resources represent an acquisition of net assets that applies to future periods and will not be recognized as an inflow of resources (revenue) until that time, except for pension and OPEB related deferred inflows of resources, which will be recognized as a credit to expense. Specific disclosures of items representing deferred outflows and inflows of resources appear in Note 20. Advances Payable The County uses certain funds as clearing accounts for the distribution of financial resources to other County funds. For external financial reporting purposes, the portions of the clearing account balances that pertain to other County funds should be reported as cash of the appropriate funds. The corresponding liability is included in “Advances Payable” because the amounts represent unearned revenue. The unspent balance of certain COVID-19 related financial assistance payments are recognized as Advances Payable due to the uncertainty on the revenue recognition. See Note 22 for additional information. Compensated Absences Vacation pay benefits accrue to employees ranging from 10 to 25 days per year depending on years of service and the benefit plan. Sick leave benefits accrue at the rate of 10 to 12 days per year for union represented employees depending on years of service. Non-represented employees accrue at a rate of up to eight days of sick leave per year depending on the benefit plan. Employees can also accumulate unused holiday and compensatory time off benefits throughout the year. All benefits are payable upon termination, if unused, within limits and rates as specified in the County Salary Ordinance. Liabilities for accrued compensated absences are accrued in the government-wide financial statements and in the proprietary funds. For the governmental funds, expenditures are recorded when amounts become due and payable (i.e., when employees terminate from service). Lease Liability As a lessee, a lease is defined as a contractual agreement that conveys control of the right-to-use another entity's nonfinancial asset, for a minimum contractual period of greater than one year, in an exchange or exchange-like transaction. The County leases a significant amount of nonfinancial assets such as land, buildings, and equipment. The related lease liabilities are presented in the amounts equal to the present value of lease payments, payable during the remaining lease term. A lease liability, as discussed in Note 9, and the associated right-to-use lease asset, as discussed in Note 5, is recognized on the government-wide statement of net position. 72 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Subscription Liability A subscription is defined as a contractual agreement that conveys control of the right-to-use another entity's information technology software, for a minimum contractual period of greater than one year, in an exchange or exchange-like transaction. The County has entered into various subscription based information technology arrangements. The related subscription liabilities are presented in the amounts equal to the present value of subscription payments, payable during the remaining subscription term. A subscription liability, as discussed in Note 10, and the associated right-to-use subscription asset, as discussed in Note 5, is recognized on the government-wide statement of net position. Net Pension Liability and Related Balances For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of LACERA and additions to/deductions from LACERA’s fiduciary net position have been determined on the same basis as they are reported by LACERA. 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. Reported results pertain to liability and asset information within the following defined timeframes: Valuation Date - June 30, 2022 rolled forward to June 30, 2023 Measurement Date - June 30, 2023 Measurement Period - July 1, 2022 to June 30, 2023 Net OPEB Liability and Related Balances - Retiree Healthcare For purposes of measuring the net OPEB liability related to Retiree Healthcare, deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of LACERA and additions to/deductions from LACERA’s fiduciary net position have been determined on the same basis as they are reported by LACERA. For this purpose, benefit payments are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Reported results pertain to liability and asset information within the following defined timeframes: Valuation Date - June 30, 2022 rolled forward to June 30, 2023 Measurement Date - June 30, 2023 Measurement Period - July 1, 2022 to June 30, 2023 73 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Total OPEB Liability and Related Balances - Long-Term Disability For purposes of measuring the total OPEB liability related to Long-Term Disability (LTD), deferred outflows of resources and deferred inflows of resources related to OPEB, and OPEB expense, have been determined on the same basis as they are reported by the plan. For this purpose, the LTD plan recognizes benefit payments when due and payable in accordance with the benefit terms. Reported results pertain to liability information within the following defined timeframes: Valuation Date - June 30, 2023 Measurement Date - June 30, 2023 Measurement Period - July 1, 2022 to June 30, 2023 Long-term Debt In the government-wide and proprietary funds financial statements, long-term debt and other long- term obligations, including financed purchase obligations, are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary funds statement of net position. Bond premiums and discounts are amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are recognized in the period issued. In the governmental funds financial statements, bond premiums, discounts, and issuance costs are recognized in the period issued. Issuance costs, even if withheld from the actual net proceeds received, are reported as debt service expenditures. Interest is reported as an expenditure in the period in which the related payment is made. The matured portion of long-term debt (i.e., portion that has come due for payment) is reported as a liability in the fund financial statements of the related fund. Fund Balances In the fund financial statements, the reported fund balances are categorized as nonspendable, restricted, committed, assigned, or unassigned based on the extent to which the County is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Specific details related to Fund Balances appear in Note 21. Nonspendable Fund Balance - amounts that cannot be spent because they are either (a) not in spendable form, or (b) legally or contractually required to be maintained intact. The “not in spendable form” criterion includes items that are not expected to be converted to cash, for example: inventories and long-term notes receivable. Restricted Fund Balance - amounts with constraints placed on their use that are either (a) externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation. Restrictions may effectively be changed or lifted only by changing the condition of the constraint. 74 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-Continued Fund Balances-Continued Committed Fund Balance - amounts that can only be used for the specific purposes determined by a formal action of the County’s highest level of decision-making authority, the County’s Board. Commitments may be changed or lifted only by the County taking the same formal action that imposed the constraint originally. The underlying action that imposed the limitation needs to occur no later than the close of the fiscal year. Assigned Fund Balance - amounts intended to be used by the County for specific purposes that are neither restricted nor committed. The intent can be established at either the highest level of decision making, or by a body or an official designated for that purpose. Authorization to assign fund balance rests with the County’s Board through the budget process. The Board has also delegated authority to the Chief Executive Officer and County Department Heads for contracts and purchasing authority. Unassigned Fund Balance - the residual classification for the County’s General Fund that includes amounts not contained in other classifications. In other funds, the unassigned classification is used only if expenditures incurred for specific purposes exceed the amounts restricted, committed, or assigned to those purposes. The Board establishes, modifies, or rescinds fund balance commitments by passage of an ordinance or resolution. For its budget, the County utilizes the GASB 54 criteria and an ordinance or resolution that are equally binding, for purposes of establishing a fund balance commitment. This is done through the adoption of the budget and subsequent amendments that occur throughout the fiscal year. In circumstances when an expenditure is made for a purpose for which amounts are available in multiple fund balance classifications, fund balance is generally depleted in the order of restricted, committed, assigned, and unassigned. Cash Flows For purposes of reporting cash flows, all amounts reported as "Pooled Cash and Investments," "Other Investments," and "Restricted Assets" are considered cash equivalents. Pooled cash and investment amounts represent funds held in the County Treasurer's cash management pool. Other investments and restricted assets are invested in money market mutual funds and U.S. Treasury securities held by outside trustees. Such amounts are similar in nature to demand deposits (i.e., funds may be deposited and withdrawn at any time without prior notice or penalty). Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and deferred outflows of resources, liabilities and deferred inflows of resources, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates. 75 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 2. NEW ACCOUNTING PRONOUNCEMENTS The following GASB Statements have been implemented in the current basic financial statements. GASB Statement No. 99 - Statement No. 99, "Omnibus 2022", enhances comparability in accounting and financial reporting and improves the consistency of authoritative literature by addressing (1) practice issues that have been identified during implementation and application of certain GASB Statements and (2) accounting and financial reporting for financial guarantees. GASB Statement No. 99, paragraphs 4-10, the requirements related to financial guarantees and the classification and reporting of derivative instruments within the scope of Statement 53, are effective for reporting periods beginning after June 15, 2023. This statement did not have a material impact to the financial statements. GASB Statement No. 100 - Statement No. 100, "Accounting Changes and Error Corrections - an amendment of GASB Statement No. 62" enhances accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decisions or assessing accountability. This statement prescribes the accounting and financial reporting for (1) each type of accounting change and (2) error corrections. This statement requires that (a) changes in accounting principles and error corrections be reported retroactively by restating prior periods, (b) changes to or within the financial reporting entity be reported by adjusting beginning balances of the current period, and (c) changes in accounting estimates be reported prospectively by recognizing the change in the current period. The requirements of this statement for changes in accounting principles apply to the implementation of a new pronouncement in absence of specific transition provisions in the new pronouncement. This statement also requires that the aggregate amount of adjustments to and restatements of beginning net position, fund balance, or fund net position, as applicable, be displayed by reporting unit in the financial statements. This statement did not have a material impact to the financial statements. We will apply the statement as appropriate in the future. 3. DEFICIT NET POSITION The following activities/funds had a net deficit at June 30, 2024 (in thousands): Government-wide: Accumulated Deficit Governmental Activities $ 9,952,635 Business-type Activities 494,739 Enterprise Funds: Harbor-UCLA Medical Center 293,983 Olive View-UCLA Medical Center 485,777 Los Angeles General Medical Center 504,769 Rancho Los Amigos National Rehab Center 174,793 Internal Service Funds: Public Works 1,226,043 The government-wide governmental and business-type activities, enterprise and internal service funds deficits result primarily from the recognition of certain liabilities including accrued compensated absences, net pension liability, net OPEB liability, workers’ compensation, self-insurance and, for the enterprise funds, medical malpractice, and third party payors, as required by GAAP. Deficits are expected to continue until such liabilities are retired through user charges or otherwise funded. 76 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS Investments in the County's cash and investment pool, other cash and investments, and Pension and OPEB Trust Funds investments, are stated at fair value. Aggregate pooled cash and investments and other cash and investments are as follows at June 30, 2024 (in thousands): Restricted Assets Pooled Cash Other Pooled Cash Other and Investments Investments and Investments Investments Total Governmental Funds $ 17,728,823 62,549 $ 17,791,372 Proprietary Funds 1,106,524 129,270 3,557 1,239,351 Fiduciary Funds (excluding Pension and OPEB) 37,643,928 225,962 37,869,890 Pension and OPEB Trust Funds 142,381 84,579,111 84,721,492 Discretely Presented Component Units 267,354 814,333 14,470 1,096,157 Total $ 56,889,010 85,681,955 129,270 18,027 $ 142,718,262 A summary of cash and investments (by type) as of June 30, 2024 is as follows (in thousands): Cash: Cash and investments are reported as follows: County Imprest Cash $ 9,836 Governmental Funds $ 17,791,372 Cash in Vault 208 Proprietary Funds 1,239,351 Cash in Bank 256,915 Investment Trust Fund 381,747 Deposits in Transit 13,811 Custodial Funds 37,488,143 LACDA 27,952 Pension and OPEB Trust Funds (LACERA) 84,721,492 Total Cash 308,722 Discretely presented component units: First 5 LA 277,110 LACDA 819,047 Total Cash and Investments $ 142,718,262 Investments: In Treasury Pool 56,737,508 In Specific Purpose Investment (SPI) 361,621 In Other Specific Investments 311 Held by Outside Trustees 63,954 In LACERA 84,579,111 In Discretely Presented Component Unit - LACDA 667,035 Total Investments 142,409,540 Total Cash and Investments $ 142,718,262 77 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued County Treasurer Cash As of June 30, 2024, the County Treasurer (Treasurer) maintained accounts in six banks. The carrying amount of the Treasurer’s total deposits in financial institutions was $256.92 million, deposits in transit were $13.81 million, and cash in the Treasurer’s vault was $208 thousand. Under California Government Code Section 53652, each financial institution in California is required to pledge a pool of securities as collateral against all of its public deposits. California Government Code Section 53651 delineates the types of eligible securities and the required collateral percentage, generally at 110%. In addition, under California Government Code Section 53653, the Treasurer has discretion to waive security for the portion of any deposits as insured pursuant to federal law. Through contractual agreement, the Treasurer has opted to waive security for the portions of deposits that are federally insured. The total balance of deposits in financial institutions was covered by federal depository insurance or collateralized with securities monitored by the Department of Financial Protection and Innovation (DFPI). DFPI confirmed that the pools of collateral related to the County Treasurer’s deposits were maintained at required levels as of June 30, 2024. County Investment Pool California Government Code Sections 53601 and 53635 authorize the Treasurer to invest the External Investment Pool (Pool) and SPI funds in obligations of the United States Treasury, federal agencies, municipalities, asset-backed securities, bankers’ acceptances, commercial paper, negotiable certificates of deposit, medium-term notes, corporate notes, repurchase agreements, reverse repurchase agreements, forwards, futures, options, shares of beneficial interest of a Joint Powers Authority (JPA) that invests in authorized securities, shares of beneficial interest issued by diversified management companies known as money market mutual funds (MMF) registered with the Securities and Exchange Commission (SEC), securities lending agreements, the State of California’s Local Agency Investment Fund (LAIF), and supranational institutions. California Government Code Section 53534 authorizes the Treasurer to enter into interest rate swap agreements. However, these agreements are only used in conjunction with the sale of the bonds approved by the Board. As permitted by the California Government Code, the Treasurer developed, and the Board adopted, an Investment Policy that further defines and restricts the limits within which the Treasurer may invest. The investments are managed by the Treasurer, which reports investment activity to the Board on a monthly basis. In addition, the Treasurer's investment activity is subject to an annual investment policy review, compliance oversight, quarterly financial review, and annual financial reporting. The Treasurer also maintains Other Specific Investments, which are invested pursuant to Section 1300.76.1, Title 28, California Code of Regulations. The County has not provided nor obtained any legally binding guarantees during the year ended June 30, 2024, to support the value of shares in the Pool. 78 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued County Investment Pool-Continued The School Districts and the Superior Court are required by legal provisions to participate in the County’s investment pool. Almost sixty percent (59.06%) of the Treasurer’s Pool consists of these involuntary participants. Voluntary participants in the County’s Pool include the Sanitation Districts, Metropolitan Transportation Authority, the South Coast Air Quality Management District and other special districts with independent governing boards. The deposits held for both involuntary and voluntary entities are included in either the Investment Trust Fund or the External Investment Pool (Custodial Fund). Certain SPI have been made by the County as directed by external depositors. This investment activity occurs separately from the County’s Pool and is reported in the External Specific Investment Pool (Custodial Fund) in the amount of $225.65 million. The Pool is not registered as an investment company with the SEC. California Government Code statutes and the County Board set forth the various investment policies that the Treasurer must follow. Investments are stated at fair value and are valued daily. The Treasurer categorizes its fair value measurements within the fair value hierarchy established by GAAP. Securities classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets for those securities. Securities classified in Level 2 of the fair value hierarchy are valued using other observable inputs such as matrix pricing techniques or based on quoted prices for assets in markets that are not active. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices. Level 3 inputs are significant unobservable inputs. Securities classified in Level 3 are valued using the income approach such as discounted cash flow techniques. Investment in an external government investment pool is not subject to reporting within the level hierarchy. Investments in LAIF are governed by the California Government Code and overseen by a five member Local Investment Advisory Board as designated by the California Government Code. As of June 30, 2024, the total amount invested by all California local governments and special districts in LAIF was $21.974 billion. LAIF is part of the State of California’s Pooled Money Investment Account (PMIA), which as of June 30, 2024 had a balance of $178.041 billion. The PMIA is not SEC registered, but is required to invest according to the California Government Code. Included in the PMIA’s investment portfolio are structured notes and asset-backed securities totaling $5.348 billion at June 30, 2024. Collectively, these represent 3.00% of the PMIA balance of $178.041 billion. The SPI holdings in the LAIF investment pool as of June 30, 2024, were $42.68 million, which were valued using a fair value factor provided by LAIF. 79 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued County Investment Pool-Continued The Treasurer has the following recurring fair value measurements as of June 30, 2024 (in thousands): Fair Value Measurement Using Quoted Prices in Active Significant Markets for Other Significant External Identical Observable Unobservable Government Assets Inputs Inputs Investment Pool Fair Value (Level 1) (Level 2) (Level 3) Pools Commercial Paper $ 16,470,771 $ $ 16,470,771 $ $ Los Angeles County Securities 14,450 14,450 Negotiable Certificates of Deposit 2,099,924 2,099,924 U.S. Agency Securities 26,907,399 26,907,399 U.S. Treasury Securities: U.S. Treasury Notes 2,178,004 2,178,004 U.S. Treasury Bills 9,044,012 9,044,012 Municipals 22,948 22,948 Total Investments $ 56,737,508 $ $ 56,723,058 $ 14,450 $ SPI Local Agency Investment Fund $ 42,675 $ $ $ $ 42,675 Los Angeles County Securities 2,152 2,152 U.S. Agency Securities 195,490 195,490 U.S. Treasury Securities: U.S. Treasury Bills 121,304 121,304 Total Investments $ 361,621 $ $ 316,794 $ 2,152 $ 42,675 Other Specific Investments U.S. Treasury Bills $ 311 $ $ 311 $ $ Total Investments $ 311 $ $ 311 $ $ 80 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued County Investment Pool-Continued As permitted by the Government Code, the Treasurer developed, and the Board adopted, an Investment Policy that further defines and restricts the limits within which the Treasurer may invest. The table below identifies the investment types that are authorized by the County, along with the related concentration of credit limits: Maximum Maximum Percentage Maximum Investment Minimum Maturity of Portfolio In One Issuer Rating Authorized Investment Gov. Gov. Gov. Gov. Type Code Pool Policy Code Pool Policy Code Pool Policy Code Pool Policy U. S. Treasury Notes, Bills and Bonds 5 years None (1) None None None None None None U.S. Agency Securities 5 years None (1) None None None None None None Local Agency Obligations 5 years 5 years (2) None 10%* None None None Various (2) Asset-Backed Securities 5 years 5 years 20% 20% None $750 million* AA AA (3)* Bankers' Acceptances 180 days 180 days 40% 40% 30% $750 million* None A-1/P-1/F1* Negotiable Certificates of Deposit (4) 5 years 3 years* 30% 30% None $750 million* None A-1/P-1/F1* Commercial Paper 270 days 270 days 40% 40% 10% $1.5 billion* A-1 A-1/P-1/F1 Corporate and Depository Medium-Term Notes (5) 5 years 3 years* 30% 30% 10% $750 million* A A-1/P-1/F1* LAIF N/A N/A None $75 million (6) None None None None Shares of Beneficial Interest N/A N/A 20% 15%* 10% 10% AAA AAA Repurchase Agreements 1 year 30 days* None $1 billion* None $500 million* None None Reverse Repurchase Agreements 92 days 92 days 20% $500 million* None $250 million* None None Forwards, Futures, and Options N/A 90 days* None $100 million* None $50 million* None A* Interest Rate Swaps N/A None None None None None A A Securities Lending Agreements 92 days 92 days 20% 20% (7) None None None None Supranationals 5 years 5 years 30% 30% None None AA AA (1) Pursuant to the California Government Code 53601, the Board granted authority to make investments in U.S. Treasury Notes, Bills and Bonds, and U.S. Agency Securities that have maturities beyond 5 years. (2) Any obligation issued or caused to be issued on behalf of other County affiliates must have a minimum rating of "A3" (Moody’s) or "A-" (S&P or Fitch) and the maximum maturity is limited to thirty years. Any short- or medium-term obligation issued by the State of California or a California local agency must have a minimum rating of "MIG-1" or "A2" (Moody's) or "SP-1" or "A" (S&P) and the maximum maturity is limited to 5 years. (3) All Asset-Backed securities must be rated at least “AA.” Pool Policy also requires that Asset-Backed securities issuers' debts be rated "A" or its equivalent or better. (4) Euro Certificates of Deposit are further restricted to a maximum maturity of one year and a maximum percentage of portfolio of 10%. (5) Floating Rate Notes are further restricted to a maximum maturity of 5 years, maximum of 10% of the portfolio, and maximum investment in one issuer of $750 million. The maximum maturity may be 7 years, provided that the Board’s authorization to exceed maturities in excess of 5 years is in effect, of which $100 million par value may be greater than 5 years to maturity. (6) The maximum percentage of the portfolio is based on the investment limit established by LAIF for each account, not by Pool Policy. (7) The maximum par value is limited to a combined total of reverse repurchase agreements and securities lending agreements of 20% of the base value of the portfolio. *Represents restriction in which the County’s Investment Policy is more restrictive than the California Government Code. 8811 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued County Investment Pool-Continued A summary of investments held by the Pool at June 30, 2024 is as follows (dollars in thousands): Weighted Average Pool Fair Value Principal Interest Rate Range Maturity Range Maturity In Years Commercial Paper $ 16,470,771 $ 16,480,703 5.19% - 5.39% 07/01/24 - 12/20/24 0.12 Los Angeles County Securities 14,450 15,000 5.76% - 5.82% 06/30/25 - 06/30/26 1.65 Negotiable Certificates of Deposit 2,099,924 2,100,000 5.28% - 5.87% 07/01/24 - 01/17/25 0.19 Municipals 22,948 23,036 2.96% 08/01/24 0.09 U.S. Agency Securities 26,907,399 28,936,298 0.50% - 6.01% 07/01/24 - 01/05/34 3.21 U.S. Treasury Securities: U.S. Treasury Notes 2,178,004 2,395,446 0.63% - 1.13% 11/15/24 - 11/15/30 2.57 U.S. Treasury Bills 9,044,012 9,047,323 5.12% - 5.25% 07/02/24 - 10/22/24 0.13 Total $ 56,737,508 $ 58,997,806 1.68 The unrealized loss on investments held in the Pool was $2.260 billion as of June 30, 2024. This amount takes into account all changes in fair value that occurred during the year. The method used to apportion the unrealized loss was based on a pro-rata share of each funds’ cash balance as of June 30, 2024 relative to the County Pool balances. A separate financial report is issued for the Pool for the year ended June 30, 2024 and can be obtained at https://ttc.lacounty.gov/investor- information/. Specific Purpose Investments and Other Specific Investments A summary of investments held by the SPI and Other Specific Investments at June 30, 2024 is as follows (dollars in thousands): Weighted Average Maturity In SPI Fair Value Principal Interest Rate Range Maturity Range Years Local Agency Investment Fund $ 42,675 $ 42,833 12/31/24 0.50 Los Angeles County Securities 2,152 2,060 5.00% 12/02/27 3.42 U.S. Agency Securities 195,490 217,409 2.00% - 5.21% 12/05/24 - 08/27/43 4.81 U.S. Treasury Notes 121,304 121,425 4.66% - 5.14% 11/07/24 - 12/26/24 0.44 Total $ 361,621 $ 383,727 3.14 Weighted Average Other Specific Maturity In Investments Fair Value Principal Interest Rate Range Maturity Range Years U.S. Treasury Bills $ 311 $ 311 5.15% 11/21/24 0.39 82 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The County’s Investment Policy limits most investment maturities to less than five years, with the exception of U.S. Treasury Notes, Bills, and Bonds and U.S. Agency Securities, which may have maturities beyond five years. The Treasurer manages the Pool and mitigates exposure to declines in fair value by generally investing in short-term investments with maturities of six months or less and by holding all investments to maturity. The Treasury Pool maintained the weighted average maturity range of 1.0 to 4.0 years per the Pool policy. For purposes of computing weighted average maturity, the maturity date of variable-rate notes is the stated maturity. The balance of the Pool's investments at June 30, 2024, is $56.738 billion, of which 60.03% will mature in six months or less. Of the remainder, 36.07% have a maturity of more than one year. At June 30, 2024, the weighted average maturity in years for the Pool was 1.68 years. The California Government Code and the Investment Policy allow the Treasurer to purchase floating rate notes, that is, any instruments that have a coupon interest rate that is adjusted periodically due to changes in a base or benchmark rate. The Investment Policy limits the amount invested in floating rate notes to 10% of the Pool portfolio. The Investment Policy prohibits the purchase of inverse floating rate notes and hybrid or complex structured investments and for the year ended June 30, 2024, the Pool contained floating rate notes at fair value of $14.45 million (0.03% of the Pool). The notes are tied to the six-month U.S. Treasury Bill and Bank of America prime rates. The fair value of variable securities is generally less susceptible to changes in value than fixed rate securities because the variable-rate coupon resets back to the market rate on a periodic basis. At June 30, 2024, there were no variable rate notes in the SPI and Other Specific Investments. Fair value fluctuates with interest rates, and increasing interest rates could cause fair value to decline below original cost. County management believes the liquidity in the portfolios is adequate to meet cash flow requirements and to preclude the County from having to sell investments below original cost for that purpose. Custodial Credit Risk Custodial credit risk for investments is the risk that the Treasurer will not be able to recover the value of investment securities that are in the possession of an outside party. Investments are exposed to custodial credit risk if the securities are uninsured, are not registered in the name of the Treasurer and are held by either the counterparty, or the counterparty's trust department or agent but not in the Treasurer's name. At year-end, all Pool, SPI and Other Specific Investment securities, except for the Rancho Palos Verdes Redevelopment Agency Tax Allocation Bond (RPV Bond), Bond Anticipation Notes (BANS) and LAIF, were held by the custodian bank in the name of the Treasurer. The RPV Bond and BANS were held in the Treasurer’s vault and are recorded in the Los Angeles County Securities line item. The LAIF investments were managed by the State of California and the County is considered a pool participant. 83 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued Credit Risk and Concentration of Credit Risk Credit risk is the risk that an issuer, or other counterparty to an investment, will not fulfill its obligations. Concentration of credit risk is the risk of loss attributed to the magnitude of an investment in a single issuer. The County mitigates these risks by holding a diversified portfolio of high quality investments. The Investment Policy establishes acceptable credit ratings for investments from any two of three Nationally Recognized Statistical Rating Organizations (NRSRO). For an issuer of short-term debt, the rating must be no less than A-1 (S&P), P-1 (Moody’s), and F-1 (Fitch) while an issuer of long- term debt shall be rated no less than an “A.” All investments purchased during the year ended June 30, 2024 met the credit rating criteria in the Investment Policy, at the issuer level. However, while the NRSROs did rate the issuer of the investments purchased, the NRSROs did not, in all instances, rate the investment itself (e.g., commercial paper, corporate and deposit notes, negotiable certificates of deposit, and U.S. Treasury bills, bonds and notes). Accordingly, for purposes of reporting the credit quality distribution of investments, some investments are reported as not rated. The Investment Policy also permits investments in LAIF, pursuant to California Government Code Section 16429.1. At June 30, 2024, a portion of the SPI was invested in LAIF, which is unrated as to credit quality. The Pool and SPI had the following investments in a single issuer that represent 5% or more of total investments at June 30, 2024 (dollars in thousands): Issuer Pool SPI Fair Value % of Portfolio Fair Value % of Portfolio Federal Home Loan Bank $ 8,485,260 14.95% $ 100,800 27.87% Federal Home Loan Mortgage Corporation 7,604,010 13.40% 55,764 15.42% Federal Farm Credit Bank 6,886,059 12.14% 38,926 10.76% Federal National Mortgage Association 3,932,070 6.93% 84 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued Credit Risk and Concentration of Credit Risk-Continued The following is a summary of the credit quality distribution and concentration of credit risk by investment type as a percentage of each portfolio’s fair value at June 30, 2024: Pool S&P Moody's Fitch % of Portfolio Commercial Paper Not Rated Not Rated Not Rated 29.03 % Los Angeles County Securities Not Rated Not Rated Not Rated 0.03 % Municipals AA Not Rated AA+ 0.04 % Negotiable Certificates of Deposits Not Rated Not Rated Not Rated 3.70 % U.S. Agency Securities AA+ Aaa AA+ 23.98 % AA+ Aaa Not Rated 7.54 % AA+ Aaa F1+ 0.26 % Not Rated Not Rated F1+ 0.40 % Not Rated Not Rated Not Rated 9.24 % AA+ Not Rated F1+ 0.35 % AA+ WR AA+ 0.24 % Not Rated Aaa AA+ 5.41 % U.S. Treasury Securities* 19.78 % 100.00 % SPI Local Agency Investment Fund Not Rated Not Rated Not Rated 11.80 % Los Angeles County Securities Not Rated Not Rated Not Rated 0.60 % U.S. Agency Securities AA+ Aaa AA+ 24.55 % AA+ Aaa Not Rated 27.87 % Not Rated Aaa AA+ 1.63 % U.S. Treasury Securities* 33.55 % 100.00 % Other Specific Investments U.S. Treasury Securities* 100.00 % 100.00 % *Pursuant to GASB Statement No. 40, unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. 85 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued Reverse Repurchase Agreements The California Government Code permits the Treasurer to enter into reverse repurchase agreements, that is, a sale of securities with a simultaneous agreement to repurchase them in the future at the same price plus a contract rate of interest. The fair value of the securities underlying reverse repurchase agreements normally exceeds the cash received, providing the broker-dealer a margin against a decline in the fair value of the securities. If the broker-dealer defaults on the obligation to resell these securities to the County or provide securities or cash of equal value, the County would suffer an economic loss equal to the difference between the fair value plus accrued interest of the underlying securities and the agreement obligation, including accrued interest. The County's investment guidelines limit the maximum par value of reverse repurchase agreements to $500.00 million and proceeds from reverse repurchase agreements may only be reinvested in instruments with maturities at or before the maturity of the reverse repurchase agreement. During the fiscal year, the County did not enter into any reverse repurchase agreements. Securities Lending Transactions For the year ended June 30, 2024, the Pool did not enter into any securities lending transactions. Cash and Investments - Held by Outside Trustees NPC and JPAs have been established for the purpose of rendering assistance to the County to refinance, acquire, construct, improve, lease and sell properties and equipment, including the construction of buildings, and purchase of equipment, land, and any other real or personal property, for the benefit of County residents, through the issuance of bonds, certificates of participation notes (COPs) and commercial paper. The NPC and JPAs’ cash is invested with the outside trustees and the amounts are held in the NPC and JPAs name. Investment practices are governed by the County’s investment guidelines, established pursuant to the California Government Code and the County Board's action. Investments are stated at fair value. Deposits held by outside trustees as of June 30, 2024 were $163. A total of $71.80 million of investments held by outside trustees are invested in the Pool. In addition, the outside trustees invested $63.95 million outside of the Pool. The following is a summary of investments held by outside trustees as of June 30, 2024 (dollars in thousands): Weighted Interest Rate Average Fair Value Principal Range Maturity Range Maturity (Years) U.S. Treasury Securities: U.S. Treasury Bonds $ 19,943 $ 19,943 11/15/26 - 11/15/28 3.86 U.S. Treasury Notes 1,975 1,975 0.40% - 2.94% 11/30/24 - 05/31/26 0.11 Net Asset Value Money Market Mutual Funds $ 42,036 86 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued The following is a summary of the credit quality distribution and concentration of credit risk as of June 30, 2024: Other Investments S&P Moody's Fitch % of Portfolio Money Market Mutual Funds Not Rated Not Rated Not Rated 65.73% U.S. Treasury Securities * 34.27% 100.00% *Pursuant to GASB Statement No. 40, unless there is information to the contrary, obligations of the U.S. government or obligations explicitly guaranteed by the U.S. government are not considered to have credit risk and do not require disclosure of credit quality. LACERA Investment Portfolio Narratives and tables presented for the Pension and OPEB Trust funds managed by LACERA are taken directly from LACERA’s ACFR for the year ended June 30, 2024 (certain terms have been modified to conform with the County’s ACFR presentation). The custodial credit risk, credit risk, concentration of credit risk, interest rate risk, and foreign currency risk related to Pension and OPEB Trust Fund investments are different than the corresponding risk on investments held by the Treasurer. Detailed deposit and investment risk disclosures are included in Note G and Note I and the fair value measurement disclosures are included in Note P of LACERA’s ACFR. Investments The investments of the Pension and OPEB Trust Funds are reported at fair value at June 30, 2024, (in thousands) and are as follows: Fair Value Cash Collateral on Loaned Securities $ 2,359,153 Short-term Investments 3,323,894 Domestic and International Equity 31,569,333 Fixed Income 21,590,994 Real Estate* 4,409,040 Real Assets 3,376,031 Private Equity 13,075,366 Hedge Funds 4,875,300 Total $ 84,579,111 * Refer to Note J of LACERA’s ACFR for the year ended June 30, 2024, for additional discussion on special purpose entities. The Pension and OPEB Trust Funds also had deposits with the Pool at June 30, 2024 totaling $142.38 million. 87 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Investment Risks The County Employees Retirement Law of 1937 (CERL) vests the Board of Investments (BOI) with exclusive control over LACERA’s investment portfolio. The BOI established Investment Policy Statements and Manager Guidelines for the management of the LACERA defined benefit retirement plan (Pension Plan) and the LACERA Other Post-Employment Benefit Master Trust (OPEB Master Trust or OPEB Trust). BOI exercises authority and control over the management of LACERA’s investment assets by setting a policy that the investment office executes either internally or through the use of prudent external experts. Each Investment Policy Statement recognizes that every investment asset class and type is subject to certain risks. Outlined below are the deposit and investment risks as they relate to fixed income investments. Credit Risk Credit risk is the risk that an issuer or a counterparty to an investment transaction will not fulfill its obligations, causing the investment to decline in value. LACERA seeks to maintain a diversified portfolio of fixed and floating rate instruments in order to obtain the highest total return for the Pension plan at an acceptable level of risk within this asset class. To manage credit risk, credit guidelines have been established. Investment Grade Bonds Investment Grade bonds are categorized as a component of the Risk Reduction and Mitigation functional asset category. The majority of this category is invested in an indexing strategy that provides exposure to the Bloomberg U.S. Aggregate Bond Index. LACERA also invests with managers that employ a low active-risk "core bond" approach. Investment guidelines require that managers invest predominantly in sectors represented in their benchmark index. As a result, these portfolios contain almost 100% of bonds rated investment grade by the major credit rating agencies: Moody’s, S&P, and Fitch. High Yield Bonds Dedicated High Yield bond portfolios are categorized in the Credit functional asset category. By definition, high yield bonds are securities rated below investment grade. Therefore, the majority of bonds in the high yield portfolios are rated below investment grade by at least one of the major credit rating agencies: Moody's, S&P, and Fitch. The credit portfolios allow for the assumption of more credit risk than Investment Grade portfolios by investing in securities that include unrated bonds, bonds rated below investment grade issued by corporations undergoing financial stress or distress, junior tranches of structured securities backed by residential and commercial mortgages, bank loans, illiquid credit, and emerging market debt. LACERA utilizes specific investment manager guidelines for these portfolios that may include limiting maximum exposure by issuer, industry, and sector, which result in well-diversified portfolios. 88 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Credit Quality Ratings The following is a schedule as of June 30, 2024 of the credit quality ratings by Moody’s, a nationally recognized statistical rating organization, of investments in fixed income securities. Whole loan mortgages included in the Pension Plan portfolio of $8.66 million are excluded from this presentation. Credit Quality Ratings of Investments in Fixed Income Securities - Pension Plan As of June 30, 2024 (dollars in thousands) Corporate Private and Asset- Non U.S. Placement U.S. U.S. Govt. Backed Pooled Fixed Fixed Percentage Quality Ratings Treasuries Agencies Municipals Securities Investment Income Income Total of Portfolio Aaa $ 6,052,414 823,751 118,170 1,604,320 581 51,304 $ 8,650,540 43.59 % Aa 3,871 30,128 80,320 1,145 18,601 134,065 0.67 % A 264,037 396,844 28,953 40,083 729,917 3.68 % Baa 306,056 394,010 24,568 42,838 767,472 3.87 % Ba 102,453 17,297 17,154 202,448 339,352 1.71 % B 486,583 52,435 286,620 825,638 4.16 % Caa 91,324 4,536 108,068 203,928 1.03 % Ca 1,808 600 3,580 5,988 0.03 % C 693 80 773 0.00 % Not Rated 420 203,108 7,805,688 48,092 131,615 8,188,923 41.26 % Total Investment in Fixed Income Securities - Pension Plan $ 6,052,414 824,171 3,871 1,604,360 10,298,479 178,144 885,157 $ 19,846,596 100.00 % Note: Pooled Investments included within the Not Rated Quality Ratings, represent investments in commingled funds. The Credit Quality Ratings table does not include holdings with commingled investment structures or structures that are not directly held in custody by LACERA's global custodian, State Street Bank and Trust Company. 