cdiacdocs.sto.ca.govcdiacdocs.sto.ca.gov/2015-1711.pdf · SUPPLEMENT TO OFFICIAL STATEMENT DATED...

SUPPLEMENT TO OFFICIAL STATEMENT DATED SEPTEMBER 1, 2015

$3,685,000CITY OF LOS ALAMITOS

2015 CERTIFICATES OF PARTICIPATION(BANK QUALIFIED)

Except as expressly supplemented hereby, the Official Statement dated September 1, 2015 has not beenamended or supplemented.

This Supplement to Official Statement (the “Supplement”) supplements the Official Statement datedSeptember 1, 2015 (the “Official Statement”) relating to the above-captioned certificates (the “Certificates”).This Supplement provides corrected information about the Certificates. Capitalized terms used herein and nototherwise defined have the meanings given such terms in the Official Statement.

The following table shall replace the table entitled “Schedule of Lease Payments” on Page 9 of theOfficial Statement.

September 15 Principal Interest Annual Total2016 $ 70,000 $ 146,842.45 $ 216,842.452017 70,000 139,568.76 209,568.762018 70,000 138,168.76 208,168.762019 75,000 136,768.76 211,768.762020 75,000 133,768.76 208,768.762021 80,000 130,768.76 210,768.762022 85,000 127,568.76 212,568.762023 85,000 123,318.76 208,318.762024 90,000 119,068.76 209,068.762025 95,000 114,568.76 209,568.762026 100,000 109,818.76 209,818.762027 105,000 104,818.76 209,818.762028 110,000 101,668.76 211,668.762029 110,000 98,368.76 208,368.762030 115,000 94,931.26 209,931.262031 120,000 91,193.76 211,193.762032 125,000 87,143.76 212,143.762033 125,000 82,925.00 207,925.002034 130,000 78,550.00 208,550.002035 135,000 74,000.00 209,000.002036 140,000 68,600.00 208,600.002037 150,000 63,000.00 213,000.002038 155,000 57,000.00 212,000.002039 160,000 50,800.00 210,800.002040 165,000 44,400.00 209,400.002041 175,000 37,800.00 212,800.002042 180,000 30,800.00 210,800.002043 190,000 23,600.00 213,600.002044 195,000 16,000.00 211,000.002045 205,000 8,200.00 213,200.00Total $3,685,000 $2,634,030.11 $6,319,030.11

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2015-1711

MATURITY SCHEDULE

(Base CUSIP©:† 544195)

Maturity Date(October 1)

PrincipalAmount Interest Rate Yield Price CUSIP©

2016 $70,000 2.000% 0.500% 101.556 AX82017 70,000 2.000% 0.860% 102.302 AY62018 70,000 2.000% 1.150% 102.533 AZ32019 75,000 4.000% 1.420% 110.098 BA72020 75,000 4.000% 1.650% 111.323 BB52021 80,000 4.000% 1.940% 111.69 BC32022 85,000 5.000% 2.130% 118.673 BD12023 85,000 5.000% 2.300% 119.718 BE92024 90,000 5.000% 2.420% 120.838 BF62025 95,000 5.000% 2.580% 121.286 BG42026 100,000 5.000% 2.700% 120.11C BH22027 105,000 3.000% 3.050% 99.498 BJ82028 110,000 3.000% 3.150% 98.404 BK52029 110,000 3.125% 3.250% 98.598 BL32030 115,000 3.250% 3.350% 98.824 BM12031 120,000 3.375% 3.450% 99.08 BN92032 125,000 3.375% 3.500% 98.404 BP42033 125,000 3.500% 3.550% 99.336 BQ22034 130,000 3.500% 3.600% 98.629 BR0

$425,000 4.000% Term Certificates due October 1, 2037, Price: 102.074C Yield: 3.750% CUSIP:† BS8$480,000 4.000% Term Certificates due October 1, 2040, Price: 101.238C Yield: 3.850% CUSIP:† BT6$945,000 4.000% Term Certificates due October 1, 2045, Price: 100.822C Yield: 3.900% CUSIP:† BU3

†CUSIP® is a registered trademark of the American Bankers Association. CUSIP Global Services (“CGS”) is managed on behalf of the AmericanBankers Association by S&P Capital I.Q. Copyright© 2015 CUSIP Global Services. All rights reserved. CUSIP® data herein is provided by CGS.CUSIP® numbers have been assigned by an independent company not affiliated with the City and are included solely for the convenience of theregistered owners of the Certificates. The City is not responsible for the selection or uses of these CUSIP® numbers, and no representation is madeas to their correctness on the Certificates or as included herein. The CUSIP® number for a specific maturity is subject to being changed after thedelivery of the Certificates as a result of various subsequent actions including, but no limited to, a refunding in whole or in part or as a result of theprocurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of certainmaturities of the Certificates.

C Priced to call on October 1, 2015.

CITY OF LOS ALAMITOS, CALIFORNIA

CITY COUNCIL

Richard D. Murphy, MayorTroy D. Edgar, Mayor Pro TemDean Grose, Council Member

Shelley Hasselbrink, Council MemberWarren Kusumoto, Council Member

CITY STAFF

Bret M. Plumlee, City ManagerJason Al-Imam, Administrative Services Director/Treasurer

Windmera Quintanar, City ClerkWallin, Kress, Reisman & Kranitz, LLP, City Attorney

SPECIAL SERVICES

Special Counsel and Disclosure Counsel

Best Best & Krieger LLPRiverside, California

Trustee and Escrow Bank

The Bank of New York Mellon Trust Company, N.A.Los Angeles, California

Municipal Advisor

Fieldman, Rolapp & Associates, Inc.Irvine, California

Verification Agent

Causey Demgen & Moore P.C.Denver, Colorado

1/'(.!-"&$!(+/$+/(,+"**0!*$%/!#*"+)2!

GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT

No Offering May Be Made Except by this Official Statement. No dealer, broker, salesperson or other person has beenauthorized to give any information or to make any representations with respect to the Certificates other than as contained in this OfficialStatement, and if given or made, such other information or representation must not be relied upon as having been authorized.

No Unlawful Offers or Solicitations. This Official Statement does not constitute an offer to sell or the solicitation of an offerto buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is notqualified to do so or to any person to whom it is unlawful to make such offer or solicitation.

Effective Date. This Official Statement speaks only as of its date, and the information and expressions of opinion contained inthis Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of theCertificates will, under any circumstances, create any implication that there has been no change in the affairs of the City or any otherparties described in this Official Statement.

Use of this Official Statement. This Official Statement is submitted in connection with the sale of the Certificates referred toherein and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not a contract with thepurchasers of the Certificates.