89 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Credit Quality Ratings of Investments in Fixed Income Securities - OPEB Trust As of June 30, 2024 (dollars in thousands) Corporate Private and Asset- Non-U.S. Placement U.S. U.S. Govt. Backed Pooled Fixed Fixed Percentage Quality Ratings Treasuries Agencies Municipals Securities Investments Income Income Total of Portfolio Aaa $ 633,286 $ 113,312 $ $ 9,229 $ $ 4,742 $ $ 760,569 43.82 % Aa 1,314 5,023 3,156 9,493 0.55 % A 587 41,662 8,941 51,190 2.95 % Baa 44,722 8,647 3,314 56,683 3.26 % Ba 93,585 14,526 81,048 189,159 10.90 % B 167,408 9,874 104,345 281,627 16.23 % Caa 16,187 1,301 32,682 50,170 2.89 % Ca 311 1,187 1,498 0.08 % C 20 20 0.00 % Not Rated 64 73 25,762 294,517 11,247 3,618 335,281 19.32 % Total Investment in Fixed Income Securities - OPEB Trust $ 633,286 $ 113,376 $ 1,974 $ 403,889 $ 294,517 $ 62,434 $ 226,214 $ 1,735,690 100.00 % Note: Pooled Investments included with the Not Rated Quality represents investments in commingled funds. Custodial Credit Risk LACERA’s contract with its custodian, State Street Bank and Trust (Bank), provides that the Bank may hold LACERA’s securities registered in the Bank’s or its agent’s nominee name, in bearer form, book-entry form, with a clearing house corporation, or with a depository, so long as the Bank’s records clearly indicate that the securities are held in custody for LACERA’s account. The Bank may also hold securities in custody in LACERA’s name when required by LACERA. When held in custody by the Bank, the securities are not at risk of loss in the event of the Bank’s financial failure, because the securities are not property (assets) of the Bank. Cash invested overnight in the Bank’s depository accounts is subject to the risk that in the event of the Bank’s failure, LACERA might not recover all or some of those overnight deposits. This risk is mitigated when the overnight deposits are insured or collateralized. LACERA’s policy as incorporated in its current contract with the Bank requires the Bank to certify it has taken all steps to assure all LACERA monies on deposit with the Bank are eligible for and covered by pass-through insurance, in accordance with applicable law and FDIC rules and regulations. The steps taken by the Bank include paying deposit insurance premiums when due, maintaining a prompt corrective action capital category of “well capitalized,” and identifying on the Bank’s records that it acts as a fiduciary for LACERA with respect to the monies on deposit. In addition, the Bank is required to provide evidence of insurance and to maintain a financial institution bond, which would cover the loss of money and securities with respect to any and all property the Bank or its agents hold in or for LACERA’s account, up to the amount of the bond. 90 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued To implement certain investment strategies, some of LACERA’s assets are invested in investment managers’ pooled vehicles. The securities in these vehicles may be held by a different custodian other than the Bank. Counterparty Risk Counterparty risk for investments is the risk that, in the event of the failure of the counterparty to complete a transaction, LACERA would not be able to recover the value of the investment or collateral securities that are in the possession of an outside party. LACERA and its investment managers seek to minimize risk of loss from its counterparties by diversifying the number of counterparties, periodically reviewing their credit quality, and seeking to structure agreements so that collateral is posted on accrued gains if they reach certain size thresholds. On March 31, 2024, LACERA sold 17 private equity limited partnership interests, which were valued at $1.221 billion to three separate buyers. The buyer will remit payments for these partnership interests to LACERA at the end of an 18-month deferral period on September 30, 2025. To estimate the fair value of these transactions, LACERA discounted the future payments to net present value utilizing a 5.00% discount rate, which included the current swap rate plus an appropriate spread, to arrive at the long-term Notes Receivable-Sale of Investments balance of $1.149 billion. LACERA determined the fair value of these payments applying judgment and considering factors such as general market conditions and the time value of money. LACERA contemplated other elements of the transactions, including each buyer's respective risk of default, which did not impact the fair value for this reporting period. Concentration of Credit Risk Concentration of credit risk is the risk of loss that can occur when there is a concentration of exposure to a single or small number of debt issuers versus having exposure to a relatively more diversified pool of debt issuers. For diversification purposes, all investment grade and liquid credit portfolios limit the exposure to a single issuer. This limitation does not apply to U.S. Treasury securities, government-guaranteed debt (including G-7 countries), agency debt, agency mortgage- backed securities, and approved commingled funds and fund-of-one vehicles. As of June 30, 2024, LACERA did not hold any investments in any one debt issuer that would represent 5.00% or more of the Pension Plan Fiduciary Net Position. Investments issued or explicitly guaranteed by the U.S. government and pooled investments are excluded from this requirement. Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. Duration is a measure of the price sensitivity of a fixed income portfolio to changes in interest rates. It is calculated as the weighted average time to receive a bond’s coupon and principal payments. The longer the duration of a portfolio, the greater its price sensitivity to changes in interest rates. 91 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Interest Rate Risk-Continued To manage interest rate risk, investment manager guidelines require that the duration of all investment grade bond portfolios must remain within a range centered around the duration of the benchmark index. Deviations from any of the portfolio structure guidelines are monitored as part of LACERA's compliance review process. The Duration in Fixed Income Securities - Pension Plan schedule for the year ended June 30, 2024 presents the duration by investment type. Whole loan mortgages included in the Pension Plan Portfolio of $8.66 million are excluded from this presentation. Duration in Fixed Income Securities - Pension Plan As of June 30, 2024 (dollars in thousands) Portfolio Weighted Average Effective Investment Type Fair Value Duration* U.S. Treasuries, U.S. Government Agency, and Municipal Instruments: U.S. Treasuries $ 6,052,414 10.81 U.S. Government Agency 824,171 4.41 Municipal / Revenue Bonds 3,871 14.03 Subtotal U.S. Treasuries, U.S. Government Agency, and Municipal Instruments 6,880,456 Corporate Bonds and Credit Securities: Asset-Backed Securities 178,877 2.19 Corporate and Other Credit 1,425,483 2.73 Pooled Funds 10,298,479 1.51 Subtotal Corporate Bonds and Credit Securities 11,902,839 Non-U.S. Fixed Income 178,144 1.97 Private Placement Fixed Income 885,157 2.98 Subtotal Non-U.S. and Private Placement Securities 1,063,301 Total Fixed Income Securities - Pension Plan $ 19,846,596 Note: The Duration table does not include holdings within commingled investment structures or structures that are not directly held in custody by LACERA's global custodian, State Street Bank and Trust Company. *Effective Duration is a measure of a bond's sensitivity to interest rates. It is calculated as the percentage change in a bond's price caused by a change in the bond's yield. For example, a duration of 5 indicates that a 1.00% increase in a bond's yield will cause the bond price to decline 5.00%. 92 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Duration in Fixed Income Securities - OPEB Trust As of June 30, 2024 (dollars in thousands) Portfolio Weighted Average Effective Investment Type Fair Value Duration* U.S. Treasuries, U.S. Government Agency, and Municipal Instruments: U.S. Treasuries $ 633,286 8.84 U.S. Government Agency 113,376 4.94 Municipal / Revenue Bonds 1,974 9.72 Subtotal U.S. Treasuries Instruments 748,636 Corporate Bonds and Credit Securities: Asset-Backed Securities 5,513 3.20 Corporate and Other Credit 398,376 2.07 Pooled Funds 294,517 N/A Subtotal Corporate Bonds and Credit Securities 698,406 Non-U.S. Fixed Income 62,434 2.69 Private Placement Fixed Income 226,214 3.21 Subtotal Non-U.S. and Private Placement Securities 288,648 Total Fixed Income Securities - OPEB Trust $ 1,735,690 *Effective Duration is a measure of a bond's sensitivity to interest rates. It is calculated as the percentage change in a bond's price caused by a change in the bond's yield. For example, a duration of 5 indicates that a 1.00% increase in a bond's yield will cause the bond price to decline 5.00%. Foreign Currency Risk Foreign currency risk is the risk that changes in exchange rates will adversely affect the fair value of an investment or deposit. LACERA’s investment managers are permitted to invest in approved countries or regions, as stated in their respective investment manager guidelines. To mitigate foreign currency risk with global equity, LACERA has implemented a passive currency hedging program, which hedges into U.S. dollars approximately 50% of LACERA’s foreign currency exposure for developed market equities. The following schedules represent LACERA’s exposure to foreign currency risk in U.S. dollars. Most of the exposure is from separately managed accounts with the remaining exposure from non-U.S. commingled funds that are denominated in foreign currency. For the commingled funds, LACERA owns units, and the fund holds the actual securities and/or currencies. The values shown include LACERA’s separately managed account holdings and the pro-rata portion of non-U.S. commingled fund holdings. 93 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Non-U.S. Investment Securities at Fair Value - Pension Plan As of June 30, 2024 (in thousands) Fixed Foreign Private Equity Forward Currency Equity Income Currency Real Estate Real Assets Investments Contracts Total AFRICA South African Rand $ 84,344 161 $ 84,505 AMERICAS Brazilian Real 106,481 1,124 107,605 Canadian Dollar 898,571 1,712 8,448 152,310 588 1,061,629 Chilean Peso 7,996 194 8,190 Colombian Peso 2,106 105 2,211 Mexican Peso 39,695 969 40,664 ASIA Australian Dollar 437,024 766 15,699 (5,222) 448,267 Chinese Renminbi 65,275 3,138 68,413 Hong Kong Dollar 557,649 2,548 (29) 560,168 Indonesian Rupiah 47,328 1,680 49,008 Japanese Yen 1,343,462 10,973 46,401 1,400,836 Malaysian Ringgit 43,802 801 44,603 New Zealand Dollar 9,822 304 (33) 10,093 Pakistan Rupee 29 29 Philippine Peso 12,954 193 13,147 Singapore Dollar 86,614 464 347 87,425 South Korean Won 278,007 1,701 279,708 Taiwan Dollar 447,679 1,600 449,279 Thai Baht 37,123 603 37,726 EUROPE British Pound Sterling 1,320,543 12,885 6,712 54 249,139 1,240 1,590,573 Czech Republic Koruna 3,286 130 3,416 Danish Krone 295,161 430 1,347 296,938 Euro 2,466,836 34,770 14,508 290,417 355,378 867,790 11,638 4,041,337 Hungarian Forint 7,697 263 7,960 Norwegian Krone 75,500 774 (298) 75,976 Polish Zloty 38,938 1,222 40,160 Russian Ruble 1,978 1,978 Swedish Krona 223,745 689 (569) 223,865 Swiss Franc 614,346 1,045 (412) 614,979 MIDDLE EAST Egyptian Pound 3,320 128 3,448 Israeli New Shekel 38,411 1,020 421 39,852 Kuwaiti Dinar 25,521 484 26,005 Qatari Rial 30,699 407 31,106 Saudi Riyal 6,469 6,469 Turkish Lira 32,771 647 33,418 UAE Dirham 41,894 1,038 42,932 Total Investment Securities Subject to Foreign Currency Risk - Pension Plan $ 9,731,069 49,367 67,276 290,471 507,688 1,132,628 55,419 $ 11,833,918 94 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Non-U.S. Investment Securities at Fair Value - OPEB Trust As of June 30, 2024 (in thousands) Fixed Foreign Currency Equity Income Currency Real Assets Total AMERICAS Canadian Dollar $ 47,141 145 $ 47,286 ASIA Australian Dollar 31,856 106 31,962 Hong Kong Dollar 7,270 184 7,454 Japanese Yen 99,563 535 100,098 New Zealand Dollar 1,147 10 1,157 Singapore Dollar 5,545 27 5,572 EUROPE British Pound Sterling 60,236 274 60,510 Danish Krone 15,623 69 15,692 Euro 126,606 479 528 8,715 136,328 Norwegian Krone 3,440 254 3,694 Swedish Krona 14,769 64 14,833 Swiss Franc 36,679 142 36,821 MIDDLE EAST Israeli New Shekel 2,582 6 2,588 Total Investment Securities Subject to Foreign Currency Risk - OPEB Trust $ 452,457 479 2,344 8,715 $ 463,995 Securities Lending Program The BOI policies authorize LACERA to participate in a securities lending program. LACERA generates income by lending securities that it owns to market participants such as brokers and dealers ("borrowers"). In return for lending securities, LACERA receives collateral, either in the form of cash or other securities. When cash collateral is received, LACERA pays the borrower interest on the cash and invests it with the goal of earning a higher yield than the interest rate paid to the borrower. When non-cash collateral is received, the borrower pays a fee for borrowing the securities. At the end of the loan, the borrower returns the securities and LACERA returns the collateral. In addition, either party to the transaction can terminate a loan on demand. Bank is the sole manager of LACERA's custodian and the lending agent for LACERA's securities lending program. The amount of collateral LACERA receives is based on the market value of the security loaned and depends on the type of security: 105% of market value for non-U.S. securities and 102% on U.S. securities are the minimum amounts of collateral received. State Street Global Advisors invests the cash collateral received from the lending program. The collateral is invested in short-term highly liquid instruments. Loans are marked-to-market daily, so that if the fair value of a security on loan rises, LACERA receives additional collateral. Conversely, if the fair value of a security on loan declines, LACERA returns a portion of the collateral. Earnings generated in excess of the interest paid to the borrowers represent net investment income to LACERA. 95 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Securities Lending Program-Continued Under the terms of the lending agreement, the lending agent provides indemnification against borrower default. In the event a borrower does not return securities on loan, the terms of the lending agreement entitle LACERA to terminate the loan and use the collateral to purchase a like amount of “replacement securities”. In the event the purchase price of replacement securities exceeds the amount of collateral, the lending agent is liable to LACERA for the difference, plus interest. At fiscal year-end, LACERA had no credit risk exposure to borrowers, because the amount of collateral received exceeded the value of securities on loan. LACERA had no losses on securities lending transactions resulting from the default of a borrower for the year ended June 30, 2024. As of June 30, 2024, the fair value of securities on loan was $7.972 billion, with a value of cash collateral received of $2.359 billion, which is included in Other payables on the financial statements, and non-cash collateral of $6.086 billion. LACERA’s investment income, net of expenses from securities lending, was $18.12 million for the year ended June 30, 2024. Securities Lending As of June 30, 2024 (in thousands) Fair Value of Cash Non-Cash Securities on Collateral Collateral Calculated Collateral Securities on Loan Loan Received Received Mark (1) Percent (2) U.S. Equity $ 2,042,727 $ 1,058,414 $ 1,060,711 $ 1,650 103.82 % U.S. Fixed Income 5,460,388 1,139,561 4,685,295 (55,248) 105.66 % Non-U.S. Equity 469,192 161,178 340,324 (781) 106.72 % Total $ 7,972,307 $ 2,359,153 $ 6,086,330 $ (54,379) (1) Calculated Mark is performed daily. It is the amount LACERA will collect from the borrower (if the amount is positive), or payment to the borrower (if the amount is negative) to bring the collateralization to appropriate levels based on fair value. (2) Collateral percent is the total collateral received divided by the fair value of securities on loan. U.S. loans are collateralized at 102% minimum of the fair value of the securities on loan while non-U.S. loans are collateralized at 105% minimum. 96 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Hedge Funds LACERA's Investment Policy Statement establishes the portfolio framework and role of the hedge funds program. Diversified hedge funds comprise a variety of hedged investments, such as relative value, arbitrage, and long/short strategies within a diversified portfolio. The status of LACERA's hedge fund investment program as of June 30, 2024 is as follows: • In the core hedge funds portfolio, LACERA is invested in nine direct hedge fund managers and one hedge fund-of-funds manager. • LACERA is invested in a total of ten hedge fund emerging managers in the hedge funds emerging manager program. Stable Asset Management, LACERA's discretionary separate account manager for the hedge funds emerging manager program, selected three new emerging managers during FY 2023-2024. • LACERA continues to maintain one hedge fund of funds manager, Grosvenor Capital Management (GCM). In 2019, LACERA initiated the full redemption of the GCM hedge fund of funds' portfolio. This portfolio began returning cash during FY 2019-2020 and will continue to distribute cash in alignment with the liquidity terms of the portfolio or underlying managers. GCM is managing the redemption process of the GCM portfolio. The investment performance for this strategy is measured separately from other asset classes. The fair value of assets invested in hedge funds as of June 30, 2024 was $4.875 billion. The core portfolio, emerging manager portfolio, and GCM hedge funds of funds portfolio reside within Diversified Hedge Funds under the Risk Reduction and Mitigation functional asset category of LACERA's Total Fund. Fair Value LACERA categorizes its fair value measurements within the fair value hierarchy established by GAAP. The hierarchy is based on the valuation inputs used to measure the fair value of the investment securities and holdings. The fair value hierarchy includes three levels and one additional category. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; and Level 3 inputs are significant unobservable inputs. Certain other investments held by LACERA are valued at net asset value (NAV) per share when an investment does not have a readily determined fair value, provided that the NAV is calculated and used as a practical expedient to estimate fair value in accordance with the requirements of GAAP. The table below illustrates investments classified by their fair value hierarchy (Levels 1, 2, and 3) as well as investments measured at NAV. 97 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Fair Value-Continued Equity and Fixed Income Securities Equity securities classified in Level 1 of the fair value hierarchy are valued using prices quoted in active markets issued by pricing vendors for these securities. Fixed income and equity securities classified in Level 2 of the fair value hierarchy are valued using prices determined by matrix pricing techniques maintained by the various pricing vendors for these securities. Equity securities classified in Level 2 are not traded in the active market. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices. These matrix pricing techniques incorporate inputs such as yield, prepayment speeds, and credit spreads for fixed income securities. Derivative securities classified as Level 2 are securities whose value are either derived daily from associated securities that are traded, or are determined by using a market approach that considers benchmark interest rates. Fixed income and equity securities classified in Level 3 are securities whose stated market price is unobservable by the marketplace; many of these securities are priced by the issuers or industry groups for these securities. Fair value is defined as the quoted market value on the last trading day of the period. These prices are obtained from various pricing sources by the Bank. Hedge Funds, Private Equity, Real Assets, Real Estate, Equity, and Fixed Income Funds Investments in hedge funds, private equity, real assets, real estate, equity and fixed income funds are valued at the estimated net asset value (NAV) based upon the fair value of the underlying investments, as determined in good faith by the General Partner (GP), in accordance with GAAP fair value principles in instances where no observable public market values are available. Investments that are estimated at fair value are initially valued at cost with subsequent adjustments that reflect third party transactions, financial operating results, and other factors deemed relevant by the GP. These assets are reported by LACERA based on the practical expedient allowed under GAAP. In instances where observable public market values are available for the underlying securities held, fair value is determined by the fund's administrator using independent pricing sources. Real Estate Separate Account Investments Real estate investments are valued at NAV, based upon estimated fair value, as determined in good faith by the Investment Manager. These investments are initially valued at cost with subsequent adjustments that reflect third party transactions, financial operating results, and other factors deemed relevant by the Investment Manager. Properties are subject to independent third party appraisals annually. 98 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Fair Value-Continued Investments and Derivative Instruments Measured at Fair Value - Pension Plan As of June 30, 2024 (in thousands) Quoted Prices In Active Markets for Significant Other Significant Identical Assets Observable Inputs Unobservable Investments by Fair Value Level Total Level 1 Level 2 Inputs Level 3 Fixed Income Securities Asset-Backed Securities $ 178,877 $ $ 178,877 $ Corporate and Other Credit 1,425,484 1,365,945 59,539 Municipal/Revenue Bonds 3,871 3,871 Non-U.S. Fixed Income 178,144 147,184 30,960 Private Placement Fixed Income 885,157 876,344 8,813 U.S. Government Agency 824,171 824,171 U.S. Treasuries 6,052,414 6,052,414 Whole Loan Mortgages 8,661 8,661 Total Fixed Income Securities 9,556,779 9,448,806 107,973 Equity Securities Non-U.S. Equity 10,463,610 10,457,776 1,091 4,743 Pooled Investments 473,278 473,278 U.S. Equity 17,962,579 17,925,521 7,247 29,811 Total Equity Securities 28,899,467 28,856,575 8,338 34,554 Collateral from Securities Lending 2,359,152 2,359,152 Total Investments by Fair Value Level $ 40,815,398 $ 28,856,575 $ 11,816,296 $ 142,527 Investments Measured at NAV Fixed Income $ 10,298,479 Equity 559,458 Hedge Funds 4,875,300 Private Equity 13,057,192 Real Estate 4,406,609 Real Assets 3,359,137 Total Investments Measured at NAV 36,556,175 Total Investments $ 77,371,573 Derivatives Foreign Exchange Contracts $ 55,419 $ $ 55,419 $ Foreign Equity Derivatives 543 543 U.S. Equity Derivatives 2,728 2,728 U.S. Fixed Income Derivatives 46 46 Total Derivatives $ 58,736 $ 3,317 $ 55,419 $ 99 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Fair Value-Continued Investments Measured at the Net Asset Value - Pension Plan As of June 30, 2024 (dollars in thousands) Unfunded Redemption Fair Value Commitments Redemption Frequency (If Currently Eligible) Notice Period Fixed Income Funds (1) $ 10,298,479 $ 617,178 Daily, Monthly or Not Eligible 1-60 days or N/A Commingled Equity Funds (2) 559,458 Annual or Not Eligible 1-90 days or N/A Monthly, Quarterly, Semi-Annual, Annual; Self- Hedge Funds (3) 4,875,300 Liquidating 5-180 days Private Equity (4) 13,057,192 5,273,126 Not Eligible N/A Real Estate (4) 4,406,609 1,514,021 Quarterly or Not Eligible 30 days+ or N/A Real Assets (4) 3,359,137 1,896,738 Not Eligible N/A Total Investments Measured at the NAV $ 36,556,175 (1) Fixed Income Funds: 22 fixed income funds are valued at the NAV of units held at the end of the period based upon the fair value of the underlying investments. Approximately 65% of assets are available for redemption within 12 months; these funds provide daily, monthly or quarterly liquidity. Approximately 35% of the fund assets have liquidity beyond 12 months. (2) Commingled Equity Funds: 1 equity fund is considered commingled in nature. The fund is valued at the NAV of units held at the end of the period based upon the fair value of the underlying investments. The fund represents 2% of the equity assets and is subject to a lock up period that limits redemptions for the next year. (3) Hedge Funds: This portfolio consists of 18 current funds and 1 fund of funds. Hedge Fund investments are valued at NAV per share. When considering liquidity terms of the current funds, 75% of the fund assets are available for redemption within 12 months; these funds provide monthly, quarterly, semi-annual, or annual liquidity. Some of these funds are subject to redemption notices that extend the time frame to receive redemptions beyond the next 12 months. Approximately 25% of fund assets are in funds that offer periodic liquidity that extends beyond the next 12 months. LACERA's Hedge Funds portfolio invests in the following strategies: (a) Macro and Tactical Trading: This strategy makes investments based on analyses and forecasts of macroeconomic trends, including governmental and central bank policies, fiscal trends, trade imbalances, interest rate trends, inter-country relations, and economic and technical analysis. (b) Equity Long/Short: This strategy purchases and/or sells equities based on fundamental and/or quantitative analysis and other factors. (c) Credit: This strategy includes long-biased credit, long/short credit, structured credit, and mortgage credit. (d) Relative Value: This strategy’s focus is to benefit from valuation discrepancies that may be present in related financial instruments by purchasing and/or shorting these instruments. (e) Multi-Strategy: This strategy aims to pursue varying strategies to diversify risks and reduce volatility. (f) Event Driven: This strategy seeks to gain an advantage from pricing inefficiencies that may occur in the onset or aftermath of a corporate action or related event. (4) Private Equity, Real Assets, and Real Estate Funds: LACERA’s Private Equity portfolio consists of 278 funds, investing primarily in buyout funds, with some exposure to venture capital, special situations, fund of funds, and co-investments. Due to contractual limitations, none of the funds are eligible for redemption. The Real Assets portfolio consists of 29 funds, investing primarily in infrastructure and natural resources. 4 of the funds are eligible for redemption after an initial lock-up period, and the other 25 of the funds are not eligible for redemption as the lock-up period is typically from 10-15 years. The Real Estate portfolio, composed of 28 commingled funds, invests in both U.S. and Non-U.S. commercial real estate. The fair values of these funds have been determined using net assets valued at the end of the period and net assets valued one quarter in arrears plus current quarter cash flows. 6 out of 28 Real Estate funds are eligible for redemption depending upon the availability of cash for redemptions in the fund. Distributions are received as underlying investments within the funds are liquidated, which on average can occur over the span of 5 to 10 years. For Real Estate investments held in separate accounts and debt program investments, see Note J - Special Purpose Entities of LACERA's ACFR. 100 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Fair Value-Continued Investments Measured at Fair Value - OPEB Trust As of June 30, 2024 (in thousands) Quoted Prices in Active Markets Significant Other Significant for Identical Observable Unobservable Investments by Fair Value Level Total Assets Level 1 Inputs Level 2 Inputs Level 3 Fixed Income Securities Asset-Backed Securities $ 5,513 $ $ 5,513 $ Private Placement Fixed Income 226,213 226,213 Corporate and Other Credit 398,371 398,065 306 Municipal / Revenue Bonds 1,974 1,974 Non-U.S. Fixed Income 62,434 62,434 Pooled Investments 20,365 20,365 U.S. Government Agency 113,376 113,376 U.S. Treasuries 633,286 633,286 Total Fixed Income Securities 1,461,532 20,365 1,440,861 306 Equity Securities Non-U.S. Equity 479,762 479,762 Pooled Investments 188,244 188,244 U.S. Equity 1,439,130 1,439,129 1 Total Equity Securities 2,107,136 2,107,135 1 Total Investments by Fair Value Level $ 3,568,668 $ 2,127,500 $ 1,440,862 $ 306 Investments Measured at Net Asset Value (NAV) Fixed Income $ 274,152 Private Equity 18,175 Real Estate 2,431 Real Assets 16,894 Total Investments Measured at NAV 311,652 Total Investments $ 3,880,320 Derivatives U.S. Fixed Income Derivatives $ 5 $ 5 $ $ Foreign Equity Derivatives 2 2 Total Derivatives $ 7 $ 7 $ $ 101 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 4. CASH AND INVESTMENTS-Continued LACERA Investment Portfolio-Continued Fair Value-Continued Investments Measured at Net Asset Value - OPEB Trust As of June 30, 2024 (dollars in thousands) Unfunded Redemption Frequency (If Redemption Investment by Fair Value Level Fair Value Commitments Currently Eligible) Notice Period Fixed Income Securities Fixed Income Funds (1) $ 274,152 $ 95,856 Daily, Monthly, or Not Eligible 1-60 days or N/A Private Equity (2) 18,175 117,098 Not Eligible N/A Real Estate (3) 2,431 67,395 Not Eligible N/A Real Assets (4) 16,894 96,508 Not Eligible N/A Total Investments Measured at NAV (1) $ 311,652 (1) Fixed Income Funds: The portfolio consists of 9 fixed income funds value at the NAV of units held at the end of the period based on the fair value of underlying investments. Approximately 95% of assets are available for redemption within 12 months. Approximately 5% of the fund assets are not eligible for redemption due to contractual limitations. (2) Private Equity: 7 private equity funds are valued at NAV. Due to contractual limitations, non of the funds are eligible for redemption. (3) Real Estate: The Real Estate portfolio is composed of 1 fund. Due to contractual limitations, the fund is not eligible for redemption. (4) Real Assets: The Real Assets portfolio consists of 5 funds. Due to contractual limitations, none of the funds are eligible for redemption. 102 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 5. CAPITAL ASSETS Capital assets activity for the year ended June 30, 2024 is as follows (in thousands): Balance Balance Governmental Activities July 1, 2023 Additions Deletions June 30, 2024 Capital assets, not being depreciated/ amortized: Land $ 2,572,121 1,911 — $ 2,574,032 Easements 5,074,796 23,249 — 5,098,045 Software in progress 81,278 41,395 (2,435) 120,238 Construction in progress-buildings and improvements 1,452,844 387,294 (185,151) 1,654,987 Construction in progress-infrastructure 759,965 209,313 (53,431) 915,847 Subscription assets in progress 8,250 14,961 (9,392) 13,819 Subtotal 9,949,254 678,123 (250,409) 10,376,968 Capital assets, being depreciated/amortized: Buildings and improvements 7,006,509 242,589 (7,757) 7,241,341 Equipment 1,901,542 185,539 (87,899) 1,999,182 Software 608,122 1,430 (12,619) 596,933 Infrastructure 8,207,619 52,735 — 8,260,354 Lease land 10,137 — (9,082) 1,055 Lease buildings and improvements 1,749,598 148,703 (63,955) 1,834,346 Lease equipment 17,397 294 (611) 17,080 Subscription assets 108,590 40,173 148,763 Subtotal 19,609,514 671,463 (181,923) 20,099,054 Less accumulated depreciation/amortization for: Buildings and improvements (2,757,257) (164,418) 2,396 (2,919,279) Equipment (1,446,454) (152,636) 82,690 (1,516,400) Software (443,681) (32,838) 12,619 (463,900) Infrastructure (4,928,259) (146,986) — (5,075,245) Lease land (7,118) (2,345) 9,082 (381) Lease buildings and improvements (240,227) (141,947) 33,350 (348,824) Lease equipment (4,736) (3,469) 611 (7,594) Subscription assets (21,651) (29,718) (51,369) Subtotal (9,849,383) (674,357) 140,748 (10,382,992) Total capital assets, being depreciated/ amortized, net 9,760,131 (2,894) (41,175) 9,716,062 Governmental activities capital assets, net $ 19,709,385 675,229 (291,584) $ 20,093,030 103 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 5. CAPITAL ASSETS-Continued Balance Balance Business-type Activities July 1, 2023 Additions Deletions June 30, 2024 Capital assets, not being depreciated/ amortized: Land $ 134,932 — — $ 134,932 Easements 33,242 176 — 33,418 Construction in progress-buildings and improvements 515,477 248,161 (203,484) 560,154 Construction in progress- infrastructure 59,092 19,930 (3,576) 75,446 Subtotal 742,743 268,267 (207,060) 803,950 Capital assets, being depreciated/ amortized: Buildings and improvements 2,950,168 217,043 (51,728) 3,115,483 Equipment 454,126 42,088 (55,455) 440,759 Software 58,922 — — 58,922 Infrastructure 1,321,540 3,302 — 1,324,842 Lease buildings and improvements —0 2,801 2,801 Lease equipment 2,0900 — 2,090 Subtotal 4,786,846 265,234 (107,183) 4,944,897 Less accumulated depreciation/ amortization for: Buildings and improvements (1,058,081) (63,234) 3,119 (1,118,196) Equipment (310,017) (31,573) 53,191 (288,399) Software (56,752) (1,433) — (58,185) Infrastructure (744,639) (24,381) — (769,020) Lease buildings and improvements —0 (985) (985) Lease equipment (5040) (414) (918) Subtotal (2,169,993) (122,020) 56,310 (2,235,703) Total capital assets, being depreciated/ amortized, net 2,616,853 143,214 (50,873) 2,709,194 Business-type activities capital assets, net 3,359,596 411,481 (257,933) 3,513,144 Total capital assets, net $ 23,068,981 1,086,710 (549,517) $ 23,606,174 104 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 5. CAPITAL ASSETS-Continued Depreciation/Amortization Expense Depreciation/Amortization expense was charged to functions/programs of the primary government as follows (in thousands): Governmental activities: General government $ 83,191 Public protection 243,725 Public ways and facilities 86,900 Health and sanitation 113,963 Public assistance 73,645 Education 6,305 Recreation and cultural services 46,576 Capital assets held by the County’s internal service funds are charged to the various functions based on their usage of the assets 20,052 Total depreciation/amortization expense, governmental activities $ 674,357 Business-type activities: Hospitals $ 94,861 Waterworks 23,822 Aviation 3,337 Total depreciation/amortization expense, business-type activities $ 122,020 105 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 5. CAPITAL ASSETS-Continued Discretely Presented Component Units LACDA Capital assets activity for the LACDA component unit for the year ended June 30, 2024, was as follows (in thousands): Balance Balance July 1, 2023 Additions Deletions June 30, 2024 Capital assets, not being depreciated/ amortized: Land $ 85,343 — (4,098) $ 81,245 Construction in progress-buildings and improvements 6,178 6,170 (2,340) 10,008 Subtotal 91,521 6,170 (6,438) 91,253 Capital assets, being depreciated/amortized: Buildings and improvements 271,935 11,440 (7,565) 275,810 Equipment 9,025 675 (337) 9,363 Software 1,025 — — 1,025 Lease equipment 260 107 (260) 107 Subscription assets 3,079 4,545 (1,262) 6,362 Subtotal 285,324 16,767 (9,424) 292,667 Less accumulated depreciation/amortization for: Buildings and improvements (182,886) (7,339) 6,596 (183,629) Equipment (7,985) (425) 327 (8,083) Software (436) (102) — (538) Lease equipment (187) (73) 254 (6) Subscription assets (1,334) (1,686) 1,252 (1,768) Subtotal (192,828) (9,625) 8,429 (194,024) Total capital assets being depreciated/ amortized, net 92,496 7,142 (995) 98,643 LACDA capital assets, net $ 184,017 13,312 (7,433) $ 189,896 106 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 5. CAPITAL ASSETS-Continued First 5 LA Capital assets activity for the First 5 LA component unit for the year ended June 30, 2024, was as follows (in thousands): Balance Balance July 1, 2023 Additions Deletions June 30, 2024 Capital assets, not being depreciated- Land $ 2,039 — — $ 2,039 Capital assets, being depreciated: Buildings and improvements 15,822 148 — 15,970 Equipment 3,237 97 — 3,334 Subtotal 19,059 245 19,304 Less accumulated depreciation for: Buildings and improvements (4,570) (359) — (4,929) Equipment (3,063) (79) — (3,142) Subtotal (7,633) (438) (8,071) Total capital assets being depreciated,net 11,426 (193) 11,233 First 5 LA capital assets, net $ 13,465 (193) $ 13,272 6. PUBLIC-PRIVATE AND PUBLIC-PUBLIC PARTNERSHIPS AND AVAILABILITY AGREEMENTS GASB 94, “Public-Private and Public-Public Partnerships (PPPs) and Availability Payment Arrangements (APAs)" (GASB 94) defines a PPP as an arrangement in which the government (the transferor) contracts with an operator to provide public services by conveying control of the right to operate or use a nonfinancial asset, such as infrastructure or other capital asset (the underlying PPP asset), for a period of time in an exchange or exchange-like transaction type of public-private or public-public partnership. Some PPPs meet the definition of a service concession arrangement (SCA), which the board defines in this statement as a PPP in which (1) the operator collects and is compensated by fees from third parties; (2) the transferor determines or has the ability to modify or approve which services the operator is required to provide, to whom the operator is required to provide the services, and the prices or rates that can be charged for the services; and (3) the transferor is entitled to significant residual interest in the service utility of the underlying PPP asset at the end of the arrangement. An APA is an arrangement in which a government compensates an operator for services that may include designing, constructing, financing, maintaining, or operating an underlying nonfinancial asset for a period of time in an exchange or exchange-like transaction. The County determined that golf courses met the criteria set forth in GASB 94 (where the County is the transferor) and therefore included these SCAs in the County’s financial statements as deferred inflows of resources. GASB 94 also provides guidance on accounting treatment if the County were acting as an operator of another government’s facility. The County has determined that there are no incidences where the County would qualify as an operator. 107 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 6. PUBLIC-PRIVATE AND PUBLIC-PUBLIC PARTNERSHIPS AND AVAILABILITY AGREEMENTS- Continued Golf Courses The County manages a public golf course system, which offers affordable greens fees, discount programs for senior citizens and students, and a junior golf program. Each golf course is leased under agreement with an operator, which provides for activities such as golf course management, clubhouse operations, and food and beverage concessions. The operators collect user fees and are responsible for the day-to-day operations of the golf courses. The operators are required to operate and maintain the golf courses, and make installment payments to the County, in accordance with their respective contracts. As of June 30, 2024, the present value of the installment payments under contract is estimated to be $82.58 million and reported as deferred inflows of resources in the statement of net position. The present values of the installment payments were calculated using discount rates of 5.12%, 3.55%, 3.70%, 1.87% and 4.20% for the term of the agreement for each SCA. The lease terms for the twenty golf courses cover remaining periods ranging from 3 to 15 years as of June 30, 2024. The FY 2023-2024 total monthly installment payments are approximately $815,000. The County primarily uses the proceeds to fund parks and recreation operations, 10% of which is set aside for future golf course capital improvements. The acquisition value of the golf courses, including land, buildings, and construction in progress, is reported at $21.73 million as of June 30, 2024. 7. PENSION PLAN Plan Description The County pension plan is administered by LACERA, which was established under the CERL. LACERA is a cost-sharing, multi-employer defined benefit plan. It provides benefits to employees of the County and the following additional entities that are not part of the County's reporting entity: Los Angeles Superior Court Little Lake Cemetery District Local Agency Formation Commission Los Angeles County Office of Education (LACOE) South Coast Air Quality Management District (SCAQMD) New employees of LACOE hired on or after July 1971 and new employees of SCAQMD hired after December 31, 1979 are not eligible for LACERA benefits. LACERA issues a stand-alone financial report, which is available at its offices located at Gateway Plaza, 300 N. Lake Avenue, Pasadena, California 91101-4199 or at www.LACERA.com. Benefits Provided Benefits are authorized in accordance with the California Constitution, the CERL, the bylaws, and procedures and policies adopted by LACERA's Boards of Retirement and Investments. The County Board may also adopt resolutions, as permitted by CERL, which may affect the benefits of LACERA members. 108 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Benefits Provided-Continued LACERA provides retirement, disability, death benefits and cost of living adjustments to eligible members. Vesting occurs when a member accumulates 5 years of creditable service under contributory plans or accumulates 10 years of creditable service under the general service non- contributory plan. Benefits are based upon 12 or 36 months' average compensation, depending on the plan, as well as age at retirement and length of service as of the retirement date, according to applicable statutory formula. Vested members who terminate employment before retirement age are considered terminated vested (deferred) members. Service-connected disability benefits may be granted regardless of length of service consideration. Five years of service are required for nonservice-connected disability eligibility according to applicable statutory formula. Members of the non-contributory plan, who are covered under separate long-term disability provisions not administered by LACERA, are not eligible for disability benefits provided by LACERA. Contributions LACERA has nine benefit tiers known as A, B, C, D, E and G, and Safety A, B and C. All tiers except E are employee contributory. Tier E is employee non-contributory. Prior to December 31, 2012, new general members were only eligible for tier D or E and new safety members were only eligible for Safety B. As of January 1, 2013, new general employees are only eligible for tier G and new safety members are only eligible for Safety C. These new tiers were added as a result of the California Public Employees’ Pension Reform Act of 2013 (PEPRA) and became effective January 1, 2013. Rates for the tiers are established in accordance with State law by LACERA's Boards of Retirement and Investments and the County Board. The following employer rates were in effect for FY 2023-2024: July 1, 2023 - September 15, 2023 A B C D E G General Members 31.11% 24.13% 21.23% 22.75% 24.30% 22.66% Safety Members 39.93% 34.79% 27.91% September 16, 2023 - June 30, 2024 A B C D E G General Members 31.52% 25.79% 22.45% 24.16% 25.74% 23.96% Safety Members 42.18% 36.31% 29.48% The rates were determined by the actuarial valuations performed as of June 30, 2022. The investment rate of return assumption used in the valuation performed as of June 30, 2022 remained at 7.00%. The employer contribution rates used in FY 2023-2024, beginning September 16, 2023, increased from 0.41% to 2.25% over the rates used in FY 2022-2023 and may increase again during the following fiscal year. The most significant factors causing the increase were increases to the normal cost rate and deferred recognition of new assumptions. Employee rates vary by option and employee entry age from 6% to 18% of their annual covered salary. During FY 2023-2024, the County contributed the full amount of the Actuarial Determined Contribution, as determined by the actuarial valuations, in the form of semi-monthly cash payments in the amount of $2.411 billion. 109 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Net Pension Liability, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2024, the County reported a liability of $14.074 billion for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2023, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2022, projected forward to the measurement date, taking into account any significant changes between the valuation date and the measurement date. The County’s proportion of the net pension liability was based on a projection of the County’s future contribution effort to the pension plan relative to the projected contributions of all pension plan participants, actuarially determined. At June 30, 2023, the County’s proportionate share was 96.28%, which was a decrease of (0.19)% from its proportion measured as of June 30, 2022. For the year ended June 30, 2024, the County recognized pension expense of $386.50 million which is reported as $346.03 million for governmental activities and $40.47 million for business-type activities. Pension expense represents the change in the net pension liability during the measurement period, adjusted for actual contributions and the deferred recognition of changes in investment gain/loss, actuarial gain/loss, actuarial assumptions or methods, and plan benefits. At June 30, 2024, the County reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources (in thousands): Deferred Inflows Deferred Outflows of Resources of Resources Net difference between projected and actual earnings $ $ 100,005 Change in assumptions 2,340,769 Change in experience 5,720 1,598,001 Change in proportion and differences between County contributions and proportionate share of contributions 281,397 287,374 Contributions made subsequent to measurement date 2,410,853 Total $ 287,117 $ 6,737,002 Deferred outflows of resources and deferred inflows of resources above represent the unamortized portion of changes to net pension liability to be recognized in future periods in a systematic and rational manner. Investment gains or losses are recognized in pension expense over a 5 year period and economic/demographic gains or losses and assumption changes or inputs are recognized over the average remaining service life for all active and inactive members, which is 7 years as of June 30, 2023. 110 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Net Pension Liability, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions-Continued Amounts currently reported as deferred outflows and inflows of resources, other than contributions related to pension, will be recognized in pension expense as follows (in thousands): Deferred Outflows/(Inflows) Year Ending June 30: of Resources 2024 $ 818,952 2025 (92,112) 2026 2,081,272 2027 726,290 2028 289,791 Thereafter 214,839 Deferred outflows of $2.411 billion related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the subsequent fiscal period rather than the current fiscal period. As of the measurement date of June 30, 2024, the Pension Plan's fiduciary net position increased approximately $5.350 billion due to significant increases in the fair value of the Pension Plan's investments. Overall, the increase in the fiduciary net position and increase in the total pension liability of $4.245 billion from interest and service costs, resulted in a decrease in net pension liability from $14.618 billion to $13.513 billion. The County's proportionate share of the Pension Plan's net pension liability was 96.28% as of June 30, 2023 and is historically above 96%. Actuarial Assumptions Valuation Timing June 30, 2022, rolled forward to June 30, 2023 Actuarial Cost Method Individual Entry Age Normal Inflation 2.75% General Wage Growth 3.25% Projected Salary Increases 3.66% to 12.54% Investment Rate of Return 7.15%, net of investment expense, including inflation Cost of Living Adjustments (COLA) Post-retirement benefit increases of either 2.75% or 2.00% per year are assumed based on the benefits provided. Supplemental Targeted Adjustment for Retirees (STAR) COLA benefits are assumed to be substantively automatic at the 80% purchasing power level until the STAR reserve is projected to be insufficient to pay further STAR benefits. Mortality Various rates based on the Pub-2010 mortality tables and using the MP-2021 Ultimate Projection Scale. See June 30, 2022 actuarial valuation for details. It can be found at www.LACERA.com. Experience Study Covers the 3 year period ended June 30, 2022. 111 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Actuarial Assumptions-Continued The long-term expected rate of return on pension plan investments (7.00%, net of all expenses) was determined using a building block method in which a median, or expected, geometric rate of return was developed for each major asset class. The median rates were combined to produce the long- term expected rate of return by weighting the expected future rates of return by the target asset allocation percentages. For the year ended June 30, 2023: Weighted Average Long-Term Expected Rate of Return (After Expected 2.75% Inflation Rate) Asset Class Target Allocation (Geometric) Growth 53.00% 6.20 % Global Equity 32.00 % 5.00 % Private Equity 17.00 % 7.00 % Non-Core Private Real Estate 4.00 % 6.50 % Credit 11.00% 3.10 % Liquid Credit 4.00 % 2.20 % Illiquid Credit 7.00 % 3.30 % Real Assets and Inflation Hedges 17.00% 3.70 % Core Private Real Estate 6.00 % 3.20 % Natural Resources and Commodities 3.00 % 3.90 % Infrastructure 5.00 % 4.90 % TIPS 3.00 % 0.10 % Risk Reduction and Mitigation 19.00% 1.10 % Investment Grade Bonds 7.00 % 0.20 % Diversified Hedge Fund Portfolio 6.00 % 2.10 % Long-Term Government Bonds 5.00 % 0.70 % Cash Equivalents 1.00 % (0.80) % Discount Rate The discount rate used to measure the total pension liability was 7.13%. This is equal to the 7.00% long-term investment return assumption adopted by LACERA (net of investment and administrative expenses), plus 0.13% assumed administrative expenses. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate, and that County contributions will be made at rates equal to the difference between actuarially determined contribution rates and member rates. Based on those assumptions, the pension plan’s fiduciary net position was projected to be sufficient to pay all projected future benefit payments of current active and inactive plan members. Therefore, the discount rate for calculating the total pension liability is equal to the long-term expected rate of return, gross of administrative expenses. 112 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Sensitivity of the County’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate The following represents the County’s proportionate share of the net pension liability calculated using the discount rate of 7.13%, as well as what the County’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower (6.13%) or 1-percentage point higher (8.13%) than the current rate (in thousands): 1% Decrease Discount Rate 1% Increase (6.13%) (7.13%) (8.13%) Net Pension Liability $ 25,362,576 $ 14,073,963 $ 4,716,228 Pension Plan Fiduciary Net Position Detailed information about pension plan fiduciary net position as of June 30, 2023 is available in the separately issued LACERA financial report, which can be found at www.LACERA.com. Deferred Compensation Plans The County offers to its employees three deferred compensation plans created in accordance with Sections 401 and 457 of the Internal Revenue Code. One or more of these plans are available to substantially all employees and allow participants to defer a portion of their current income until future years. Plan Description and Funding Policy The Deferred Compensation and Thrift Plan was established as a Section 457 defined contribution plan covering employees who have achieved full time and permanent employment status. The plan is designed to permit these employees to voluntarily defer a portion of their compensation and provide for retirement and death benefits. The plan is funded by employer and employee contributions. As of June 30, 2024, the County provided up to a 4% matching contribution per pay period of the employee’s voluntary contribution. Employer and employee contributions are deposited into the participant accounts and invested based on participant selected options. Total employer contributions for the year ended June 30, 2024, were $323.45 million. The Savings Plan is a Section 401(k) defined contribution plan covering eligible full-time permanent employees of the County not covered by collective bargaining agreements and who desire to participate in the plan. Employees eligible for voluntary participation in this plan are also eligible for participation in the Deferred Compensation and Thrift Plan. The plan is funded by employer and employee contributions. As of June 30, 2024, the County provided up to a 4% matching contribution per pay period of the employee’s voluntary contribution. Employer and employee contributions are deposited into the participant accounts and invested based on participant selected options. Total employer contributions for the year ended June 30, 2024, were $88.12 million. 113 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 7. PENSION PLAN-Continued Deferred Compensation Plans-Continued Plan Description and Funding Policy-Continued The Pension Savings Plan is a Section 457 defined contribution plan covering part-time, temporary and seasonal County employees who are not eligible to participate in the retirement programs provided through the LACERA. The plan was established in lieu of employee coverage under Social Security. Participation in the plan is mandatory and employees must contribute a minimum of 4.5% of their eligible earnings and the County makes a contribution equal to 3% of compensation. Participants may contribute additional amounts beyond the required 4.5%. Total employer contributions for the year ended June 30, 2024, were $9.87 million. The plans are administered through a third-party administrator. The assets of the plans are held in trust by Great West Trust Company LLC and invested at the direction of the participants. Thus, plan assets and any related liability to plan participants have been excluded from the County’s financial statements. 8. OTHER POSTEMPLOYMENT BENEFITS Retiree Healthcare Plan Description LACERA administers an agent multiple-employer Retiree Healthcare (RHC) OPEB program on behalf of the County, its affiliated Superior Court, and four outside districts. The outside districts include: Little Lake Cemetery District, Local Agency Formation Commission, LACOE and the South Coast Air Quality Management District. As of July 1, 2018, LACERA transitioned the OPEB program from a cost-sharing, multiple-employer plan. The agent plan structure determines program liabilities and costs directly by employer and allocates shared expenses. The measurement date for the RHC OPEB program is June 30, 2023. In April 1982, the County adopted an ordinance pursuant to Government Code Section 31691, which provided for a health insurance program and death benefits for retired employees and their dependents. In 1994, the County amended the agreements to continue to support LACERA’s retiree insurance benefits program regardless of the status of active member insurance. In June 2014, the LACERA Board approved the County’s request to modify the agreements to create a new retiree healthcare benefit plan in order to lower its Retiree Healthcare Program (RHP) costs. Structurally, this means the County will be segregating all current retirees and current employees into RHP Tier 1 and placing all employees hired after June 30, 2014 into RHP Tier 2. Under RHP Tier 2, retirees who are eligible for Medicare will be required to enroll in that program. In addition, coverage will be available for employees or eligible survivors only. 114 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Plan Description-Continued Pursuant to the 1982, 1994, and 2014 Agreements between the County and LACERA, the parties agreed to the continuation of the health insurance benefits then in existence. The County agreed to subsidize a portion of the insurance premiums of certain retired members and their eligible dependents based on the member’s length of service. The County further agreed to maintain the status quo of existing benefits provided to participants. As part of the 2014 Agreement, the County modified the existing healthcare benefit plan, which created a new benefit structure, Tier 2, for all employees hired after June 30, 2014. LACERA agreed not to change retired members’ contributions toward insurance premiums or modify medical benefit levels without the County’s prior consent. Active employees are not required to make contributions to the plan. Pursuant to the California Government Code, the County established an irrevocable OPEB Trust for the purpose of holding and investing assets to pre-fund the RHP, which LACERA administers. On May 15, 2012, the County Board entered into a trust and investment services agreement with the LACERA Board of Investments to act as trustee and investment manager. The OPEB Trust does not modify the County’s benefit programs. LACERA issues a stand-alone financial report that includes the required information for the OPEB plan. The report is available at its offices located at Gateway Plaza, 300 North Lake Avenue, Pasadena, California 91101-4199 or www.LACERA.com. Benefits Provided Health care benefits earned by County employees are dependent on the number of completed years of retirement service credited to the retiree by LACERA upon retirement; it does not include reciprocal service in another retirement system. Service includes all service on which the member's retirement allowance was based. The RHC OPEB Program offers members an extensive choice of medical plans as well as two dental/vision plans. The medical plans are either HMOs or indemnity plans, and some are designed to work with Medicare benefits, such as the Medicare Supplement or Medicare HMO plans. Coverage is available regardless of preexisting medical conditions. Under Tier 2, retirees who are eligible for Medicare are required to enroll in that program. Medicare-eligible retirees and their covered dependents must enroll in Medicare Parts A and B and in a Medicare HMO plan or Medicare Supplement plan under Tier 2. Medical and Dental/Vision - Program benefits are provided through third party insurance carriers with the participant’s cost for medical and dental/vision insurance varying according to the years of retirement service credit with LACERA, the plan selected, and the number of persons covered. The County contribution subsidizing the participant’s cost starts at 10 years of service credit in the amount of 40% of the lesser of the benchmark plan rate or the premium of the plan in which the retiree is enrolled. For each year of retirement service credit earned beyond 10 years, the County contributes 4% per year, up to a maximum of 100% for a member with 25 years of service credit. The County contribution can never exceed the premium of the benchmark plans. Members are responsible for premium amounts above the benchmark plans, including those with 25 or more years of service credit. 115 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Benefits Provided-Continued Under Tier 1, the County subsidy is based on the coverage elected by the retiree. The benchmark plans are Anthem Blue Cross Plans I and II for medical and Cigna Indemnity Dental/Vision for dental and vision. Under Tier 2, the County subsidy is based on retiree only coverage. Tier 2 medical benchmark plans are Anthem Blue Cross Plans I and II for Medicare-ineligible members, Anthem Blue Cross Plan III for Medicare-eligible members, and Cigna Indemnity Dental/Vision for dental and vision plans. Medicare Part B - The County reimburses the member’s Medicare Part B standard rate premiums paid by member to Social Security for Part B coverage, subject to annual approval by the County Board of Supervisors. Eligible members and their dependents must be enrolled in both Medicare Part A and Medicare Part B and enrolled in a LACERA- administered Medicare HMO Plan or Medicare Supplement Plan and meet all of the qualifications. Under Tier 2, the County reimburses for Medicare Part B (at the standard rate) for eligible members or eligible survivors only. Disability - If a member is granted a service-connected disability retirement and has less than 13 years of service, the County contributes the lesser of 50% of the benchmark plan rate or the premium of the plan in which the retiree is enrolled. Under Tier 2, the benchmark plan rate is based on retiree-only premiums. A member with 13 years of service credit receives a 52% subsidy. This percentage increases 4% for each additional completed year of service, up to a maximum of 100%. Death/Burial Benefit - There is a one-time lump-sum $5,000 death/burial benefit payable to the designated beneficiary upon the death of a retiree, reimbursed to LACERA by the County. Active and vested terminated (deferred) members are eligible for this benefit once they retire. Spouses and dependents are not eligible for this death benefit. Employees Covered by Benefit Terms Medical and Dental/Vision Benefits 2023 Dental/ Medical Vision Retired Participants Retired Members and Survivors 55,359 57,271 Spouses and Dependents 28,274 32,699 Total Retired 83,633 89,970 Inactive Members - Vested 9,612 9,612 Active Members - Vested 75,388 75,388 Total Membership Eligible for Benefits 168,633 174,970 116 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Employees Covered by Benefit Terms-Continued Death Benefits 2023 Retired with Eligibility for Death Benefits 63,152 Active Members - Vested 9,612 Inactive Members - Vested 75,388 Total Membership Eligible for Benefits 148,152 Contributions The current funding policy requires the County to contribute on a pay-as-you-go basis. During FY 2023-2024, the County made payments to LACERA totaling $760.61 million for retiree healthcare benefits. Included in this amount was $101.48 million for Medicare Part B reimbursements and $9.39 million in death benefits. Additionally, $50.26 million was paid by member participants. During FY 2023-2024, the County also contributed $503.39 million in excess of the pay-as-you-go amounts. Net OPEB Liability At June 30, 2024, the County reported a net RHC OPEB liability of $23.914 billion. The net RHC OPEB liability was measured as of June 30, 2023, and the total RHC OPEB liability used to calculate the net RHC OPEB liability was determined by an actuarial valuation as July 1, 2022 projected forward to the measurement date. 117 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Actuarial Methods and Assumptions Valuation Timing July 1, 2022, rolled forward to June 30, 2023 Actuarial Cost Method Individual Entry Age Normal, Level Percent of Pay Asset Valuation Method Fair Value Inflation 2.75% Salary Increases 3.25% general wage increase and merit according to Table A-5 of the July 1, 2022 actuarial valuation of retirement benefits. It can be found at: www.LACERA.com. Mortality Various rates based on the Pub-2010 mortality tables and using the MP-2021 Ultimate Projection Scale for expected future mortality improvement. Experience Study Covers the three year period ended June 30, 2023. Discount Rate 5.04% Long-term expected rate of return, net of investment expenses 6.00% 20 Year Tax-Exempt Municipal Bond Yield 3.65% Healthcare Cost Trend rates: Initial Year Ultimate LACERA Medical Under 65 7.60% 4.20% LACERA Medical Over 65 8.80% 4.20% Part B Premiums 11.20% 4.10% Dental/Vision 2.60% 3.70% Weighted Average Trend 8.31% 4.16% Investments The LACERA Board of Investments is responsible for setting the investment policy and investing any contributions made to the OPEB Trust from the participating employers. In December 2017, the LACERA Board of Investments adopted a revised asset allocation policy which divides the OPEB Trust into four broad functional categories and contains asset classes that align with the purpose of each function. The approved target weights provide for diversification of assets in an effort to meet the LACERA's actuarial assumed rate of return, consistent with market conditions and risk control. The following was the adopted asset allocation policy as of June 30, 2023. 118 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Investments-Continued Asset Class Target Allocation Growth 47.50% Global Equity 45.00 % Private Equity 2.50 % Credit 19.00% Liquid Credit 16.50 % Illiquid Credit 2.50 % Risk Reduction and Mitigation 13.50% Cash Equivalents 2.00 % Investment Grade Bonds 9.00 % Long-term Government Bonds 2.50 % Real Assets and Inflation Hedges 20.00% Real Estate 9.00 % Natural Resources 1.00 % Commodities 3.00 % Infrastructure 1.00 % TIPS 6.00 % Money-Weighted Rate of Return As of the measurement date, June 30, 2023, the annual money-weighted rate of return on OPEB Trust investments, net of OPEB Trust investment expense, was 6.00%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. For the measurement date of June 30, 2022, the annual money- weighted rate of return was also 6.00%. Discount Rate GAAP requires determination of whether the OPEB Trust’s Fiduciary Net Position is projected to be sufficient to make projected benefit payments. The Plan’s fiduciary net position was not projected to be available to make all projected future benefit payments of current active and inactive employees. Therefore, the discount rate incorporates a municipal bond rate based on the 20-year Bond Buyer GO index (municipal bond rate) which was 3.65% as of June 30, 2023. For 2023, the long-term expected rate of return of 6.00% was applied to projected benefit payments from 2023 to 2063. The municipal bond rate was applied to the remaining periods. The resultant blended discount rate used to measure the Total OPEB Liability as of June 30, 2023 was 5.04%, an increase of 0.19% from the rate as of June 30, 2022. 119 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued Changes in the Net OPEB Liability (in thousands) Increase (Decrease) Total OPEB Plan Fiduciary Net OPEB Liability Net Position Liability Changes in Net OPEB Liability (a) (b) (a)-(b) Balance as of June 30, 2022 $ 25,778,695 2,327,435 $ 23,451,260 Service cost 853,253 853,253 Interest on Total OPEB Liability 1,274,585 1,274,585 Effect of economic/demographic gains or losses (689,452) (689,452) Effect of assumption changes or inputs 418,154 418,154 Benefit payments (712,101) (712,101) Employer contributions 1,163,076 (1,163,076) Net investment income 240,868 (240,868) Administrative expenses (9,952) 9,952 Balance as of June 30, 2023 $ 26,923,134 3,009,326 $ 23,913,808 Sensitivity of the County’s Net RHC OPEB Liability to Changes in the Discount Rate The following represents the County’s net RHC OPEB liability calculated using the discount rate of 5.04%, as well as what the County’s net OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (4.04%) or 1-percentage point higher (6.04%) than the current rate (in thousands): 1% Discount 1% Decrease Rate Increase (4.04%) (5.04%) (6.04%) Net RHC OPEB Liability $ 28,471,567 $ 23,913,808 $ 20,249,503 Sensitivity of the County’s Net RHC OPEB Liability to Changes in the Healthcare Cost Trend Rates The following represents the County’s net RHC OPEB liability, as well as what the County’s net RHC OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage point lower or 1-percentage point higher than the current healthcare cost trend rates (in thousands): 1% Current Trend 1% Decrease Rates Increase Net RHC OPEB Liability $ 19,585,963 $ 23,913,808 $ 29,510,571 120 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Retiree Healthcare-Continued OPEB Expense and the Deferred Outflows/Inflows of Resources Related to RHC OPEB For the year ended June 30, 2024, the County recognized negative OPEB expense of $(188.57) million which is reported as $(100.19) million for governmental activities and $(88.38) million for business-type activities. OPEB expense represents the change in the net OPEB liability during the measurement period, adjusted for actual contributions and the deferred recognition of change in investment gain/loss, actuarial gain/loss, actuarial assumptions or methods, and plan benefits. At June 30, 2024, the County reported deferred outflows of resources and deferred inflows of resources related to RHC OPEB from the following sources (in thousands): Deferred Deferred Inflows of Outflows of Resources Resources Net difference between projected and actual earnings $ $ 63,150 Change of assumptions 5,992,124 2,716,959 Change in experience 1,408,944 215,354 Change in proportion and differences between contributions and the proportionate share of contributions 1,106,397 1,106,397 Contributions made subsequent to measurement date 1,264,001 Total $ 8,507,465 $ 5,365,861 The deferred inflows of resources and deferred outflows of resources above represent the unamortized portion of changes to the net RHC OPEB liability to be recognized in future periods in a systematic and rational manner. Investment gains or losses are recognized in OPEB expense over a five year period and economic/demographic gains or losses and assumption changes or inputs are recognized over the average remaining service life of all active and inactive members, which is 8 years as of June 30, 2023. The change in proportion and differences between the contributions and the proportionate share of contributions represents the changes in allocation percentages to the individual funds, including the proprietary funds, of the total OPEB RHC liability from the prior measurement date to the current measurement date. Amounts currently reported as deferred outflows and inflows of resources, other than contributions related to RHC OPEB, will be recognized in RHC OPEB expense as follows (in thousands): Deferred Outflows/(Inflows) Year ending June 30: of Resources 2025 $ (901,321) 2026 (915,865) 2027 (661,363) 2028 (397,367) 2029 (641,539) Thereafter (888,150) Deferred outflows of resources of $1.264 billion related to contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the subsequent fiscal period rather than in the current fiscal period. 121 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long-Term Disability Plan Description The County provides LTD benefits to employees and these benefits have been determined to fall within the definition of OPEB. The LTD plans are administered by the County and are not administered through a trust. Each of the LTD plans are a single employer plan and the amounts paid by the County are on a pay-as-you-go basis. These LTD benefits provide for income replacement if an employee is unable to work because of illness or injury. The Board approved the County’s original LTD plan effective March 3, 1982. Effective January 1, 1991, a new Megaflex plan was approved by the Board and includes a Megaflex LTD plan and a LTD Health plan. The LTD Health plan was added to the LTD program and made available to all participants effective January 1, 2002. Benefits Provided The benefit provisions of the four LTD plans are as follows: Eligibility Non-Megaflex Income/Survivor Income Benefit (SIB) - The plan covers: (1) An employee who becomes totally disabled as a direct result of an injury or disease while performing his/her assigned duties; or, (2) An employee who becomes totally disabled after having completed five or more years of continuous service with the County; or, (3) A qualified beneficiary of a deceased employee who had previously become totally disabled as a direct result of an injury or disease while performing his/her assigned duties; or, (4) A qualified beneficiary of a deceased employee who had previously become totally disabled after having completed five or more years of continuous service with the County; or, (5) A qualified beneficiary of an employee who dies as a direct result of an injury or disease while performing his/her assigned duties, or, (6) A qualified beneficiary of an employee who dies in active service after having completed five or more years of continuous service with the County. Megaflex Income/SIB - The plan covers: (1) An employee purchases LTD coverage and then becomes totally disabled; or, (2) An employee who becomes totally disabled after having completed five or more years of continuous service with the County and is a member of Retirement Plan E. (3) The qualified beneficiary of a Retirement Plan E participant who is currently enrolled in the SIB plan at the time of death. 122 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long-Term Disability-Continued Benefits Provided-Continued Non-MegaFlex Member LTD Health Plan - The plan continues medical insurance coverage for employees who are receiving or eligible to receive LTD Income benefits and are enrolled in one of the County approved health plans. MegaFlex Member LTD Health Plan - The plan continues medical insurance coverage for employees who are receiving or eligible to receive LTD Income benefits and are enrolled in one of the County approved health plans. Benefit Formula Non-Megaflex Income/SIB - The plan provides a basic monthly benefit of: (1) 60% of Basic Monthly Compensation (commences after 6 months of disability). (2) Annual COLA, beginning after 2 years of benefit payments (limited to a maximum of 2% per year), if disabled after 1/1/2001. (3) For a qualified beneficiary, 55% of the LTD disability benefit that the employee was receiving or would have received immediately prior to death; and, continues for the life of the qualified surviving spouse/domestic partner and upon spousal death to the qualified children beneficiaries. Megaflex Income/SIB - The plan provides a basic monthly benefit of: (1) 40% or 60% of Basic Monthly Compensation (commences after 6 months of disability) a. Plan E members (1) With 5+ years of services 40% non-elective or can buy up to 60% (2) With less than 5 years of service: can buy 40% or 60% b. Plan A, B, C, or D members: can buy 40% or 60% (2) Annual COLA, beginning after 2 years of benefit payments (limited to a maximum of 2% per year), if disabled after 1/1/2001. (3) For a qualified beneficiary, the plan provides a basic monthly benefit of 10%, 15%, 25%, 35%, or 50% of employee’s monthly salary if they elected. Non-MegaFlex Member LTD Health Plan - The plan pays 75% of monthly medical premiums for disabled members. MegaFlex Member LTD Health Plan - The plan pays 75% of monthly medical premiums for disabled members. 123 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long-Term Disability-Continued Benefits Provided-Continued Maximum Period Non-Megaflex Income/SIB and Megaflex Income/SIB - LTD benefits stop when: (1) Employee is no longer totally disabled or turns age 65, whichever occurs first. However, if employee is age 62 or older when benefit commences, benefit can continue beyond age 65 (length depends on age at commencement) as follows: Age at Disability Maximum Period 62 3 ½ 63 3 64 2 ½ 65 2 66 1 ¾ 67 1 ½ 68 1 ¼ 69 and older 1 or (2) Employee takes early or normal retirement under Plan E. Employees covered by benefit terms At June 30, 2023, the following employees were covered by the benefit terms: LTD Income and Survivor Benefit Plans: Inactive employees or beneficiaries currently receiving benefit payments 2,295 Inactive employees entitled to but not yet receiving benefit payments 0 Active employees 80,078 LTD Health Plans Inactive employees or beneficiaries currently receiving benefit payments 380 Inactive employees entitled to but not yet receiving benefit payments 0 Active employees 77,102 Total LTD OPEB Liability At June 30, 2024, the County reported a total LTD OPEB liability of $1.212 billion. The total LTD OPEB liability was determined by an actuarial valuation as of June 30, 2023. 124 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long-Term Disability-Continued Actuarial Methods and Assumptions Valuation Timing June 30, 2023 Actuarial Cost Method Individual Entry Age Normal, Level Percent of Pay Inflation The inflation rate is included in the salary increase percentage and the Healthcare cost trend rates. Salary Increases 3.25% general wage increase and merit according to Table A-5 of the June 30, 2022 RHC OPEB Program's actuarial valuation report which can be found at www.LACERA.com. Mortality Various rates based on the Pub-2010 mortality tables and using the MP-2021 Ultimate Projection Scale for expected future mortality improvement. Discount Rate Equal to the municipal bond rate based on the 20- year Bond Buyer GO index (municipal bond rate), which was 3.54% as of June 30, 2022, and 3.65% as of June 30, 2023. Healthcare Cost Trend rates: Rate (pre Medicare/ Rate (pre Medicare/ Year post Medicare) Year post Medicare) 2023-2024 8.50%/3.70% 2031-2032 4.90%/4.90% 2024-2025 7.60%/8.80% 2032-2033 4.80%/4.80% 2025-2026 6.30%/7.30% 2042-2043 4.50%/4.50% 2026-2027 5.70%/6.00% 2052-2053 4.50%/4.50% 2027-2028 5.30%/5.40% 2062-2063 4.60%/4.60% 2028-2029 5.20%/5.20% 2072-2073 4.20%/4.20% 2029-2030 5.10%/5.10% 2082+ 0.000042% 2030-2031 5.00%/5.00% 125 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long-Term Disability-Continued Changes in the Total LTD OPEB Liability (in thousands): Total LTD OPEB Liability at 6/30/2022 $ 1,289,325 Service cost 55,362 Interest 46,487 Differences between expected and actual experience (80,333) Changes of assumptions or other inputs (35,491) Benefit payments (63,487) Net Changes (77,462) Total LTD OPEB Liability at 6/30/2023 $ 1,211,863 Changes of assumptions or other inputs reflect a change in the discount rate from 3.54% as of June 30, 2022 to 3.65% as of June 30, 2023. Sensitivity of the Total LTD OPEB Liability to Changes in the Discount Rate The following represents the County’s total LTD OPEB liability calculated using the discount rate of 3.65%, as well as what the County’s total LTD OPEB liability would be if it were calculated using a discount rate that is 1-percentage point lower (2.65%) or 1-percentage point higher (4.65%) than the current rate (in thousands): 1% Discount 1% Decrease Rate Increase (2.65%) (3.65%) (4.65%) Total LTD OPEB Liability $ 1,341,676 $ 1,211,863 $ 1,094,610 Sensitivity of the County’s Total LTD OPEB Liability to Changes in the Healthcare Cost Trend Rates The following represents the County’s total LTD OPEB liability, as well as what the County’s total LTD OPEB liability would be if it were calculated using healthcare cost trend rates that are 1-percentage point lower or 1-percentage point higher than the current healthcare cost trend rates (in thousands): 1% Current Trend 1% Decrease Rates Increase Total LTD OPEB Liability $ 1,198,462 $ 1,211,863 $ 1,228,426 126 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Long Term Disability-Continued OPEB Expense and the Deferred Outflows of Resources and Deferred Inflows of Resources Related to LTD OPEB For the year ended June 30, 2024, the County recognized LTD OPEB expense of $27.98 million which is reported as $28.23 million for governmental activities and $(251) thousand for business-type activities. OPEB expense represents the change in the total LTD OPEB liability during the measurement period, adjusted for the deferred recognition of change in actuarial gain/loss, actuarial assumptions or methods, and plan benefits. At June 30, 2024, the County reported deferred outflows of resources and deferred inflows of resources related to LTD OPEB from the following sources (in thousands): Deferred Deferred Inflows of Outflows of Resources Resources Change in experience $ 103,543 $ 89,832 Change of assumptions 280,300 178,926 Change in proportionate share 97,957 97,957 Total $ 481,800 $ 366,715 The deferred inflows of resources and deferred outflows of resources above represent the unamortized portion of changes to the total LTD OPEB liability to be recognized in future periods in a systematic and rational manner. Economic/demographic gains or losses, assumption changes or inputs, and change in proportion are recognized over the average remaining service life of all active and inactive members, which is 11 years. The change in proportionate share represents the changes in allocation percentages to the individual funds, including the proprietary funds, of the total OPEB LTD liability from the prior measurement date to the current measurement date. Amounts currently reported as deferred outflows and inflows of resources will be recognized in OPEB expense as follows (in thousands): Deferred Outflows/(Inflows) Year Ending June 30: of Resources 2025 $ (10,378) 2026 (10,378) 2027 (10,378) 2028 (10,378) 2029 (10,378) Thereafter (63,195) 127 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 8. OTHER POSTEMPLOYMENT BENEFITS-Continued Combined Balances of the Net OPEB Liability, Deferred Outflows of Resources, Deferred Inflows of Resources and the OPEB Expense The following total balances are reflected in the accompanying statement of net position (in thousands): RHC OPEB LTD OPEB Total Net RHC OPEB Liability $ 23,913,808 $ 23,913,808 Total LTD OPEB Liability 1,211,863 1,211,863 Total OPEB Liability 23,913,808 1,211,863 25,125,671 Deferred Outflows of Resources 5,365,861 366,715 5,732,576 Deferred Inflows of Resources 8,507,465 481,800 8,989,265 OPEB Expense (188,571) 27,982 (160,589) 9. LEASES Lease Liabilities The County has entered into various leases as a lessee. These leases vary in nature, substance, and terms and conditions, dependent upon the asset being leased. Examples of the types of assets leased range from office space, parking, warehouse space and office equipment to land for fire operations. Leases are categorized as either short-term (12 months or less in length, including options) or long-term. In determining the future minimum lease payments and receipts, the County includes the right to extend option terms in the non-cancelable lease term. Short-term lease financial transactions are reflected in the government-wide statement of activities and in the fund financial statements. 128 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 9. LEASES-Continued Lease Liabilities-Continued The following is a schedule of future minimum lease payments for the lease liabilities as of June 30, 2024 (in thousands): Governmental Activities Business-type Activities Year Ending June 30 Principal Interest Principal Interest 2025 $ 119,375 $ 46,525 $ 1,022 $ 111 2026 120,403 42,948 885 74 2027 114,558 39,408 788 39 2028 110,390 36,028 420 14 2029 103,849 32,748 73 2030-2034 401,216 122,448 2035-2039 274,387 72,406 2040-2044 160,635 39,041 2045-2049 89,694 18,764 2050-2054 43,625 8,944 2055-2059 33,201 2,499 2060-2064 3,348 89 2065-2068 168 8 Total $ 1,574,849 $ 461,856 $ 3,188 $ 238 Rent expenses related to leases for governmental activities were $119.58 million and $921 thousand for business-type activities, for the year ended June 30, 2024. Variable payments not previously included in the measurement of the lease liability were $15.70 million for the year ended June 30, 2024. There were no payments for residual value guarantees or termination penalties during the reporting period. The following is a schedule of right-to-use lease assets by major classes at June 30, 2024, (in thousands): Governmental Business-type Activities Activities Lease land $ 1,055 $ Lease buildings and improvements 1,834,346 2,801 Lease equipment 17,080 2,090 Lease asset accumulated amortization (356,799) (1,903) Total $ 1,495,682 $ 2,988 129 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 9. LEASES-Continued Lease Receivables As the lessor, the County leases County-owned properties such as land and buildings. The County has entered into long-term leases relative to the Marina del Rey Project area, asset development projects, regional parks, roads, Martin Luther King, Jr. Community Hospital (MLK Hospital), Flood Control District property, and County airports (Brackett Field, San Gabriel Valley, Whiteman, and General Wm. J. Fox Airfield). Substantially all the Marina's land and harbor facilities are leased to others. The asset development projects, which include the Marina del Rey Project area, are ground leases and development agreements entered into by the County for private sector development of commercial, industrial, residential, and cultural uses on vacant or underutilized County-owned property. Certain regional parks are leased under agreements which provide for activities such as food and beverage concessions, and recreational vehicle camping. Certain roads are leased under franchise agreements for electrical transmission system operations. The MLK Hospital is leased to the Martin Luther King, Jr. - Los Angeles Healthcare Corporation (MLK-LA) and is further discussed in Note 14. Flood Control District leases are for parking lots, and ingress and egress in connection with various commercial centers. The airport leases are for hanger space, vehicle parking, aircraft tiedowns and storage facilities, and are currently the only leases within the business-type activities category. The asset development leases covering remaining periods ranging generally from 1 to 90 years, regional parks leases covering remaining periods from 2 to 54 years, roads leases with remaining periods of 33 years, and the MLK Hospital lease with a remaining period of 60 years are all accounted for in the General Fund. The Flood Control District leases cover remaining periods ranging from 11 to 66 years and are accounted for in the Flood Control District Fund. The airport leases cover remaining periods from 7 to 35 years and are accounted for in the Aviation Enterprise Fund. The land carrying value of the asset development project ground leases that include the Marina del Rey Project area and the Flood Control District totals $771.5 million. The carrying value of the capital assets associated with the regional parks, roads, MLK Hospital, and County airports leases is not determinable. 130 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 9. LEASES-Continued Lease Receivables-Continued The following is a schedule of future minimum lease payment receipts on non-cancelable leases as of June 30, 2024 (in thousands): Year Ending June 30, Governmental Activities Business-type Activities Principal Interest Principal Interest 2025 $ 34,438 $ 36,060 $ 862 $ 354 2026 34,929 35,416 878 338 2027 34,821 34,770 895 321 2028 33,177 34,150 911 305 2029 33,585 33,546 928 288 2030-2034 177,919 157,947 3,734 1,206 2035-2039 189,908 140,655 3,014 920 2040-2044 194,409 122,277 3,277 631 2045-2049 193,027 104,008 2,685 353 2050-2054 205,194 84,769 1,551 150 2055-2059 205,549 64,655 983 46 2060-2064 167,335 44,832 2065-2069 101,043 31,484 2070-2074 81,350 23,605 2075-2079 88,716 15,857 2080-2084 87,403 7,416 2085-2089 10,650 2,754 2090-2094 3,476 1,933 2095-2099 4,308 1,241 2100-2104 3,022 367 2105-2109 559 75 2110-2114 528 22 Total $ 1,885,346 $ 977,839 $ 19,718 $ 4,912 The following is a schedule of lease payment income for leases for the year ended June 30, 2024 (in thousands): Governmental Business-type Activities Activities Minimum lease payments $ 34,005 $ 847 Variable lease payments 40,806 2,353 Total $ 74,811 $ 3,200 131 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 9. LEASES-Continued Lease Receivables-Continued The minimum lease income is a fixed amount based on the lease agreements. The variable lease income is a percentage of revenue above a certain base for the asset development leases or a calculated percentage of the gross revenue less the minimum rent payment for the other leases. The interest revenue received for leases of County-owned property for the year ended June 30, 2024 is $36.06 million. 10. SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS The County has entered into various Subscription-Based Information Technology Arrangements (SBITAs) as a lessee. These leases are for software as a service, platform as a service or infrastructure as a service and vary in terms and conditions. SBITA leases are presented in the financial statements and accompanying footnotes in accordance with GASB 96. SBITA leases are categorized as either short-term (12 months or less in length, including options) or long-term. In determining the future minimum subscription lease payments, the County will include the right to extend option terms in the non-cancelable lease term if it is reasonably certain that the option will be exercised. Variable payments based on a per seat subscription or based on transaction volumes are not included in the measurement of the subscription liability. Short-term lease financial transactions are reflected in the government-wide statement of activities and in the fund financial statements. SBITA Lease Liabilities The following is a schedule of future minimum lease payments for the SBITA lease liabilities as of June 30, 2024 (in thousands): Governmental Activities Year Ending June 30, Principal Interest 2025 $ 22,843 $ 3,470 2026 17,439 2,621 2027 9,072 1,817 2028 8,449 1,406 2029 6,892 1,039 2030-2034 18,702 1,482 2035-2038 550 14 Total $ 83,947 $ 11,849 132 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 10. SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS-Continued SBITA variable payments not included in the measurement of the subscription liability for governmental activities were $89.96 million for the year ended June 30, 2024. There were no SBITA leases for business-type activities during the period. Additionally, there were no payments for termination penalties during the reporting period. The following is a schedule of the right-to-use (RTU) assets and accumulated amortization for subscription leases at June 30, 2024, (in thousands): Governmental Activities Subscription asset $ 148,763 Subscription asset accumulated amortization (51,369) Total $ 97,394 The development in progress for SBITAs that are not yet in production as of June 30, 2024 is $13.82 million. 11. LONG-TERM OBLIGATIONS Long-term obligations of the County consist of bonds, notes and loans from direct borrowings and direct placements, financed purchase obligations from direct borrowing, pension (see Note 7), OPEB (see Note 8), lease (see Note 9), subscription (see Note 10) and other liabilities, which are payable from the General, Special Revenue, Debt Service, Enterprise, and Internal Service Funds. A summary of bonds, and notes and loans from direct borrowings and direct placements recorded within governmental activities follows (in thousands): Original Par Balance Amount of Debt June 30, 2024 NPC BANS, 5.82% to 5.83% $ 15,000 $ 15,000 Public Buildings Bonds and Notes, 0.32% to 7.62% 2,066,006 2,003,757 Los Angeles County Securitization Corporation Tobacco Settlement Asset-Backed Bonds, 0.71% to 5.35% 349,584 332,895 Marina del Rey Loans, 4.50% to 4.70% 23,500 6,781 Lease Revenue Obligation Notes, 2.70% to 5.55% 205,589 205,589 Total $ 2,659,679 $ 2,564,022 A summary of bonds, and notes and loans from direct borrowings and direct placements recorded within business-type activities follows (in thousands): Original Par Balance Amount of Debt June 30, 2024 Public Buildings Bonds and Notes, 2.00% to 7.62% $ 820,783 $ 773,090 Lease Revenue Obligation Notes, 2.70% to 5.55% 254,387 254,387 Waterworks District Loans, 1.40% to 2.28% 12,619 8,522 Aviation Loan, 2.95% 2,000 1,064 Total $ 1,089,789 $ 1,037,063 133 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Public Buildings Bonds The County has issued lease revenue bonds through various financing entities that have been established and are component units of the County. The debt proceeds have been used to finance the acquisition of County facilities and equipment. The County makes annual payments to the financing entities for the use of the property and the debt is secured by the underlying capital assets that have been financed. The County has pledged a total of 16 County-owned properties as collateral for various bonds. During FY 2023-2024, the County did not issue new bonds. Principal and interest requirements on Public Buildings bonds for governmental activities and business-type activities are as follows (in thousands): Governmental Activities Business-type Activities Year Ending June 30, Principal Interest Principal Interest 2025 $ 52,336 $ 85,403 $ 21,688 $ 42,373 2026 54,967 82,511 22,748 40,926 2027 57,747 79,444 23,878 39,401 2028 60,681 76,216 25,069 37,791 2029 63,783 72,824 26,312 36,101 2030-2034 336,597 310,382 152,633 151,999 2035-2039 366,054 215,935 194,746 94,539 2040-2044 361,246 118,205 138,724 32,819 2045-2049 267,115 46,816 63,195 11,663 2050-2052 128,636 6,547 19,448 595 Subtotal 1,749,162 $ 1,094,283 688,441 $ 488,207 Add: Unamortized bond premiums 254,595 84,649 Total public building bonds $ 2,003,757 $ 773,090 Tobacco Settlement Asset-Backed Bonds In 2006, the County entered into a Sale Agreement with the LACSC under which the County relinquishes to the LACSC a portion of its future tobacco settlement revenues (TSRs) for the next 40 years. The County received from the sold TSRs a lump sum payment of $319.83 million and a residual certificate in exchange for the rights to receive and retain 25.90% of the County’s TSRs through 2046. The residual certificate represented the County’s ownership interest in excess TSRs to be received by the LACSC during the term of the Sale Agreement. Residuals through 2024 were $131.51 million. The total TSRs sold, based on the projected payment schedule in the Master Settlement Agreement and adjusted for historical trends, was estimated to be $1.438 billion. The estimated present value of the TSRs sold, net of the expected residuals and assuming a 5.70% interest rate at the time of the sale, was $309.23 million. In the event of a decline in the tobacco settlement revenues for any reason, including the default or bankruptcy of a participating cigarette manufacturer, resulting in a decline in the tobacco settlement revenues and possible default on the Tobacco Bonds, neither the California County Tobacco Securitization Agency, the County, nor the LACSC has any liability to make up any such shortfall. 134 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Tobacco Settlement Asset-Backed Bonds-Continued On June 10, 2020, the California County Tobacco Securitization Agency issued $349.59 million of Tobacco Settlement Bonds comprised of three series, maturing on various dates between 2021 and 2055, as reflected in governmental activities. These tax-exempt Tobacco Settlement Bonds Series 2020A (Senior) totaling $213.46 million, Series 2020B-1 (Subordinate) totaling $52.50 million, and Series 2020B-2 (Subordinate) totaling $83.63 million were issued to refund on a current basis all of the outstanding principal amount of $392.40 million of the Agency’s Tobacco Settlement Asset- Backed Bonds Series 2006 through defeasance and redemption. The effective interest rates of the Series 2020 bonds vary from 0.71% through 5.35%. Principal and interest requirements (in thousands) for the Tobacco Settlement Asset-Backed bonds are as follows: Governmental Activities Year Ending June 30, Principal Interest 2025 $ 6,240 $ 8,827 2026 6,445 8,515 2027 6,775 8,192 2028 7,070 7,854 2029 7,220 7,500 2030-2034 36,910 31,990 2035-2039 40,385 23,714 2040-2044 39,520 15,489 2045-2049 50,935 7,819 2050-2054 — 2055 83,629 446,441 Subtotal 285,129 566,341 Add: Accretions 19,533 (19,533) Add: Unamortized bond premiums 28,233 Total tobacco settlement asset-backed bonds $ 332,895 $ 546,808 Notes, Loans, and Lease Revenue Obligation Notes Notes from Direct Placements BANs are issued by LAC-CAL to provide interim financing for equipment purchases. BANS are purchased by the County Treasury Pool and are payable within three years of their initial issuance date from the proceeds of long-term bonds or other available funds. The repayment of BANs is secured by lease agreements between the County and LAC-CAL and a pledge of the acquired equipment. During FY 2023-2024, LACCAL, an Internal Service Fund, issued additional BANs in the amount of $10.00 million as reflected in governmental activities. As of June 30, 2024, the note balance is $15.00 million for governmental activities only. 135 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Notes, Loans, and Lease Revenue Obligation Notes-Continued Loans from Direct Borrowings Marina del Rey loans were obtained from the California Department of Boating and Waterways for the restoration and renovation of the marina seawall. The loans are secured by Marina del Rey lease revenue and by Los Angeles County Music Center parking revenues. The loan contract contains a provision that in the event the County fails to make payment due, all principal and interest outstanding shall become immediately due and payable, and the deficiency will be added to, and become part of, the principal of the loan. As of June 30, 2024, the balance is $6.78 million for governmental activities. In June 2010, the Board approved a resolution authorizing the Waterworks Districts to obtain Safe Drinking Water State Revolving loans in the amount of $3.41 million and $5.47 million from the California Department of Public Health to fund the Sepulveda Feeder Interconnection project (Malibu) and the Marina del Rey Waterline Replacement project (Marina), respectively. The loans will be repaid over 20 years and are secured by revenues from surcharges collected for capital improvements. Annual principal and interest payments of the loans are expected to require less than 46.73% of the annual surcharge revenues. The funding agreements contain a provision that in an event of default, obligations may be immediately due and payable, and further disbursements may be terminated. As of June 30, 2024, total loans drawn are $3.40 million on the Sepulveda Feeder Interconnection project and $5.47 million on the Marina del Rey Waterline Replacement project. As of June 30, 2024, the balance is $4.88 million for business-type activities. In July 2014, the Board approved the Whiteman Airport Leasehold Interest Acquisition Project, with a total project cost of $4.02 million. To partially finance the acquisition, the Aviation Enterprise Fund obtained an Airport Development Loan from the State of California Department of Transportation, Aeronautics Program for $2.00 million with an annual interest rate of 2.95%. The Airport Development Loan will be repaid over 17 years with revenue generated by lease payment income. The loan agreement contains a provision that if the County fails to comply with or perform any term or condition in the agreement, or fails to pay the annual loan payment, the entire outstanding principal amount of the loan and all accrued interest may be immediately due and payable. In addition, the County may be ineligible for future financing under the program. During FY 2023-2024, the County did not obtain any additional airport development loans. As of June 30, 2024, the balance is $1.06 million for business-type activities. In September 2020, the Board approved a resolution authorizing the Waterworks Districts to obtain Safe Drinking Water State Revolving loans in the amount of $3.75 million from the California State Water Resources Control Board to fund the Del Valle Road Water Main Replacement Project. The loan will be repaid over 20 years and is secured by revenues from surcharges collected for capital improvements. Annual principal and interest payments of the loans are expected to require approximately 36% of the annual surcharge revenues. The funding agreement contains a provision that in an event of default, obligations may be immediately due and payable, and further disbursements may be terminated. During FY 2023-2024, the County drew down $381 thousand in loans. As of June 30, 2024, the balance is $3.64 million for business-type activities. 136 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Notes, Loans, and Lease Revenue Obligation Notes-Continued Lease Revenue Obligation Notes from Direct Borrowings LRON provide the County with a flexible and cost-effective source of financing to provide interim funding during the initial construction phase of a capital project and fund tenant improvements cost on certain leases, which may be refinanced with the issuance of long-term bonds upon completion. Repayment of LRON is secured by four irrevocable direct-pay letters of credit (LOC) from separate banks supporting the issuance of LRON. This program is secured by fifteen County-owned properties pledged as collateral in a lease-revenue financing structure with LACCAL. The LOCs were issued for a five-year period with the option to extend the LOCs for an additional one-year period or to some other term mutually agreed to with the participating banks. The LOCs had an original termination date of April 30, 2024, but were extended to July 18, 2024. The aggregate maximum principal amount of the four LOCs is $600.00 million, which consists of $100.00 million of Series A (BMO Bank, as successor by merger to Bank of the West), $200.00 million of Series B (U.S. Bank), $200.00 million of Series C (Wells Fargo Bank), and $100.00 million of Series D (State Street Bank). The County is responsible for the payment of a non-refundable letter of credit fee for each LOC on a quarterly basis in an amount equal to the rate per annum corresponding to the lowest long-term unenhanced debt ratings assigned by any of Moody’s, S&P, or Fitch to any Lease Obligation Debt of the County. The letter of credit fee for all four series of LOCs is equal to 0.35% of the maximum principal amount of the LOC. As of June 30, 2024, $459.98 million of LRON issued under the program were outstanding, including $80.00 million of Series A, $112.13 million of Series B, $167.85 million of Series C, and $100.00 million of Series D. LRON are issued as variable rate instruments with a maximum term not to exceed 270 days. On the maturity date of LRON, the notes are reissued at the prevailing interest rates in the note market, which reflects the term of the note and the perceived credit quality of the supporting letter of credit bank. In the event the notes are not able to be reissued in the note market, the bank will make a Principal Advance to pay the principal of the maturing note. If the Principal Advance remains outstanding longer than 90 days, a term loan is created to repay the bank. During FY 2023-2024, the County reissued $135.46 million for governmental activities and $115.48 million for business-type activities, representing the total amounts outstanding at the beginning of the year. These reissues, along with new County LRON of $70.53 million for governmental activities and $341.91 million for business-type activities, totaling $412.44 million, and redemptions of $400 thousand for governmental activities and $203.00 million for business-type activities, totaling $203.40 million, are reflected as notes payable. The total outstanding LRON as of June 30, 2024 is $459.98 million, which is reported as $205.59 million for governmental activities and $254.39 million for business-type activities. The average interest rate on CP Notes issued in FY 2023-2024 was 3.26%. 137 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Notes, Loans, and Lease Revenue Obligation Notes-Continued Lease Revenue Obligation Notes from Direct Borrowings-Continued Principal and interest requirements on NPC BANS, Marina del Rey Loans and LRON for governmental activities and Waterworks District Loans, Aviation Loan and LRON for business-type activities are as follows (in thousands): Year Ending Governmental Activities Business-type Activities June 30 Principal Interest Principal Interest 2025 $ 211,828 $ 305 $ 254,828 $ 138 2026 11,295 249 672 181 2027 1,354 191 687 166 2028 1,414 130 703 150 2029 1,479 67 719 134 2030-2034 — — 3,543 422 2035-2039 — — 878 165 2040-2044 651 118 2045-2049 698 70 2050-2053 594 20 Total notes, loans, and LRON $ 227,370 $ 942 $ 263,973 $ 1,564 Financed Purchase Obligations-Direct Borrowings Principal and interest requirements on financed purchase obligations for governmental activities are as follows (in thousands): Year Ending Governmental Activities June 30 Principal Interest 2025 $ 2,906 $ 255 2026 2,687 199 2027 2,667 147 2028 2,616 96 2029 2,350 50 2030-2031 2,346 18 Total financed purchase obligations $ 15,572 $ 765 138 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Summary-All Future Principal, Interest and Accretions The following summarizes total future principal and interest requirements for the various debt issues referenced above (in thousands): Governmental Activities Business-type Activities Debt Type Principal Interest Principal Interest Public Buildings Bonds $ 1,749,162 $ 1,094,283 $ 688,441 $ 488,207 Tobacco settlement asset-backed bonds 285,129 566,341 Notes, Loans, and LRON from direct borrowings and placements 227,370 942 263,973 1,564 Subtotal 2,261,661 $ 1,661,566 952,414 $ 489,771 Add: Accretions 19,533 (19,533) Unamortized premiums on bonds payable 282,828 84,649 Total bonds and notes $ 2,564,022 $ 1,642,033 $ 1,037,063 Long-term liabilities recorded in the government-wide statement of net position include accreted interest on zero coupon bonds and unamortized bond premiums. Bonds Defeased in Prior Years In prior years, various debt obligations, including bonds, were defeased by placing the proceeds of refunding bonds in an irrevocable trust to provide for all future debt service payments on the old obligations. Debt should also be considered defeased when cash and other monetary assets acquired with only existing resources are placed in an irrevocable trust to extinguish debt. Accordingly, the trust account assets and the related debt service payments for the defeased bonds would not be reflected in the County’s statement of net position. At June 30, 2024, there were no outstanding bonds considered defeased. 139 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Changes in Long-term Liabilities The following is a summary of long-term liabilities and corresponding activity for the year ended June 30, 2024 (in thousands): Balance Additions/ Transfers/ Balance Due Within July 1, 2023 Accretions Maturities June 30, 2024 One Year Governmental activities: Bonds payable $ 2,098,840 — 64,549 $ 2,034,291 $ 58,576 Notes, loans, and LRON from direct borrowings and placements 143,434 205,589 136,653 212,370 206,828 2,242,274 205,589 201,202 2,246,661 265,404 ISF bonds payable and notes from direct placements 5,000 10,000 15,000 5,000 Total bonds payable, notes, loans and LRON 2,247,274 215,589 201,202 2,261,661 270,404 Interest accretion on capital appreciation bonds payable 14,227 5,306 19,533 — Unamortized premium on bonds payable 289,086 — 6,258 282,828 8,607 Other long-term liabilities: Lease liability (Note 9) 1,578,192 148,997 152,340 1,574,849 119,375 Subscription liability (Note 10) 85,925 26,054 28,032 83,947 22,843 Financed purchase obligations 22,750 7,178 15,572 2,906 Accrued compensated absences 2,174,321 234,941 150,613 2,258,649 137,493 Workers’ compensation (Note 18) 3,111,957 857,102 680,168 3,288,891 662,712 Litigation and self-insurance (Note 18) 3,732,163 732,668 120,533 4,344,298 147,087 Pollution remediation obligation (Note 19) 37,166 20,753 2,783 55,136 1,751 Net pension liability (Note 7) 11,382,441 767,064 12,149,505 Net OPEB liability (Note 8) 20,994,604 353,216 21,347,820 Third party payor 332,521 224,620 207,611 349,530 215,895 Total governmental activities $ 46,002,627 3,586,310 1,556,718 $ 48,032,219 $ 1,589,073 Business-type activities: Bonds payable $ 709,169 — 20,728 $ 688,441 $ 21,688 Add: Unamortized premium on bonds payable 85,405 756 84,649 1,178 Notes, loans, and LRON from direct borrowings and placements 125,331 254,769 116,127 263,973 254,828 Total bonds payable, notes, loans and LRON 919,905 254,769 137,611 1,037,063 277,694 Other long-term liabilities: Lease liability (Note 9) 1,731 2,801 1,344 3,188 1,022 Accrued compensated absences 283,868 39,349 18,364 304,853 16,241 Workers’ compensation (Note 18) 392,276 47,467 37,779 401,964 37,686 Litigation and self-insurance (Note 18) 34,050 57 21,914 12,193 5,810 Net pension liability (Note 7) 1,778,119 146,339 1,924,458 Net OPEB liability (Note 8) 3,745,981 31,870 3,777,851 Third party payor (Note 14) 526,774 129,541 124,865 531,450 126,515 Total business-type activities $ 7,682,704 652,193 341,877 $ 7,993,020 $ 464,968 140 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 11. LONG-TERM OBLIGATIONS-Continued Changes in Long-term Liabilities-Continued For governmental activities, the General Fund, the Fire Protection District Special Revenue Fund and the LA County Library Special Revenue Fund have typically been used to liquidate workers’ compensation, accrued compensated absences, pension, OPEB, lease, financed purchase, subscription, litigation and self-insurance. Bond interest accretions for deep discount bonds have been included in the amounts reported for bonds. Accretions increased during FY 2023-2024, thereby increasing liabilities for bonds by $5.31 million for governmental activities. Note 18 contains information about changes in the combined current and long-term liabilities for workers' compensation and litigation and self-insurance. Discretely Presented Component Unit Long-term debt obligations and corresponding activity for the LACDA and First 5 LA discretely presented component units for the year ended June 30, 2024, were as follows (in thousands): Balance Balance Due Within July 1, 2023 Additions Maturities June 30, 2024 One Year LACDA Governmental activities: Bonds payable $ 31,105 675 $ 30,430 $ 705 Unamortized premium on bonds payable 3,608 42 3,566 Notes from direct borrowing 13,446 1 ,564,010,309 8 12,048 1,102 Compensated absences 1,932 1,930 1,690 2,172 1,954 Lease liability 76 71 81 66 13 Subscription liability 1,292 4,326 1,546 4,072 1,403 Claims payable 6,914 4,014 4,014 6,914 691 Net pension liability 39,316 6,828 5,359 40,785 Net OPEB liability 1,277 1,277 — Total governmental activities $ 98,966 17,169 16,082 $ 100,053 $ 5,868 Business-type activities: Subscription liability $ 243 218 116 $ 345 $ 124 Notes from direct borrowing 2,200 2,200 Compensated absences 1,358 1,088 1,206 1,240 1,116 Net pension liability 24,741 4,316 3,375 25,682 Net OPEB liability 202 202 — Total business-type activities $ 28,744 5,622 4,899 $ 29,467 $ 1,240 Total long-term obligations-LACDA $ 127,710 22,791 20,981 $ 129,520 $ 7,108 First 5 LA Compensated absences $ 1,005 684 715 $ 974 $ 148 Total long-term obligations-First 5 LA $ 1,005 684 715 $ 974 $ 148 Total long-term obligations-Discretely presented component units $ 128,715 23,475 21,696 $ 130,494 $ 7,256 141 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 12. SHORT-TERM DEBT On July 1, 2023, the County issued $700.00 million of short-term Tax and Revenue Anticipation Notes at an effective interest rate of 3.14%. The proceeds of the notes were used to assist with County General Fund cash flow needs prior to the first major apportionment of property taxes, which occurred in December 2023. The notes matured and were redeemed on June 28, 2024. 13. CONDUIT DEBT OBLIGATIONS Community Facilities and Improvement District Bonds As of June 30, 2024, various community facilities and improvement districts established by the County had outstanding special tax bonds payable totaling $63.00 million and limited obligation improvement bonds totaling $544 thousand. The bonds were issued to finance the cost of various construction activities and infrastructure improvements, which have a regional or direct benefit to the related property owners. The bonds do not constitute an indebtedness of the County and are payable solely from special taxes and benefit assessments collected from property owners within the districts. In the opinion of County officials, these bonds are not payable from any revenues or assets of the County and neither the full faith and credit of the County, the State or any political subdivision thereof is obligated to the payment of the principal or interest on the bonds. The County has limited commitments for these bonds. Accordingly, no liability has been recorded in the accompanying basic financial statements. The County functions as an agent for the districts and bondholders. Debt service transactions related to the various bond issues are reported in the custodial funds. Construction activities are reported in the Improvement Districts' Capital Projects Fund. Industrial Development and Other Conduit Bonds Industrial development bonds, and other conduit bonds, have been issued to provide financial assistance to private sector entities and nonprofit corporations for the acquisition of industrial and health care facilities, which provide a public benefit. The bonds are secured by the facilities acquired and/or bank letter of credit and are payable solely from project revenue or other pledged funds. The County is not obligated in any manner for the repayment of the bonds. All industrial development bonds were paid during the year and no amount was outstanding as of June 30, 2024. Redevelopment Refunding Bonds The County of Los Angeles Redevelopment Refunding Authority, a JPA between the County and the Los Angeles County Public Works Financing Authority, was established to issue bonds that would enable successor agencies to former redevelopment agencies within the County to refund their outstanding tax allocation bonds in order to achieve debt service savings and to provide significant economies of scale through reduced costs of issuance and lower interest rates. The bonds are secured by a lien on future tax revenues of successor agencies. The County is not obligated in any manner for the repayment of the bonds. The County has limited commitment for these bonds. Accordingly, no liability has been recorded in the accompanying basic financial statements. As of June 30, 2024, the amount of redevelopment refunding bonds outstanding was $372.66 million. 142 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES Net patient service revenues are reported at the estimated net realizable amounts from patients, third party payors, and others for services rendered, including estimated retroactive adjustments under reimbursement agreements with third party payors. Retroactive adjustments are accrued on an estimated basis in the period the related services are rendered and adjusted in future periods, as final settlements are determined. California Advancing and Innovating Medi-Cal On December 28, 2021, the federal Centers for Medicaid and Medicare Services (CMS) approved the California Advancing and Innovating Medi-Cal (CalAIM) Section 1115 demonstration and CalAIM Section 1915(b) waiver, effective through December 31, 2026. CalAIM is an innovative and long- term commitment to transform and strengthen Medi-Cal, making the program more equitable, coordinated, and person-centered to help people maximize their health and life trajectory. CalAIM shifts Medi-Cal to a population health approach on a statewide level that prioritizes prevention and addresses social drivers of health. Revenues from CalAIM include those derived from Medical Managed Care (which the State moved from the Section 1115 waiver - where it resided in Medi-Cal 2020 - to the 1915(b) waiver portion of CalAIM). Those revenues are depicted below, consistent with historical reporting, to facilitate year- to-year comparisons. CalAIM revenues include (among other sources): 1. Global Payment Program 2. Providing Access and Transforming Health 3. Enhanced Care Management 4. Community Support Global Payment Program The Global Payment Program (GPP) originated under the Medi-Cal 2020 Waiver and was approved to continue under the CalAIM Section 1115 demonstration. GPP is a payment reform program that aims to change the way county-owned and operated Public Hospital Systems (PHS) in California are compensated for providing care to the remaining uninsured. The program encourages a shift away from cost-based, hospital-centric models of care, through financial incentives to provide cost-effective primary and specialty care. The GPP lifts restrictions that have historically impeded providing services for the remaining uninsured in the most appropriate setting for each patient, and now includes non-traditional methods of care delivery that have not been covered under either program. The shift from volume to value is done through a value-based point methodology, which takes into account both the value of care to the patient, and the recognition of costs to the health care system. 143 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued California Advancing and Innovating Medi-Cal-Continued Global Payment Program-Continued The GPP funds are comprised of (a) Disproportionate Share Hospital (DSH) funds that otherwise would have been allotted to the PHS, and (b) Safety Net Uncompensated Care Pool (SNCP) funds. DSH is a federal program to support safety-net hospitals that care for a disproportionate share of low-income patients. SNCP was established under California's 2005 waiver to support services provided to uninsured patients. Each GPP (PHS) participant has an opportunity to earn a global budget for care to the remaining uninsured and must meet service thresholds to receive full funding. Points are assigned to services in the following categories: • Traditional Outpatient (e.g., primary or specialty care visit, dental, ER/urgent care, mental health visit). • Non-Traditional Outpatient (e.g., health coaching, care navigation, community wellness encounters). • Technology-Based Outpatient (e.g., nurse advice line, email consultation, provider-to-provider eConsult for specialty care). • Inpatient and Facility Stays (e.g., trauma care, ICU stays, recuperative care, respite care, sober center stays, skilled nursing facility stays). The County provides funding for the State of California's (State) share of the program by using "intergovernmental transfers" (IGTs) to draw down federal matching funds. The estimated GPP revenues and related IGTs recorded in FY 2023-2024 were as follows (in thousands): GPP Intergovernmental Revenues Transfers Expense Harbor-UCLA Medical Center $ 389,836 $ 195,380 Olive View-UCLA Medical Center 186,112 97,494 Los Angeles General Medical Center 460,454 264,911 Rancho Los Amigos National Rehab Center 25,306 10,333 Total $ 1,061,708 $ 568,118 The General Fund received $764.11 million for GPP and paid $335.92 million of related IGTs, which were recorded as “Charges for Services” revenue and "Health and Sanitation" expenditures, respectively, on the governmental funds statement. Providing Access and Transforming Health Providing Access and Transforming Health (PATH) is a five-year, $1.850 billion initiative to provide and build capacity and infrastructure for initiatives under CalAIM, namely Enhanced Care Management, Community Support, and Justice-Involved services. There are several subaccounts in PATH that the Department of Health Services (DHS) has either applied for or will apply for: 144 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued California Advancing and Innovating Medi-Cal-Continued Providing Access and Transforming Health-Continued • Whole Person Care Services and Transition to Managed Care Mitigation Initiative PATH funds services provided by former Whole Person Care Pilot Lead Entities until the services transition to managed care coverage under CalAIM. This funding started January 1, 2022, and ended on October 1, 2024. The County must provide local matching funds in the form of an IGT, based on the number of eligible services, to receive reimbursement from the California Department of Health Care Services (DHCS). • Capacity and Infrastructure Transition, Expansion and Development (CITED) Initiative PATH provides direct funding to support the transition, expansion, and development of Enhanced Care Management and Community Support services. Funds are made available from DHCS directly to recipients in several rounds, with the first round being up to $100 million statewide. DHS applied for funds in Round 1 and was authorized for $8.59 million gross in February 2023. DHS applied for Round 2 funds and was awarded $4.00 million gross in October 2023. In Round 3, DHS was awarded $6.70 million gross in August 2024 and was asked to provide an IGT for the non-federal share as the funds were awarded from excess Whole Person Care Mitigation Funds (from bullet one above). Total funds received out of the awarded amounts is contingent on DHS making the approved expenditures. • Justice-Involved Capacity Building Program Starting in 2023, DHCS made PATH funding available to support DHS pre-release capacity building activities to support the ability to aid claiming certain health services provided in jail 90 days before release. CMS authorized payment for these services in a waiver amendment that was approved January 26, 2023. DHS is working with DHCS to determine how much funding will be available for pre-release capacity building. Enhanced Care Management Enhanced Care Management (ECM) is a new Medi-Cal managed care benefit that supports a whole person-focused, interdisciplinary approach to intensive care management. It aims to improve care coordination and address the physical, behavioral health, and social needs of Medi- Cal beneficiaries with the highest costs and most complex needs. ECM is designed to replace similar services that were previously provided under Whole Person Care and Health Homes Program. DHS has contracted with LA Care Health Plan (LA Care) and Health Net Community Solutions, Inc. (Health Net) to provide ECM services to certain high-need members assigned to DHS for primary care. Beginning in January 2024, DHS also contracted with Molina Healthcare California (Molina) to serve this population. In FY 2023-2024, an estimated $3.91 million of ECM revenues were recorded as part of net patient service revenues. The General Fund received an estimated $2.96 million for ECM, which were recorded as "Charges for Services" revenue on the governmental funds statement. 145 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued California Advancing and Innovating Medi-Cal-Continued Community Support Community Support (CS) covers a variety of managed care services that address complex barriers to health and drivers of health care costs, such as homelessness, unstable or unsafe housing, and food insecurity. CS focuses on meeting the specific medical and social needs of the high-risk clients, with the goal of reducing utilization of higher-cost services. These services are voluntary for the managed care plan to offer, and for the patients to opt in to receiving. DHS has contracted with six Medi-Cal managed care plans to launch and offer the following CS services as of January 2022: recuperative care, housing navigation, tenancy sustaining services, personal care, and housing deposit assistance. Additional services for newly eligible populations are scheduled to roll out through 2024. The General Fund recorded an estimated $61.58 million for CS, which were recorded as "Charges for Services" revenue on the governmental funds statement. It is expected that these amounts will decline in future years due to health plans limiting the duration of housing benefits to periods that are shorter than the time during which a person receives housing services from the County. While current year revenues reflect coverage for a substantial share of current clients, in future years, only newly housed individuals will be reimbursed. Previous Medi-Cal Demonstration Projects Bridge to Reform Bridge to Reform was approved in November 2010 by CMS, pursuant to Section 1115(a) of the Social Security Act. This waiver affected many aspects of Medi-Cal revenue for the County hospitals and clinics including the financing methods by which the State drew down federal matching funds. Bridge to Reform covered the period November 1, 2010 to October 31, 2015, with a temporary extension to December 31, 2015. As of the end of the FY 2023-2024, Program Year 2010-2011 is still pending State's final reconciliation. Disproportionate Share Hospital Program In FY 2023-2024, the DHCS completed their final reconciliation of the Disproportionate Share Hospital Program (DSH) for Year 2014-2015. DSH revenues and related IGTs recorded in FY 2023-2024 are as follows (in thousands): DSH Intergovernmental Transfers Revenues Harbor-UCLA Medical Center $ (5,572) $ (7,729) Olive View-UCLA Medical Center 2,486 Rancho Los Amigos National Rehab Center 1 Total $ (3,085) $ (7,729) 146 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Managed Care for Seniors and Persons with Disabilities Under the Medi-Cal Demonstration Project, in an effort to provide more coordinated care and contain costs, Medi-Cal beneficiaries who are Seniors and Persons with Disabilities (SPDs) are required to enroll in managed care plans, rather than using a fee for service system. In FY 2023-2024, an estimated $189.65 million of SPD revenues were recorded as part of net patient service revenues. The General Fund received $39.32 million for SPD, which were recorded as "Charges for Services" revenue on the governmental funds statement. Affordable Care Act On January 1, 2014, when the federal health care reform of the Patient Protection and Affordable Care Act went into effect, the Hospital Presumptive Eligibility program also provided individuals with temporary Medi-Cal benefits while a formal, permanent Medi-Cal application is being processed. Medicaid Coverage Expansion The Medicaid Coverage Expansion (MCE), also known as the Optional Medicaid Expansion program, provides Medi-Cal coverage for adult citizens or legal residents (ages 19-64) who are uninsured and have incomes at or below 138.00% of the Federal Property Level. The current Federal Medical Assistance Percentage (FMAP) for the MCE Program is 90.00%. The County contracts with LA Care, Health Net, and as of January 1, 2024, Molina to provide services for their Medi-Cal managed care members. During FY 2023-2024, LA Care and Health Net paid the County managed care capitation payments based on the CY 2023 contract rates, while Molina paid contracted rates effective January 2024. In FY 2023-2024, the total estimated MCE revenues and related estimated IGTs, including prior year over/under-realization were as follows (in thousands): Program Intergovernmental Revenues Transfers Expense MCE $ 356,279 $ MCRS - MCE 249,580 51,105 Total $ 605,859 $ 51,105 The General Fund received $70.50 million for MCE which was recorded as "Charges for Services" revenue. The IGTs recorded under "Health and Sanitation" expenditures on the governmental funds statement are related to prior year IGT reconciliations. On September 1, 2023, the County received a Civil Investigative Demand (“CID”) from the United States Department of Justice (“DOJ”). The demand seeks records and information related to managed care and the expansion of Medicaid to adult expansion under the Affordable Care Act. The County is cooperating with the investigation and has made rolling productions of documents responsive to the CID, with the latest production in April 2024. DOJ's last contact to the County about this matter occurred in May 2024. Potential penalties are contingent on a number of factors and too speculative to reasonably estimate at this time. 147 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Other Medi-Cal Programs Medi-Cal Fee-For-Service The Medi-Cal Demonstration Project restructured the financing method by which the State draws down federal matching funds for the inpatient hospital FFS to cost based reimbursement. The non-federal share of the Medi-Cal FFS is provided by the hospitals primarily through certified public expenditures (CPE) whereby the hospital expends its local funding for services to draw down the federal financing participation (FFP), currently provided at a 52.50% match which incorporates a 2.50% increase in the FFP rate as authorized by the Families First Coronavirus Response Act (FFCRA). For FY 2023-2024, an estimated $192.53 million of Medi-Cal FFS revenues were recorded as part of net patient service revenue. Medi-Cal Physician State Plan Amendment The Medi-Cal Demonstration Project payment for inpatient and other facility services excluded professional services. State Plan Amendment 05-23 allows professional services provided by public entities to be paid similarly to the inpatient hospital services under the Medi-Cal Demonstration Project. Hospitals are allowed to claim federal reimbursement for unreimbursed costs of Medi-Cal professional services (Hospital Inpatient, Emergency Room, and Psychiatric services), which is matched at the applicable FMAP rate for the year. Revenues of $48.91 million were recognized and recorded as part of net patient service revenue during FY 2023-2024. Cost Based Reimbursement Clinics Cost Based Reimbursement Clinics (CBRC) reimburse 100% of allowable costs for outpatient services provided to Medi-Cal FFS beneficiaries at the County's hospital-based clinics, outpatient centers and Ambulatory Care Network health centers (excluding clinics that provide predominately public health services). In FY 2023-2024, CBRC revenues were $170.05 million for the enterprise funds and were recorded as net patient services revenue. As of June 30, 2024, the County estimated that approximately $16.42 million of CBRC accounts receivable would not be collectible within 12 months and this amount is classified as a noncurrent asset in the enterprise fund statements of net position for each hospital. The General Fund received $35.07 million for CBRC, which was recorded as "Charges for Services" revenue on the governmental funds statement. As of June 30, 2024, the County estimated that approximately $14.17 million of CBRC accounts receivable would not be collectible within 12 months. Medi-Cal Cost Report Settlements In FY 2023-2024, the County recognized final inpatient hospital FFS settlements of $0.63 million related to the FY 2014-2015. In addition, the County received CBRC audit settlements of $42.24 million related to FY 2021-2022 for hospitals only. The County’s appeal of certain CBRC audit adjustments at various levels to the Office of Administrative Appeals have been favorably resolved resulting in $4.51 million of final settlement revenues. The State is in the process of auditing the FY 2020-2021 and FY 2021-2022 non-hospital CBRC and FY 2022-2023 hospital cost reports. Settlements are expected by the 4th quarter of FY 2024-2025. 