Preparation of this Official Statement. The information contained in this Official Statement has been obtained from sourcesthat are believed to be reliable, but this information is not guaranteed as to accuracy or completeness. The information and expressionsof opinions herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereundershall, under any circumstances, create any implication that there has been no change in the affairs of the City since the date hereof. ThisOfficial Statement is submitted in connection with the sale of the Certificates referred to herein and may not be reproduced or used, inwhole or in part, for any other purpose, unless authorized in writing by the City. All summaries of the Certificates, the Lease Agreement,the Trust Agreement or other documents, are made subject to the provisions of such documents and do not purport to be completestatements of any or all of such provisions. Reference is hereby made to such documents on file with the Administrative ServicesDirector for further information. See “INTRODUCTION—Summaries Not Definitive.”

The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewedthe information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securitieslaws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness ofsuch information.

Document References and Summaries. All references to and summaries of the Trust Agreement, the Lease Agreement orother documents contained in this Official Statement are subject to the provisions of those documents and do not purport to be completestatements of those documents.

Certificates are Exempt from Securities Laws Registration. The execution, sale and delivery of the Certificates have not beenregistered under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, in reliance uponexemptions for the execution, sale and delivery of municipal securities provided under Section 3(a)(2) of the Securities Act of 1933 andSection 3(a)(12) of the Securities Exchange Act of 1934.

Stabilization of Prices. In connection with this offering, the Underwriter may overallot or effect transactions which stabilize ormaintain the market price of the Certificates at a level above that which might otherwise prevail in the open market. Such stabilizing, ifcommenced, may be discontinued at any time. The Underwriter may offer and sell the Certificates to certain dealers and others at priceslower than the public offering prices set forth on the cover page hereof and said public offering prices may be changed from time to timeby the Underwriter.

Estimates and Projections. Certain statements included or incorporated by reference in this Official Statement constitute“forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E ofthe United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, asamended. Such statements are generally identifiable by the terminology used such as “plan,” “expect,” “estimate,” “budget” or othersimilar words.

THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICHMAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENTFROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE CITY DOES NOT PLAN TO ISSUE ANY UPDATES OR REVISIONS TO THOSE FORWARD-LOOKING STATEMENTS IF OR WHEN ITS EXPECTATIONS, OR EVENTS, CONDITIONS OR CIRCUMSTANCES ON WHICHSUCH STATEMENTS ARE BASED OCCUR.

TABLE OF CONTENTS

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INTRODUCTION............................................. 1General ...................................................... 1The City..................................................... 1Authority for the Certificates .................... 1Purpose ...................................................... 1Security for the Certificates....................... 1Abatement ................................................. 2Prepayment................................................ 2Limited Obligations................................... 2Summaries Not Definitive......................... 2

CONTINUING DISCLOSURE ........................ 3FINANCING PLAN ......................................... 3

Use of Bond Proceeds ............................... 3Verification................................................ 4

THE PROJECT AND THE LEASEDPREMISES................................................ 4Release of Property; Substitution .............. 4

ESTIMATED SOURCES AND USES OFFUNDS...................................................... 5

THE CERTIFICATES ...................................... 6General ...................................................... 6Prepayment of the Certificates .................. 6Book-Entry System ................................... 8Schedule of Lease Payments ..................... 9

SECURITY FOR THE CERTIFICATES ....... 10General .................................................... 10Lease Payments ....................................... 10Appropriation; Use of Leased

Premises........................................... 10Assignment; Recourse on Default ........... 11Insurance ................................................. 11Additional Payments ............................... 12

THE CITY....................................................... 12Profile of the City of Los Alamitos ......... 12City Council ............................................ 13Administrative Personnel ........................ 13Effect of State Budget on General

Fund Revenues ................................ 14Limitations on Remedies Available;

Bankruptcy ...................................... 14State Law Limitations on

Appropriations................................. 14Change in Law ........................................ 14Loss of Tax Exemption ........................... 14

CONSTITUTIONAL AND STATUTORYLIMITATIONS ON TAXES ANDAPPROPRIATIONS ............................... 15Article XIIIA of the California

Constitution ..................................... 15

Article XIIIB of the CaliforniaConstitution......................................16

Proposition 218 ........................................16Proposition 1A of 2004............................18Proposition 22 ..........................................18Proposition 26 ..........................................18Future Initiatives ......................................19

RISK FACTORS .............................................19Lease Payments Are Not Debt.................19Valid and Binding Covenant to Budget

and Appropriate ...............................19Earthquakes..............................................20Risk of Uninsured Loss............................20Abatement................................................20Hazardous Substances..............................21Eminent Domain ......................................21Bankruptcy...............................................21Limitations on Remedies .........................22Risk of Tax Audit ....................................22Loss of Tax Exemption............................22Limited Secondary Market ......................22Changes in Law .......................................23Impact of State Budget ............................23

ABSENCE OF LITIGATION .........................23CONTINUING DISCLOSURE.......................23CONCLUDING INFORMATION..................23

Sale of the Certificates .............................23Legal Opinion ..........................................24Tax Matters ..............................................24Litigation..................................................25Municipal Advisor ...................................25Ratings .....................................................26Miscellaneous ..........................................26

APPENDIX A - CITY OF LOS ALAMITOSGENERAL DEMOGRAPHIC ANDFINANCIAL INFORMATION ......A-1

APPENDIX B - SUMMARY OF PRINCIPALLEGAL DOCUMENTS.................. B-1

APPENDIX C - AUDITED FINANCIALSTATEMENTS OF THE CITY FORFISCAL YEAR 2013-14................. C-1

APPENDIX D - PROPOSED FORM OFFINAL OPINION ...........................D-1

APPENDIX E - FORM OF CONTINUINGDISCLOSURE CERTIFICATE ..... E-1

APPENDIX F - BOOK-ENTRYPROVISIONS ..................................F-1

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$3,685,000CITY OF LOS ALAMITOS

2015 CERTIFICATES OF PARTICIPATION(BANK QUALIFIED)

INTRODUCTION

This introduction contains only a brief summary of certain of the terms of the Certificates being offered,and a brief description of the Official Statement. All statements contained in this introduction are qualified intheir entirety by reference to the entire Official Statement.

General

The purpose of this Official Statement (which includes the cover page and the Appendices attachedhereto) is to provide information concerning the execution and delivery of the City of Los Alamitos’ (the“City”) 2015 Certificates of Participation (the “Certificates”).

The City

The City was incorporated in 1960 and operates as a charter City. The City operates under a council-manager form of government, and is governed by a five-member City Council elected at large with four-yearstaggered terms. The Mayor is elected by the Council Members every year. The positions of City Clerk, CityManager and City Attorney are filled by appointment of the City Council.

The City encompasses approximately 4.3 square miles in the north-western portion of Orange County(the “County”), about 30 miles south of downtown Los Angeles and approximately 60 miles north of San Diego.The current population of the City is approximately 11,779. For other selected information concerning the City,see APPENDIX A – “CITY OF LOS ALAMITOS GENERAL DEMOGRAPHIC AND FINANCIALINFORMATION” hereto.