148 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Other Medi-Cal Programs-Continued Medi-Cal Managed Care Graduate Medical Education On March 19, 2020, the State executed State Plan Amendment (SPA) Transmittal Number 17-009 that allows for graduate medical education (GME) payments to certain governmental hospitals for Medi-Cal managed care services effective January 1, 2017. The Medi-Cal managed care plans do not include GME payments within the capitation rates. These supplemental GME payments are funded by voluntary IGTs made by the County pursuant to Welfare and Institutions Code (WIC) sections 14164 and 14105.29(c), that is used solely as the source for the non-federal share of GME payments made to the eligible providers of the Governmental Funding Entity pursuant to WIC section 14105.29 and Supplement 6 to Attachment 4.19-A of the SPA. The funds transferred qualify for FFP pursuant to 42 Code of Federal Regulations part 433 subpart B. Under the SPA, the County is required by Welfare and Institutions Code Section 14105.29, to pay the State a 5% administrative fee that is assessed on the full amount of the IGTs. This amount is also recorded as part of the IGT. In FY 2023-2024, the County recorded the GME supplemental gross revenue payments as listed below and recorded the corresponding IGT expense as follows (in thousands): GME Intergovernmental Revenues Transfers Expense Harbor-UCLA Medical Center $ 68,741 $ 13,570 Olive View-UCLA Medical Center 32,362 7,447 Los Angeles General Medical Center 125,647 25,561 Rancho Los Amigos National Rehab Center 2,650 479 Total $ 229,400 $ 47,057 Medi-Cal Managed Care Rate Supplements The State is obtaining CMS' approval to continue the Medi-Cal Managed Care Rate Supplements (MCRS) paid to LA Care and Health Net Health Plans for calendar year 2024. The supplements are funded by IGTs made by the County. The County does not receive the supplemental payments directly from the State; rather, the State contracts with LA Care and Health Net, which then subcontract for services with various provider networks. In addition, in order to receive the supplemental payments, the County is required by Welfare and Institutions Code Section 14301.4, to pay the State a 20% administrative fee that is assessed on the full amount of the IGTs. This amount is also recorded as part of the IGT. 149 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Other Medi-Cal Programs-Continued Medi-Cal Managed Care Rate Supplements-Continued The total estimated managed care rate supplement revenues and related estimated IGTs recorded in FY 2023-2024, including prior year over/under realization, were as follows (in thousands): MCRS Intergovernmental Revenues Transfers Expense Harbor-UCLA Medical Center $ 75,835 $ 49,993 Olive View-UCLA Medical Center 65,337 38,910 Rancho Los Amigos National Rehab Center 223,477 140,354 Total $ 364,649 $ 229,257 Managed Care Rule On April 25 2016, CMS published the Medicaid and Children's Health Insurance Program (CHIP) Managed Care Final Rule. The rule, many provisions of which went into effect July 1, 2017, is an update to the regulatory framework for Medicaid, aligning it as much as possible with Medicare and other commercial insurance requirements for issues like rate setting, access standards, grievances and appeals, and quality. The managed care rule limits the ability of states to direct payments to health care providers, unless certain conditions are met. Among the allowable exceptions are payments tied to performance, and payments that provide a uniform payment increase which includes a pre- determined increase over contracted rates. The previous SPD-SB208 and AB85 MCE-to-Cost programs did not meet these conditions. In order to retain this critical funding, the following two programs were introduced: 1. Enhanced Payment Program 2. Quality Incentive Program Enhanced Payment Program The Enhanced Payment Program (EPP) creates a funding pool to supplement the base rates public health care systems receive through Medi-Cal managed care contracts. It was intended to meet the managed care rule’s criteria that allow payments that provide a uniform increase within a class of providers such as a predetermined increase over contracted rates. The mechanism for delivering EPP payments to public health care systems depends largely on those systems’ existing payment arrangements with their managed care plans. Under the proposed structure, health plans would receive an add-on to their managed care rates and would provide interim payments to providers throughout the year. Payments would be reconciled at the end of the year, protecting health plans from any risk associated with payment. 150 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Other Medi-Cal Programs-Continued Managed Care Rule-Continued Enhanced Payment Program-Continued The estimated EPP revenues and related IGTs reported in FY 2023-2024 are as follows (in thousands): EPP Intergovernmental Revenues Transfers Expense Harbor-UCLA Medical Center $ 299,604 $ 86,426 Olive View-UCLA Medical Center 138,703 38,855 Los Angeles General Medical Center 312,479 94,682 Rancho Los Amigos National Rehab Center 19,992 6,544 Total $ 770,778 $ 226,507 The General Fund received $180.74 million for EPP and paid $52.80 million of related IGTs, which were recorded as "Charges for Services" revenue and "Health and Sanitation" expenditures, respectively, on the governmental funds statement. Quality Incentive Program The Quality Incentive Program (QIP) is meant to meet the Managed Care Rule’s exception that allows payments tied to performance. The QIP represents a pay for performance program for California’s public health care systems that uses a value-based structure. QIP payments are tied to the achievement of performance on a set of clinically established quality measures for Medi-Cal managed care enrollees. At FY 2023-2024 year-end, the estimated QIP revenues, which were recorded as patient service revenues, and related IGTs, including prior year over/under realization, are as follows (in thousands): QIP Intergovernmental Revenues Transfers Expense Harbor-UCLA Medical Center $ 176,405 $ 24,092 Olive View-UCLA Medical Center 70,517 8,643 Los Angeles General Medical Center 141,038 16,283 Rancho Los Amigos National Rehab Center 35,149 4,893 Total $ 423,109 $ 53,911 The General Fund received $33.79 million for QIP and paid $3.95 million of related IGTs, which were recorded as "Intergovernmental Revenues - Federal" and "Health and Sanitation" expenditures, respectively, on the governmental funds statement. 151 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Third Party Payor Liability The County's Hospitals reported third party payor liabilities of $531.45 million (see Note 11) as of June 30, 2024, as reported on the statement of net position for proprietary funds. The current liabilities for amounts due within one year are $126.52 million. The noncurrent liabilities for third party payors related to enterprise funds are $404.93 million. The primary programs associated with third party payors liabilities include DSH ($62.60 million), Medi-Cal ($54.39 million), SNCP ($24.36 million), Medicare ($29.05 million), SPD ($66.33 million), MCE ($97.33 million), AB 915 ($30.69 million), In-home Supportive Services (IHSS) ($28.54 million), Medi- Cal Physician SPA ($9.57 million), and other miscellaneous programs ($2.07 million). Accounts Receivable-Net The following is a summary, by hospital, of accounts receivable and allowances for uncollectible amounts as of June 30, 2024 (in thousands): Los Angeles H-UCLA OV-UCLA General Rancho Total Accounts receivable $ 3,753,314 2,136,458 4,716,199 860,707 $ 11,466,678 Less: Allowance for uncollectible amounts 2,973,934 1,661,093 3,677,243 650,947 8,963,217 Accounts receivable - net $ 779,380 475,365 1,038,956 209,760 $ 2,503,461 Charity Care Charity care includes those uncollectible amounts for which the patient is unable to pay. Generally, charity care adjustment accounts are those accounts for which an indigence standard has been established and under which the patient qualifies. Inability to pay may be determined through DHS’ Ability-to-Pay program, through other collection efforts by DHS, by the Treasurer and Tax Collector, or by an outside collection agency. Determinations of charity care may be made prior to, at the time of service, or any time thereafter. The estimated cost of charity care for the year ended June 30, 2024 was $526.47 million. The total amount of such charity care provided by the hospitals for the year ended June 30, 2024 is as follows (in thousands): Charity care at established rates $ 1,286,976 GPP reimbursements 177,005 Other reimbursements (6,689) Charges forgone $ 1,116,660 152 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 14. HOSPITAL AND OTHER PROGRAM REVENUES-Continued Realignment As a result of the ACA, the State adopted and passed Assembly Bill 85 (AB85), as amended by Senate Bill 98, which lays out the process by which a portion of the 1991 County Health Realignment funds will be redirected to support Social Services programs based on a formula. The redirection is based on the assumption that the counties will decrease their cost for healthcare for the indigent population. These savings will be shared between the counties’ health departments and the State. The sharing ratio is 80% to the State and 20% to the County. This ratio has been in place since FY 2014-2015. AB85, as amended, provides a unique formula for the County to determine the amount to be redirected. In FY 2023-2024, the State did not withhold any of the County's Health Realignment funds. This amount is expected to be reconciled against actual revenues and expenses for FY 2023-2024 within two years. The redirection amount will be subject to the State's review and approval. The financial impact of the potential redirection of realignment funding in future years is not yet known. In FY 2022-2023, the State did not withhold any of the County's Health Realignment funds. Based on updated revenues realized for FY 2022-2023 services in FY 2023-2024, the projected redirection amount remains at $0.00. In FY 2021-2022, the State did not withhold any of the County's Health Realignment funds. Based on updated revenues realized for FY 2021-2022 services in FY 2023-2024, the projected redirection amount remains at $0.00. Martin Luther King, Jr. Community Hospital The County and the University of California (UC), with the State, created a wholly independent, non- profit 501(c)(3) entity, the Martin Luther King, Jr. - Los Angeles Healthcare Corporation (MLK-LA), to operate a hospital at the MLK-MACC site. As originally conceived, the hospital would: i) serve as a safety-net provider treating a high volume of Medi-Cal and uninsured patients and ii) be integrated with the County's existing network of specialty and primary care ambulatory clinics. The seven- member MLK Hospital Board of Directors was appointed by the County and UC in August 2010. The MLK Community Hospital opened on May 14, 2015. To assist with the opening of the MLK Hospital, the County provided MLK-LA with $50.00 million of coordination start-up funds, $39.10 million of grant funding, and $82.00 million of long-term loan funding, which includes a 30-year loan in the amount of $50.00 million, a 10-year revolving line of credit in the amount of $20.00 million, and a 2-year loan in the amount of $12.00 million. On January 5, 2016, the Board approved an additional short-term revolving loan in the amount of $40.00 million to assist MLK-LA with post-hospital opening expenses. As of June 30, 2024, the 30-year loan has an outstanding balance of $35.71 million. In May 2023, MLK-LA drew down $20 million from the revolving line of credit. On November 21, 2023, the County unanimously approved a motion to defer the interest and principal payment for three years. On June 11, 2024, the County approved a revised maturity date of May 13, 2028. As of June 30, 2024, the outstanding balance under the revolving loan was $20.00 million. In addition, the DHS has committed to make ongoing annual payments of $18.00 million for indigent care support, and up to $50.00 million in annual intergovernmental transfers for the benefit of the MLK Hospital. Under the terms of the agreement, the lease is for a period of forty (40) years with three options to extend the term by an additional ten years. The County established a lease receivable to lease the MLK facility to MLK-LA which has a balance of $650.88 million as of June 30, 2024 and is reflected in governmental activities and the governmental funds. 153 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS Interfund Receivables/Payables Interfund receivables and payables have been eliminated in the government-wide financial statements, except for “internal balances” that are reflected between the governmental and business-type activities. The majority of the interfund balances resulted from the time lag between the time that (1) goods and services were provided; (2) the recording of those transactions in the accounting system; and (3) payments between the funds were made. Interfund receivables and payables have been recorded in the fund financial statements. Such amounts arise due to the exchange of goods or services (or subsidy transfers) between funds that were pending the transfer of cash as of June 30, 2024. 154 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Receivables/Payables-Continued Cash transfers related to interfund receivables/payables are generally made within 30 days after year-end. Amounts due to/from other funds at June 30, 2024 are as follows (in thousands): Receivable Fund Payable Fund Amount General Fund Fire Protection District $ 23,080 Flood Control District 2,487 LA County Library 6,274 Regional Park and Open Space District 3,225 Mental Health Services Act 360,866 Nonmajor Governmental Funds 243,842 Harbor-UCLA Medical Center 132,458 Olive View-UCLA Medical Center 66,433 Los Angeles General Medical Center 241,857 Rancho Los Amigos Nat’l Rehab Center 40,368 Waterworks 812 Nonmajor Aviation 42 Internal Service Funds 10,937 1,132,681 Fire Protection District General Fund 1,260 Nonmajor Governmental Funds 105 Internal Service Funds 2 1,367 Flood Control District General Fund 8,786 Nonmajor Governmental Funds 2,564 Waterworks 433 Nonmajor Aviation 35 Internal Service Funds 20,896 32,714 LA County Library General Fund 12,810 Nonmajor Governmental Funds 146 12,956 155 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Receivables/Payables-Continued Receivable Fund Payable Fund Amount Regional Park and Open Space District General Fund $ 4 Nonmajor Governmental Funds General Fund 8,987 Fire Protection District 851 Flood Control District 29 LA County Library 4 Nonmajor Governmental Funds 14,880 Harbor-UCLA Medical Center 2,366 Waterworks 1 Internal Service Funds 21,018 48,136 Harbor-UCLA Medical Center General Fund 48,210 Nonmajor Governmental Funds 58,692 Olive View-UCLA Medical Center 2,485 Los Angeles General Medical Center 292,939 Rancho Los Amigos Nat'l Rehab Center 423 402,749 Olive View-UCLA Medical Center General Fund 31,571 Fire Protection District 62 Nonmajor Governmental Funds 21,323 Harbor-UCLA Medical Center 277 Los Angeles General Medical Center 184,608 Rancho Los Amigos Nat’l Rehab Center 127 237,968 Los Angeles General Medical Center General Fund 456,859 Fire Protection District 35 Nonmajor Governmental Funds 41,742 Harbor-UCLA Medical Center 292,160 Olive View-UCLA Medical Center 183,675 Rancho Los Amigos Nat’l Rehab Center 311,568 1,286,039 156 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Receivables/Payables-Continued Receivable Fund Payable Fund Amount Rancho Los Amigos Nat’l Rehab Center General Fund $ 3,343 Harbor-UCLA Medical Center 196 Olive View-UCLA Medical Center 14 Los Angeles General Medical Center 310,733 314,286 Waterworks General Fund 203 Internal Service Funds 2,381 2,584 Nonmajor Aviation General Fund 55 Fire Protection District 8 Internal Service Funds 277 340 Internal Service Funds General Fund 47,156 Fire Protection District 322 Flood Control District 41,386 Nonmajor Governmental Funds 45,420 Harbor-UCLA Medical Center 627 Olive View-UCLA Medical Center 1,632 Los Angeles General Medical Center 536 Rancho Los Amigos Nat'l Rehab Center 67 Waterworks 8,553 Nonmajor Aviation 853 146,552 Total Interfund Receivables/Payables $ 3,618,376 Interfund Transfers Transfers were made during the year from the General Fund to subsidize the operations of the LA County Library and the four hospitals. Other transfers primarily consisted of payments from the various operating funds (principally the General Fund) to debt service funds in accordance with long- term debt covenants. In addition, special revenue funds that are statutorily restricted made transfers to other funds to augment funding for programs operated in the General Fund and hospitals. 157 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Transfers-Continued Interfund transfers to/from other funds for the year ended June 30, 2024 are as follows (in thousands): Transfer From Transfer To Amount General Fund Fire Protection District $ 50,721 LA County Library 43,881 Nonmajor Governmental Funds 157,037 Harbor-UCLA Medical Center 310,285 Olive View-UCLA Medical Center 109,987 Los Angeles General Medical Center 442,137 Rancho Los Amigos Nat’l Rehab Center 92,013 Internal Service Funds 235 1,206,296 Fire Protection District General Fund 143 Nonmajor Governmental Funds 13,936 14,079 Flood Control District General Fund 7,500 Internal Service Funds 4,000 11,500 LA County Library General Fund 150 Nonmajor Governmental Funds 23,618 23,768 Mental Health Services Act General Fund 781,814 Nonmajor Governmental Funds General Fund 492,236 Fire Protection District 4,563 LA County Library 1,032 Nonmajor Governmental Funds 30,031 Harbor-UCLA Medical Center 67,515 Olive View-UCLA Medical Center 40,220 Los Angeles General Medical Center 100,934 Rancho Los Amigos Nat'l Rehab Center 4,719 Internal Service Funds 410 741,660 Harbor-UCLA Medical Center Nonmajor Governmental Funds 252 Los Angeles General Medical Center 262,518 Rancho Los Amigos Nat'l Rehab Center 217 262,987 158 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Transfers-Continued Transfer From Transfer To Amount Olive View-UCLA Medical Center Los Angeles General Medical Center $ 56,263 Rancho Los Amigos Nat'l Rehab Center 66 56,329 Los Angeles General Medical Center General Fund 73,039 Nonmajor Governmental Funds 1 Harbor-UCLA Medical Center 82,789 Olive View-UCLA Medical Center 136,267 Rancho Los Amigos Nat'l Rehab Center 129,493 421,589 Rancho Los Amigos Nat’l Rehab Center Nonmajor Governmental Funds 1,556 Harbor-UCLA Medical Center 3,980 Olive View-UCLA Medical Center 872 Los Angeles General Medical Center 237,621 244,029 Waterworks Enterprise Funds Internal Service Funds 198 Nonmajor Aviation Funds Internal Service Funds 14 Internal Service Funds Nonmajor Governmental Funds 3,809 Total Interfund Transfers $ 3,768,072 Interfund Advances The General Fund, along with other funds that receive services from the Public Works Internal Service Fund, makes short-term advances to ensure sufficient cash is available to fund operations. In addition, the General Fund makes short-term advances to assist the Hospital Funds in meeting their cash flow requirements. 159 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 15. INTERFUND TRANSACTIONS-Continued Interfund Advances-Continued Advances from/to other funds at June 30, 2024 are as follows (in thousands): Receivable Fund Payable Fund Amount General Fund Harbor-UCLA Medical Center $ 4,735 Olive View-UCLA Medical Center 2,554 Los Angeles General Medical Center 6,401 Rancho Los Amigos Nat’l Rehab Center 1,265 Internal Service Funds 2,851 17,806 Flood Control District Internal Service Funds 6,141 Nonmajor Governmental Funds Internal Service Funds 11,307 Waterworks Internal Service Funds 1,444 Nonmajor Aviation Internal Service Funds 257 Total Interfund Advances $ 36,955 16. BUDGETARY ACCOUNTING DIFFERENCES/RECONCILIATIONS BETWEEN THE BUDGETARY BASIS AND GAAP The County’s statement of revenues, expenditures and changes in fund balances-budget and actual on budgetary basis for the major governmental funds has been prepared on the budgetary basis of accounting, which is different from GAAP. The amounts presented for the governmental funds statements are based on the modified accrual basis of accounting and differ from the amounts presented on a budgetary basis of accounting. The major areas of difference are as follows: – For budgetary purposes, nonspendable, restricted, committed and assigned fund balances and the portion of unassigned fund balance reserved for the “Rainy Day” fund are recorded as other financing uses at the time they are established. The County recognizes them as uses of budgetary fund balance. The nonspendable, restricted, committed and assigned fund balances that are subsequently canceled or otherwise made available are recorded as changes in fund balance in other financing sources. – Under the budgetary basis, revenues (primarily intergovernmental) are recognized at the time encumbrances are established for certain programs and capital improvements. The intent of the budgetary policy is to match the use of budgetary resources (for amounts encumbered, but not yet expended) with funding sources that will materialize as revenues when actual expenditures are incurred. Under the modified accrual basis, revenues are not recognized until the qualifying expenditures are incurred and amounts are collected within the County’s availability period. 160 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 16. BUDGETARY ACCOUNTING DIFFERENCES/RECONCILIATIONS BETWEEN THE BUDGETARY BASIS AND GAAP-Continued – For the General Fund, obligations for accrued compensated absences and estimated liabilities for litigation and self-insurance are recorded as budgetary expenditures to the extent that they are estimated to be payable within one year after year-end. Under the modified accrual basis of accounting, such expenditures are not recognized until they become due and payable in accordance with GASB Interpretation 6. – In conjunction with the sale of Tobacco Settlement Asset-Backed bonds in FY 2005-2006, the County sold 25.9% of its future tobacco settlement revenues. Under the budgetary basis, the proceeds were recognized as revenues. Under the modified accrual basis, the proceeds were recorded as deferred inflows of resources and are being recognized over the duration of the sale agreement, in accordance with GASB 48 and 65. This matter is also discussed in Note 11, under the caption, “Tobacco Settlement Asset-Backed Bonds.” – Under the budgetary basis, property tax revenues are recognized to the extent that they are collectible within one year after year-end. Under the modified accrual basis, property tax revenues are recognized only to the extent that they are collectible within 60 days. – For budgetary purposes, investment income is recognized prior to the effect of changes in the fair value of investments. Under the modified accrual basis, the effects of such fair value changes have been recognized. – The County determined that certain assets were held by LACERA (the OPEB administrator) in an OPEB Custodial Fund. For budgetary purposes, any excess payments (beyond the pay-as-you-go amount) are recognized as expenditures. Under the modified accrual basis, the expenditures are adjusted to recognize the OPEB Custodial assets at June 30, 2024. 161 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 16. BUDGETARY ACCOUNTING DIFFERENCES/RECONCILIATIONS BETWEEN THE BUDGETARY BASIS AND GAAP-Continued The following schedule is a reconciliation of the budgetary and GAAP fund balances for the major governmental funds (in thousands): Regional Park and Mental Fire Flood LA Open Health General Protection Control County Space Services Fund District District Library District Act Fund balance - budgetary basis $ 4,216,065 $ 75,436 $ 59,574 $ 65,337 $ 150,558 $ 355,740 Budgetary fund balances 3,774,570 197,814 229,289 109,574 670,836 1,268,163 Subtotal 7,990,635 273,250 288,863 174,911 821,394 1,623,903 Adjustments: Accrual of estimated liability for litigation and self-insurance claims 353,007 2,371 — 651 — — Accrual of compensated absences 118,228 — — — — — Unamortized balance of sale of tobacco settlement revenue (175,088) — — — — — Change in revenue accruals (848,542) (31,875) (18,932) (9,415) (30,880) (75,178) Change in OPEB Custodial Fund 254,469 15,397 — 2,256 — — Subtotal (297,926) (14,107) (18,932) (6,508) (30,880) (75,178) Fund balance - GAAP basis $ 7,692,709 $ 259,143 $ 269,931 $ 168,403 $ 790,514 $ 1,548,725 17. OTHER COMMITMENTS AND CONTINGENCIES Construction and Other Significant Commitments At June 30, 2024, there were contractual commitments of approximately $16.19 million for various governmental construction projects and approximately $907.44 million for various hospital construction projects that were financed by bonds and lease revenue obligation notes. LACERA Capital Commitments At June 30, 2024, LACERA had outstanding capital commitments to various investment managers, approximating $9.700 billion. 162 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 17. OTHER COMMITMENTS AND CONTINGENCIES-Continued Encumbrances The County uses “encumbrances” to control expenditure commitments for the year. Encumbrances represent commitments related to executory contracts not yet performed and purchase orders not yet filled. Commitments for such expenditure of monies are encumbered to reserve applicable appropriations. Depending on the source(s) of funding, encumbrances are reported as part of restricted, committed or assigned fund balance on the governmental funds balance sheet. As of June 30, 2024, the encumbrance balances for the governmental funds (in thousands) are reported as follows: Restricted Committed Assigned Total General Fund $ 1,343,813 $ 1,343,813 Fire Protection District 54,502 — — 54,502 Flood Control District 104,421 — — 104,421 LA County Library — — 20,934 20,934 Regional Park and Open Space District 94,123 — — 94,123 Nonmajor Governmental Funds 197,321 17,742 — 215,063 Total Encumbrances $ 450,367 17,742 1,364,747 $ 1,832,856 Contingent Gain During FY 2020-2021, the State of California and its political subdivisions participated in obtaining final settlement agreements and judgments against multiple companies to resolve legal claims related to the companies’ role in the opioid crisis. Currently, California's allocation is approximately 9.92% of the national settlement funds. The State of California Department of Health Care Services (DHCS) oversees and administers the National Opiod Settlement funds that are received as follows: 15 percent allocated to the State of California and used for future opioid remediation activities, 70 percent allocated to the Participating Subdivisions (i.e., counties and cities) and used for opioid remediation activities, and 15 percent allocated to the Plaintiff Subdivisions that are Initial Participating Subdivisions (which includes the County). The County will also receive a portion of the Mallinckrodt Bankruptcy funds (NOAT II) as determined by the Mallinckrodt Statewide Abatement Agreement. California elected to distribute the majority of NOAT II funds to cities and counties for opioid remediation activities at the local level. Cities and counties (otherwise known as Local Governments) will receive funding from the trust annually for up to eight years. The DHCS will also oversee all activities funded by the settlements including, but not limited to, designating additional high-impact abatement activities, conducting related stakeholder engagement, monitoring the California participating subdivisions for compliance, and preparing annual reports. Future opioid litigation may result in additional settlement agreements or judgments, or suspension and reduction of payments, and each agreement or judgment may have unique terms governing payment timing and duration. The County reported opioid settlement revenues of $22.62 million in FY 2023-2024 under the nonmajor health and sanitation funds, as reflected in the government-wide governmental activities and governmental fund statements. Because of the uncertainty of future revenues to be received from the State, no receivable has been established for the opioid settlements. 163 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 18. RISK MANAGEMENT The County purchases insurance for certain risk exposures such as property, aviation, employee fidelity, boiler and machinery, cyber, catastrophic workers’ compensation, art objects, volunteers, special events, public official bonds, crime, safety reserve employee death and disability, and fiduciary liability for the deferred compensation plans. There have been settlements related to these programs that exceeded self-insured retention in the last three years. Losses did not exceed coverage in FY 2021-2022, FY 2022-2023 or FY 2023-2024. The County retains the risk for all other loss exposures. Major areas of risk include workers' compensation, medical malpractice, law enforcement, natural disasters, inverse condemnation, non- tort and tort liability. Expenditures are accounted for in the fund whose operations resulted in the loss. Claims expenditures and liabilities are reported when it is probable that a loss has been incurred and the amount of that loss, including those incurred but not reported, can be reasonably estimated. The County utilizes actuarial studies, historical data, and individual claims reviews to estimate these liabilities. The liabilities include estimable incremental claim adjustment expenses, net of salvage, and recovery/subrogation of approximately 10% of the total liability expenditures. They do not include other claim adjustment costs because the County does not believe it is practical or cost effective to estimate them. As indicated in the following table, the County’s workers’ compensation balance as of June 30, 2024 was approximately $3.691 billion. This amount is undiscounted and is based on an actuarial study of the County’s self-insured program as of June 30, 2024. Approximately $175.33 million of the total liabilities pertain to salary continuation payments and other related costs mandated by the State Labor Code. As of June 30, 2024, the County's estimate of these liabilities is $8.047 billion. Changes in the reported liability since July 1, 2023 resulted from the following (in thousands): Current Year Beginning of Claims and Balance At Fiscal Year Changes In Claim Fiscal Year- Liability Estimates Payments End 2022-2023 Workers’ Compensation $ 3,400,463 760,369 (656,599) $ 3,504,233 Other 613,918 3,410,854 (258,559) 3,766,213 Total $ 4,014,381 4,171,223 (915,158) $ 7,270,446 2023-2024 Workers’ Compensation $ 3,504,233 904,569 (717,947) $ 3,690,855 Other 3,766,213 732,725 (142,447) 4,356,491 Total $ 7,270,446 1,637,294 (860,394) $ 8,047,346 In addition to the above estimated liabilities, the County has determined that claims seeking damages of approximately $322.93 million are reasonably possible of creating adverse judgments against the County. Because of the uncertainty of their outcome, no loss has been accrued for these claims. 164 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 18. RISK MANAGEMENT-Continued The County receives substantial federal revenues and operates many programs which are subject to federal rules and regulations. Federal assistance is especially critical to the County's ability to operate its four County hospitals and health care network. The County is carefully monitoring State and federal policy developments to determine the future impacts, if any, on its ability to administer federal programs and deliver County services that rely upon federal funding. 19. POLLUTION REMEDIATION The County is involved in several remediation actions to clean up pollution sites within its boundaries. These matters generally coincide with the County’s ownership of land, buildings and infrastructure assets. In some cases, regulatory agencies (e.g., Regional Water Quality Board, State Department of Toxic Control, California Coastal Commission) notified the County of the need for remedial action. In addition, the County conducts its own environmental monitoring and this activity identifies pollution sites and matters requiring further investigation and possible remediation. Once the County is aware of these conditions, it commences monitoring, assessment, testing and/or cleanup activities, and recognizes a pollution remediation obligation when estimates can reasonably be determined. The pollution remediation obligation is an estimate and is subject to revision because of price increases or reductions, changes in technology, or changes in applicable laws or regulations. The types of pollution that have been identified include leaking underground storage tanks, water, groundwater and soil contamination, asbestos and lead paint contamination, methane gas detection and excessive levels of other contaminants. Remediation efforts include developing remediation and feasibility studies, source identification studies, site testing, sampling and analysis, ground water cleanup, and removal of storage tanks, asbestos tiles and other hazardous materials. As of June 30, 2024, the County’s estimated pollution remediation obligation totaled $55.14 million. This obligation was associated with the County’s governmental activities. Obligations of enterprise and internal service funds were immaterial. The estimated liability was determined by project managers, based on historical cost information for projects of the same type, size and complexity and measured at their current value. In subsequent periods, the County will adjust the estimated obligation when new information indicates that such changes are required. At this time, the County has determined there are no estimated recoveries reducing the obligation. 20. DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES Deferred outflows and inflows of resources balances in the government-wide and the proprietary funds statement of net position as of June 30, 2024 are described as follows: – The deferred outflows of resources, included on the government-wide statement of net position, relate to the unamortized losses on refunding of debt, changes in the net pension liability as discussed in Note 7, and changes in the net OPEB liability as discussed in Note 8. The unamortized losses on refunding of debt are a deferred charge on refunding resulting from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the remaining life of the old debt or the life of the new debt, whichever is shorter. 165 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 20. DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES-Continued – The deferred inflows of resources, included on the government-wide statement of net position, relate to the future installment payments of public-private and public-public partnerships as discussed in Note 6, from changes in the lease receivable as discussed in Note 9, from changes in the net pension liability as discussed in Note 7, and from changes in the net OPEB liability as discussed in Note 8. Government-wide Statement of Net Position (in thousands) Governmental Business-type Activities Activities Total Deferred outflows of resources: Unamortized losses on refunding of debt $ 6,220 $ 6,220 Pension 5,829,749 907,253 6,737,002 OPEB 4,981,055 751,521 5,732,576 Total government-wide deferred outflows of resources $ 10,817,024 1,658,774 $ 12,475,798 Deferred inflows of resources: Unamortized gain on refunding of debt $ 10,595 10,270 $ 20,865 Public-private partnerships 82,577 82,577 Leases 1,885,346 19,718 1,905,064 Pension 225,190 61,927 287,117 OPEB 7,451,585 1,537,680 8,989,265 Total government-wide deferred inflows of resources $ 9,655,293 1,629,595 $ 11,284,888 Proprietary Funds Statement of Net Position (in thousands): H-UCLA OV-UCLA LA GEN Rancho Aviation Total ISF Funds Deferred outflows of resources: Pension $ 280,913 158,626 380,245 87,469 $ 907,253 $ 231,082 OPEB 223,600 118,646 323,843 85,432 751,521 225,638 Total proprietary funds deferred outflows of resources $ 504,513 277,272 704,088 172,901 $ 1,658,774 $ 456,720 Deferred inflows of resources: Unamortized gain on refunding of debt $ 10,270 $ 10,270 $ Leases 19,718 19,718 Pension 16,741 19,276 22,648 3,262 61,927 2,588 OPEB 425,046 306,668 666,642 139,324 1,537,680 310,034 Total proprietary funds deferred inflows of resources $ 452,057 325,944 689,290 142,586 19,718 $ 1,629,595 $ 312,622 166 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 20. DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES-Continued Deferred outflows and inflows of resources balances in the governmental funds balance sheet as of June 30, 2024 are described as follows: – The intra-entity sales of future tobacco settlement revenues are reported as deferred inflows of resources in the General Fund and deferred outflows of resources in the nonmajor governmental funds. – Under the modified accrual basis of accounting, earning revenues during the current period is not sufficient for revenue recognition in the current period. Revenue must also be susceptible to accrual (i.e., measurable and available to finance expenditures of the current period). Governmental funds report revenues that are not available as deferred inflows of resources. The County has included three such items, which are property tax revenues to be collected beyond the 60 day accrual period, lease receivables measured at the present value or expected to be received during the lease term in a future period, plus other long-term receivables, related mostly to SB90 claims, expected to be collected beyond the 12 month accrual period. Governmental Funds Balance Sheet (in thousands): Regional Park and Fire Flood Open General Protection Control LA County Space Nonmajor Fund District District Library District Funds Total Deferred outflows of resources - Tobacco settlement revenues $ 175,088 $ 175,088 Deferred inflows of resources: Tobacco settlement revenues $ 175,088 $ 175,088 Leases 1,846,351 34,055 4,940 1,885,346 Property tax revenues 205,455 42,060 10,640 6,336 1,455 15,903 281,849 Other long-term receivables 235,309 12,952 248,261 Total governmental funds deferred inflows of resources $ 2,462,203 55,012 44,695 6,336 1,455 20,843 $ 2,590,544 167 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 21. FUND BALANCES Fund balances are presented in the following categories: nonspendable, restricted, committed, assigned, and unassigned as described in Note 1. A detailed schedule of fund balances for all the major and nonmajor governmental funds at June 30, 2024 (in thousands) is as follows: Regional Park and Mental Fire Flood LA Open Health Nonmajor General Protection Control County Space Services Governmental Fund District District Library District Act Funds Fund Balances: Nonspendable: Inventories $ 142,429 $ 12,173 $ 1,101 $ 8 $ $ $ 1 Long-term receivables 151,324 84,577 Permanent fund principal — — — — — — 2,180 Total Nonspendable 293,753 12,173 1,101 8 86,758 Restricted for: Purpose of fund 246,970 268,731 88,616 790,514 1,548,725 2,508,640 Purpose of utility users tax 84,392 Sheriff Pitchess landfill 2,262 La Alameda project 2,000 Capital projects 52,847 Debt service 263,064 Total Restricted 88,654 246,970 268,731 88,616 790,514 1,548,725 2,824,551 Committed to: Purpose of fund 80,020 Capital projects and extraordinary maintenance 72,689 89,752 Affordable housing 4,027 American Rescue Plan- enabled capital programs 209,400 Board budget policies and priorities 8,693 Budget uncertainties 95,838 Capital assets 16,575 Department of Children and Family Services 8,840 DPSS building purchase 33,944 Financial system (eCAPS) 26,000 Health services future financial requirements 1,200 Health services-tobacco settlement 175,616 Alternatives to incarceration- facilities and programs 130,373 Information technology enhancements 56,758 Library services 1,496 168 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 21. FUND BALANCES-Continued Regional Park and Mental Fire Flood LA Open Health Nonmajor General Protection Control County Space Services Governmental Fund District District Library District Act Funds Live scan 2,000 Office of Diversion and Re- Entry Permanent Supportive Housing 112,777 Public works-permit tracking system 3,151 Services to unincorporated areas 4,320 Sheriff unincorporated patrol 90 TTC remittance processing and mailroom equipment 500 TTC unsecured property tax system 50,769 Youth justice reimagined development 31,393 Woolsey fire recovery efforts 23,864 Total Committed 1,070,313 169,772 Assigned to: Purpose of fund 99 79,779 154,763 Future purchases 1,345,188 Capital projects 49,192 Total Assigned 1,345,188 99 79,779 203,955 Unassigned 4,894,801 Total Fund Balances $ 7,692,709 $ 259,143 $ 269,931 $ 168,403 $ 790,514 $ 1,548,725 $ 3,285,036 Reserve for “Rainy Day” Fund On June 22, 2009, the Board established a Reserve for “Rainy Day” fund. The Reserve for “Rainy Day” fund was established and maintained to protect essential County programs against unforeseen emergencies and economic downturns. On May 3, 2022, the Board adopted an updated "Rainy Day" Fund amount of 17.00% of on-going locally generated revenue from the previous 10.00% amount. Transfers, at a minimum of ten percent (10.00%) of excess fund balance, less Board approved carryovers, will be set aside in the "Rainy Day" Fund each year until the 17.00% cap is met. Excess fund balance is defined as the difference between the actual year-end fund balance amount as determined by the Auditor-Controller, less the estimated fund balance amount included in the Adopted Budget. Board approved carryover is defined as unspent funding that was previously approved by the Board for critical programs and/or uncompleted projects. Seventeen percent (17.00%) of the new ongoing discretionary revenues should be set aside annually, during the budget process as a hedge against any unforeseen fiscal issues during the year. At year-end, these funds will be transferred to the Rainy Day fund. 169 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 21. FUND BALANCES-Continued Reserve for “Rainy Day” Fund-Continued The County’s “Rainy Day” fund does not meet the criteria for a stabilization arrangement for reporting the funds as either restricted or committed. As such, the Reserve for “Rainy Day” funds in the amount of $978.56 million is reported as unassigned fund balance in the General Fund. 22. CORONAVIRUS DISEASE 2019 (COVID-19) On March 13, 2020, a presidential emergency was declared for all states, tribes, territories, and the District of Columbia due to the ongoing Coronavirus Disease 2019 (COVID-19) pandemic. The declaration made federal disaster assistance available; through the Coronavirus Aid, Relief, and Economic Security (CARES) Act to the County and to the State of California to supplement the County’s local recovery efforts. To assist in the efforts to respond to COVID-19, the County received significant fiscal stimulus in federal funds. The significant outstanding funding is described below. American Rescue Plan Act of 2021 The American Rescue Plan (ARP) Act of 2021 Coronavirus State and Local Government Fiscal Recovery Funds (Fiscal Recovery Funds) continues many of the programs started by the CARES Act (2020) and Consolidated Appropriations Act (2021) by adding new phases, new allocations, and new guidance to address issues related to the continuation of the COVID-19 pandemic. The ARP also creates a variety of new programs to address continuing pandemic-related crises, and fund recovery efforts as the United States begins to emerge from the COVID-19 pandemic. The ARP was passed by Congress on March 10, 2021 and signed into law on March 11, 2021. The Fiscal Recovery Funds may be used for the following: 1) to respond to the public health emergency or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality; 2) to respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers; 3) to provide government services to the extent of the reduction in revenue due to the COVID-19 public health emergency relative to revenues collected in the most recent full fiscal year prior to the emergency; and 4) to make necessary investments in water, sewer, or broadband infrastructure. In December 2022, Congress amended the ARP program through the Consolidated Appropriations Act, 2023, providing additional flexibility for recipients to use ARP funds to respond to natural disasters, build critical infrastructure, and support community development. On May 16, 2021, the County received the first tranche of $974.99 million of ARP funds from the U.S. Department of Treasury and on June 9, 2022, the County received the second tranche of $974.99 million. The ARP funds must be obligated between March 3, 2021 and December 31, 2024, and expended to cover such obligations by December 31, 2026. For FY 2023-2024, the County recorded $713.09 million as revenue on the fund and government-wide financial statements and $459.94 million is reported as advances payable. 