Authority for the Certificates

The Certificates are being executed and delivered pursuant to the provisions of a Trust Agreement,dated as of September 1, 2015 (the “Trust Agreement”), among the City, the City of Los Alamitos PublicFacilities Corporation (the “Corporation”) and The Bank of New York Mellon Trust Company, N.A., as trustee(the “Trustee”).

Purpose

The proceeds of the sale of the Certificates will be used, together with other available moneys, (i) toadvance refund the City’s outstanding 2006 Certificates of Participation (Laurel Park Acquisition) (the “2006Certificates”), (ii) to provide funds to the City to finance the design, acquisition and construction of certainpublic facilities (the “Project”) and (iii) to pay certain costs of delivery of the Certificates. See “THE PROJECTAND THE LEASED PREMISES” and “ESTIMATED SOURCES AND USES OF FUNDS” herein.

Security for the Certificates

The Certificates evidence and represent undivided proportionate interest in the right to receive certainLease Payments and prepayments thereof. Lease Payments (as defined herein) will be made by the City to theCorporation for the right to the use and occupancy of certain real property and improvements thereon, includingcertain components of the Project (the “Leased Premises”). See “THE PROJECT AND THE LEASEDPREMISES – The Leased Premises” below. The Leased Premises will be leased by the City from theCorporation pursuant to a Lease Agreement, dated as of September 1, 2015 (the “Lease Agreement”), betweenthe City, as lessee, and the Corporation, as lessor.

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In accordance with the Lease Agreement, the City is required to pay to the Trustee specified LeasePayments for the Leased Premises which are designed to be sufficient to pay the principal and interest withrespect to the Certificates. See APPENDIX B – “SUMMARY OF PRINCIPAL LEGAL DOCUMENTS”herein.

The City has covenanted in the Lease Agreement to take all such actions as may be necessary to includeall Lease Payments in each of its annual budgets for the General Fund during the Term of the Lease Agreementand to make the necessary annual appropriations for all such Lease Payments and Additional Payments. Thecovenants of the City constitute duties imposed by law. In addition, the City has covenanted to maintain, orcause to be maintained, insurance on the Leased Premises. See “SECURITY FOR THE CERTIFICATES –Insurance” herein. However, the Lease Payments are subject to abatement in certain circumstances. See “–Abatement” below.

Pursuant to the Trust Agreement, the Corporation has assigned to the Trustee for the benefit of theOwners of the Certificates (i) its right to receive Lease Payments from the City under the Lease Agreement, (ii)all estate, right, title and interest of the Corporation in and to and all duties and obligations of the Corporationunder the Lease Agreement and (iii) all the moneys and securities deposited or required to be deposited with theTrustee pursuant to the Trust Agreement not expressly held for the benefit of the City.

Abatement

The amount of Lease Payments due under the Lease Agreement and, correspondingly, the amountavailable to pay the principal and interest with respect to the Certificates, will be subject to complete or partialabatement during any period in which, by reason of damage or destruction or eminent domain, there issubstantial interference with the use and possession by the City of the Leased Premises. The amount of theabatement will be determined by the City so that the resulting Lease Payments represent fair consideration forthe use and occupancy of the portions of the Leased Premises not damaged or destroyed. See “RISKFACTORS - Abatement” herein.

Amounts on deposit in the Lease Payment Fund and the Reserve Fund, and proceeds from any insuranceor eminent domain award, constitute a special fund for payment of Lease Payments, and will be available to payLease Payments in the event there is substantial interference with the use and possession of the LeasedPremises.

Prepayment

The Certificates are subject to optional, extraordinary and mandatory prepayment as described herein.

Limited Obligations

THE OBLIGATION OF THE CITY TO MAKE LEASE PAYMENTS IS AN OBLIGATIONPAYABLE EACH YEAR FROM THE CITY’S GENERAL FUND OR ANY SOURCE OF FUNDSLEGALLY AVAILABLE FOR THE PAYMENT OF LEASE PAYMENTS, BUT DOES NOT CONSTITUTEA DEBT OF THE CITY OR OF THE STATE OF CALIFORNIA OR OF ANY POLITICAL SUBDIVISIONTHEREOF WITHIN THE MEANING OF ANY STATUTORY OR CONSTITUTIONAL DEBTLIMITATION OR RESTRICTION, OR AN OBLIGATION FOR WHICH THE CITY OR THE STATE OFCALIFORNIA IS OBLIGATED TO LEVY OR PLEDGE ANY FORM OF TAXATION OR FOR WHICHTHE CITY OR THE STATE OF CALIFORNIA HAS LEVIED OR PLEDGED ANY FORM OF TAXATION.

Summaries Not Definitive

The summaries and references of documents, statutes, reports and other instruments referred to hereindo not purport to be complete, comprehensive or definitive, and each such summary and reference is qualified inits entirety by reference to each document, statute, report, or instrument. The capitalization of any word notconventionally capitalized, or otherwise defined herein, indicates that such word is defined in a particular

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agreement or other document and, as used herein, has the meaning given it in such agreement or document. SeeAPPENDIX B – “SUMMARY OF PRINCIPAL LEGAL DOCUMENTS” for summaries of certain of suchdefinitions.

Copies of the documents described herein will be available at the City Manager’s office, City of LosAlamitos, 3191 Katella Avenue, Los Alamitos, California 90720.

CONTINUING DISCLOSURE

The City has covenanted for the benefit of owners of the Certificates to provide certain financialinformation and operating data relating to the City by not later than nine months after the end of the City’sFiscal Year (presently June 30) in each year commencing with its report for fiscal year 2014-15 to be deliverednot later than April 1, 2016 (the “Annual Report”) and to provide notices of the occurrence of certainenumerated events. These covenants have been made in order to assist the Underwriter in complying withSecurities Exchange Commission Rule 15c2-12(b)(5). The specific nature of the information to be contained inthe Annual Report or the notices of material events by the City is contained in APPENDIX E – “FORM OFCONTINUING DISCLOSURE CERTIFICATE.”

Failure of the City to provide the required information at the required time may have a negative impacton the value of the Certificates in the secondary market. See “CONTINUING DISCLOSURE,” herein.

FINANCING PLAN

Use of Bond Proceeds

Proceeds from the sale of the Certificates, together with certain other available moneys, will be used to(i) advance refinance outstanding obligations of the City, (ii) finance the design, acquisition and construction ofnew public improvements, and (iii) pay costs incurred in connection with the execution, sale and delivery of theCertificates.

The City previously executed and delivered its $3,365,000 original principal amount of City of LosAlamitos 2006 Certificates of Participation (the “2006 Certificates”). The 2006 Certificates were executed anddelivered pursuant to Trust Agreement, dated as of May 1, 2006 (the “2006 Trust Agreement”), between theCity and the Trustee. As of July 1, 2015, $2,820,000.00 of the 2006 Certificates remain outstanding.

The City plans to apply a portion of the proceeds of the Certificates and certain other moneys to refundall outstanding obligations with respect to the 2006 Certificates. To effect such refunding, the City will cause aportion of the proceeds of the 2006 Certificates and certain other moneys to be deposited into the Escrow Fund(the “Escrow Fund”) established under the Escrow Deposit and Trust Agreement, dated as of September 1, 2015(the “Escrow Agreement”), by and between City and The Bank of New York Mellon Trust Company, N.A, asescrow bank (the “Escrow Bank”). Such amounts will be held in cash or invested in direct general obligationsof the United States of America (the “Defeasance Obligations”). Sufficiency of the deposits in the 2006 EscrowFund to pay such amounts will be verified by Causey Demgen & Moore P.C., Denver, Colorado (the“Verification Agent”).

With respect to the 2006 Certificates, cash and certain Defeasance Obligations will be scheduled tomature in such amounts and at such times and bear interest at such rates as to provide amounts sufficient to payregularly scheduled principal and interest with respect to the 2006 Certificates on and prior to September 1,2016 and to pay on September 1, 2016 the redemption price of the 2006 Certificates maturing after September 1,2016, without premium.

All cash and Defeasance Obligations in the Escrow Fund will be irrevocably pledged to secure, whendue, the payment of the principal, interest with respect to the 2006 Certificates and will not be available to paythe principal or interest on the Certificates.

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Assuming the accuracy of the Verification Agent’s computations, as a result of the deposit andinvestment of funds under the Escrow Agreement, all of the City’s obligations with respect to the 2006Certificates will be fully discharged upon the execution and delivery of the Certificates.

Verification

The Verification Agent will verify the mathematical accuracy of the information provided to theVerification Agent as of the date of the closing on the Certificates relating to the adequacy of the amountsdeposited in the Escrow Fund to pay regularly scheduled principal and interest with respect to the 2006Certificates on and prior to September 1, 2016 and to pay on September 1, 2016 the redemption price of the2006 Certificates maturing after September 1, 2016, and the computation of the yield of the 2006 Certificatesand the Certificates which support Special Counsel’s opinion that interest with respect to the Certificatesreceived by the Owners is excluded from gross income for federal income tax purposes.

THE PROJECT AND THE LEASED PREMISES

The following description contains a list of improvements eligible to be financed through the proceedsof the Certificates: Los Alamitos Boulevard revitalization project, upgrade of curb ramps and sidewalks forcompliance with the Americans with Disabilities Act, replacement of parks and playgrounds, rubberized groundcover, Little Cottonwood septic tank project, Old Dutch Haven Street rehabilitation, alley improvements, schooltraffic improvements, Old Dutch Haven block wall and purple pipe improvements.

The estimated costs of financing such improvements are as follows:

Project(1) AmountLos Alamitos Boulevard Revitalization Project $ 700,000ADA Curb Ramps & Sidewalks 300,000Parks Playground Replacement & Rubberized Ground Cover Project 227,500Little Cottonwood Park Septic Tank Project 110,000Old Dutch Haven Street Rehabilitation 292,000Alley Improvements 250,000School Traffic Improvements 228,000Old Dutch Haven Block Wall 30,000Purple Pipe Project 250,000

$2,387,500______________________(1) Not all of the eligible improvements will be financed through the proceeds of the Certificates.

The Leased Premises is the Laurel Park site. Laurel Park is a public park that is improved for variousrecreational uses. It has a baseball diamond and tennis courts, with the remaining fields landscaped with lawns,trees, shrubs and other vegetation. There is a public men’s/women’s restroom for park visitors. Parking isavailable to park-goers on an asphalt-concrete paved parking lot adjacent to the fields. The original value of theLeased Premises is $4.65 million. The value of the property for the purposes of the execution and delivery of theCertificates is the original purchase price of Laurel Park in May 2006.

Release of Property; Substitution

Under the Lease Agreement, the City has the option to substitute other land, facilities or improvementsfor the Leased Premises or any portion thereof or to release a portion of the Leased Premises from the lien of theLease Agreement, provided that the City satisfies all of the requirements set forth in the Lease Agreement.

The City is not entitled to any reduction, diminution, extension or other modification of the LeasePayments whatsoever as a result of such substitution or release.

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See APPENDIX B – “SUMMARY OF PRINCIPAL LEGAL DOCUMENTS – The Lease Agreement –Release and Substitution.”

ESTIMATED SOURCES AND USES OF FUNDS

The proceeds to be received from the sale of the Certificates are anticipated to be applied as follows:

SOURCES:Principal Amount of Certificates $3,685,000.00Plus Original Issue Premium 133,245.90Less Underwriter’s Discount (63,353.70)Plus Funds from 2006 Certificates Reserve Fund 220,186.12

Total Sources $3,975,078.32

USES:Escrow Fund(1) $2,942,014.07Project Fund(2) 915,000.00Delivery Costs Fund(3) 118,064.25

Total Uses: $3,975,078.32______________________(1) To refund and defease the 2006 Certificates.(2) To be used to finance the Project (see “THE PROJECT AND THE LEASED PREMISES” above).(3) The delivery costs include fees and expenses of the municipal advisor, special counsel, disclosure counsel and the

trustee, printing expenses, rating fee, title insurance and other costs.

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THE CERTIFICATES

General

The Certificates will be initially executed, delivered and registered as one fully registered certificate foreach maturity, without coupons, in the name of Cede & Co., as nominee of DTC. DTC will act as securitiesdepository of the Certificates. Individual purchases may be made in book-entry form only, in the principalamount of $5,000 and integral multiples thereof. Purchasers will not receive physical certificates representingtheir interest in the Certificates purchased. Principal and interest will be paid to DTC which will in turn remitsuch principal and interest to its participants for subsequent disbursement to the beneficial owners of theCertificates as described herein. So long as DTC’s book-entry system is in effect with respect to the Certificates,notices to Owners of the Certificates by the City or the Trustee will be sent to DTC. Notices and communicationby DTC to its participants, and then to the beneficial owners of the Certificates, will be governed byarrangements among them, subject to then effective statutory or regulatory requirements. See APPENDIX F –“BOOK-ENTRY PROVISIONS.”

In the event that such book-entry system is discontinued with respect to the Certificates, the City willcause the Trustee to execute and deliver replacements in the form of registered certificates and, thereafter, theCertificates will be transferable and exchangeable on the terms and conditions provided in the Trust Agreement.In addition, the following provisions would then apply: Payment of interest due with respect to any Certificateon any Interest Payment Date will be made to the person appearing on the Registration Books as the Ownerthereof as of the Regular Record Date immediately preceding such Interest Payment Date, such interest to bepaid by check mailed on the Interest Payment Date by first class mail to such Owner at his or her address as itappears on the Registration Books as of such Regular Record Date or, upon written request filed with theTrustee prior to the Regular Record Date by an Owner of at least $1,000,000 in aggregate principal amount ofCertificates, by wire transfer in immediately available funds to an account in the United States designated bysuch Owner in such written request. Any such written request will remain in effect until rescinded in writing bythe Owner. The principal and redemption price with respect to the Certificates at maturity or upon priorredemption shall be payable by check denominated in lawful money of the United States of America uponsurrender of the Certificates at the corporate trust office of the Trustee.