170 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 22. CORONAVIRUS DISEASE 2019 (COVID-19)-Continued American Rescue Plan Act of 2021-Continued Local Assistance and Tribal Consistency Funds On November 17, 2022, the County received $1.66 million from the Local Assistance and Tribal Consistency Fund (LATCF). The LATCF was established by Section 605 of the Social Security Act, as added by Section 9901 of the American Rescue Plan Act of 2021. The purpose of the LATCF program is to serve as a general revenue enhancement program and is designed, in part, to supplement existing federal programs that augment and stabilize revenues. For FY 2023-2024, the County recorded $258 thousand as revenue on the fund and government-wide financial statements, and $3.07 million is reported as advances payable. Under the fund statements, the General Fund recorded the COVID-19 revenue as “Intergovernmental Revenues-Federal”. The government-wide financial statements recorded the COVID-19 revenue as “Operating Grants and Contributions”. The remaining balance was reported under advance payable on the fund and government-wide financial statements as summarized below (in thousands): COVID-19 Federal Revenues Advances Payable ARP $ 713,090 $ 459,940 LATCF 258 3,070 Total $ 713,348 $ 463,010 23. SUBSEQUENT EVENTS Tax and Revenue Anticipation Notes (TRANS) On July 1, 2024, the County issued $700.00 million in FY 2024-2025 TRANS, which will mature on June 30, 2025. The TRANS are collateralized by taxes and other revenues attributable to FY 2024-2025 and were issued in the form of Fixed Rate Notes at an effective interest rate of 3.25%. Lease Revenue Obligation Notes from Direct Borrowings On July 1, 2024, four Letter of Credit (LOC) and Reimbursement Agreements were entered into between LACCAL and four separate banks to replace the four LOC and Reimbursement Agreements that had an original termination date of April 30, 2024 and were extended to July 18, 2024. The aggregate maximum principal amount of the four LOCs is $750.00 million, which consists of $200.00 million of Series A (Bank of Montreal), $100.00 million of Series B (U.S. Bank), $350.00 million of Series C (Bank of America), and $100.00 million of Series D (Sumitomo Mitsui Banking Corporation) The LOCs were established for a 5-year term with an initial expiration date of July 31, 2029. 171 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 23. SUBSEQUENT EVENTS-Continued Los Angeles County Facilities 2, Inc. (LACF2) Lease Revenue Bonds, Series 2024A (Tax-Exempt) and Series 2024B (Federally Taxable) – Vermont Corridor Site 2 LACF2 is a California nonprofit public benefit corporation and an organization described under Section 501(c)(3) of the Internal Revenue Code of 1986. It was formed on December 3, 2021 and replicates the financing model of Vermont Corridor Site 1, the Vermont Corridor County Administration Building and parking structure. On August 22, 2024, LACF2 issued $212.14 million of lease revenue bonds, which includes $205.91 million in tax-exempt lease revenue bonds (2024A), maturing from 2029-2057, with yields ranging from 2.43% to 3.83%, and $6.23 million in federally taxable lease revenue bonds (2024B), maturing in 2029, with a yield of 4.54%. Proceeds from the sale of the bonds plus the associated premium of $28.48 million for 2024A will be used to finance Vermont Corridor Site 2, a County administrative office building by renovating and expanding the vacated former Department of Mental Health headquarters and demolishing the vacated former Workforce Development, Aging, and Community Services headquarters and parking structure. Public Works Financing Authority (PWFA) - Lease Revenue Bonds, 2024 Series H On September 5, 2024, PWFA issued $569.27 million of lease revenue bonds (2024 Series H), with an associated premium of $76.93 million and released funds with respect to prior bonds that were refunded of $5.45 million, resulting in proceeds of $651.65 million. These bonds are maturing from 2024 to 2053, with yields from 2.32% to 4.14%. Proceeds of $433.01 million will be used to finance Phase I Projects for the Harbor-UCLA Medical Center Replacement Project, $131.68 million was used to refund the PWFA’s Lease Revenue Bonds, 2015 Series A, $85.25 million was used to refinance LRON previously issued by the County for the Phase I Projects for the Harbor-UCLA Medical Center Replacement Project, and $1.71 million of the proceeds covered the cost of issuance. County of Los Angeles Community Facilities District No. 2021-01 (Valencia-Facilities) (Improvement Area No. 2) Special Tax Bonds, Series 2024 On September 11, 2024, the County of Los Angeles Community Facilities District No. 2021-01 (Valencia-Facilities) issued Improvement Area No. 2 Special Tax Bonds, Series 2024, totaling $27.14 million. Proceeds from the sale of the bonds plus an associated premium of $1.60 million will be used to implement significant public infrastructure and facilities in Improvement Area No. 2, an unincorporated portion of the County within a long-term master-planned community in the Valencia area. These bonds are maturing from 2026 to 2054, with yields from 2.74% to 4.38%. The debt service will be paid from the special tax which has been authorized to be levied within Improvement Area No. 2, where a portion will be used to fund costs of the County to administer the District. Lease Revenue Commercial Paper Obligation Notes (LRON) On September 6, 2024, the County redeemed $85.25 million of tax-exempt LRON using a portion of the proceeds from 2024 Series H. On October 4, 2024, the County issued an additional $3.00 million in tax-exempt LRON with an interest of 3.0%. The proceeds are being used to fund capital requirements of various capital projects. LRON issuances are supported and secured by four separate series of letters of credit and pledged County properties. 172 COUNTY OF LOS ANGELES NOTES TO THE BASIC FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2024 23. SUBSEQUENT EVENTS-Continued Acquisition of the Gas Company Tower On November 6, 2024, the Board authorized the County to execute the Purchase and Sale Agreement for the Gas Company Tower for $200.00 million, plus an amount not to exceed $5.00 million for closing costs. The Gas Company Tower acquisition includes an approximately 1.5 million- square-foot, 54-story commercial office building located at 555 West 5th Street, Los Angeles and airspace parcels located at 350 South Figueroa Street and 333 South Flower Street, Los Angeles. Measure A - Homeless Services and Affordable Housing Ordinance On November 5, 2024, the voters of Los Angeles County successfully passed Measure A - Homeless Services and Affordable Housing Ordinance. This measure authorizes the implementation of a permanent one-half cent sales tax to reduce and prevent homelessness, as well as to provide mental health and addiction treatment, and affordable housing. Additionally, this measure repeals the one- quarter cent sales tax enacted by Measure H in 2017, which would have otherwise expired in 2027. This will impact the nonmajor special revenue fund Homeless and Housing Measure H. Measure A is projected to generate approximately $1.076 billion annually. Measure E - Consolidated Fire Protection District of Los Angeles County Emergency Response and Infrastructure Ordinance On November 5, 2024, the voters of Los Angeles County successfully passed Measure E - Consolidated Fire Protection District of Los Angeles County Emergency Response and Infrastructure Ordinance. This measure will levy 6 cents per square foot of certain parcel improvements and is estimated to generate $152 million annually to support the Fire Protection District emergency response and infrastructure costs. Measure G - Los Angeles County Government Structure, Ethics, and Accountability Charter Amendment On November 5, 2024, the voters of Los Angeles County successfully passed Measure G - Los Angeles County Government Structure, Ethics, and Accountability Charter Amendment. This measure will change the County's governance structure and increase the Board of Supervisors from 5 to 9 members after the 2030 census, change the County's Chief Executive Office from an appointed to elected position by 2028, create an independent ethics commission by 2026, establish a nonpartisan Legislative Analyst, and update certain County policies. Measure G fiscal impact is not yet determinable. 173 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Los Angeles County Employees Retirement Association Schedule of the County's Proportionate Share of the Net Pension Liability and Related Ratios Last Ten Fiscal Years1 (Dollar amounts in thousands) 6/30/2023 6/30/2022 6/30/2021 6/30/2020 6/30/2019 6/30/2018 6/30/2017 6/30/2016 6/30/2015 6/30/2014 Pension Plan’s fiduciary net position as percentage of total pension liability 83.480 % 83.750 % 90.920 % 76.400 % 82.910 % 83.960 % 82.370 % 81.749 % 86.296 % 86.804 % County’s proportionate share of the collective net pension liability $ 14,073,963 $ 13,160,560 $ 7,030,463 $ 17,394,887 $ 11,560,668 $ 10,345,209 $ 10,849,931 $ 10,272,671 $ 7,448,374 $ 6,957,082 County’s proportion as percentage of the collective net pension liability 96.281 % 96.472 % 96.415 % 96.268 % 96.223 % 96.169 % 96.119 % 96.170 % 96.081 % 95.897 % Covered payroll $ 9,050,122 $ 8,756,990 $ 8,714,969 $ 8,377,352 $ 8,031,454 $ 7,631,381 $ 7,320,575 $ 6,986,004 $ 6,948,738 $ 6,672,228 County’s proportionate share of the collective net pension liability as a percentage of its covered payroll 155.511 % 150.286 % 80.671 % 207.642 % 143.942 % 135.561 % 148.211 % 147.046 % 107.190 % 104.269 % Schedule of County’s Pension Contributions Last Ten Fiscal Years2 (Dollar amounts in thousands) 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 Actuarially Determined Contribution (ADC) $2,410,853 $2,216,111 $2,122,282 $1,940,715 $1,732,960 $1,605,150 $1,466,411 $1,300,711 $1,389,628 $1,437,555 Less: Contributions in relation to the ADC 2,410,853 2,216,111 2,122,282 1,940,715 1,732,960 1,605,150 1,466,411 1,300,711 1,389,628 1,437,555 Contribution Deficiency (excess) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Covered payroll $9,450,058 $9,050,122 $8,756,990 $8,714,969 $8,377,352 $8,031,454 $7,631,381 $7,320,575 $6,986,004 $6,948,738 Contributions as a percentage of total covered payroll 25.512 % 24.487 % 24.235 % 22.269 % 20.686 % 19.986 % 19.216 % 17.768 % 19.892 % 20.688 % (1) Reflects data as of the measurement date. (2) Reflects data as of the reporting date. 174 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Los Angeles County Employees Retirement Association Notes to Required Supplementary Information Changes of benefit terms There were no plan changes after June 30, 2013. Changes of assumptions There were no changes in investment return assumption since FY 2021. There were no changes of assumptions in determining the ADC since FY 2014-2015. 175 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Los Angeles County Employees Retirement Association Schedule of Changes in Net RHC OPEB Liability and Related Ratios Last Ten Fiscal Years 1,2,3 (Dollar amounts in thousands) 06/30/2023 06/30/2022 06/30/2021 06/30/2020 06/30/2019 Total OPEB Liability Effect of Change from Cost Sharing to Agent Plan $ $ $ $ $ (2,204,743) Service cost 853,253 1,024,895 1,166,558 967,482 779,965 Interest on Total OPEB Liability 1,274,585 1,217,398 1,147,426 1,250,934 1,197,607 Effect of economic/demographic gains or losses (689,452) (168,643) 323,030 (432,634) Effect of assumption changes or inputs 418,154 (3,365,579) (3,729,953) 2,346,920 2,356,270 Benefit payments (712,101) (689,511) (664,932) (631,917) (601,985) Net change in Total OPEB Liability 1,144,439 (1,981,440) (1,757,871) 3,500,785 1,527,114 Total OPEB Liability, beginning 25,778,695 27,760,135 29,518,006 26,017,221 24,490,107 Total OPEB liability, ending (a) 26,923,134 25,778,695 27,760,135 29,518,006 26,017,221 Fiduciary Net Position Employer contributions 1,163,076 1,071,024 1,031,058 886,821 840,965 Net Investment income 240,868 (280,358) 437,417 5,918 59,606 Benefit payments (712,101) (689,511) (664,932) (631,917) (601,985) Administrative expenses (9,952) (9,534) (9,127) (8,830) (8,601) Net change in plan Fiduciary Net Position 681,891 91,621 794,416 251,992 289,985 Fiduciary Net Position, beginning 2,327,435 2,235,814 1,441,398 1,189,406 899,421 Fiduciary Net Position, ending (b) 3,009,326 2,327,435 2,235,814 1,441,398 1,189,406 Net OPEB Liability, ending = (a) - (b) $ 23,913,808 $ 23,451,260 $ 25,524,321 $ 28,076,608 $ 24,827,815 Fiduciary Net Position as a % of Total OPEB Liability 11.18 % 9.03 % 8.05 % 4.88 % 4.57 % Covered-employee payroll 4 $ 10,332,418 $ 9,864,653 $ 9,653,678 $ 9,404,208 $ 9,071,329 Net OPEB Liability as a % of covered employee payroll 231.44 % 237.73 % 264.40 % 298.55 % 273.70 % Notes to Schedule: Changes of benefit terms: No changes to benefit terms Changes of Assumptions: The discount rate increased from 4.85% as of June 30, 2022 to 5.04% as of June 30, 2023. (1) Historical information is required only for measurement periods for which GASB 75 is applicable. Eventually, 10 years of data will be shown. (2) Reflects data as of the measurement date. (3) As of July 1, 2018, LACERA transitioned from a cost-sharing, multiple employer plan to an agent plan structure. Therefore, this schedule only reflects five years of data. (4) Contributions to the plan are not based on a measure of pay. Therefore, covered-employee payroll is used. 176 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Schedule of County's RHC OPEB Contributions Last 10 Fiscal Years1,2 (Dollar amounts in thousands) 2024 2023 2022 2021 2020 2019 2018 Actuarially Determined Contribution (ADC) $ 1,540,000 $ 1,559,600 $ 1,437,900 $ 1,508,400 $ 1,482,200 $ 1,549,500 $ 1,901,000 Less: Contributions in relation to the ADC 1,264,001 1,154,487 1,064,859 1,025,851 880,949 787,366 679,872 Contribution Deficiency (excess) $ 275,999 $ 405,113 $ 373,041 $ 482,549 $ 601,251 $ 762,134 $ 1,221,128 Covered-employee payroll 3 $ 10,785,762 $ 10,332,418 $ 9,864,653 $ 9,653,678 $ 9,404,208 $ 9,071,329 $ 8,571,345 Contributions as a percentage of total covered-employee payroll 11.719 % 11.173 % 10.795 % 10.627 % 9.368 % 8.680 % 6.523 % (1) Historical information is required only for measurement periods for which GASB 75 is applicable. Eventually, 10 years of data will be shown. (2) Reflects data as of the reporting date. (3) Contributions to the plan are not based on a measure of pay. Therefore, covered-employee payroll is used. Actuarial Methods and Assumptions Valuation Timing July 1, 2022, rolled forward to June 30, 2023 Actuarial Cost Method Individual Entry Age Normal, Level Percent of Pay Asset Valuation Method Fair Value Inflation 2.75% Salary Increases 3.25% general wage increase and merit according to Table A-5 of the July 1, 2022 actuarial valuation of retirement benefits. It can be found at www.LACERA.com. Mortality Various rates based on the Pub-2010 mortality tables and using the MP-2021 Ultimate Projection Scale for expected future mortality improvement. Experience Study Covers the three year period ended June 30, 2023. Discount Rate 5.04 Long-term expected rate of return, net of investment expenses 6.00% 20 Year Tax-Exempt Municipal Bond Yield 3.65% 177 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Schedule of Changes in the Total LTD OPEB Liability and Related Ratios Last Ten Fiscal Years1 (Dollar amounts in thousands) 6/30/2023 6/30/2022 6/30/2021 6/30/2020 6/30/2019 6/30/2018 6/30/2017 Total OPEB Liability Service cost $ 55,362 $ 68,827 $ 62,563 $ 47,316 $ 41,832 $ 43,162 $ 49,068 Interest 46,487 32,594 29,275 38,779 41,028 38,818 33,546 Differences between expected and actual experience (80,333) (512) 111,863 8,067 (55,159) 1,111 589 Changes of assumptions or other inputs (35,491) (218,398) 37,166 170,346 78,190 (43,574) (106,200) Benefit payments (63,487) (66,425) (59,149) (66,671) (60,451) (64,313) (63,430) Net Change in Total OPEB Liability (77,462) (183,914) 181,718 197,837 45,440 (24,796) (86,427) Total LTD OPEB Liability - beginning 1,289,325 1,473,239 1,291,521 1,093,684 1,048,244 1,073,040 1,159,467 Total LTD OPEB Liability - ending $ 1,211,863 $ 1,289,325 $ 1,473,239 $ 1,291,521 $ 1,093,684 $ 1,048,244 $ 1,073,040 Covered-employee payroll $ 10,332,418 $ 9,864,653 $ 9,653,678 $ 9,404,208 $ 9,071,329 $ 8,571,345 $ 8,176,831 Total LTD OPEB Liability as a percentage of covered-employee payroll 11.729 % 13.070 % 15.261 % 13.733 % 12.056 % 12.230 % 13.123 % Notes to schedule: Changes of benefit terms: No changes to benefit terms Changes of assumptions: Changes of Assumptions and other inputs reflect the effects of changes in the discount rate each period. The following are the discount rates used in each period: As of June 30, 2017 3.58 % As of June 30, 2018 3.87 % As of June 30, 2019 3.50 % As of June 30, 2020 2.21 % As of June 30, 2021 2.16 % As of June 30, 2022 3.54 % As of June 30, 2023 3.65 % (1) Historical information is required only for measurement periods for which GASB 75 is applicable. Eventually, 10 years of data will be shown. 178 COUNTY OF LOS ANGELES REQUIRED SUPPLEMENTARY INFORMATION (Unaudited) Total LTD OPEB Liability Notes to Required Supplementary Information Changes of benefit terms None Changes of assumptions The discount rate increased from 3.54% as of June 30, 2023 to 3.65% as of June 30, 2024. No assets are accumulated in a trust that meets the criteria in GASB 75, paragraph 4 to pay related benefits. 179 180 COUNTY OF LOS ANGELES MAJOR GOVERNMENTAL FUND GENERAL FUND GENERAL FUND The General Fund is the general operating fund of the County. It is used to account for and report all financial resources not accounted for and reported in another fund. Revenues are derived from Taxes; Licenses, permits and franchises; Fines, forfeitures and penalties; Revenue from use of money and property; Intergovernmental revenues; Charges for services and Miscellaneous. Expenditures are expended for functions of General government; Public protection; Public ways and facilities; Health and sanitation; Public assistance; Education; Recreation and cultural services; Debt service and Capital outlay. COUNTY OF LOS ANGELES GENERAL FUND SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL ON BUDGETARY BASIS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) ACTUAL ON VARIANCE FROM ORIGINAL FINAL BUDGETARY FINAL BUDGET BUDGET BUDGET BASIS POSITIVE (NEGATIVE) GENERAL GOVERNMENT: Salaries and employee benefits $ 1,507,317 1,480,363 1,300,643 179,720 Services and supplies 3,134,164 3,110,853 1,258,321 1,852,532 Other charges 205,189 231,576 188,438 43,138 Capital assets 18,904 22,988 19,835 3,153 Intrafund transfers (1,023,133) (1,024,024) (887,544) (136,480) TOTAL GENERAL GOVERNMENT 3,842,441 3,821,756 1,879,693 1,942,063 PUBLIC PROTECTION: Salaries and employee benefits 5,811,478 5,835,878 5,685,364 150,514 Services and supplies 1,140,266 1,395,439 1,174,638 220,801 Other charges 385,036 446,503 433,618 12,885 Capital assets 38,344 50,809 48,316 2,493 Intrafund transfers (166,821) (175,725) (156,306) (19,419) TOTAL PUBLIC PROTECTION 7,208,303 7,552,904 7,185,630 367,274 HEALTH AND SANITATION: Salaries and employee benefits 3,121,300 3,059,451 2,794,232 265,219 Services and supplies 5,435,893 5,539,210 4,783,464 755,746 Other charges 574,364 799,481 695,629 103,852 Capital assets 37,942 35,512 28,532 6,980 Intrafund transfers (625,340) (631,048) (510,563) (120,485) TOTAL HEALTH AND SANITATION 8,544,159 8,802,606 7,791,294 1,011,312 PUBLIC ASSISTANCE: Salaries and employee benefits 3,346,309 3,346,760 3,251,676 95,084 Services and supplies 1,893,901 1,792,347 1,389,624 402,723 Other charges 4,882,258 5,008,034 4,546,764 461,270 Capital assets 7,947 9,677 5,511 4,166 Intrafund transfers (155,803) (155,803) (95,985) (59,818) TOTAL PUBLIC ASSISTANCE 9,974,612 10,001,015 9,097,590 903,425 RECREATION AND CULTURAL SERVICES: Salaries and employee benefits 250,541 238,966 234,430 4,536 Services and supplies 242,319 249,904 236,029 13,875 Other charges 46,529 50,878 46,928 3,950 Capital assets 5,841 5,748 2,280 3,468 Intrafund transfers (1,007) (1,007) (3,370) 2,363 TOTAL RECREATION AND CULTURAL SERVICES 544,223 544,489 516,297 28,192 DEBT SERVICE- Interest 22,701 22,701 22,701 CAPITAL OUTLAY 1,701,042 2,115,294 443,447 1,671,847 TOTAL GENERAL FUND $ 31,837,481 32,860,765 26,936,652 5,924,113 181 182 NONMAJOR GOVERNMENTAL FUNDS COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR SPECIAL REVENUE FUNDS The nonmajor Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. ROAD FUND The Road Fund is used to account for the maintenance and construction of streets, roads, highways, and bridges. Revenues consist primarily of the County’s share of State highway users’ taxes as supplemented by federal funds, vehicle code fines, and charges for services provided to cities. OTHER STREETS, HIGHWAYS, ROADS AND BRIDGES FUNDS The Other Streets, Highways, Roads and Bridges Funds: Article 3-Bikeway, Off-Street Parking, Proposition C Local Return, Proposition C Local Return Capital Reserve, Special Road Districts, Construction Fee Districts, Transit Operations, Paratransit Operations, Measure M and Measure R Local Returns are used to account for transportation and road related services or functions. Revenues are derived from local sales tax revenue, parking meter receipts, Districts’ share of the countywide tax levy, State and other intergovernmental revenues, and service charges to parking lots. STREET LIGHTING DISTRICTS FUNDS The Street Lighting Districts Funds are used to account for the installation and maintenance of street lighting systems. Revenues are derived primarily from the countywide tax levy and benefit assessments. GARBAGE DISPOSAL DISTRICTS FUNDS The Garbage Disposal Districts Funds are used to account for the provisions of the Health and Safety Code to provide garbage and refuse collection and disposal services within the boundaries of each District. Revenues are mostly from charges for services and property taxes. SEWER MAINTENANCE DISTRICTS FUNDS The Sewer Maintenance Districts Funds are used to account for the Health and Safety Code for the administration, maintenance, operation and repair of sanitary sewers, appurtenances, pumping plants, sewer treatment plants and related services. These Districts are financed through sewer service charges. HEALTH SERVICES MEASURE B FUND The Health Services Measure B Fund is used to account for a countywide system of Trauma Centers and Emergency Medical Services, for bioterrorism preparedness and response, and for related administrative costs. Revenues are derived primarily from a voter-approved special tax. Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR SPECIAL REVENUE FUNDS HEALTH AND SANITATION FUNDS The Health and Sanitation Funds: Hospital Services, Physician Services, Statham Alcohol, Alcohol and Drug Problem, Proposition 36, Driving Under the Influence, AIDS Education, Air Quality Improvement, Bicycle Safety Helmet, Hazardous Waste Enforcement, Mission Canyon Closure, Solid Waste Management Funds, Cancer Patient Welfare, SoCal Gas Settlement, and EMS Vehicle Replacement are used to account for the cost of emergency services for the indigent, County alcoholism programs and services, AIDS education, air quality improvements, bicycle safety, hazardous waste enforcement, solid waste management, cancer patient services, lead paint abatement, a health study on the long-term effects of exposure to natural gas, and replacement of vehicles. Revenues are from patient collections, court fines, State-assessed vehicle fees, penalties assessed for hazardous waste violations, sanitation services, and legal settlement funds. The Lead Paint Settlement fund provides for residential lead paint hazard remediation and mitigation services throughout the County to prevent lead poisoning of children. Revenues are from legal settlement funds. The Opioid Settlement fund provides for opioid remediation activities and revenues are from legal settlement funds. The Juul Settlement fund provides for nicotine and vaping remediation activities and revenues are from legal settlement funds. SAFE, CLEAN WATER PROGRAM MEASURE W FUNDS The Safe, Clean Water Program Measure W Funds are used to account for programs and projects to increase stormwater and urban runoff capture and reduce stormwater and urban runoff pollution, including projects and programs providing a water supply benefit, water quality benefit, and community investment benefit. Revenues are derived primarily from a voter-approved special tax. OTHER PUBLIC PROTECTION FUNDS The Other Public Protection Funds: Jail Store, Inmate Welfare, Narcotic Enforcement, Vehicle Theft Prevention, Countywide Warrant System, Sheriff's Processing Fees, Training and Automation, Automated Fingerprint Identification System, DNA Identification Fund, District Attorney Asset Forfeiture, Fire Department Developer Fees, Forest Mitigation, Information Systems Advisory Body, Drug Abuse Gang Diversion, Jury Operations Improvement, Dependency Court Facilities, Small Claims Advisor Program, and Fire Department Helicopter and Vehicle Accumulative Capital Outlay are used to account for certain services and supplies to inmates, to supplement the cost of various law enforcement, prosecutorial investigation, fire protection activities, and to finance vehicle and helicopter replacement, facilities improvement, equipment maintenance and automated systems. Child Seat Restraint Loaner is used to account for the operation of a child restraint low-cost purchase and loan program. Fish and Game is used to account for the preservation and propagation of fish and wildlife. Revenues are derived from sale of minor supplies, fines related to controlled substance convictions, benefit assessments, forfeiture of assets used in connection with transportation or possession of a controlled substance, court fines and revenues, and local fish and game fines. Probation Community Corrections Performance Incentives fund is used to account for the improvement of public safety outcomes at the community level utilizing evidence-based services geared towards maintaining offenders within the community. Revenues are derived principally from State revenues. Probation Juvenile Justice Crime Prevention Act Fund is used to account for programs and services for community- level prevention, intervention, supervision, and treatment strategies that target high-risk neighborhoods serving probationers and at-risk youth through the collaborative efforts of Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR SPECIAL REVENUE FUNDS governmental agencies and community-based organizations. Revenues are derived principally from State revenues. Probation Juvenile Justice Realignment Block Grant Fund is used to account for programs and services for the custody, treatment, and supervision of youth. The Consumer Protection Settlement Fund is used to account for the County’s consumer protection, enforcement, and education programs. Revenues are derived from settlements from businesses that engage in unfair businesses practices. The Sativa Water System Fund is used to account for the operation and maintenance of the former Sativa Water District’s accounting and budgetary activities. Revenues are derived from charges for services and contributions from the County. PUBLIC ASSISTANCE FUNDS The Public Assistance Funds: Child Abuse/Neglect Prevention Program, Alternate Dispute Resolution Program, Alcohol and Drug Abuse Education Program, Domestic Violence Program, and Linkages Support Program are used to account for a variety of public assistance services. The programs are financed from special fees collected for birth certificates, marriage licenses, confidential marriage certificates, court fines for driving under the influence of alcohol or drugs, and disabled parking violation assessments. HOMELESS AND HOUSING MEASURE H FUND The Homeless and Housing Measure H Fund is used to account for providing homeless prevention programming for families and individuals; expanding rapid re-housing; developing interim/bridge housing for those exiting institutions; increasing employment opportunities for homeless adults via social and/or subsidized employment; expanding the Jail In Reach Program; providing services and rental subsidies for permanent supportive housing; implementing a coordinated countywide outreach and engagement system; establishing a decriminalization policy and first responders training to effectively address homeless encampments and unsheltered homeless individuals; enhancing the emergency shelter system; preserving and promoting the development of affordable housing for homeless families and individuals; and implementing other strategies and efforts that seek to coordinate a seamless homeless services system to better combat homelessness among single adults, families, and youth. Revenues are derived primarily from a voter-approved local sales tax. RECREATION FUNDS The Recreation Funds: Golf Course, Park Improvement, Recreation and Development, Tesoro Adobe Park, San Gabriel Canyon, and Ford Theatres are used to account for the maintenance and improvements to County parks and golf courses, public recreation areas, and Ford Theatres. Civic Art Special fund and Public Art in Private Development fund are used to account for civic art projects. The Off-Highway Vehicle fund is used to account for the development, construction, operation, and maintenance of off-highway vehicle recreation facilities. Revenues are derived from a percentage of golf course green fees, vehicle entrance fees collected from the regional parks, and a percentage of the design and construction costs. Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR SPECIAL REVENUE FUNDS COURTHOUSE TEMPORARY CONSTRUCTION FUND The Courthouse Temporary Construction Fund is used to temporarily account for monies ultimately to be used for various courthouse construction projects. Revenues are derived principally from surcharges included in fines for criminal convictions. CRIMINAL JUSTICE TEMPORARY CONSTRUCTION FUND The Criminal Justice Temporary Construction Fund is used to temporarily account for monies ultimately to be used for the improvement of criminal justice facilities and automated information systems. Revenues are derived principally from surcharges on criminal fines. REGISTRAR-RECORDER IMPROVEMENT FUNDS The Registrar-Recorder Improvement Funds: Modernization and Improvement, Micrographics, Social Security Truncation, Vitals and Health Statistics, Restrictive Covenant Modification Program, and Multi-County e-Recording Project funds are used to account for the improvement of Registrar-Recorder automated information systems. Revenues are derived principally from recording and filing fees. OTHER SPECIAL REVENUE FUNDS The Other Special Revenue Funds: Information Technology Infrastructure and the Accumulative Capital Outlay (ACO) are used to account for the replacement of motor vehicles, printing, information technology, and communications equipment. Asset Development Implementation fund is used to account for short to intermediate financing for County asset development activities. Productivity Investment is used to account for the start-up and incidental costs associated with productivity improvement projects. The Cable TV Franchise fund is used to account for cable- related activities. Civic Center Employee parking is used to account for providing parking services and alternative means of transportation for County employees. County Library Developer Fees are used to account for the acquisition of land, construct library facilities, and purchase equipment and library materials. Various funds are used to account for resources that are legally restricted and the principal and earnings may be used for purposes that support general government and education. Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR DEBT SERVICE FUNDS The nonmajor Debt Service Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for principal and interest. Public Buildings Funds The Los Angeles County Public Works Financing Authority, Los Angeles County Regional Financing Authority, and Public Buildings Funds receive their funds primarily from long-term debt proceeds and the General Fund in the form of operating transfers. 2010 Multiple Capital Projects I - Series A 2010 Multiple Capital Projects I - Series B 2015 Multiple Capital Projects - Series A Lease Revenue Refunding Bonds, 2015 Series B Lease Revenue Refunding Bonds, 2015 Series C Lease Revenue Bonds, 2016 Series D Lease Revenue Bonds, Series 2018A (LACF) Lease Revenue Bonds, Series 2018B (LACF) Lease Revenue Bonds, 2019 Series E-1 Lease Revenue Bonds, 2019 Series E-2 Lease Revenue Bonds, 2020 Series A Lease Revenue Bonds, 2021 Series F Lease Revenue Refunding Bonds, 2022 Series G Lease Revenue Refunding Bonds, Series 2022 Lease Revenue Obligation Notes Los Angeles County Securitization Corporation Fund The Los Angeles County Securitization Corporation receives funding primarily from the collection of the County’s future tobacco settlement payments and from long-term debt proceeds secured by the County’s Tobacco Assets. Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR CAPITAL PROJECTS FUNDS The nonmajor Capital Projects Funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. Accumulative Capital Outlay Funds Accumulative Capital Outlay Funds are used to account for specific capital projects in accordance with Government Code Section 53731. Improvement District Fund Improvement District Fund is used to account for the projects financed by contributions from property owners. Public Buildings Funds Public Buildings Funds are used to account for capital projects financed by bonds, lease revenue obligation notes, and operating transfers. Gap Loan Fund Gap Loan Fund is used to account for the County’s proceeds from sale of “Gap Loan” receivables that are restricted for capital spending purposes. Continued… COUNTY OF LOS ANGELES NONMAJOR GOVERNMENTAL FUNDS NONMAJOR PERMANENT FUNDS Nonmajor Permanent Funds are used to account for and report resources that are legally restricted to the extent that only earnings, and not principal, may be used for purposes that support various County programs. COUNTY OF LOS ANGELES COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS - SUMMARY JUNE 30, 2024 (in thousands) TOTAL SPECIAL DEBT CAPITAL NONMAJOR REVENUE SERVICE PROJECTS PERMANENT GOVERNMENTAL FUNDS FUNDS FUNDS FUNDS FUNDS ASSETS Pooled cash and investments: Operating $ 3,016,470 35,984 204,530 2,176 $ 3,259,160 Other 61,464 — 699 8 62,171 Total pooled cash and investments 3,077,934 35,984 205,229 2,184 3,321,331 Other investments — 51,729 8,555 — 60,284 Taxes receivable 24,298 — 24,298 Interest receivable 8,287 263 523 6 9,079 Lease receivable 4,940 4,940 Other receivables 250,395 — 101 250,496 Due from other funds 39,468 — 8,668 — 48,136 Advances to other funds 11,307 11,307 Inventories 1 1 TOTAL ASSETS 3,416,630 87,976 223,076 2,190 3,729,872 DEFERRED OUTFLOWS OF RESOURCES — 175,088 175,088 TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES $ 3,416,630 263,064 223,076 2,190 $ 3,904,960 LIABILITIES Accounts payable $ 106,062 2,198 — $ 108,260 Accrued payroll 109 109 Due to other funds 399,660 — 29,044 10 428,714 Advances payable 61,709 43 61,752 Third party payor 246 — 246 TOTAL LIABILITIES 567,786 31,285 10 599,081 DEFERRED INFLOWS OF RESOURCES 20,843 20,843 FUND BALANCES Nonspendable 84,578 2,180 86,758 Restricted 2,508,640 263,064 52,847 — 2,824,551 Committed 80,020 89,752 169,772 Assigned 154,763 49,192 203,955 TOTAL FUND BALANCES 2,828,001 263,064 191,791 2,180 3,285,036 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES $ 3,416,630 263,064 223,076 2,190 $ 3,904,960 183 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS - SUMMARY FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) TOTAL SPECIAL DEBT CAPITAL NONMAJOR REVENUE SERVICE PROJECTS PERMANENT GOVERNMENTAL FUNDS FUNDS FUNDS FUNDS FUNDS REVENUES Taxes $ 1,021,125 — $ 1,021,125 Licenses, permits and franchises 26,127 — 26,127 Fines, forfeitures and penalties 33,984 — 33,984 Revenue from use of money and property: Investment income 127,078 3,315 7,403 105 137,901 Rents and concessions 46,834 — 46,834 Lease revenue 283 283 Royalties 4 4 Intergovernmental revenues: Federal 13,988 — 13,988 State 497,099 — — 497,099 Other 15,604 — 15,604 Charges for services 431,280 — 8,700 439,980 Miscellaneous 73,515 22,565 1,263 — 97,343 TOTAL REVENUES 2,286,921 25,880 17,366 105 2,330,272 EXPENDITURES Current: General government 13,011 34 13,045 Public protection 302,624 302,624 Public ways and facilities 551,752 551,752 Health and sanitation 230,668 230,668 Public assistance 248,042 248,042 Education 2,047 2,047 Recreation and cultural services 11,658 11,658 Debt service: Principal — 200,018 200,018 Interest and other charges — 109,920 109,920 Capital outlay — 82,757 82,757 TOTAL EXPENDITURES 1,359,802 309,938 82,757 34 1,752,531 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES 927,119 (284,058) (65,391) 71 577,741 OTHER FINANCING SOURCES (USES) Transfers in 46,122 156,739 27,379 — 230,240 Transfers out (725,182) (14,877) (1,601) — (741,660) Issuance of debt — 135,067 70,522 205,589 Sales of capital assets 252 — 252 TOTAL OTHER FINANCING SOURCES (USES) (678,808) 276,929 96,300 (305,579) NET CHANGE IN FUND BALANCES 248,311 (7,129) 30,909 71 272,162 FUND BALANCES, JULY 1, 2023 2,579,690 270,193 160,882 2,109 3,012,874 FUND BALANCES, JUNE 30, 2024 $ 2,828,001 263,064 191,791 2,180 $ 3,285,036 184 185 COUNTY OF LOS ANGELES COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE JUNE 30, 2024 (in thousands) Streets, Highways, Roads Street Garbage Sewer Health and Bridges Lighting Disposal Maintenance Services Road Other Districts Districts Districts Measure B ASSETS Pooled cash and investments: Operating $ 59,123 313,221 126,402 63,454 33,914 234,839 Other 27,021 8,915 804 549 511 3,604 Total pooled cash and investments 86,144 322,136 127,206 64,003 34,425 238,443 Taxes receivable — 519 1,960 1,287 820 10,006 Interest receivable 376 864 354 196 101 652 Lease receivable 4,940 Other receivables 38,179 12,465 92 930 928 — Due from other funds 27,267 1,414 3,346 184 1,281 — Advances to other funds 7,829 1,125 186 — 1,170 — Inventories 1 — — — — — TOTAL ASSETS $ 164,736 338,523 133,144 66,600 38,725 249,101 LIABILITIES Accounts payable $ 5,335 6,109 2,355 4,363 79 6,364 Accrued payroll — — — — — — Due to other funds 33,079 13,800 3,623 2,551 6,736 145,815 Advances payable 45,231 10,743 1,384 — — — Third party payor 246 — — — — — TOTAL LIABILITIES 83,891 30,652 7,362 6,914 6,815 152,179 DEFERRED INFLOWS OF RESOURCES 4,940 348 1,302 1,441 690 6,035 FUND BALANCES Nonspendable 1 — — — — — Restricted 75,904 307,523 124,480 58,245 31,220 90,887 Committed — — — — — — Assigned — — — — — — TOTAL FUND BALANCES 75,905 307,523 124,480 58,245 31,220 90,887 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES $ 164,736 338,523 133,144 66,600 38,725 249,101 186 Safe, Clean Health Water Other Homeless and Program Public Public and Housing Sanitation Measure W Protection Assistance Measure H Recreation ASSETS Pooled cash and investments: $ 182,211 587,895 663,912 15,491 456,304 85,709 Operating 1,985 4,359 7,224 436 1,991 1,769 Other 184,196 592,254 671,136 15,927 458,295 87,478 Total pooled cash and investments 30 9,676 — — — — Taxes receivable 514 1,536 1,366 9 1,653 202 Interest receivable Lease receivable 9,790 — 145 513 186,385 843 Other receivables 4,214 327 194 — — 534 Due from other funds 774 223 — — — — Advances to other funds — — — — — — Inventories $ 199,518 604,016 672,841 16,449 646,333 89,057 TOTAL ASSETS LIABILITIES $ 8,996 22,184 13,610 329 28,311 1,543 Accounts payable — — — — — — Accrued payroll 12,078 7,288 64,217 370 82,390 15,819 Due to other funds 4,351 — — — — — Advances payable — — — — — — Third party payor 25,425 29,472 77,827 699 110,701 17,362 TOTAL LIABILITIES 39 6,048 — — — — DEFERRED INFLOWS OF RESOURCES FUND BALANCES — — 173 — 84,404 — Nonspendable 173,393 568,496 507,633 15,750 451,228 34,781 Restricted — — 71,061 — — — Committed 661 — 16,147 — — 36,914 Assigned 174,054 568,496 595,014 15,750 535,632 71,695 TOTAL FUND BALANCES TOTAL LIABILITIES, DEFERRED INFLOWS OF $ 199,518 604,016 672,841 16,449 646,333 89,057 RESOURCES, AND FUND BALANCES Continued... 