Interest with respect to the Certificates is payable on April 1 and October 1 of each year, commencingApril 1, 2016, and continuing to and including the date of maturity or prepayment, whichever is earlier.

Principal represented by the Certificates is payable on October 1 in each of the years, commencingOctober 1, 2016 and in the amounts set forth on the inside front cover of this Official Statement.

Any Certificate may be transferred upon the registration books kept by the Trustee by the person inwhose name it is registered, in person or by his duly authorized attorney, upon surrender of the Certificate forcancellation, accompanied by delivery of a written instrument of transfer in a form approved by the Trustee,duly executed.

Certificates may be exchanged at the corporate trust office of the Trustee for a like aggregate principalamount of Certificates of other authorized denominations of the same maturity. The Trustee may require thepayment by the Certificate Owner requesting such exchange of any tax or other governmental charge required tobe paid with respect to such exchange. The Trustee is not required to register the transfer or exchange of anyCertificate during the period the Trustee is selecting Certificates for prepayment or any certificate selected forprepayment.

Prepayment of the Certificates

Optional Prepayment. Certificates maturing on or after October 1,2026, are subject to prepayment inwhole or in part from prepayments made at the option of the City pursuant to the Lease Agreement on or afterOctober 1, 2025 or any date thereafter, at a prepayment price equal to the principal amount thereof plus a

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premium (as set forth in the following schedule) together with interest accrued with respect thereto to the datefixed for prepayment.

Mandatory Sinking Fund Prepayment. The Certificates maturing on October 1, 2037 are also subjectto mandatory sinking fund prepayment on October 1 in each year on or after October 1, 2035, by lot, at aprepayment price equal to the principal amount thereof, without premium, together with accrued interest to thedate of prepayment, from the principal component of the Lease Payment to be paid by the City pursuant to theLease Agreement with respect to each such prepayment date as follows:

Prepayment Date(October 1)

Principal Amount ofCertificates to be Prepaid

2035 $135,0002036 140,0002037 (Maturity) 150,000

The Certificates maturing on October 1, 2040 are also subject to mandatory sinking fund prepayment onOctober 1 in each year on or after October 1, 2038, by lot, at a prepayment price equal to the principal amountthereof, without premium, together with accrued interest to the date of prepayment, from the principalcomponent of the Lease Payment to be paid by the City pursuant to the Lease Agreement with respect to eachsuch prepayment date as follows:



2038 $155,0002039 160,0002040 (Maturity) 165,000

The Certificates maturing on October 1, 2045 are also subject to mandatory sinking fund prepayment onOctober 1 in each year on or after October 1, 2041, by lot, at a prepayment price equal to the principal amountthereof, without premium, together with accrued interest to the date of prepayment, from the principalcomponent of the Lease Payment to be paid by the City pursuant to the Lease Agreement with respect to eachsuch prepayment date as follows:



2041 $175,0002042 180,0002043 190,0002044 195,0002045 (Maturity) 205,000

In the event that the Trustee prepays Certificates in part, but not in whole, pursuant to the TrustAgreement an optional prepayment or a prepayment from Net Proceeds of insurance or condemnation, theamount of the Certificates to be prepaid in each subsequent year pursuant to a mandatory sinking fundprepayment will be modified to correspond to the principal components of the Lease Payments prevailingfollowing such prepayment.

In providing for the mandatory sinking fund prepayment of Certificates, the Trustee may, at the writtendirection of the City, utilizing funds on deposit in the Lease Payment Fund, purchase in the open marketCertificates in the full principal amount of the Certificates to be prepaid on any prepayment date, or any partthereof; provided that the City will not direct the Trustee to purchase Certificates for such purpose after the 75th

day preceding any such prepayment date, and provided further that the City shall not provide for the purchase ofCertificates, at a purchase price for any Certificate which exceeds the principal amount thereof. If the Trusteepurchases Certificates in a principal amount which is less than the full principal amount of the Certificates to beprepaid on the succeeding prepayment date, the Trustee shall, at the written direction of the City, prepay

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Certificates in a principal amount equal to the remainder of the principal amount of Certificates to be prepaid onsuch prepayment date.

Extraordinary Prepayment. The Certificates are also subject to mandatory prepayment on any April 1or October 1, in whole or in part, from the Net Proceeds of insurance or condemnation or sale of the LeasedPremises and Site, which Net Proceeds are deposited in the Lease Payment Fund and credited as a Prepaymentmade by the City pursuant to the Lease Agreement, at a prepayment price equal to the principal amount,together with accrued interest to the date fixed for prepayment, without premium.

Selection of Certificates for Prepayment. Except with respect to mandatory sinking fund prepayment,whenever less than all Outstanding Certificates are called for prepayment, the Trustee will select Certificates forprepayment, from the Outstanding Certificates not previously called for prepayment, such that, as nearly aspracticable, approximately equal principal, interest and mandatory sinking fund prepayment payments prevailwith respect to the Certificates in each Fiscal Year following the prepayment as determined by the City. TheTrustee will select Certificates for prepayment by lot within a maturity in any manner which the Trustee in itssole discretion deems appropriate and fair.

Notice of Prepayment. The Trustee will give notice of the prepayment specifying: (a) that theCertificates or a designated portion thereof are to be redeemed, (b) the date of prepayment, (c) the place orplaces where the prepayment will be made and (d) if money has been deposited to the appropriate fund oraccount under the Trust Agreement, that on the specified date there will become due and payable upon eachCertificate, the principal and premium, if any, together with interest accrued to said date, and that from and aftersuch date interest with respect thereto will cease to accrue and be payable. The City shall have the right torescind any notice of optional prepayment by written notice to the Trustee on or prior to the date fixed forredemption. Any notice of optional prepayment shall be cancelled and annulled if for any reason funds will notbe or are not available on the date fixed for prepayment for the payment in full of the Certificates then called forprepayment and such cancellation shall not constitute an Event of Default under the Trust Agreement. The Cityand the Trustee shall have no liability to the Owners or any other party related to or arising from such rescissionof prepayment. The Trustee shall mail notice of such rescission of prepayment in the same manner as theoriginal notice of prepayment was sent.

Notice of prepayment shall be mailed by first class postage prepaid to the Securities Depositories and toone or more of the Information Services, to the managing member of such syndicate and to the respectiveOwners of Certificates designated for prepayment at their addresses appearing on the Certificate registrationbooks at least 30 days but not more than 60 days prior to the prepayment date, which notice will, in addition tosetting forth the above information, set forth, in the case of each Certificate called only in part, the portion of theprincipal thereof which is to be redeemed.

The Trust Agreement provides that neither failure to receive a redemption notice nor any immaterialdefect in any notice will affect the sufficiency of the proceedings for the prepayment of Certificates.