187 COUNTY OF LOS ANGELES COMBINING BALANCE SHEET - Continued NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE JUNE 30, 2024 (in thousands) Criminal Courthouse Justice Registrar- Temporary Temporary Recorder Other Special Construction Construction Improvement Revenue Total ASSETS Pooled cash and investments: Operating $ 24,899 44,552 22,896 101,648 $ 3,016,470 Other 730 618 651 297 61,464 Total pooled cash and investments 25,629 45,170 23,547 101,945 3,077,934 Taxes receivable — — — — 24,298 Interest receivable 108 149 — 207 8,287 Lease receivable $ — 4,940 Other receivables $ — $ — 125 — 250,395 Due from other funds — — $ — 707 39,468 Advances to other funds $ — $ — $ — $ — 11,307 Inventories $ — $ — $ — $ — 1 TOTAL ASSETS $ 25,737 45,319 23,672 102,859 $ 3,416,630 LIABILITIES Accounts payable $ 6,010 — 474 $ 106,062 Accrued payroll — — — 109 109 Due to other funds 676 2,132 370 8,716 399,660 Advances payable — — — — 61,709 Third party payor — — — — 246 TOTAL LIABILITIES 676 8,142 370 9,299 567,786 DEFERRED INFLOWS OF RESOURCES — — — — 20,843 FUND BALANCES Nonspendable — — — — 84,578 Restricted 25,061 17,607 23,302 3,130 2,508,640 Committed — — — 8,959 80,020 Assigned — 19,570 — 81,471 154,763 TOTAL FUND BALANCES 25,061 37,177 23,302 93,560 2,828,001 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES, AND FUND BALANCES $ 25,737 45,319 23,672 102,859 $ 3,416,630 188 189 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Streets, Highways, Roads Street Garbage Sewer Health and Bridges Lighting Disposal Maintenance Services Road Other Districts Districts Districts Measure B REVENUES Taxes $ 9,374 95,466 32,845 9,793 — 333,818 Licenses, permits and franchises 5,511 — — — — — Fines, forfeitures and penalties — 29 123 223 157 960 Revenue from use of money and property: Investment income 9,196 13,653 5,367 3,237 1,943 8,324 Rents and concessions 113 79 4 — — — Lease revenue 283 Royalties — — — — — — Intergovernmental revenues: Federal 6,367 7,614 — — 7 — State 330,581 2,528 116 33 749 — Other 364 13,626 221 — 41 — Charges for services 21,411 2,907 3,515 21,800 38,588 — Miscellaneous 1,388 1,655 1 — 4 101 TOTAL REVENUES 384,588 137,557 42,192 35,086 41,489 343,203 EXPENDITURES Current: General government — — — — — — Public protection — — — — — — Public ways and facilities 421,711 103,471 26,570 — — — Health and sanitation — — — 37,349 43,159 65,246 Public assistance — — — — — — Education — — — — — — Recreation and cultural services — — — — — — TOTAL EXPENDITURES 421,711 103,471 26,570 37,349 43,159 65,246 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (37,123) 34,086 15,622 (2,263) (1,670) 277,957 OTHER FINANCING SOURCES (USES) Transfers in 4,206 — — — — — Transfers out — (52) (7) — — (267,727) Sales of capital assets 31 2 — — — — TOTAL OTHER FINANCING SOURCES (USES) 4,237 (50) (7) — (267,727) NET CHANGE IN FUND BALANCES (32,886) 34,036 15,615 (2,263) (1,670) 10,230 FUND BALANCES, JULY 1, 2023 108,791 273,487 108,865 60,508 32,890 80,657 FUND BALANCES, JUNE 30, 2024 $ 75,905 307,523 124,480 58,245 31,220 90,887 190 Safe, Clean Health Water Other Homeless and Program Public Public and Housing Sanitation Measure W Protection Assistance Measure H Recreation REVENUES $ — — — 538,242 — Taxes 15,518 — — 1,096 — 1,178 Licenses, permits and franchises 10,698 850 2,986 1,769 — — Fines, forfeitures and penalties Revenue from use of money and property: 8,584 20,845 23,825 123 21,577 3,274 Investment income — — 21,620 — — 18,248 Rents and concessions Lease revenue — — — — — — Royalties Intergovernmental revenues: — — — — — — Federal 2,038 — 160,937 — — 115 State 1,352 — — — — — Other 23,085 279,785 18,938 5,391 — 4,360 Charges for services 48,329 1 18,535 69 33 3,388 Miscellaneous 109,604 301,481 246,841 8,448 559,852 30,563 TOTAL REVENUES EXPENDITURES Current: — — — — — — General government — 177,949 92,352 — — — Public protection — — — — — — Public ways and facilities 84,914 — — — — — Health and sanitation — — — 5,779 242,263 — Public assistance — — — — — — Education — — — — — 11,658 Recreation and cultural services 84,914 177,949 92,352 5,779 242,263 11,658 TOTAL EXPENDITURES EXCESS (DEFICIENCY) OF REVENUES OVER 24,690 123,532 154,489 2,669 317,589 18,905 EXPENDITURES OTHER FINANCING SOURCES (USES) — — 24,288 — — 779 Transfers in (11,096) (17,555) (154,593) (326) (221,451) (15,598) Transfers out — — 17 — — — Sales of capital assets (11,096) (17,555) (130,288) (326) (221,451) (14,819) TOTAL OTHER FINANCING SOURCES (USES) 13,594 105,977 24,201 2,343 96,138 4,086 NET CHANGE IN FUND BALANCES 160,460 462,519 570,813 13,407 439,494 67,609 FUND BALANCES, JULY 1, 2023 $ 174,054 568,496 595,014 15,750 535,632 71,695 FUND BALANCES, JUNE 30, 2024 Continued… 191 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-Continued NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Criminal Courthouse Justice Registrar- Other Temporary Temporary Recorder Special Construction Construction Improvement Revenue Total REVENUES Taxes $ — — 1,587 $ 1,021,125 Licenses, permits and franchises — — — 2,824 26,127 Fines, forfeitures and penalties 7,679 8,510 — — 33,984 Revenue from use of money and property: Investment income 1,135 2,791 — 3,204 127,078 Rents and concessions — — — 6,770 46,834 Lease revenue — — — — 283 Royalties — — — 4 4 Intergovernmental revenues: Federal — — — — 13,988 State — — — 2 497,099 Other — — — — 15,604 Charges for services — — 9,859 1,641 431,280 Miscellaneous — — — 11 73,515 TOTAL REVENUES 8,814 11,301 9,859 16,043 2,286,921 EXPENDITURES Current: General government — — — 13,011 13,011 Public protection 678 31,645 — — 302,624 Public ways and facilities — — — — 551,752 Health and sanitation — — — — 230,668 Public assistance — — — — 248,042 Education — — — 2,047 2,047 Recreation and cultural services — — — — 11,658 TOTAL EXPENDITURES 678 31,645 15,058 1,359,802 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES 8,136 (20,344) 9,859 985 927,119 OTHER FINANCING SOURCES (USES) Transfers in 5,227 — — 11,622 46,122 Transfers out (14,716) — (11,116) (10,945) (725,182) Sales of capital assets — — — 202 252 TOTAL OTHER FINANCING SOURCES (USES) (9,489) — (11,116) 879 (678,808) NET CHANGE IN FUND BALANCES (1,353) (20,344) (1,257) 1,864 248,311 FUND BALANCES, JULY 1, 2023 26,414 57,521 24,559 91,696 2,579,690 FUND BALANCES, JUNE 30, 2024 $ 25,061 37,177 23,302 93,560 $ 2,828,001 192 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) TOTALS ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 1,008,298 1,011,636 1,021,352 9,716 Licenses, permits and franchises 25,607 25,607 26,127 520 Fines, forfeitures and penalties 37,047 37,047 33,984 (3,063) Revenue from use of money and property: Investment income 23,085 28,439 108,369 79,930 Rents and concessions 43,197 45,363 47,117 1,754 Royalties 4 4 4 — Intergovernmental revenues: Federal 38,177 38,177 13,988 (24,189) State 491,764 491,764 497,099 5,335 Other 24,626 24,626 15,604 (9,022) Charges for services 443,740 442,610 431,672 (10,938) Miscellaneous 41,456 43,228 73,515 30,287 TOTAL REVENUES 2,177,001 2,188,501 2,268,831 80,330 EXPENDITURES Current: General government 58,186 49,572 13,447 36,125 Public protection 1,258,101 1,259,746 325,334 934,412 Public ways and facilities 865,851 914,232 551,586 362,646 Health and sanitation 348,323 374,281 239,352 134,929 Public assistance 282,530 283,891 245,634 38,257 Education 10,096 10,096 2,047 8,049 Recreation and cultural services 52,041 53,609 12,204 41,405 TOTAL EXPENDITURES 2,875,128 2,945,427 1,389,604 1,555,823 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (698,127) (756,926) 879,227 1,636,153 OTHER FINANCING SOURCES (USES) Sales of capital assets 565 565 252 (313) Transfers in 330,012 337,823 329,984 (7,839) Transfers out (1,309,159) (1,323,831) (994,328) 329,503 Appropriations for contingencies (201,551) (178,287) — 178,287 Changes in fund balances (198,319) (155,923) (185,255) (29,332) TOTAL OTHER FINANCING SOURCES (USES) (1,378,452) (1,319,653) (849,347) 470,306 NET CHANGE IN FUND BALANCES (2,076,579) (2,076,579) 29,880 2,106,459 FUND BALANCES, JULY 1, 2023 2,076,579 2,076,579 2,076,579 FUND BALANCES, JUNE 30, 2024 $ 2,106,459 2,106,459 Continued... 193 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) ROAD ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 7,546 9,374 9,374 — Licenses, permits and franchises 7,032 7,032 5,511 (1,521) Revenue from use of money and property: Investment income 1,871 1,980 5,927 3,947 Rents and concessions 160 160 396 236 Intergovernmental revenues: Federal 17,767 17,767 6,367 (11,400) State 332,317 332,317 330,581 (1,736) Other 780 780 364 (416) Charges for services 20,879 20,879 21,411 532 Miscellaneous 78 78 1,388 1,310 TOTAL REVENUES 388,430 390,367 381,319 (9,048) EXPENDITURES Current-Public ways and facilities: Services and supplies 356,976 408,993 391,147 17,846 Other charges 20,000 15,000 10,654 4,346 Capital assets 3,772 3,772 1,368 2,404 Capital outlay 20,863 21,863 17,317 4,546 TOTAL EXPENDITURES 401,611 449,628 420,486 29,142 DEFICIENCY OF REVENUES OVER EXPENDITURES (13,181) (59,261) (39,167) 20,094 OTHER FINANCING SOURCES (USES) Sales of capital assets — — 31 31 Transfers in 5,316 5,316 4,206 (1,110) Transfers out (13,865) (4,865) — 4,865 Appropriations for contingencies — (1,937) — 1,937 Changes in fund balance 1 39,018 63,613 24,595 TOTAL OTHER FINANCING SOURCES (USES) (8,548) 37,532 67,850 30,318 NET CHANGE IN FUND BALANCE (21,729) (21,729) 28,683 50,412 FUND BALANCE, JULY 1, 2023 21,729 21,729 21,729 FUND BALANCE, JUNE 30, 2024 $ 50,412 50,412 Continued.... 194 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) OTHER STREETS, HIGHWAYS, ROADS, AND BRIDGES ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 90,292 90,624 95,487 4,863 Fines, forfeitures and penalties 30 30 29 (1) Revenue from use of money and property: Investment income 2,767 2,799 12,193 9,394 Rents and concessions 106 106 79 (27) Intergovernmental revenues: Federal 20,410 20,410 7,614 (12,796) State 2,678 2,678 2,528 (150) Other 21,629 21,629 13,626 (8,003) Charges for services 11,790 11,790 2,907 (8,883) Miscellaneous 130 130 1,655 1,525 TOTAL REVENUES 149,832 150,196 136,118 (14,078) EXPENDITURES Current-Public ways and facilities: Services and supplies 292,792 293,156 95,275 197,881 Other charges 9,472 9,472 3,450 6,022 Capital assets 6,950 6,950 — 6,950 Capital outlay 73,638 73,638 8,927 64,711 TOTAL EXPENDITURES 382,852 383,216 107,652 275,564 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (233,020) (233,020) 28,466 261,486 OTHER FINANCING SOURCES (USES) Sales of capital assets — — 2 2 Transfers out (457) (457) (52) 405 Changes in fund balance (19) (19) 8,199 8,218 TOTAL OTHER FINANCING SOURCES (USES) (476) (476) 8,149 8,625 NET CHANGE IN FUND BALANCE (233,496) (233,496) 36,615 270,111 FUND BALANCE, JULY 1, 2023 233,496 233,496 233,496 FUND BALANCE, JUNE 30, 2024 $ 270,111 270,111 Continued... 195 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) STREET LIGHTING DISTRICTS ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 33,052 33,052 32,914 (138) Fines, forfeitures and penalties 114 114 123 9 Revenue from use of money and property: Investment income 1,190 1,190 4,823 3,633 Rents and Concessions 0 0 4 4 Intergovernmental revenues: State 120 120 116 (4) Other 354 354 221 (133) Charges for services 3,633 3,633 3,515 (118) Miscellaneous — — 1 1 TOTAL REVENUES 38,463 38,463 41,717 3,254 EXPENDITURES Current-Public ways and facilities: Services and supplies 79,897 79,897 23,420 56,477 Other charges 81 81 28 53 Capital assets 10 10 — 10 Capital outlay 1,400 1,400 — 1,400 TOTAL EXPENDITURES 81,388 81,388 23,448 57,940 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (42,925) (42,925) 18,269 61,194 OTHER FINANCING SOURCES (USES) Transfers in 3,176 3,176 3,146 (30) Transfers out (3,387) (3,387) (3,153) 234 Changes in fund balance (3,067) (3,067) (2,840) 227 TOTAL OTHER FINANCING SOURCES (USES) (3,278) (3,278) (2,847) 431 NET CHANGE IN FUND BALANCE (46,203) (46,203) 15,422 61,625 FUND BALANCE, JULY 1, 2023 46,203 46,203 46,203 FUND BALANCE, JUNE 30, 2024 $ 61,625 61,625 Continued... 196 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) GARBAGE DISPOSAL DISTRICTS ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 9,851 9,851 9,797 (54) Fines, forfeitures and penalties 225 225 223 (2) Revenue from use of money and property- Investment income 752 752 2,542 1,790 Intergovernmental revenues- State 34 34 33 (1) Charges for services 22,089 22,089 21,870 (219) TOTAL REVENUES 32,951 32,951 34,465 1,514 EXPENDITURES Current-Health and sanitation- Services and supplies 55,573 55,573 35,446 20,127 TOTAL EXPENDITURES 55,573 55,573 35,446 20,127 DEFICIENCY OF REVENUES OVER EXPENDITURES (22,622) (22,622) (981) 21,641 OTHER FINANCING SOURCES Changes in fund balance 10,068 10,068 10,710 642 TOTAL OTHER FINANCING SOURCES 10,068 10,068 10,710 642 NET CHANGE IN FUND BALANCE (12,554) (12,554) 9,729 22,283 FUND BALANCE, JULY 1, 2023 12,554 12,554 12,554 FUND BALANCE, JUNE 30, 2024 $ 22,283 22,283 Continued... 197 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) SEWER MAINTENANCE DISTRICTS ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Fines, forfeitures and penalties $ 192 192 157 (35) Revenue from use of money and property- Investment income 445 445 1,372 927 Intergovernmental revenues: Federal — — 7 7 State — — 749 749 Other 41 41 41 — Charges for services 38,120 38,120 38,762 642 Miscellaneous — — 4 4 TOTAL REVENUES 38,798 38,798 41,092 2,294 EXPENDITURES Current-Health and sanitation: Services and supplies 68,607 68,607 44,104 24,503 Other charges 1,000 1,000 21 979 Capital outlay 1,000 1,000 — 1,000 TOTAL EXPENDITURES 70,607 70,607 44,125 26,482 DEFICIENCY OF REVENUES OVER EXPENDITURES (31,809) (31,809) (3,033) 28,776 OTHER FINANCING SOURCES Changes in fund balance 1 1 506 505 TOTAL OTHER FINANCING SOURCES 1 1 506 505 NET CHANGE IN FUND BALANCE (31,808) (31,808) (2,527) 29,281 FUND BALANCE, JULY 1, 2023 31,808 31,808 31,808 FUND BALANCE, JUNE 30, 2024 $ 29,281 29,281 Continued... 198 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) HEALTH SERVICES MEASURE B ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 332,773 333,951 333,951 — Fines, forfeitures and penalties 807 807 960 153 Revenue from use of money and property- Investment income 1,404 6,617 6,334 (283) Miscellaneous — — 101 101 TOTAL REVENUES 334,984 341,375 341,346 (29) EXPENDITURES Current-Health and sanitation: Services and supplies 28,422 47,971 31,931 16,040 Other charges 55,820 62,229 40,116 22,113 TOTAL EXPENDITURES 84,242 110,200 72,047 38,153 EXCESS OF REVENUES OVER EXPENDITURES 250,742 231,175 269,299 38,124 OTHER FINANCING SOURCES (USES) Transfers out (268,468) (270,414) (267,727) 2,687 Appropriations for contingencies (34,037) (12,524) — 12,524 Changes in fund balance — — 272 272 TOTAL OTHER FINANCING SOURCES (USES) (302,505) (282,938) (267,455) 15,483 NET CHANGE IN FUND BALANCE (51,763) (51,763) 1,844 53,607 FUND BALANCE, JULY 1, 2023 51,763 51,763 51,763 FUND BALANCE, JUNE 30, 2024 $ 53,607 53,607 Continued... 199 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) HEALTH AND SANITATION ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Licenses, permits and franchises $ 13,625 13,625 15,518 1,893 Fines, forfeitures and penalties 13,226 13,226 10,698 (2,528) Revenue from use of money and property- Investment income 3,212 3,212 7,482 4,270 Intergovernmental revenues: State 1,266 1,266 2,038 772 Other 1,822 1,822 1,352 (470) Charges for services 34,133 34,133 23,085 (11,048) Miscellaneous 35,345 35,345 48,329 12,984 TOTAL REVENUES 102,629 102,629 108,502 5,873 EXPENDITURES Current-Health and sanitation: Services and supplies 116,054 105,330 55,487 49,843 Other charges 20,886 31,673 31,604 69 Capital assets 961 898 643 255 TOTAL EXPENDITURES 137,901 137,901 87,734 50,167 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (35,272) (35,272) 20,768 56,040 OTHER FINANCING SOURCES (USES) Transfers out (23,441) (23,441) (11,096) 12,345 Appropriations for contingencies (74,242) (74,242) — 74,242 Changes in fund balance (701) (701) 1,347 2,048 TOTAL OTHER FINANCING SOURCES (USES) (98,384) (98,384) (9,749) 88,635 NET CHANGE IN FUND BALANCE (133,656) (133,656) 11,019 144,675 FUND BALANCE, JULY 1, 2023 133,656 133,656 133,656 FUND BALANCE, JUNE 30, 2024 $ 144,675 144,675 Continued... 200 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) SAFE, CLEAN WATER PROGRAM MEASURE W ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Fines, forfeitures and penalties $ 502 502 850 348 Revenue from use of money and property- Investment income 4,423 4,423 20,752 16,329 Charges for services 280,600 280,600 279,933 (667) Miscellaneous 1 1 TOTAL REVENUES 285,525 285,525 301,536 16,011 EXPENDITURES Current-Public Protection: Services and supplies 125,029 125,329 27,111 98,218 Other charges 609,449 602,524 159,042 443,482 TOTAL EXPENDITURES 734,478 727,853 186,153 541,700 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (448,953) (442,328) 115,383 557,711 OTHER FINANCING SOURCES (USES) Transfers in 286,550 286,550 280,716 (5,834) Transfers out (304,086) (310,711) (298,271) 12,440 Changes in fund balance (2) (2) 8,832 8,834 TOTAL OTHER FINANCING SOURCES (USES) (17,538) (24,163) (8,723) 15,440 NET CHANGE IN FUND BALANCE (466,491) (466,491) 106,660 573,151 FUND BALANCE, JULY 1, 2023 466,491 466,491 466,491 0 FUND BALANCE, JUNE 30, 2024 $ 573,151 573,151 Continued... 201 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) OTHER PUBLIC PROTECTION ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Fines, forfeitures and penalties $ 3,867 3,867 2,986 (881) Revenue from use of money and property: Investment income 4,845 4,845 18,875 14,030 Rents and concessions 18,764 18,764 21,620 2,856 Intergovernmental revenues- State 155,219 155,219 160,937 5,718 Charges for services 11,629 10,499 18,938 8,439 Miscellaneous 4,510 4,510 18,535 14,025 TOTAL REVENUES 198,834 197,704 241,891 44,187 EXPENDITURES Current-Public protection: Services and supplies 351,549 352,076 69,601 282,475 Other charges 1,800 1,654 1,043 611 Capital assets 66,520 69,001 21,498 47,503 Capital outlay 530 710 — 710 TOTAL EXPENDITURES 420,399 423,441 92,142 331,299 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (221,565) (225,737) 149,749 375,486 OTHER FINANCING SOURCES (USES) Sales of capital assets 45 45 17 (28) Transfers in 22,162 24,543 24,288 (255) Transfers out (233,670) (234,058) (154,593) 79,465 Appropriations for contingencies (25,998) (25,998) — 25,998 Changes in fund balance (9,575) (7,396) (3,090) 4,306 TOTAL OTHER FINANCING SOURCES (USES) (247,036) (242,864) (133,378) 109,486 NET CHANGE IN FUND BALANCE (468,601) (468,601) 16,371 484,972 FUND BALANCE, JULY 1, 2023 468,601 468,601 468,601 — FUND BALANCE, JUNE 30, 2024 $ 484,972 484,972 Continued... 202 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) PUBLIC ASSISTANCE ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Licenses, permits and franchises $ 750 750 1,096 346 Fines, forfeitures and penalties 1,584 1,584 1,769 185 Revenue from use of money and property- Investment income 5 5 127 122 Charges for services 4,900 4,900 5,391 491 Miscellaneous 53 53 69 16 TOTAL REVENUES 7,292 7,292 8,452 1,160 EXPENDITURES Current-Public assistance- Services and supplies 10,912 10,912 6,446 4,466 TOTAL EXPENDITURES 10,912 10,912 6,446 4,466 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (3,620) (3,620) 2,006 5,626 OTHER FINANCING SOURCES (USES) Transfers out (682) (682) (326) 356 Appropriations for contingencies (4,762) (4,762) — 4,762 Changes in fund balance (176) (176) 534 710 TOTAL OTHER FINANCING SOURCES (USES) (5,620) (5,620) 208 5,828 NET CHANGE IN FUND BALANCE (9,240) (9,240) 2,214 11,454 FUND BALANCE, JULY 1, 2023 9,240 9,240 9,240 FUND BALANCE, JUNE 30, 2024 $ 11,454 11,454 Continued... 203 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) HOMELESS AND HOUSING MEASURE H ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ 534,784 534,784 538,242 3,458 Revenue from use of money and property- Investment income — — 18,993 18,993 Miscellaneous — — 33 33 TOTAL REVENUES 534,784 534,784 557,268 22,484 EXPENDITURES Current-Public assistance: Services and supplies — 2,000 1,697 303 Other charges 271,618 270,979 237,491 33,488 TOTAL EXPENDITURES 271,618 272,979 239,188 33,791 EXCESS OF REVENUES OVER EXPENDITURES 263,166 261,805 318,080 56,275 OTHER FINANCING USES Transfers out (403,354) (403,843) (221,451) 182,392 Appropriations for contingencies (650) — — — Changes in fund balance (194,849) (193,649) (274,089) (80,440) TOTAL OTHER FINANCING USES (598,853) (597,492) (495,540) 101,952 NET CHANGE IN FUND BALANCE (335,687) (335,687) (177,460) 158,227 FUND BALANCE, JULY 1, 2023 335,687 335,687 335,687 FUND BALANCE, JUNE 30, 2024 $ 158,227 158,227 Continued... 204 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) RECREATION ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Licenses, permits and franchises $ 1,000 1,000 1,178 178 Revenue from use of money and property: Investment income 434 434 2,752 2,318 Rents and concessions 18,209 19,906 18,248 (1,658) Intergovernmental revenues- State 130 130 115 (15) Charges for services 4,658 4,658 4,360 (298) Miscellaneous 1,315 3,087 3,388 301 TOTAL REVENUES 25,746 29,215 30,041 826 EXPENDITURES Current-Recreation and cultural services: Services and supplies 51,072 52,640 12,044 40,596 Other charges 869 869 160 709 Capital assets 100 100 — 100 TOTAL EXPENDITURES 52,041 53,609 12,204 41,405 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (26,295) (24,394) 17,837 42,231 OTHER FINANCING SOURCES (USES) Transfers in 577 779 779 — Transfers out (41,792) (43,895) (15,598) 28,297 Appropriations for contingencies (271) (271) — 271 Changes in fund balance — — 32 32 TOTAL OTHER FINANCING SOURCES (USES) (41,486) (43,387) (14,787) 28,600 NET CHANGE IN FUND BALANCE (67,781) (67,781) 3,050 70,831 FUND BALANCE, JULY 1, 2023 67,781 67,781 67,781 FUND BALANCE, JUNE 30, 2024 $ 70,831 70,831 Continued... 205 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) COURTHOUSE TEMPORARY CONSTRUCTION ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Fines, forfeitures and penalties $ 7,500 7,500 7,679 179 Revenue from use of money and property- Investment income 40 40 1,135 1,095 TOTAL REVENUES 7,540 7,540 8,814 1,274 EXPENDITURES Current-Public protection: Services and supplies 18,968 18,968 678 18,290 Other charges 14,986 20,214 14,716 5,498 TOTAL EXPENDITURES 33,954 39,182 15,394 23,788 DEFICIENCY OF REVENUES OVER EXPENDITURES (26,414) (31,642) (6,580) 25,062 OTHER FINANCING SOURCES Transfers in — 5,228 5,227 (1) TOTAL OTHER FINANCING SOURCES — 5,228 5,227 (1) NET CHANGE IN FUND BALANCE (26,414) (26,414) (1,353) 25,061 FUND BALANCE, JULY 1, 2023 26,414 26,414 26,414 FUND BALANCE, JUNE 30, 2024 $ 25,061 25,061 Continued... 206 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) CRIMINAL JUSTICE TEMPORARY CONSTRUCTION ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Fines, forfeitures and penalties $ 9,000 9,000 8,510 (490) Revenue from use of money and property- Investment income 700 700 2,203 1,503 TOTAL REVENUES 9,700 9,700 10,713 1,013 EXPENDITURES Current-Public protection: Services and supplies 67,354 67,354 29,729 37,625 Other charges 1,916 1,916 1,916 — TOTAL EXPENDITURES 69,270 69,270 31,645 37,625 DEFICIENCY OF REVENUES OVER EXPENDITURES (59,570) (59,570) (20,932) 38,638 OTHER FINANCING USES Transfers out (306) (306) — 306 Changes in fund balance — — (1) (1) TOTAL OTHER FINANCING USES (306) (306) (1) 305 NET CHANGE IN FUND BALANCE (59,876) (59,876) (20,933) 38,943 FUND BALANCE, JULY 1, 2023 59,876 59,876 59,876 FUND BALANCE, JUNE 30, 2024 $ 38,943 38,943 Continued... 207 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) REGISTRAR-RECORDER IMPROVEMENT ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Charges for services $ 10,763 10,763 9,859 (904) OTHER FINANCING SOURCES (USES) Transfers out (12,210) (13,660) (11,116) 2,544 Appropriations for contingencies (23,109) (21,659) — 21,659 Changes in fund balance — — 1 1 TOTAL OTHER FINANCING SOURCES (USES) (35,319) (35,319) (11,115) 24,204 NET CHANGE IN FUND BALANCE (24,556) (24,556) (1,256) 23,300 FUND BALANCE, JULY 1, 2023 24,556 24,556 24,556 FUND BALANCE, JUNE 30, 2024 $ 23,300 23,300 Continued... 208 COUNTY OF LOS ANGELES SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL ON BUDGETARY BASIS NONMAJOR GOVERNMENTAL FUNDS - SPECIAL REVENUE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) OTHER SPECIAL REVENUE ORIGINAL FINAL ACTUAL ON VARIANCE WITH BUDGET BUDGET BUDGETARY FINAL BUDGET BASIS POSITIVE (NEGATIVE) REVENUES Taxes $ — 1,587 1,587 Licenses, permits and franchises 3,200 3,200 2,824 (376) Revenue from use of money and property: Investment income 997 997 2,859 1,862 Rents and concessions 5,958 6,427 6,770 343 Royalties 4 4 4 — Intergovernmental revenues- State — — 2 2 Charges for services 546 546 1,641 1,095 Miscellaneous 25 25 11 (14) TOTAL REVENUES 10,730 11,199 15,698 4,499 EXPENDITURES Current: General government: Salaries and employee benefits 6,394 6,863 6,862 1 Services and supplies 50,462 41,379 6,294 35,085 Capital assets 1,330 1,330 291 1,039 Total general government 58,186 49,572 13,447 36,125 Education- Services and supplies 10,096 10,096 2,047 8,049 TOTAL EXPENDITURES 68,282 59,668 15,494 44,174 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (57,552) (48,469) 204 48,673 OTHER FINANCING SOURCES (USES) Sales of capital assets 520 520 202 (318) Transfers in 12,231 12,231 11,622 (609) Transfers out (3,441) (14,112) (10,945) 3,167 Appropriations for contingencies (38,482) (36,894) — 36,894 Changes in fund balance — — 719 719 TOTAL OTHER FINANCING SOURCES (USES) (29,172) (38,255) 1,598 39,853 NET CHANGE IN FUND BALANCE (86,724) (86,724) 1,802 88,526 FUND BALANCE, JULY 1, 2023 86,724 86,724 86,724 FUND BALANCE, JUNE 30, 2024 $ 88,526 88,526 209 COUNTY OF LOS ANGELES COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS - DEBT SERVICE JUNE 30, 2024 (in thousands) LA County Public Securitization Buildings Corporation Total ASSETS Pooled cash and investments- Operating $ 35,984 — $ 35,984 Total pooled cash and investments 35,984 35,984 Other investments 28,889 22,840 51,729 Interest receivable 263 — 263 TOTAL ASSETS 65,136 22,840 87,976 DEFERRED OUTFLOWS OF RESOURCES 175,088 175,088 TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES $ 65,136 197,928 $ 263,064 FUND BALANCES - RESTRICTED $ 65,136 197,928 $ 263,064 TOTAL FUND BALANCES $ 65,136 197,928 $ 263,064 210 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS - DEBT SERVICE FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) LA County Public Securitization Buildings Corporation Total REVENUES Revenue from use of money and property- Investment income $ 2,059 1,256 $ 3,315 Miscellaneous — 22,565 22,565 TOTAL REVENUES 2,059 23,821 25,880 EXPENDITURES - Debt service Principal 185,398 14,620 200,018 Interest and other charges 100,333 9,587 109,920 TOTAL EXPENDITURES 285,731 24,207 309,938 DEFICIENCY OF REVENUES OVER EXPENDITURES (283,672) (386) (284,058) OTHER FINANCING SOURCES (USES) Transfers in 156,739 — 156,739 Transfers out (6,758) (8,119) (14,877) Issuance of debt 135,067 — 135,067 TOTAL OTHER FINANCING SOURCES (USES) 285,048 (8,119) 276,929 NET CHANGE IN FUND BALANCES 1,376 (8,505) (7,129) FUND BALANCES, JULY 1, 2023 63,760 206,433 270,193 FUND BALANCES, JUNE 30, 2024 $ 65,136 197,928 $ 263,064 211 COUNTY OF LOS ANGELES COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS - CAPITAL PROJECTS JUNE 30, 2024 (in thousands) Accumulative Improvement Public Capital Outlay Districts Buildings Gap Loan Total ASSETS Pooled cash and investments: Operating $ 133,227 13 35,295 35,995 $ 204,530 Other 541 — 20 138 699 Total pooled cash and investments 133,768 13 35,315 36,133 205,229 Other investments — — 8,555 — 8,555 Interest receivable 379 — 40 104 523 Other receivables 101 — — — 101 Due from other funds 8,169 — 499 — 8,668 TOTAL ASSETS $ 142,417 13 44,409 36,237 $ 223,076 LIABILITIES Accounts payable $ 2 — 2,196 — $ 2,198 Due to other funds 3,441 — 25,174 429 29,044 Advances payable 43 — — — 43 TOTAL LIABILITIES 3,486 27,370 429 31,285 FUND BALANCES Restricted — — 17,039 35,808 52,847 Committed 89,752 — — — 89,752 Assigned 49,179 13 — — 49,192 TOTAL FUND BALANCES 138,931 13 17,039 35,808 191,791 TOTAL LIABILITIES AND FUND BALANCES $ 142,417 13 44,409 36,237 $ 223,076 212 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS - CAPITAL PROJECTS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Accumulative Improvement Public Capital Outlay Districts Buildings Gap Loan Total REVENUES Revenue from use of money and property- Investment income (loss) $ 5,474 — (58) 1,987 $ 7,403 Charges for services 8,700 — — — 8,700 Miscellaneous 1,263 — — — 1,263 TOTAL REVENUES 15,437 — (58) 1,987 17,366 EXPENDITURES - Capital outlay 19,366 — 63,391 — 82,757 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (3,929) — (63,449) 1,987 (65,391) OTHER FINANCING SOURCES (USES) Transfers in 26,911 — 468 — 27,379 Transfers out — — (1,172) (429) (1,601) Issuance of debt — — 70,522 — 70,522 TOTAL OTHER FINANCING SOURCES (USES) 26,911 — 69,818 (429) 96,300 NET CHANGE IN FUND BALANCES 22,982 — 6,369 1,558 30,909 FUND BALANCES, JULY 1, 2023 115,949 13 10,670 34,250 160,882 FUND BALANCES, JUNE 30, 2024 $ 138,931 13 17,039 35,808 $ 191,791 213 COUNTY OF LOS ANGELES COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS - PERMANENT FUNDS JUNE 30, 2024 (in thousands) Annuities Endowments Total ASSETS Pooled cash and investments: Operating $ 390 1,786 $ 2,176 Other 1 7 8 Total pooled cash and investments 391 1,793 2,184 Interest receivable 1 5 6 TOTAL ASSETS $ 392 1,798 $ 2,190 LIABILITIES Due to other funds $ 10 $ 10 FUND BALANCES Nonspendable 392 1,788 2,180 TOTAL FUND BALANCES 392 1,788 2,180 TOTAL LIABILITIES AND FUND BALANCES $ 392 1,798 $ 2,190 214 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS - PERMANENT FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Annuities Endowments Total REVENUES Revenue from use of money and property- Investment income $ 20 85 $ 105 EXPENDITURES - General government 15 19 34 NET CHANGE IN FUND BALANCES 5 66 71 FUND BALANCES, JULY 1, 2023 387 1,722 2,109 FUND BALANCES, JUNE 30, 2024 $ 392 1,788 $ 2,180 215 216 INTERNAL SERVICE FUNDS COUNTY OF LOS ANGELES INTERNAL SERVICE FUNDS The Internal Service Funds are used to account for the financing of sources provided by a department or agency to other departments or agencies on a cost-reimbursement basis. PUBLIC WORKS FUND The Public Works Fund is used to account for the cost of services provided by the Department of Public Works to the Road Fund, Flood Control District, County Engineer, and various other special districts and agencies. Costs are recovered through billings for services. EQUIPMENT ACQUISITION FUND The Equipment Acquisition Fund is used to account for the operations of the Los Angeles County Capital Asset Leasing Corporation. County departments are charged for equipment items acquired on their behalf. The charges represent recovery of equipment depreciation expense and bond interest expense. COUNTY OF LOS ANGELES COMBINING STATEMENT OF NET POSITION INTERNAL SERVICE FUNDS JUNE 30, 2024 (in thousands) Public Equipment Works Acquisition Total ASSETS Current assets: Pooled cash and investments: Operating $ 37,102 804 $ 37,906 Other 10,288 15 10,303 Total pooled cash and investments 47,390 819 48,209 Interest receivable 130 9 139 Other receivables 13,046 — 13,046 Due from other funds 146,501 51 146,552 Inventories 11,030 — 11,030 Total current assets 218,097 879 218,976 Noncurrent assets: Restricted assets — 5,119 5,119 Capital assets: Equipment 264,861 16,939 281,800 Lease assets 1,224 — 1,224 Subscription assets 613 613 Less accumulated depreciation/amortization (156,494) (3,431) (159,925) Total capital assets - net 110,204 13,508 123,712 Total noncurrent assets 110,204 18,627 128,831 TOTAL ASSETS 328,301 19,506 347,807 DEFERRED OUTFLOWS OF RESOURCES 456,720 — 456,720 LIABILITIES Current liabilities: Accounts payable 6,786 656 7,442 Accrued payroll 26,235 — 26,235 Other payables 2,879 — 2,879 Accrued interest payable — 341 341 Due to other funds 55,511 — 55,511 Advances from other funds 22,000 — 22,000 Advances payable 141 — 141 Current portion of long-term liabilities 13,658 5,000 18,658 Total current liabilities 127,210 5,997 133,207 Noncurrent liabilities: Accrued compensated absences 76,428 — 76,428 Bonds and notes — 10,000 10,000 Lease liability 301 — 301 Workers' compensation 58,123 — 58,123 Net pension liability 479,257 — 479,257 Net OPEB liability 957,123 — 957,123 Total noncurrent liabilities 1,571,232 10,000 1,581,232 TOTAL LIABILITIES 1,698,442 15,997 1,714,439 DEFERRED INFLOWS OF RESOURCES 312,622 — 312,622 NET POSITION Net investment in capital assets 109,596 3,627 113,223 Unrestricted (deficit) (1,335,639) (118) (1,335,757) TOTAL NET POSITION (DEFICIT) $ (1,226,043) 3,509 $ (1,222,534) 217 COUNTY OF LOS ANGELES COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Public Equipment Works Acquisition Total OPERATING REVENUES- Charges for services $ 788,999 — $ 788,999 TOTAL OPERATING REVENUES 788,999 — 788,999 OPERATING EXPENSES: Salaries and employee benefits 632,489 — 632,489 Services and supplies 62,489 9 62,498 Other professional services 92,337 — 92,337 Depreciation and amortization 17,236 2,816 20,052 TOTAL OPERATING EXPENSES 804,551 2,825 807,376 OPERATING LOSS (15,552) (2,825) (18,377) NONOPERATING REVENUES (EXPENSES): Investment income 1,278 112 1,390 Gain on disposal of capital assets 686 — 686 Interest revenue — 3,569 3,569 Interest expense (27) (488) (515) TOTAL NONOPERATING REVENUES (EXPENSES) 1,937 3,193 5,130 INCOME (LOSS) BEFORE TRANSFERS (13,615) 368 (13,247) Transfers in 4,857 — 4,857 Transfers out (3,809) — (3,809) CHANGE IN NET POSITION (12,567) 368 (12,199) TOTAL NET POSITION (DEFICIT), JULY 1, 2023 (1,213,476) 3,141 (1,210,335) TOTAL NET POSITION (DEFICIT), JUNE 30, 2024 $ (1,226,043) 3,509 $ (1,222,534) 218 COUNTY OF LOS ANGELES COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Public Equipment Works Acquisition Total CASH FLOWS FROM OPERATING ACTIVITIES Cash received from charges for services $ 72,286 $ 72,286 Cash received for services provided to other funds 693,618 0 693,618 Cash paid for salaries and employee benefits (614,855) 0 (614,855) Cash paid for services and supplies (64,949) (9) (64,958) Other operating expenses (92,337) 0 (92,337) Net cash required for operating activities (6,237) (9) (6,246) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Cash advances paid to other funds (19) — (19) Transfers in 4,857 — 4,857 Transfers out (3,809) — (3,809) Net cash provided by noncapital financing activities 1,029 — 1,029 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from bonds and notes — 10,000 10,000 Interest paid on capital borrowing (27) (163) (190) Interest revenue — 3,569 3,569 Leases paid (252) (252) Subscriptions paid (224) — (224) Acquisition and construction of capital assets (12,873) (11,532) (24,405) Net cash provided by (required for) capital and related financing activities (13,376) 1,874 (11,502) CASH FLOWS FROM INVESTING ACTIVITIES Investment income 1,269 140 1,409 Net increase (decrease) in cash and cash equivalents (17,315) 2,005 (15,310) Cash and cash equivalents, July 1, 2023 64,705 3,933 68,638 Cash and cash equivalents, June 30, 2024 $ 47,390 5,938 $ 53,328 Continued.. 219 COUNTY OF LOS ANGELES COMBINING STATEMENT OF CASH FLOWS - Continued INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Public Equipment Works Acquisition Total RECONCILIATION OF OPERATING LOSS TO NET CASH REQUIRED FOR OPERATING ACTIVITIES: Operating loss $ (15,552) (2,825) $ (18,377) Adjustments to reconcile operating loss to net cash required for operating activities: Depreciation and amortization 17,236 2,816 20,052 (Increase) decrease in: Other receivables (1,509) — (1,509) Due from other funds (22,825) — (22,825) Inventories (648) — (648) Increase (decrease) in: Accounts payable (1,586) — (1,586) Accrued payroll 1,044 — 1,044 Other payables (173) — (173) Accrued compensated absences 492 — 492 Due to other funds (226) — (226) Workers' compensation 1,834 — 1,834 Net pension liability and related changes in deferred outflows and inflows of resources 14,504 — 14,504 Net OPEB liability and related changes in deferred outflows and inflows of resources 1,172 — 1,172 TOTAL ADJUSTMENTS 9,315 2,816 12,131 NET CASH REQUIRED FOR OPERATING ACTIVITIES $ (6,237) (9) $ (6,246) RECONCILIATION OF CASH AND CASH EQUIVALENTS TO THE STATEMENT OF NET POSITION: Pooled cash and investments $ 47,390 819 $ 48,209 Restricted assets — 5,119 5,119 TOTAL $ 47,390 5,938 $ 53,328 220 FIDUCIARY FUNDS COUNTY OF LOS ANGELES FIDUCIARY FUNDS The Fiduciary Funds are used to account for resources held for the benefit of parties outside of the government. PENSION AND OTHER POSTEMPLOYMENT BENEFIT TRUST FUNDS PENSION TRUST FUND The Pension Trust Fund is used to account for the fiduciary activities of the County’s Pension Plan administered by LACERA. OPEB TRUST FUND The OPEB Trust Fund is used to account for the fiduciary activities of the OPEB trust for the purpose of holding and investing assets to pre-fund the Retiree Healthcare Program administered by LACERA. CUSTODIAL FUNDS EXTERNAL INVESTMENT POOLS FUNDS EXTERNAL INVESTMENT POOL FUND The External Investment Pool Fund is used to account for the fiduciary activities from the external portion of the investment pool for participants who do not have a trust agreement or equivalent arrangement with the County. The participants primarily consist of deposits held on behalf of School Districts, Courts, and Sanitation Districts. EXTERNAL SPECIFIC INVESTMENT POOL FUND The External Specific Investment Pool Fund is used to account for the fiduciary activities from the external portion of the individual investment accounts, in aggregate, for participants who do not have a trust agreement or equivalent arrangement with the County. The related investment activity occurs separately from the County’s investment pool and is provided as a service to external investors. OTHER CUSTODIAL FUNDS PROPERTY TAX FUNDS This group of funds is used to account for the fiduciary activities for the monies received from property and other taxes, which must be held pending authority for distribution to the appropriate recipients. OTHER CUSTODIAL FUNDS This group of funds is used to account for the fiduciary activities which are held for other governmental agencies or individuals in a custodial capacity. COUNTY OF LOS ANGELES COMBINING STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS - PENSION AND OTHER POSTEMPLOYMENT BENEFIT TRUST FUNDS JUNE 30, 2024 (in thousands) OPEB Pension Trust Trust Total ASSETS Pooled cash and investments $ 142,381 $ 142,381 Other investments: Short-term investments 3,146,612 177,282 3,323,894 Equity 29,462,196 2,107,137 31,569,333 Fixed income 19,855,304 1,735,690 21,590,994 Private equity 13,057,191 18,175 13,075,366 Real estate 4,406,609 2,431 4,409,040 Real assets 3,359,137 16,894 3,376,031 Hedge funds 4,875,300 — 4,875,300 Cash collateral on loaned securities 2,359,153 — 2,359,153 Interest receivable 197,731 15,507 213,238 Other receivables 1,309,535 12,415 1,321,950 TOTAL ASSETS 82,171,149 4,085,531 86,256,680 LIABILITIES Accounts payable 517,077 106,674 623,751 Other payables 2,451,847 986 2,452,833 TOTAL LIABILITIES 2,968,924 107,660 3,076,584 NET POSITION Net position restricted for pension and other postemployment benefits $ 79,202,225 3,977,871 $ 83,180,096 221 COUNTY OF LOS ANGELES COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS - PENSION AND OTHER POSTEMPLOYMENT BENEFIT TRUST FUNDS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) OPEB Pension Trust Trust Total ADDITIONS Contributions: Pension and OPEB trust contributions: Employer $ 2,509,071 1,316,128 $ 3,825,199 Member 861,042 50,255 911,297 Total contributions 3,370,113 1,366,383 4,736,496 Investment earnings: Investment income 3,943,479 137,210 4,080,689 Net increase in the fair value of investments 2,834,757 234,787 3,069,544 Securities lending income 134,663 — 134,663 Total investment earnings 6,912,899 371,997 7,284,896 Less - Investment expenses: Expense from investing activities 184,367 3,586 187,953 Expense from securities lending activities 116,548 — 116,548 Total net investment expense 300,915 3,586 304,501 Net investment earnings 6,611,984 368,411 6,980,395 Miscellaneous 5,334 — 5,334 TOTAL ADDITIONS 9,987,431 1,734,794 11,722,225 DEDUCTIONS Administrative expenses: Salaries and employee benefits 84,481 — 84,481 Services and supplies 34,147 1,077 35,224 Total administrative expenses 118,628 1,077 119,705 Benefit payments 4,474,471 847,686 5,322,157 Miscellaneous 43,993 — 43,993 TOTAL DEDUCTIONS 4,637,092 848,763 5,485,855 CHANGE IN NET POSITION 5,350,339 886,031 6,236,370 NET POSITION, JULY 1, 2023 73,851,886 3,091,840 76,943,726 NET POSITION, JUNE 30, 2024 $ 79,202,225 3,977,871 $ 83,180,096 222 COUNTY OF LOS ANGELES COMBINING STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS - CUSTODIAL - EXTERNAL INVESTMENT POOLS JUNE 30, 2024 (in thousands) External External Specific Investment Pool Investment Pool Total ASSETS Pooled cash and investments $ 35,688,450 — $ 35,688,450 Other investments 225,653 225,653 Interest receivable 86,657 1,047 87,704 NET POSITION Net position restricted for pool participants $ 35,775,107 226,700 $ 36,001,807 223 COUNTY OF LOS ANGELES COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS - CUSTODIAL - EXTERNAL INVESTMENT POOLS FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) External External Specific Investment Pool Investment Pool Total ADDITIONS Contributions to investment pools $ 67,581,448 150,582 $ 67,732,030 Investment income 1,384,554 6,976 1,391,530 TOTAL ADDITIONS 68,966,002 157,558 69,123,560 DEDUCTIONS Distributions from investment pools 65,945,765 78,101 66,023,866 CHANGE IN NET POSITION 3,020,237 79,457 3,099,694 NET POSITION, JULY 1, 2023 32,754,870 147,243 32,902,113 NET POSITION, JUNE 30, 2024 $ 35,775,107 226,700 $ 36,001,807 224 COUNTY OF LOS ANGELES COMBINING STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS - CUSTODIAL - OTHER CUSTODIAL JUNE 30, 2024 (in thousands) Property Other Tax Custodial Total ASSETS Pooled cash and investments $ 573,548 1,000,183 $ 1,573,731 Other investments — 309 309 Taxes receivable — 1,043,734 1,043,734 Other receivables 28,107 447,232 475,339 Due from other governments 647 — 647 TOTAL ASSETS 602,302 2,491,458 3,093,760 LIABILITIES Accounts payable — 3,570 3,570 Other payables 482,335 596,430 1,078,765 Due to other governments — 81,603 81,603 TOTAL LIABILITIES 482,335 681,603 1,163,938 NET POSITION Net position restricted for individuals, organizations, and other governments $ 119,967 1,809,855 $ 1,929,822 225 COUNTY OF LOS ANGELES COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS - CUSTODIAL - OTHER CUSTODIAL FOR THE YEAR ENDED JUNE 30, 2024 (in thousands) Property Other Tax Custodial Total ADDITIONS Contributions to custodial funds $ 25,798,896 2,341,600 $ 28,140,496 Other additions — 3,005,594 3,005,594 TOTAL ADDITIONS 25,798,896 5,347,194 31,146,090 DEDUCTIONS Distributions from custodial funds 25,785,027 2,331,612 28,116,639 Other deductions 373 2,914,944 2,915,317 TOTAL DEDUCTIONS 25,785,400 5,246,556 31,031,956 CHANGE IN NET POSITION 13,496 100,638 114,134 NET POSITION, JULY 1, 2023 106,471 1,709,217 1,815,688 NET POSITION, JUNE 30, 2024 $ 119,967 1,809,855 $ 1,929,822 226 STATISTICAL SECTION STATISTICAL SECTION The information in this section is not covered by the Independent Auditor’s Report, but is presented as supplemental data for the benefit of the readers of the annual comprehensive financial report. The objectives of statistical section information are to provide financial statement users with additional historical perspective, context, and detail to assist in using the information in the financial statements, notes to financial statements, and required supplementary information to better understand and assess the County’s overall financial health. CONTENTS PAGE FINANCIAL TRENDS ..................................................................................................................... 229 These schedules contain trend information to help the reader understand how the County’s financial performance and well-being have changed over time. REVENUE CAPACITY ................................................................................................................... 236 These schedules contain trend information to help the reader assess the County’s most significant local revenue source, the property tax. DEBT CAPACITY ........................................................................................................................... 240 These schedules present information to help the reader assess the affordability of the County’s current levels of outstanding debt and the County’s ability to issue additional debt in the future. DEMOGRAPHIC AND ECONOMIC INFORMATION ..................................................................... 246 The schedules offer demographic and economic indicators to help the reader understand the environment within which the County’s financial activities take place. OPERATING INFORMATION ......................................................................................................... 