Book-Entry System

DTC will act as securities depository for the Certificates. The Certificates will be executed anddelivered as fully-registered certificates registered in the name of Cede & Co. (DTC’s partnership nominee).One fully-registered Certificate will be executed and delivered for each maturity of the Certificates, each in theaggregate principal amount of such maturity, and will be deposited with DTC. See APPENDIX F – “BOOK-ENTRY PROVISIONS” herein.

The City and the Trustee cannot and do not give any assurances that DTC, DTC Participants or otherswill distribute payments of principal, interest or premium, if any, with respect to the Certificates paid to DTC orits nominee as the registered owner, or will distribute any prepayment notices or other notices, to the BeneficialOwners, or that they will do so on a timely basis or will serve and act in the manner described in this OfficialStatement. The City and the Trustee are not responsible or liable for the failure of DTC or any DTC Participant

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to make any payment or give any notice to a Beneficial Owner with respect to the Certificates or an error ordelay relating thereto.

Schedule of Lease Payments

The table below shows the annual Lease Payments owed by the City. The Lease Payments are duefifteen days prior to each Interest Payment Date.

October 1 Principal Interest Annual Total2016 - $ 146,842.45 $ 216,842.452017 $ 70,000 139,568.76 209,568.762018 70,000 138,168.76 208,168.762019 70,000 136,768.76 211,768.762020 75,000 133,768.76 208,768.762021 75,000 130,768.76 210,768.762022 80,000 127,568.76 212,568.762023 85,000 123,318.76 208,318.762024 85,000 119,068.76 209,068.762025 90,000 114,568.76 209,568.762026 95,000 109,818.76 209,818.762027 100,000 104,818.76 209,818.762028 105,000 101,668.76 211,668.762029 110,000 98,368.76 208,368.762030 110,000 94,931.26 209,931.262031 115,000 91,193.76 211,193.762032 120,000 87,143.76 212,143.762033 125,000 82,925.00 207,925.002034 125,000 78,550.00 208,550.002035 130,000 74,000.00 209,000.002036 135,000 68,600.00 208,600.002037 140,000 63,000.00 213,000.002038 150,000 57,000.00 212,000.002039 155,000 50,800.00 210,800.002040 160,000 44,400.00 209,400.002041 165,000 37,800.00 212,800.002042 175,000 30,800.00 210,800.002043 180,000 23,600.00 213,600.002044 190,000 16,000.00 211,000.002045 195,000 8,200.00 213,200.00Total $3,685,000 $2,634,030.11 $6,319,030.11

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SECURITY FOR THE CERTIFICATES

General

Lease Payments. In the Lease Agreement, the City agrees to pay the Lease Payments to the Corporationas rental for the use and occupancy of the Leased Premises. The Lease Payments are denominated intocomponents of principal and interest that correspond to the components of principal and interest with respect tothe Certificates.

The City covenants in the Lease Agreement to take such action as may be necessary to include all LeasePayments in its annual budgets and to make the necessary annual appropriations for all such Lease Payments.However, the obligation of the City to make Lease Payments (other than to the extent that funds to make LeasePayments are available in the Lease Payment Fund, or otherwise available from an insurance or eminent domainaward) may be abated in whole or in part if the City does not have use and possession of all or part of theLeased Premises.

Assignment of Rights to the Trustee. The Corporation, pursuant to the Trust Agreement, has assigned itsrights, including its right to receive Lease Payments and its remedies under the Lease Agreement, to the Trusteefor the benefit of the Owners of the Certificates.

Certificates. Each Certificate evidences and represents an undivided interest in the Lease Payments dueunder the Lease Agreement on the payment date or prepayment date of such Certificate.

Lease Payments

Lease Payments are required to be made by the City under the Lease Agreement 15 Business Days priorto each Interest Payment Date (individually, a “Lease Payment Date”), for use and possession of the LeasedPremises to the next occurring Lease Payment Date.

Lease Payments are required to be deposited in the Lease Payment Fund maintained by the Trustee.Pursuant to the Trust Agreement, on each Lease Payment Date the Trustee will withdraw from the LeasePayment Fund the amount of the Lease Payment then due and will apply such amounts to make principal andinterest payments due with respect to the Certificates.

Appropriation; Use of Leased Premises

The City covenants in the Lease Agreement to take such action as may be necessary to include all LeasePayments in its annual budgets and to make the necessary annual appropriations for all such Lease Payments.The Lease Agreement provides that this covenant shall be deemed to be and shall be construed to be a dutyimposed by law, and it shall be the duty of each and every public official of the City to take such action and dosuch things as are required by law in the performance of the official duty of such officials to enable the City tocarry out and perform the budget and appropriation covenant.

The Lease Agreement provides that the obligation of the City to pay Lease Payments constitutes acurrent expense of the City and shall not in any way be construed to be a debt of the City in contravention of anyapplicable constitutional or statutory limitation or requirement concerning the creation of indebtedness by theCity, and that nothing in the Lease Agreement constitutes a pledge of the general tax revenues, funds or moneysof the City. Lease Payments are payable only from current funds which are budgeted and appropriated, orotherwise legally available, for the purpose of paying Lease Payments as consideration for use of the LeasedPremises during the fiscal year of the City for which such funds were budgeted and appropriated or otherwisemade legally available for such purpose. The Lease Agreement does not create an immediate indebtedness forany aggregate payments which may become due thereunder. The City has not pledged the full faith and creditof the City, the State of California or any agency or department thereof to the payment of the Lease Payments,the Certificates or the interest thereon.

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Assignment; Recourse on Default

Pursuant to the Trust Agreement, the Corporation assigns to the Trustee for the benefit of the Owners ofthe Certificates its rights and remedies under the Lease Agreement, including its rights to receive amountspayable by the City under the Lease Agreement.

If the City defaults on its obligations under the Lease Agreement, the Trustee, as assignee of theCorporation, may exercise any and all remedies authorized by law or granted to the Corporation pursuant to theLease Agreement. The Lease Agreement expressly authorizes the Trustee, as assignee of the Corporation, to re-enter the Leased Premises for the purpose of removing persons and personal property and of re-letting theLeased Premises and, at its option, to terminate the Lease Agreement. In the event the Trustee, as assignee ofthe Corporation, does not elect to terminate the Lease Agreement, it may enforce the Lease Agreement and holdthe City liable for all Lease Payments and the performance of all conditions under the Lease Agreement. Anyre-entry and re-letting will not effect a surrender of the Lease Agreement. The City, in the event of default,waives all rights to any rentals received by the Trustee through re-letting of the Lease Agreement. The Cityagrees to pay any and all costs, loss or damage, howsoever occurring, as a result of any re-entry or re-letting.See “RISK FACTORS – Bankruptcy,” “- Limitation as Enforcement of Remedies” and “- No Acceleration”herein for a discussion of factors potentially limiting the available remedies in the event of a default.

The City may not mortgage, pledge, assign or transfer its interest in the Lease Agreement except asspecifically provided in the Lease Agreement. The Lease Agreement authorizes the City to sublease a portionof the Leased Premises in the circumstances described in APPENDIX B – “SUMMARY OF PRINCIPALLEGAL DOCUMENTS.”

Insurance

The Lease Agreement requires the City to maintain certain insurance with respect to the LeasedPremises (see APPENDIX B – “SUMMARY OF PRINCIPAL LEGAL DOCUMENTS - Lease Agreement”),including the policies described in the following paragraphs.

General Liability. The Lease Agreement requires the City to maintain a standard comprehensivegeneral liability insurance policy or policies in protection of the City, the Corporation and its members, officers,agents and employees, and the Trustee, with minimum liability limits of $1,000,000 for personal injury or deathof each person and $3,000,000 for personal injury or deaths of two or more persons in a single accident or event,and in a minimum amount of $250,000 for damage to property (subject to a deductible clause of not to exceed$200,000) resulting from a single accident or event. In the alternative, the public liability and property damageinsurance may be in the form of a single limit policy in the amount of $3,000,000 covering all such risks.

The liability insurance may be maintained as part of or in conjunction with any other liability insurancecoverage carried or required to be carried by the City, and may be maintained in whole or in part in the form ofself-insurance by the City.

Workers’ Compensation. The Lease Agreement requires the City to maintain workers’ compensationinsurance against liability for compensation under the Workers Compensation Insurance and Safety Act ofCalifornia or any similar law.

Fire and Extended Coverage. The Lease Agreement requires the City to maintain City insuranceagainst loss or damage to any structures constituting any part of the Leased Premises by fire and lightning, withextended coverage and vandalism and malicious mischief insurance. The extended coverage insurance must, asnearly as practicable, cover loss or damage by explosion, windstorm, riot, aircraft, vehicle damage, smoke andsuch other hazards as are normally covered by such insurance.

This insurance must be in an amount equal to the greater of (a) 100% of the replacement cost of suchstructures on the Leased Premises or (b) the principal amount of the outstanding Certificates. The fire andextended coverage insurance may be subject to deductible clauses of not to exceed $100,000 for any one loss,

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may be maintained as part of or in conjunction with any other fire and extended coverage insurance carried orrequired to be carried by the City, and may not be maintained in whole or in part in the form of self-insurance bythe City.

Rental Interruption or Use and Occupancy Insurance. The Lease Agreement requires the City tomaintain rental interruption or use and occupancy insurance to cover loss, total or partial, of the use of anystructures constituting any part of the Leased Premises as a result of any of the hazards covered in the fire andextended coverage policy, in an amount sufficient to pay the maximum Lease Payments with respect theretopayable in any 12-month period.

The Net Proceeds of an rental interruption or use and occupancy insurance will be paid to the Trusteeand deposited in the Lease Payment Fund, and will be credited towards the payment of the Lease Payments inthe order in which such Lease Payments come due and payable.

Title Insurance. Upon the execution and delivery of the Certificates the City will provide one or moreCLTA leasehold title insurance policies in the aggregate amount of not less than the initial principal amount ofthe Certificates with respect to the City’s leasehold interest in the Site. All Net Proceeds received under the titleinsurance policy will be deposited with the Trustee in the Lease Payment Fund and shall be credited towards theprepayment of the remaining Lease Payments. Because of the nature of the Streets, the City will not acquiretitle insurance covering the Streets.

No assurance can be given that insurance proceeds will be adequate to avoid an interruption of LeasePayments. Under such a situation, an abatement of Lease Payments is likely to occur. See “RISK FACTORS –Abatement” below.

Additional Payments

The City is responsible for all improvement, repair and maintenance of the Leased Premises, for thepayment of all utility services supplied to the Leased Premises, and for the cost of the repair and replacement ofthe Leased Premises resulting from ordinary wear and tear or want of care on the part of the City or any assigneeor lessee thereof.

The City will also pay all taxes and assessments of any type or nature payable during the Term of theLease Agreement.

THE CITY

The following information provides a general overview of the City:

Profile of the City of Los Alamitos

The City of Los Alamitos, which has a population of approximately 11,779 as of January 1, 2015 and is4.3 square miles, is located in the northwest section of Orange County. The City is located in SouthernCalifornia, 30 miles from downtown Los Angeles and 10 miles from Anaheim. The City is 10 miles northeastof the seaport terminal of Long Beach, and 13 miles northeast of the Port of Los Angeles. Neighboringcommunities include Long Beach, Seal Beach, Cypress and Garden Grove.

The City of Los Alamitos is a Charter City and was incorporated on March 1, 1960. The City has aCouncil-Member form of government. The City Council appoints the City Manager, who is responsible for theday-to-day administration of City business and the coordination of all City departments. The City Council iscomprised of five members elected bi-annually to four-year alternating terms. The City Council annually electsa Mayor from its members. The City employs a staff of 50 full-time employees.

The annual budget serves as the foundation for the City’s financial planning and control. The CityCouncil holds public hearings and adopts an annual budget resolution by July 1 of each fiscal year for all funds

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and account groups. The City Council may modify appropriations with majority approval. The budgets areadopted and presented on a basis consistent with generally accepted accounting principles, and are balanced atthe time of adoption.

Changes in budget appropriations at the fund level during the year must be approved by the CityCouncil. The legal level of expenditures is controlled at the fund level, and appropriations lapse at the end ofeach fiscal year unless encumbered for re-appropriations by the City Council in the following fiscal year.Department heads may, without Council approval, amend individual line items within any fund in themaintenance and operations portions of the budget without increasing total appropriations for that division. TheCity Manager may, without divisions and programs, in the personnel costs, maintenance and operations, capitaloutlay and capital projects portions of the budget without increasing total appropriations for that fund.

City Council

The City was incorporated in 1960 and operates as a charter city. The City operates under a council-member form of government, and is governed by a five-member City Council elected at large with four-yearstaggered terms. The Mayor is elected by the Council Members each year. The positions of City Clerk, CityManager and City Attorney are filled by appointment of City Council. The following are the current membersof the City Council:

CITY COUNCIL

Councilmember Term ExpiresRichard D. Murphy, Mayor November 2016Troy D. Edgar, Mayor Pro-Tem November 2018Dean Grose, Council Member November 2016Shelley Hasselbrink, Council Member November 2018Warren Kusumoto, Council Member November 2018

Administrative Personnel

City Manager. Bret Plumlee was appointed City Manager in November 2013. Mr. Plumlee has workedin seven different cities in a variety of positions since 1984. He worked in various positions over the years asFinance Director, Administrative Services Director and Assistant City Manager. His career has progressed fromAdministrative Intern in the Finance Department at the City of La Mirada in 1987 to Assistant City Manager atthe City of La Quinta in 2007. He has been a City Manager for the past 4 years.

He was City Manager at the City of La Puente from 2011 through 2013, and he is currently working asthe City Manager in the City of Los Alamitos where he started in November 2013. Mr. Plumlee has aBachelor’s Degree in Economics from University California at Irvine and a Bachelor’s Degree in Accountingfrom California State University at Long Beach.