248 These schedules contain service and infrastructure data to help the reader understand how the information in the County’s financial report relates to the services the County provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year. 227 228 COUNTY OF LOS ANGELES NET POSITION BY CATEGORY (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (accrual basis of accounting) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 (1) (2) (3) (4) (5) Governmental activities Net investment in capital assets $ 14,846,719 14,982,488 15,165,318 14,984,847 15,166,340 15,304,410 15,649,484 15,588,360 15,833,971 16,229,559 Restricted 3,098,677 3,320,163 3,391,358 3,524,215 3,811,405 3,926,849 4,297,717 4,646,341 5,083,496 5,788,406 Unrestricted (deficit) (16,822,355) (17,719,601) (18,728,499) (29,158,786) (29,366,455) (28,834,009) (30,171,770) (29,350,156) (31,960,081) (31,970,600) Subtotal governmental activities net position 1,123,041 583,050 (171,823) (10,649,724) (10,388,710) (9,602,750) (10,224,569) (9,115,455) (11,042,614) (9,952,635) Business-type activities Net investment in capital assets 2,298,915 2,269,835 2,305,050 2,320,256 2,109,416 2,095,825 2,071,584 2,309,804 2,525,430 2,590,331 Restricted 84,672 92,699 112,775 134,647 138,686 67,499 66,423 65,363 84,718 85,492 Unrestricted (deficit) (3,220,744) (3,446,986) (3,383,795) (5,323,163) (5,351,572) (4,997,187) (4,831,786) (3,849,887) (3,426,470) (3,170,562) Subtotal business-type activities net position (837,157) (1,084,452) (965,970) (2,868,260) (3,103,470) (2,833,863) (2,693,779) (1,474,720) (816,322) (494,739) Primary government Net investment in capital assets 17,145,634 17,252,323 17,470,368 17,305,103 17,275,756 17,400,235 17,721,068 17,898,164 18,359,401 18,819,890 Restricted 3,183,349 3,412,862 3,504,133 3,658,862 3,950,091 3,994,348 4,364,140 4,711,704 5,168,214 5,873,898 Unrestricted (deficit) (20,043,099) (21,166,587) (22,112,294) (34,481,949) (34,718,027) (33,831,196) (35,003,556) (33,200,043) (35,386,551) (35,141,162) Total primary government net position $ 285,884 (501,402) (1,137,793) (13,517,984) (13,492,180) (12,436,613) (12,918,348) (10,590,175) (11,858,936) (10,447,374) Notes: (1) The County adopted GASB 68 and 71 in FY 2014-2015. (2) The County adopted GASB 75 in FY 2017-2018 and prior year amounts were not restated. (3) The County adopted GASB 84 in FY 2020-2021 and prior year amounts were not restated. (4) The County adopted GASB 87 in FY 2021-2022 and prior year amounts were not restated. (5) The County adopted GASB 96 in FY 2022-2023 and prior year amounts were not restated. 229 COUNTY OF LOS ANGELES CHANGES IN NET POSITION (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (accrual basis of accounting) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 Expenses (1) (2) (3) (4) (5) Governmental activities: General government $ 1,429,897 1,235,949 1,354,561 1,579,367 1,660,335 1,571,995 1,767,441 1,243,850 1,626,902 1,884,559 Public protection 6,638,192 7,098,459 7,532,191 7,841,468 7,772,364 7,648,073 8,963,490 8,354,532 10,535,212 10,040,684 Public ways and facilities 415,586 375,295 397,231 415,805 453,758 417,325 471,131 468,413 543,472 585,307 Health and sanitation 3,136,924 3,417,720 3,868,785 4,307,099 5,433,924 5,742,957 6,729,312 6,690,851 6,906,927 8,032,810 Public assistance 6,007,973 6,191,975 6,441,552 6,693,008 6,922,346 7,235,705 8,304,610 7,741,363 10,390,815 9,426,531 Education 107,336 141,195 127,901 160,097 161,012 146,480 174,937 152,330 154,258 173,303 Recreation and cultural services 365,755 388,284 276,625 487,173 320,838 476,798 514,751 568,447 588,735 534,164 Interest on long-term debt 99,400 93,022 104,899 106,425 124,549 199,528 107,106 147,433 161,604 178,369 Subtotal governmental activities expenses 18,201,063 18,941,899 20,103,745 21,590,442 22,849,126 23,438,861 27,032,778 25,367,219 30,907,925 30,855,727 Business-type activities: Hospitals 4,017,633 4,309,615 4,990,891 5,370,965 4,827,429 4,844,797 5,030,015 5,491,898 5,560,504 6,215,647 Waterworks 85,479 86,463 90,517 95,301 104,906 109,259 110,955 111,190 113,074 118,530 Aviation 6,675 5,661 2,776 11,148 5,954 5,598 6,195 17,582 19,677 19,951 Subtotal business-type activities expenses 4,109,787 4,401,739 5,084,184 5,477,414 4,938,289 4,959,654 5,147,165 5,620,670 5,693,255 6,354,128 Total primary government expenses 22,310,850 23,343,638 25,187,929 27,067,856 27,787,415 28,398,515 32,179,943 30,987,889 36,601,180 37,209,855 Program Revenues Governmental activities: Charges for services General government 469,598 514,167 556,361 530,893 570,425 584,296 666,991 632,043 691,118 689,191 Public protection 1,246,654 1,276,055 1,311,858 1,263,462 1,281,280 1,548,253 1,638,907 1,657,494 1,704,995 1,778,350 Health and sanitation 535,836 620,468 715,414 762,326 1,606,315 1,921,273 1,532,582 1,550,591 1,743,967 2,086,480 Recreation and cultural services 206,794 149,032 154,686 251,160 160,111 117,960 114,517 141,906 142,312 152,765 Other charges for services 46,125 48,362 41,164 53,449 62,014 57,646 47,033 58,625 60,459 50,679 Subtotal governmental activities charges for services 2,505,007 2,608,084 2,779,483 2,861,290 3,680,145 4,229,428 4,000,030 4,040,659 4,342,851 4,757,465 Operating grants and contributions 8,976,986 9,296,996 9,795,607 10,263,315 10,719,454 11,927,097 13,861,166 13,466,206 14,134,795 15,578,862 Capital grants and contributions 35,685 24,860 64,055 26,310 72,955 52,174 56,073 42,426 64,023 58,660 Total governmental activities program revenues 11,517,678 11,929,940 12,639,145 13,150,915 14,472,554 16,208,699 17,917,269 17,549,291 18,541,669 20,394,987 Business-type activities: Charges for services Hospitals 2,960,080 3,161,974 3,877,494 4,064,523 3,437,056 3,744,598 3,327,525 4,765,753 4,912,895 5,250,557 Other charges for services 77,746 83,286 81,694 90,526 89,468 91,121 101,841 112,920 106,057 116,771 Subtotal business-type activities charges for services 3,037,826 3,245,260 3,959,188 4,155,049 3,526,524 3,835,719 3,429,366 4,878,673 5,018,952 5,367,328 Operating grants and contributions 500,840 315,070 457,686 651,303 488,087 247,784 364,408 931,722 182,601 185,668 Capital grants and contributions 2,353 5,582 1,195 8,291 3,850 8,484 15,467 81 1,193 326 Total business-type activities program revenues 3,541,019 3,565,912 4,418,069 4,814,643 4,018,461 4,091,987 3,809,241 5,810,476 5,202,746 5,553,322 Total primary government program revenues $ 15,058,697 15,495,852 17,057,214 17,965,558 18,491,015 20,300,686 21,726,510 23,359,767 23,744,415 25,948,309 Notes: (1) The County adopted GASB 68 and 71 in FY 2014-2015. (2) The County adopted GASB 75 in FY 2017-2018 and prior year amounts were not restated. (3) The County adopted GASB 84 in FY 2020-2021 and prior year amounts were not restated. (4) The County adopted GASB 87 in FY 2021-2022 and prior year amounts were not restated. Continued.. (5) The County adopted GASB 96 in FY 2022-2023 and prior year amounts were not restated. 230 COUNTY OF LOS ANGELES CHANGES IN NET POSITION (UNAUDITED) - Continued LAST TEN FISCAL YEARS (in thousands) (accrual basis of accounting) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 Net (expenses) / revenues: Governmental activities $ (6,895,647) (6,683,385) (7,011,959) (7,464,600) (8,439,527) (8,376,572) (7,230,162) (9,115,509) (7,817,928) (10,460,740) Business-type activities (905,866) (568,768) (835,827) (666,115) (662,771) (919,828) (867,667) (1,337,924) 189,806 (800,806) Total primary government net expenses (7,801,513) (7,252,153) (7,847,786) (8,130,715) (9,102,298) (9,296,400) (8,097,829) (10,453,433) (7,628,122) (11,261,546) General Revenues and Transfers Governmental activities: Taxes 5,840,175 6,161,188 6,415,494 6,826,908 7,475,813 8,184,940 8,559,288 9,218,814 9,648,848 10,811,926 Unrestricted grants and contributions 513,458 512,079 374,264 428,435 433,799 473,800 85,688 571,163 631,429 679,353 Investment income (loss) 64,354 74,220 122,763 53,363 101,730 380,361 238,439 (32,284) (456,803) 863,672 Miscellaneous 134,611 181,119 141,146 178,922 149,384 269,931 255,931 205,748 175,385 253,977 Transfers (Net) (731,152) (603,762) (581,699) (777,901) (747,863) (671,446) (1,123,224) (1,469,751) (936,810) (1,058,209) Subtotal governmental activities 5,821,446 6,324,844 6,471,968 6,709,727 7,412,863 8,637,586 8,016,122 8,493,690 9,062,049 11,550,719 Business-type activities: Taxes 4,681 4,919 5,309 5,676 6,013 6,504 6,832 8,302 7,730 9,101 Unrestricted grants and contributions 33 32 459 746 3 966 Investment income (loss) 3,908 1,289 1,463 898 675 6,600 5,950 (1,090) (39,782) 53,810 Miscellaneous 19,101 26,012 61 122 110 36 809 299 303 Transfers (Net) 731,152 603,762 581,699 777,901 747,863 671,446 1,123,224 1,469,751 936,810 1,058,209 Subtotal business-type activities 758,875 635,982 588,532 784,597 754,661 684,618 1,137,274 1,478,008 904,761 1,122,389 Total primary government 6,580,321 6,960,826 7,060,500 7,494,324 8,167,524 9,322,204 9,153,396 9,971,698 9,966,810 12,673,108 Changes in Net Position Governmental activities (1,074,201) (358,541) (539,991) (754,873) (1,026,664) 261,014 785,960 (621,819) 1,244,121 1,089,979 Business-type activities (146,991) 67,214 (247,295) 118,482 91,890 (235,210) 269,607 140,084 1,094,567 321,583 Total primary government $ (1,221,192) (291,327) (787,286) (636,391) (934,774) 25,804 1,055,567 (481,735) 2,338,688 1,411,562 231 COUNTY OF LOS ANGELES FUND BALANCES, GOVERNMENTAL FUNDS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (modified accrual basis of accounting) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 General Fund Nonspendable $ 272,384 324,555 212,281 136,890 311,958 126,630 225,233 284,841 263,367 293,753 Restricted 55,694 67,880 70,157 77,406 79,210 83,372 55,061 64,516 77,629 88,654 Committed 334,346 364,679 429,440 704,954 780,517 594,193 597,337 759,944 832,792 1,070,313 Assigned 491,954 446,579 494,783 480,065 620,773 696,775 790,573 774,267 1,028,770 1,345,188 Unassigned 2,035,445 2,180,549 2,444,312 2,495,876 2,641,551 3,017,834 3,265,520 3,734,086 4,280,499 4,894,801 Total General Fund 3,189,823 3,384,242 3,650,973 3,895,191 4,434,009 4,518,804 4,933,724 5,617,654 6,483,057 7,692,709 All Other Governmental Funds (1) Nonspendable 14,047 12,817 13,859 15,979 16,040 14,324 13,667 14,152 15,263 100,040 Restricted 3,240,873 3,362,644 3,462,658 3,609,170 3,974,497 4,188,113 4,795,389 4,934,790 5,228,939 5,768,107 Committed 112,034 109,538 119,251 122,379 127,829 134,851 135,537 134,392 141,900 169,772 Assigned 202,283 197,022 213,021 220,586 226,468 246,725 257,280 274,438 285,524 283,833 Total All Other Governmental Funds 3,569,237 3,682,021 3,808,789 3,968,114 4,344,834 4,584,013 5,201,873 5,357,772 5,671,626 6,321,752 Total Governmental Fund Balance $ 6,759,060 7,066,263 7,459,762 7,863,305 8,778,843 9,102,817 10,135,597 10,975,426 12,154,683 14,014,461 Note: (1) "All Other Governmental Funds" consists of the following funds: Fire Protection District, Flood Control District, LA County Library, Regional Park and Open Space District, Mental Health Services Act, and Nonmajor Governmental Funds. 232 233 COUNTY OF LOS ANGELES CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) (modified accrual basis of accounting) Revenues (by source) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 Taxes $ 6,078,449 6,350,290 6,736,037 7,380,450 8,073,428 8,387,725 9,115,844 9,509,962 10,202,139 10,668,457 Licenses, permits and franchises 92,079 93,069 98,554 98,800 102,365 110,805 105,333 117,419 121,189 134,188 Fines, forfeitures and penalties 279,246 251,321 242,837 222,072 236,611 227,304 197,506 212,369 222,314 227,716 Revenue from use of money and property: Investment income (loss) 73,966 122,423 57,043 102,130 379,249 237,915 (31,728) (456,643) 349,321 862,610 Rents and concessions 133,208 134,627 157,590 149,423 161,772 151,890 149,437 103,812 106,234 114,215 Lease revenue (1) 69,889 70,224 69,698 Royalties 1,503 900 801 804 824 482 441 642 640 672 Intergovernmental revenues: Federal 3,412,218 3,540,477 3,712,553 3,926,753 3,969,350 4,713,682 5,819,654 5,216,498 5,391,289 5,857,035 State 6,012,662 6,002,364 6,390,825 6,651,035 7,127,912 7,204,006 8,318,833 8,774,471 9,476,704 10,343,440 Other 69,212 69,237 86,281 53,958 69,878 64,886 61,731 49,682 28,904 60,688 Charges for services 2,023,074 2,142,415 2,326,217 2,375,460 3,037,629 3,759,680 3,747,909 3,595,340 3,771,919 4,225,268 Miscellaneous 259,466 215,413 256,217 230,346 351,554 339,798 290,752 327,615 369,852 348,488 Total Revenues 18,435,083 18,922,536 20,064,955 21,191,231 23,510,572 25,198,173 27,775,712 27,521,056 30,110,729 32,912,475 Expenditures (by function) Current: General government 1,172,098 1,057,069 1,175,868 1,274,231 1,299,405 1,515,440 1,818,653 1,203,562 1,881,674 2,034,711 Public protection 6,353,892 6,737,132 6,934,740 7,103,012 7,514,418 7,768,257 7,984,554 8,521,925 8,895,627 9,331,076 Public ways and facilities 378,345 322,182 361,137 347,713 406,019 396,357 412,637 432,429 498,034 551,752 Health and sanitation 3,074,411 3,282,130 3,635,865 4,176,280 5,302,669 5,898,687 6,124,141 6,563,421 6,646,105 7,732,480 Public assistance 5,688,513 5,900,845 6,042,952 6,369,468 6,708,517 7,128,267 8,086,460 7,723,428 8,745,415 9,186,519 Education 123,723 132,397 130,056 150,032 152,112 153,282 153,787 156,824 159,505 172,117 Recreation and cultural services 357,458 376,270 401,564 447,846 441,641 483,498 441,409 470,768 505,031 536,048 Debt service: Principal 463,680 393,501 114,661 91,083 134,225 301,678 296,350 486,669 322,992 355,521 Interest and other charges 97,877 133,261 113,274 111,179 129,598 205,838 241,738 379,283 170,968 183,052 Refunding escrow 53,754 — — Capital outlay 139,228 61,518 19,997 69,646 237,052 201,510 459,490 241,622 495,507 277,496 Total Expenditures 17,849,225 18,396,305 18,930,114 20,140,490 22,325,656 24,052,814 26,019,219 26,233,685 28,320,858 30,360,772 Excess of Revenues over Expenditures 585,858 526,231 1,134,841 1,050,741 1,184,916 1,145,359 1,756,493 1,287,371 1,789,871 2,551,703 Other Financing Sources (Uses) Transfers in 757,897 572,677 662,781 927,210 1,558,376 1,338,201 1,652,029 1,611,729 1,635,854 1,685,319 Transfers out (1,353,746) (1,151,110) (1,441,818) (1,670,819) (2,418,192) (2,450,189) (3,124,518) (2,542,472) (2,729,674) (2,779,117) Issuance of debt 461,811 305,527 34,642 75,489 541,555 632,392 660,364 313,834 135,467 205,589 Refunding bonds issued 199,885 — 167,925 — — Payment to refunded bonds escrow agent (199,885) (394,116) (167,925) — — Debt premium 27,354 50,300 44,179 48,516 63,605 70,739 — — Sales of capital assets 2,422 3,031 2,649 3,261 3,118 1,795 3,211 30,694 2,337 1,545 Capital leases (1) 866 547 404 17,661 1,586 2,016 21,596 — Leases (1) 59,032 284,364 148,997 Subscriptions (1) 61,038 45,742 Total other financing sources (uses) (103,396) (219,028) (741,342) (647,198) (269,378) (821,385) (723,713) (456,444) (610,614) (691,925) Net change in fund balances $ 482,462 307,203 393,499 403,543 915,538 323,974 1,032,780 830,927 1,179,257 1,859,778 Debt service as a percentage of noncapital expenditures (2) 3.23 % 2.93 % 1.25 % 1.02 % 1.21 % 2.17 % 2.16 % 3.41 % 1.81 % 1.84 % Notes: (1) The County adopted GASB 87 in FY 2021-2022 and GASB 96 in FY 2022-23; and prior year amounts were not restated. (2) The debt service percentage calculations make use of the capital outlay expenditure balances as presented on the Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities. Amount from GW to FB reconciliation for Capital Outlay $ 454,502 416,575 693,502 233,447 569,861 708,720 1,136,003 826,703 1,025,295 1,042,559 234 COUNTY OF LOS ANGELES Governmental Funds Expenditures and Revenues (UNAUDITED) Last Ten Fiscal Years 35 30 25 20 15 10 5 0 14-15 15-16 16-17 17-18 18-19 19-20 20-21 21-22 22-23 23-24 Expenditures $17.8 18.4 18.9 20.1 22.3 24.1 26.0 26.2 28.3 30.4 Revenues $18.4 18.9 20.1 21.2 23.5 25.2 27.8 27.5 30.1 32.9 In Billions of Dollars Expenditures Revenues 235 COUNTY OF LOS ANGELES ASSESSED VALUE AND ACTUAL VALUE OF TAXABLE PROPERTY (UNAUDITED) (1) LAST TEN FISCAL YEARS (in thousands) (2) (3) (4) (5) Total Taxable Total Direct Fiscal Year Secured Unsecured Unitary Exempt Assessed Value Tax Rate 2014 - 2015 $ 1,197,665,178 50,777,030 14,325,069 (54,911,046) 1,207,856,231 1.00000% 2015 - 2016 1,270,136,487 52,284,478 15,846,612 (55,760,332) 1,282,507,245 1.00000% 2016 - 2017 1,337,673,405 54,868,734 17,308,742 (55,392,206) 1,354,458,675 1.00000% 2017 - 2018 1,417,559,668 57,596,412 17,864,439 (57,634.568) 1,435,385.951 1.00000% 2018 - 2019 1,509,708,740 61,244,751 18,739,669 (59,810,665) 1,529,882,495 1.00000% 2019 - 2020 1,603,606,366 64,264,989 19,711,509 (62,042,993) 1,625,539,871 1.00000% 2020 - 2021 1,700,279,275 67,016,870 22,196,582 (65,354.344) 1,724,138.383 1.00000% 2021 - 2022 1,768,808,097 64,760,577 20,939,324 (68,705,270) 1,785,802.728 1.00000% 2022 - 2023 1,883,665,843 69,700,622 23,971,146 (66,050,527) 1,911,287,084 1.00000% 2023 - 2024 1,994,761,572 76,285,688 25,839,957 (72,424,695) 2,024,462,522 1.00000% Notes: (1) Due to the 1978 passage of the property tax initiative Proposition 13 (Prop 13), the County does not track the estimated actual value of all County properties. Under Prop 13, property is assessed at the 1978 market value with an annual increase limited to the lesser of 2% or the CPI on property not involved in a change of ownership or properties that did not undergo new construction. Newly acquired property is assessed at its new market value (usually the purchase price) and the value of any new construction is added to the existing base value of a parcel. As a result, similar properties can have substantially different assessed values based on the date of purchase. Additionally, Prop 13 limits the property tax rate to 1% of assessed value plus the rate necessary to fund local voter-approved bonds and special assessments. (2) Secured property is generally real property, as defined as land, mines, minerals, timber, and improvements such as buildings, structures, crops, trees, and vines. (3) Unsecured property is generally personal property including machinery, equipment, office tools, and supplies. (4) Unitary properties are railroads, utilities, and pipelines crossing the County and are assessed by the State Board of Equalization and the County Assessor. (5) Exempt properties include numerous full and partial exclusions/exemptions provided by the State Constitution and the legislature that relieve certain taxpayers from the burden of paying property taxes. Source: Auditor-Controller, County of Los Angeles Taxpayers' Guide 236 COUNTY OF LOS ANGELES PROPERTY TAX RATES DIRECT AND OVERLAPPING RATES FOR TAX AREA #4 (UNAUDITED) LAST TEN FISCAL YEARS Overlapping Rates (1) (2) (3) County of Los Angeles Los Angeles Countywide City Tax School Metropolitan Total Direct and Fiscal Year Ad Valorem Tax (4) District No. 1 Districts Water District Overlapping Rates 2014 - 2015 1.000000 .028096 .187055 .003500 1.218651 2015 - 2016 1.000000 .023030 .165464 .003500 1.191994 2016 - 2017 1.000000 .021297 .167052 .003500 1.191849 2017 - 2018 1.000000 .021345 .168182 .003500 1.193027 2018 - 2019 1.000000 .023107 .169439 .003500 1.196046 2019 - 2020 1.000000 .018084 .152695 .003500 1.174279 2020 - 2021 1.000000 .016538 .180091 .003500 1.200129 2021 - 2022 1.000000 .014721 .156987 .003500 1.175208 2022 - 2023 1.000000 .016066 .145954 .003500 1.165520 2023 - 2024 1.000000 .011448 .184450 .003500 1.199398 Notes: (1) The tax rate for Tax Rate Area #4, which applies to most property within the City of Los Angeles, is used to illustrate the breakdown of a tax rate within the County. (2) The County is divided into 13,153 tax rate areas which are unique combinations of various jurisdictions servicing a specific geographic area. (3) An exception to the 1% limit was provided by Proposition 46 which was approved in June 1986 re-establishing authority of local governments to issue general obligation bonds for certain purposes. (4) Article XIIIA (Proposition 13) limits the maximum ad valorem tax rate to 1% of "full cash value" except for indebtedness approved by the voters prior to July 1, 1978. All other rates are calculated per $100 of assessed value. Source: Secured Tax Rate and Ratios Report from Auditor-Controller - Property Tax Apportionment Division. 237 COUNTY OF LOS ANGELES PRINCIPAL PROPERTY TAXPAYERS (UNAUDITED) CURRENT YEAR AND NINE YEARS AGO JUNE 30, 2024 AND JUNE 30, 2015 (in thousands) 2024 (1) 2015 (1) Net Assessed Percentage of Net Assessed Percentage of Secured Total Net Secured Total Net Property Assessed Property Assessed Taxpayer Value Rank Value Value Rank Value Southern California Edison Co. $ 12,928,332 1 0.66% $ 5,941,704 1 0.51% Southern California Gas Co. 4,982,979 2 0.25% 1,811,041 8 0.16% Rexford Industrial 4,950,061 3 0.25% Tesoro Refining and Marketing Co. 4,587,615 4 0.23% 2,572,396 3 0.22% Douglas Emmett Residential 3,684,504 5 0.19% 3,514,532 2 0.30% Pincay RE LLC Lessor 3,200,884 6 0.16% EQR / ERP Limited 2,863,282 7 0.15% 1,688,090 10 0.15% Chevron USA Inc 2,603,858 8 0.13% 1,818,710 7 0.16% Maguire Properties 2,405,883 9 0.12% AMB/MAR Carson LLC 2,310,427 10 0.12% Participants in Long Beach Unit 2,097,676 4 0.18% Universal Studios LLC 2,085,555 5 0.18% ASN Pasadena LLC 1,820,097 6 0.16% AT&T/Pacific Bell Telephone Co. 1,740,245 9 0.15% Total $ 44,517,825 2.26% $ 25,090,046 2.17% Note: (1) See schedule "Assessed Value and Actual Value of Taxable Property." Total assessed value, $1,957,239,851 as of June 30, 2024 is based on Secured $1,994,761,572 plus Unitary $25,839,957 less exemptions of $63,361,678. Total assessed value, $1,161,271,497 as of June 30, 2015 is based on Secured $1,197,665,178 plus Unitary $14,325,069 less exemptions of $50,718,750. (in thousands). Source: Los Angeles County Treasurer and Tax Collector 238 COUNTY OF LOS ANGELES PROPERTY TAX LEVIES AND COLLECTIONS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) Collections within the Fiscal Year of the Levy Total Collections to Date Collections in Percentage Subsequent Percentage Fiscal Year Taxes Levied Amount of Levy Years (1) Amount of Levy 2014 - 2015 $ 14,394,534 $ 14,167,462 98.4% $ 197,571 $ 14,365,033 99.8 % 2015 - 2016 14,906,832 14,704,346 98.6% 194,760 14,899,106 99.9 % 2016 - 2017 15,750,769 15,563,458 98.8% 187,311 15,750,769 100.0 % 2017 - 2018 16,910,307 16,685,415 98.7% 218,651 16,904,066 99.9 % 2018 - 2019 17,927,929 17,682,677 98.6% 245,252 17,927,929 100.0 % 2019 - 2020 19,059,924 18,611,655 97.6% 381,152 18,992,807 99.6 % 2020 - 2021 20,140,282 19,772,767 98.2% 313,735 20,086,502 99.7 % 2021 - 2022 20,660,286 20,320,487 98.4% 234,197 20,554,684 99.5 % 2022 - 2023 21,801,277 21,459,549 98.4% 194,636 21,654,185 99.3 % 2023 - 2024 23,562,951 23,110,953 98.1% (2) 23,110,953 98.1 % Notes: (1)Reflects property taxes levied in prior years but collected in the current year. (2)No amounts are shown in FY 2023-2024 because the property taxes levied will be collected in the following fiscal year. Source: Auditor-Controller-Accounting Division-Property Tax Section 239 COUNTY OF LOS ANGELES RATIO OF OUTSTANDING DEBT BY TYPE (UNAUDITED) LAST TEN FISCAL YEARS (In thousands, except per capita) Governmental Activities Certificates of Notes, Unamortized Financed Assessment Participation Loans, and Accreted Bond Leases Purchase Subscriptions Fiscal Year Bonds and Bonds Other Debt Interest Premiums (1) (1) (1) 2014 - 2015 $ 82,880 $ 852,579 $ 647,817 $ 167,904 $ 51,085 $ 166,320 2015 - 2016 50,610 1,031,590 389,706 164,005 85,091 158,410 2016 - 2017 38,895 1,008,101 341,541 158,759 83,846 151,941 2017 - 2018 26,575 964,557 393,882 152,040 82,158 162,606 2018 - 2019 13,620 1,226,880 575,119 143,725 124,277 156,887 2019 - 2020 1,249,978 625,629 7,820 170,221 148,826 2020 - 2021 1,581,957 645,072 4,421 230,545 156,781 2021 - 2022 1,868,738 424,125 9,192 294,346 1,419,492 29,816 2022 - 2023 1,799,091 448,183 14,227 289,086 1,578,192 22,750 85,925 2023 - 2024 1,749,162 512,499 19,533 282,828 1,574,849 15,572 83,947 Business-Type Activities Certificates of Notes, Unamortized Financed Total Primary Per Personal Participation Loans, and Bond Leases Purchase Government Income Per Capita Fiscal Year and Bonds Other Debt Premiums (1) (1) (2) (3) (3) 2014 - 2015 $ 787,537 $ 62,719 $ 34,186 2,853,027 0.55% $ 280 2015 - 2016 759,028 158,561 32,905 2,829,906 0.51% 276 2016 - 2017 746,678 170,673 32,004 2,732,438 0.47% 266 2017 - 2018 724,816 259,574 31,275 235 2,797,718 0.44% 277 2018 - 2019 703,836 331,690 30,118 165 3,306,317 0.50% 325 2019 - 2020 878,306 108,021 81,153 92 3,270,046 0.46% 323 2020 - 2021 856,538 214,484 79,709 43 3,769,550 0.52% 380 2021 - 2022 729,059 159,167 85,907 1,148 11 5,021,001 0.67% 509 2022 - 2023 709,169 125,331 85,405 1,731 5,159,090 0.69% 529 2023 - 2024 688,441 263,973 84,649 3,188 5,278,641 0.68% 537 Notes: (1) The County adopted GASB 87 in FY 2021-2022 and GASB 96 in FY 2022-2023; and prior year amounts were not restated. (2) Details regarding the County's outstanding debt can be found in the notes to the financial statements. (3) See the "Demographic and Economic Statistics" table for personal income and population. Source: Auditor-Controller, County of Los Angeles 240 COUNTY OF LOS ANGELES RATIO OF NET GENERAL BONDED DEBT (UNAUDITED) LAST TEN FISCAL YEARS (in thousands except ratio and per capita) Ratio of General Bonded Debt General Population Assessed General Bonded to Assessed Bonded Debt Fiscal Year (1) Value (1) Debt (2) Value per Capita 2014 - 2015 10,192 $ 1,207,856,231 0.000000 0.0000 2015 - 2016 10,240 1,282,507,245 0.000000 0.0000 2016 - 2017 10,278 1,354,458,675 0.000000 0.0000 2017 - 2018 10,106 1,435,385,951 0.000000 0.0000 2018 - 2019 10,184 1,529,882.495 0.000000 0.0000 2019 - 2020 10,136 1,625,539.871 0.000000 0.0000 2020 - 2021 9,931 1,724,138,383 0.000000 0.0000 2021 - 2022 9,835 1,785,802,728 0.000000 0.0000 2022 - 2023 9,819 (3) 1,911,287,084 0.000000 0.0000 2023 - 2024 9,824 (4) 2,024,462,522 0.000000 0.0000 Notes: (1) See "Demographic and Economic Statistics" table for population and "Assessed Value and Actual Value of Taxable Property" table for assessed value. (2) There has been no long-term general bonded debt outstanding for the ten fiscal years presented here. (3) Amount revised from prior year. (4) Amount is an estimate as of January 2024. Source: Los Angeles Almanac's website: www.laalmanac.com/population 241 COUNTY OF LOS ANGELES ESTIMATED DIRECT AND OVERLAPPING BONDED DEBT (UNAUDITED) June 30, 2024 2023-24 Net Assessed Valuation $ 2,024,462,522,168 Redevelopment Incremental Valuation 282,438,506,050 Full Cash Value (2023-24) 1,742,024,016,118 (1) Population - (2024) 9,824,000 (2) Percent Applicable Debt June 30, 2024 OVERLAPPING TAX AND ASSESSMENT DEBT: Metropolitan Water District 48.221 $ 8,781,044 Los Angeles Community College District 100 5,155,845,000 Other Community College Districts Various (3) 4,715,912,693 Arcadia Unified School District 100 247,145,000 Beverly Hills Unified School District 100 616,937,917 Glendale Unified School District 100 322,570,563 Long Beach Unified School District 100 1,718,791,399 Los Angeles Unified School District 100 10,723,385,000 Pasadena Unified School District 100 363,215,000 Pomona Unified School District 100 442,151,336 Redondo Beach Unified School District 100 195,066,803 Santa Monica-Malibu Unified School District 100 1,007,025,000 Torrance Unified School District 100 418,104,130 Other Unified School Districts Various (3) 4,957,211,339 High School and School Districts Various (3) 2,590,410,078 City of Los Angeles 100 948,610,000 City of Industry 100 12,930,000 Other Cities 100 35,853,440 Community Facilities Districts 100 741,005,007 1915 Act and Benefit Assessment Bonds - Estimate 100 99,278,019 TOTAL GROSS OVERLAPPING TAX AND ASSESSMENT DEBT $ 35,320,228,768 Less: Los Angeles Unified School District economically defeased general obligation bonds (299,495,000) TOTAL NET OVERLAPPING TAX AND ASSESSMENT DEBT $ 35,020,733,768 DIRECT GENERAL FUND DEBT: Los Angeles County General Fund Obligations 100 $ 4,238,390,000 (4) Subtotal Direct General Fund Obligation Debt $ 4,238,390,000 OVERLAPPING GENERAL FUND DEBT: Los Angeles County Office of Education Certificates of Participation 100 $ 2,857,300 Community College District General Fund Obligations Various (5) 43,009,602 Baldwin Park Unified School District General Fund Obligations 100 27,950,000 Compton Unified School District Certificates of Participation 100 21,965,000 Los Angeles Unified School District Certificates of Participation 100 471,590,000 Paramount Unified School District General Fund Obligations 100 18,904,000 Other Unified School District General Fund Obligations Various (5) 169,766,867 High School and Elementary School District General Fund Obligations Various (5) 155,565,939 City of Beverly Hills General Fund Obligations 100 62,565,000 Continued . . . . 242 COUNTY OF LOS ANGELES ESTIMATED DIRECT AND OVERLAPPING BONDED DEBT (UNAUDITED) - Continued June 30, 2024 City of Los Angeles General Fund Obligations 100 1,339,426,819 City of Long Beach General Fund Obligations 100 131,725,000 City of Pasadena General Fund Obligations 100 363,078,265 City of Pasadena Pension Obligation Bonds 100 128,115,000 Other Cities' General Fund Obligations and Pension Obligation Bonds 100 4,256,853,691 Subtotal Overlapping General Fund Debt $ 7,193,372,483 TOTAL GROSS DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 11,431,762,483 Less: Cities supported obligations (419,615,830) TOTAL NET DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 11,012,146,653 OVERLAPPING TAX INCREMENT DEBT (SUCCESSOR AGENCIES) $ 1,601,099,376 GROSS COMBINED TOTAL DEBT $ 48,353,090,627 (6) NET COMBINED TOTAL DEBT $ 47,633,979,797 TOTAL GROSS DIRECT DEBT $ 4,238,390,000 TOTAL NET DIRECT DEBT $ 4,238,390,000 TOTAL GROSS OVERLAPPING DEBT $ 44,114,700,627 TOTAL NET OVERLAPPING DEBT $ 43,395,589,797 RATIOS TO 2023-24 NET ASSESSED VALUATION Total Overlapping Tax and Assessment Debt 1.74 % RATIOS TO FULL CASH VALUE Gross Combined Direct Debt ($4,238,390,000) 0.24 % Net Combined Direct Debt ($4,238,390,000) 0.24 % Gross Combined Total Debt 2.78 % Net Combined Total Debt 2.73 % RATIOS TO REDEVELOPMENT INCREMENTAL VALUATION Total Overlapping Tax Increment Debt 0.57 % Notes: (1) This balance is reduced by homeowners exemptions of $6,639,125,251. (2) Yearly estimates from the Los Angeles Almanac. (3) All 100%, or almost 100%, except for Antelope Valley Joint Union High School and Community College District, Fullerton Union High School District, Las Virgenes Joint Unified School District, North Orange County Joint Community College District, and the schools and special districts included in them. (4) Includes Certificates of Participation and Bonds, Notes, Loans and Other Debt, Leases, Financed Purchase, and Subscriptions. (5) All 100%, or almost 100%, except for Fullerton Union High School District, Las Virgenes Joint Unified School District, Snowline Joint Unified School District, Victor Valley Joint Community College District, and the schools and special districts included in them. (6) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded lease obligations. Except for Los Angeles Unified School District Qualified Zone Academy Bonds (QZABs) are included based on principal due at maturity. Source: California Municipal Statistics - for general information purposes only. 243 COUNTY OF LOS ANGELES COMPUTATION OF LEGAL DEBT MARGIN (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) Total Net Legal Debt Margin / Fiscal Year Assessed Value (1) Legal Debt Limit (2) Applicable Debt Legal Debt Margin (3) Debt Limit 2014 - 2015 $ 1,207,856,231 $ 15,098,203 $ 15,098,203 100.00% 2015 - 2016 1,282,507,245 16,031,341 16,031,341 100.00% 2016 - 2017 1,354,458,675 16,930,733 16,930,733 100.00% 2017 - 2018 1,435,385,951 17,942,324 17,942,324 100.00% 2018 - 2019 1,529,882,495 19,123,531 19,123,531 100.00% 2019 - 2020 1,625,539,871 20,319,248 20,319,248 100.00% 2020 - 2021 1,724,138,383 21,551,730 21,551,730 100.00% 2021 - 2022 1,785,802,728 22,322,534 22,322,534 100.00% 2022 - 2023 1,911,287,084 23,891,089 23,891,089 100.00% 2023 - 2024 2,024,462,522 25,305,782 25,305,782 100.00% COMPUTATION OF LEGAL DEBT MARGIN June 30, 2024 Assessed valuation (net taxable) $ 2,024,462,522 Applicable percentage in computing capacity 1.25 % Total debt limit $ 25,305,782 Less: Total net applicable debt Legal debt margin, June 30, 2024 $ 25,305,782 Notes: (1) Assessed Value does not include tax exempt property. Property value data can be found in the "Assessed Value and Actual Value of Taxable Property" schedule. (2) The Legal Debt Limit is 1.25% of assessed value. (3) The Legal Debt Margin is the County's available borrowing authority under state finance statutes and is calculated by subtracting the debt applicable from the Legal Debt Limit. 244 COUNTY OF LOS ANGELES PLEDGED-REVENUE COVERAGE (UNAUDITED) LAST TEN FISCAL YEARS Calabasas Landfill Bond Fees Regional Park and Open Space Special Assessment Bond Debt Service Special Debt Service Revenue Total Assessment Total Fiscal Year Collected Principal Interest Debt Service Coverage Collection Principal Interest Debt Service Coverage 2014 - 2015 $ 545,354 $ 2,325,000 $ 1,090,709 $ 3,415,709 0.16 $ 80,090,000 $ 30,735,000 $ 4,997,513 $ 35,732,513 2.24 2015 - 2016 (1) 28,889,000 32,270,000 3,422,388 35,692,388 0.81 2016 - 2017 — 28,899,000 11,715,000 2,312,925 14,027,925 2.06 2017 - 2018 125,567,000 12,320,000 1,691,856 14,011,856 8.96 2018 - 2019 28,655,000 12,955,000 1,038,725 13,993,725 2.05 2019 - 2020 (2) 867,000 13,620,000 351,975 13,971,975 0.06 2020 - 2021 (3) 2021 - 2022 (3) — 2022 - 2023 (3) — 2023 - 2024 (3) — — — — Notes: (1) Disclosure for FY 2015-2016 and thereafter is not necessary for Calabasas Landfill Project Series 2005 due to refunding of the bond on September 2, 2015 by the issuance of Lease Revenue Refunding Bonds, 2015 Series B. (2) Disclosure for FY 2019-2020 and thereafter is not necessary for Regional Park and Open Space Special Assessment Bonds Series 2005A and 2007A due to the bonds being paid off on October 1, 2019. (3) There has been no new pledged-revenue debt obligations issued by the County. 245 COUNTY OF LOS ANGELES DEMOGRAPHIC AND ECONOMIC STATISTICS (UNAUDITED) LAST TEN FISCAL YEARS (in thousands) Population County of Per Capita School Unemployment Year Los Angeles * Personal Income * Personal Income (1) Enrollment (2) ** Rate * 2014 - 2015 10,192 $ 521,900,000 $ 51,207 1,539 6.9 % 2015 - 2016 10,240 557,382,000 54,432 1,523 5.1 % 2016 - 2017 10,278 585,515,000 56,968 1,511 4.6 % 2017 - 2018 10,106 628,809,000 62,221 1,493 4.6 % 2018 - 2019 10,184 658,900,000 64,700 1,464 4.5 % 2019 - 2020 10,136 708,700,000 69,919 1,437 13.6 % 2020 - 2021 9,931 728,400,000 73,346 1,390 9.6 % 2021 - 2022 9,835 722,300,000 73,442 1,337 4.9 % 2022 - 2023 9,819 (3) 746,900,000 (3) 76,067 (3) 1,314 5.1 % (3) 2023 - 2024 9,824 (4) 773,800,000 (5) 78,766 1,298 5.4 % (6) Notes: (1) Amounts shown are in actual dollars (not thousands). (2) Public school enrollment. (3) Amount revised from prior year. (4) Amount is an estimate as of January 2024. (5) Amount is a projection as of October 2024. (6) Amount is a projection as of February 2024. Sources: * Los Angeles Economic Development Corporation Economic Forecast's website: www.laedc.org. Los Angeles Almanac's website: www.laalmanac.com/population. UCLA Anderson Los Angles County Quarterly Forecast. ** California Department of Education's website: www.cde.ca.gov. 246 COUNTY OF LOS ANGELES TEN LARGEST INDUSTRIES (1) CURRENT YEAR AND NINE YEARS AGO June 30, 2024 June 30, 2015 Number of Percentage of Number of Percentage of Industry Employees Rank Total Employees Rank Total Educational & Health Services 947,400 1 20.62 % 729,600 2 17.06 % Trade, Transportation and Utilities 823,100 2 17.92 % 812,000 1 18.99 % Professional & Business Services 639,500 3 13.92 % 591,400 3 13.83 % Government 600,600 4 13.07 % 576,700 4 13.49 % Leisure & Hospitality 550,200 5 11.98 % 489,400 5 11.44 % Manufacturing 315,900 6 6.88 % 370,800 6 8.67 % Financial Activities 211,200 7 4.60 % 215,400 7 5.04 % Information 185,500 8 4.04 % 206,000 8 4.82 % Other Services 161,700 9 3.52 % 151,100 9 3.53 % Construction 152,000 10 3.31 % 125,800 10 2.94 % Ten largest industries 4,587,100 99.86 % 4,268,200 99.81 % All other industries 6,700 0.14 % 8,100 0.19 % Total industries 4,593,800 100.00 % 4,276,300 100.00 % Note: (1) We are presenting employment by industry because we have been unable to obtain employment numbers for individual employers. Source: State of California Employment Development Department's website: www.labormarketinfo.edd.ca.gov. 247 COUNTY OF LOS ANGELES FULL-TIME EQUIVALENT COUNTY EMPLOYEES BY FUNCTION / PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS Function / Program (1) and (2) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 General Government 10,571 10,764 10,902 11,093 11,378 11,399 11,109 10,903 11,126 11,575 Public Protection 33,537 33,664 33,694 32,877 32,850 32,920 32,295 31,210 30,304 29,795 Health and Sanitation 27,144 27,703 28,639 30,351 31,457 32,122 32,266 31,513 30,936 31,725 Public Assistance 20,808 21,376 21,913 21,963 22,015 22,023 22,684 22,851 22,400 23,131 Education 1,432 1,475 1,496 1,467 1,480 1,502 1,414 1,253 1,076 1,050 Recreation and Cultural Services 2,839 2,898 2,931 2,991 2,996 2,895 2,212 2,474 2,546 2,785 Total 96,331 97,880 99,575 100,742 102,176 102,861 101,980 100,204 98,388 100,061 Notes: (1) Full time equivalent count is calculated by dividing the total number of man-months paid by 12. Full time equivalent employees include all employees on the County's payroll system. (2) Specific data for Public Ways and Facilities is not available. Source: Employee Count study performed by the Auditor-Controller - Accounting Division. 248 COUNTY OF LOS ANGELES OPERATING INDICATORS BY FUNCTION / PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS Function / Program (1) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 General Government Assessor - Number of re-appraisable transfers processed 138,322 137,918 137,818 137,842 122,658 127,266 113,000 149,464 121,508 125,719 Auditor-Controller - Number of warrants issued monthly 189,729 177,203 177,256 170,648 177,148 162,027 138,975 148,277 149,007 146,989 Registrar-Recorder - Number of registered voters 6,394,639 6,517,088 6,611,486 6,726,161 7,010,957 7,168,621 7,295,459 7,381,491 6,053,968 6,204,387 Public Protection Sheriff - Inmate population (2) 19,041 16,740 16,713 17,114 16,797 15,914 14,312 13,366 13,882 12,335 Sheriff - Crime rate total (3) 235.6 250.3 262.34 242.17 230.23 211.39 212.39 232.63 255.66 262.29 Probation - Juvenile halls/camps population (4) 1,438 1,270 1,193 1,070 859 788 459 393 487 526 Health and Sanitation Health Services - Average daily inpatient census (5) 1,212 1,171 1,157 1,113 1,145 1,081 1,084 1,066 1,022 * 1,055 ** Health Services - Outpatient visits 2,793,000 3,013,000 2,654,000 2,797,000 2,866,000 2,661,000 2,869,000 2,924,000 * 2,619,000 * 2,486,000 ** Mental Health - Number of outpatient services to children and youth (6) 61,111 78,930 27,204 36,589 38,523 36,906 34,149 33,181 27,346 19,436 Public Assistance Children and Family Services - Child protective services caseloads 533,400 507,900 504,700 502,500 494,900 485,200 483,400 426,400 384,600 * 342,800 ** Children and Family Services - Adoption caseloads 22,700 22,300 22,200 22,400 22,900 23,400 23,300 22,600 22,900 * 23,900 ** Public Social Services - Average persons aided monthly thru CalWorks (7) 410,100 397,200 325,600 310,600 136,200 120,300 118,000 116,100 112,200 * 115,400 ** Public Social Services - Average number of indigents aided monthly 97,100 93,100 79,800 87,900 85,500 89,000 95,900 95,600 114,600 * 115,300 ** Aging and Disabilities - Number of vulnerable adults served (8) 38,558 42,341 44,692 47,696 44,703 44,338 39,889 34,131 38,046 44,286 Education LA County Library - Number of items which circulate to the public (9) 4,930,145 4,799,808 4,743,720 4,715,099 4,621,535 4,263,635 4,197,003 5,154,547 5,120,170 * 5,912,410 Recreation and Culture Museum of Art - Total education program participants (10) 530,163 526,919 554,799 512,343 524,206 488,754 316,799 300,243 378,938 422,125 Museum of Natural History - Annual attendance (11) 1,131,507 1,291,131 1,284,602 1,299,856 1,218,447 782,573 328,145 1,279,032 1,094,928 1,045,242 Parks and Recreation - Total passive and active park users (12) 11,626,319 11,824,089 11,883,209 14,249,371 13,954,419 5,818,520 3,355,267 5,278,546 5,394,731 15,776,965 Notes: (1) Indicators are not available for the Public Ways and Facilities function. (8) In FY 2022-2023, Workforce Development, Aging and Community Services Department (WDACS) was realigned to Aging and Disabilities Department and Economic Opportunity Department, with Aging and (2) The average length of stay that the inmates spent in jail in FY 2023-2024 has decreased to 84 days as compared to Disabilities Department providing service to vulnerable adults. an average of 88 days in FY 2022-2023. (3) Represents number of offenses per 10,000 residents and refers to most serious crimes. (9) In FYs 2019-2021, data reflected temporary business/facility closure and restrictions caused by the COVID-19 pandemic. In FY 2021-2022 and thereafter, data includes eBooks and eAudio. (4) FY 2023-2024 figure reflects 13 camps that are temporarily closed. (5) In FY 2016-2017, DHS completed its transition to utilize data from its new electronic health record system. The (10) FYs 2019-2023 data reflected temporary business/facility closure and restrictions caused by the new system is called Online Real-Time Centralized Health Information Database (ORCHID) that can address COVID-19 pandemic. the challenges posed by the Affordable Care Act (ACA) implemented on January 1, 2014. (6) In FY 2015-2016 and prior years, data reflected children 0-15 years of age. In FY 2016-2017 and thereafter, (11) FYs 2019-2023 data reflected temporary business/facility closure caused by the COVID-19 pandemic. data reflects a decline in statistics due to change in methodology to children 11-15 years of age. (7) CalWorks is California's program to administer the Federal Temporary Assistance for Needy Families block (12) Starting in FY 2017-2018 information includes the reporting attendance of local community parks. Passive grant that provides temporary financial support and supportive services to eligible adults with children to activities include walking, jogging, running, leisure, and picnic activities. FYs 2019-2023 data reflected enable them to transition from welfare to work and to achieve economic self-sufficiency. temporary business/facility closure caused by the COVID-19 pandemic. * Figures have been revised from previous publications. ** FY 2023-2024 data is an estimate. Source: FY 2024-2025 Recommended County Budget and Departments 249 COUNTY OF LOS ANGELES CAPITAL ASSET STATISTICS BY FUNCTION / PROGRAM (UNAUDITED) LAST TEN FISCAL YEARS Function / Program (1) 2014 - 2015 2015 - 2016 2016 - 2017 2017 - 2018 2018 - 2019 2019 - 2020 2020 - 2021 2021 - 2022 2022 - 2023 2023 - 2024 Public Protection Animal Shelters (2) 6 6 7 7 7 7 7 7 7 7 Public ways and facilities Miles of maintained County roads 3,187 3,187 3,185 3,185 3,289 3,290 3,290 3,289 3,281 3,284 Miles of unincorporated County bikeways 182 175 179 186 203 210 214 216 215 218 Airports 5 5 5 5 5 5 5 5 5 5 Dams 14 14 14 14 14 14 14 14 14 14 Storm drains, in miles 3,348 3,357 3,380 3,399 3,399 3,399 3,411 3,423 3,423 3,433 Flood pump stations 48 48 48 48 48 48 48 48 48 48 Health and Sanitation Hospitals 4 4 4 4 4 4 4 4 4 4 Health centers (3) 17 17 17 17 19 19 19 20 20 21 Education Libraries (4) 86 86 87 87 87 86 86 86 86 86 Bookmobiles 3 3 3 3 3 3 3 4 4 4 Recreation and Cultural services Museums 5 5 5 5 5 5 5 5 5 5 Arboretums and Botanic Gardens 4 4 4 4 4 4 4 4 4 4 Golf courses (5) 20 20 20 20 20 20 20 20 20 20 Beaches 15 15 15 15 15 15 15 15 15 15 Boat Slips 4,700 4,614 4,602 4,579 4,524 4,463 4,326 4,326 4,326 4,326 Notes: (1)No capital asset indicators are available for the General Government or Public Assistance functions. (2)On July 20, 2016, opening of Palmdale Animal Care Center. (3)In FY 2018-2019, the Department of Health Services (DHS) restructured phase I of their ambulatory care services. In FY 2023-2024, DHS began to restructure phase II of their ambulatory care services. On July 29, 2023, DHS added Alvarado Health Center. (4)Los Padrinos Juvenile Hall Library was added in FY 2016-2017 and was closed in FY 2019-2020. (5)On May 12, 2015, the Board approved to occupy, operate, and make improvements of Norwalk Golf Course. Source: FY 2023-2024 Final Budget book, Department of Animal Care and Control's website, Department of Health Services's website, Department of Parks and Recreation's website, and Department of Beaches and Harbor's website. 250