Administrative Services Director/Treasurer. Jason Al-Imam joined the City of Los Alamitos inNovember 2014 where he serves as the Administrative Services Director and Treasurer. Prior to joining theCity of Los Alamitos, Mr. Al-Imam served as Controller for the City of Riverside from 2009 to 2014 and from2003 to 2009 Mr. Al-Imam worked in public accounting working predominantly in the performance of audits ofcity governments. Mr. Al-Imam holds a Bachelor of Arts in Business Administration from Vanguard Universityof Southern California

See APPENDIX A - “CITY OF LOS ALAMITOS GENERAL DEMOGRAPHIC AND FINANCIALINFORMATION” for a general description of the City as well as certain demographic and statisticalinformation.

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Effect of State Budget on General Fund Revenues

State budgets and budget policies can have either a positive or a negative effect on the City’s financialcondition. State budgets are affected by national and State economic conditions and other factors over whichthe City has no control. The City monitors fiscal measures taken by the State for their potential effects on theCity’s General Fund revenues and expected cash flows. To the extent that the State budget process results inreduced revenues to the City, the City will be required to make adjustments to its budget. See APPENDIX A –“CITY OF LOS ALAMITOS GENERAL DEMOGRAPHIC AND FINANCIAL INFORMATION.”

Limitations on Remedies Available; Bankruptcy

The enforceability of the rights and remedies of the Owners and the obligations of the City may becomesubject to the following: the federal bankruptcy code and applicable bankruptcy, insolvency, reorganization,moratorium, or similar laws relating to or affecting the enforcement of creditors’ rights generally, now orhereafter in effect; usual equitable principles which may limit the specific enforcement under state law of certainremedies; the exercise by the United States of America of the powers delegated to it by the Federal Constitution;and the reasonable and necessary exercise, in certain exceptional situations, of the police power inherent in thesovereignty of the State of California and its governmental bodies in the interest of servicing a significant andlegitimate public purpose.

The opinions of counsel, including Special Counsel, delivered in connection with the execution anddelivery of the Certificates will be so qualified. Bankruptcy proceedings, or the exercising of powers by thefederal or state government, if initiated, could subject the Owners to judicial discretion and interpretation oftheir rights in bankruptcy or otherwise and consequently may entail risks of delay, limitation, or modification oftheir rights.

In addition, failure by large property owners to pay property taxes when due may have an adverseimpact on revenues available to pay Lease Payments.

State Law Limitations on Appropriations

Article XIIIB of the California Constitution limits the amount that local governments can appropriateannually. The ability of the City to make Lease Payments may be affected if the City should exceed itsappropriations limit. The State may increase the appropriation limit of cities in the State by decreasing theState’s own appropriation limit. The City does not anticipate exceeding its appropriations limit. See“CONSTITUTIONAL AND STATUTORY LIMITATIONS ON TAXES AND APPROPRIATIONS - ArticleXIIIB of the California Constitution” below.

Change in Law

No assurance can be given that the State or the City electorate will not at some future time adoptinitiatives, or that the State Legislature will not enact legislation that will amend the laws of the State, or that theCity Council (with voter approval) will not enact amendments to the City’s Charter, in a manner that couldresult in a reduction of the City’s revenues and therefore a reduction of the funds legally available to the City tomake Lease Payments. See, for example, “CONSTITUTIONAL AND STATUTORY LIMITATIONS ONTAXES AND APPROPRIATIONS – Proposition 218.”

Loss of Tax Exemption

As discussed under “CONCLUDING INFORMATION - Tax Matters” herein, the interest representedby the Certificates could become includable in gross income for purposes of federal income taxation retroactiveto the date such Certificates were executed and delivered, as a result of future acts or omissions of the City inviolation of its covenants in the Trust Agreement and the Lease Agreement. Should such an event of taxabilityoccur, the Certificates are not subject to early prepayment and will remain outstanding until maturity or untilprepaid under one of the prepayment provisions contained in the Trust Agreement.

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CONSTITUTIONAL AND STATUTORYLIMITATIONS ON TAXES AND APPROPRIATIONS

Article XIIIA of the California Constitution

On June 6, 1978, California voters approved an amendment (commonly known as both Proposition 13and the Jarvis-Gann Initiative) to the California Constitution. This amendment, which added Article XIIIA tothe California Constitution, among other things affects the valuation of real property for the purpose of taxationin that it defines the full cash property value to mean the “county assessor’s valuation of real property as shownon the 1975-76 tax bill under “full cash value,” or thereafter, the appraised value of real property newlyconstructed, or when a change in ownership has occurred after the 1975 assessment.” The full cash value maybe adjusted annually to reflect inflation at a rate not to exceed 2% per year, or a reduction in the consumer priceindex or comparable local data at a rate not to exceed 2% per year, or reduced in the event of declining propertyvalue caused by damage, destruction or other factors including a general economic downturn. The amendmentfurther limits the amount of any ad valorem tax on real property to one percent of the full cash value except thatadditional taxes may be levied to pay debt service on indebtedness approved by the voters prior to July 1, 1978,and bonded indebtedness for the acquisition or improvement of real property approved on or after July 1, 1978by two-thirds of the votes cast by the voters voting on the proposition.

Legislation enacted by the California Legislature to implement Article XIIIA provides that all taxableproperty is shown at full assessed value as described above. In conformity with this procedure, all taxableproperty value included in this Official Statement (except as noted) is shown at 100% of assessed value and allgeneral tax rates reflect the $1 per $100 of taxable value. Tax rates for voter approved bonded indebtedness andpension liability are also applied to 100% of assessed value.

The voters of the State subsequently approved various measures which further amended Article XIIIA.One such amendment generally provides that the purchase or transfer of (i) real property between spouses or (ii)the principal residence and the first $1,000,000 of the Full Cash Value of other real property between parentsand children, do not constitute a “purchase” or “change of ownership” triggering reappraisal under ArticleXIIIA. Other amendments permitted the State Legislature to allow persons over the age of 55 who meet certaincriteria or “severely disabled homeowners” who sell their residence and buy or build another of equal or lesservalue within two years in the same county, to transfer the old residence’s assessed value to the new residence.Other amendments permit the State Legislature to allow persons who are either 55 years of age or older, or whoare “severely disabled,” to transfer the old residence’s assessed value to their new residence located in either thesame or a different county and acquired or newly constructed within two years of the sale of their old residence.

In the November 1990 election, the voters approved an amendment of Article XIIIA to permit the StateLegislature to exclude from the definition of “new construction” certain additions and improvements, includingseismic retrofitting improvements and improvements utilizing earthquake hazard mitigation technologiesconstructed or installed in existing buildings after November 6, 1990.

Article XIIIA has also been amended to provide that there would be no increase in the Full Cash Valuebase in the event of reconstruction of the property damaged or destroyed in a disaster.

Section 51 of the California Revenue and Taxation Code permits county assessors who have reduced theassessed valuation of a property as a result of natural disasters, economic downturns or other factors, tosubsequently “recapture” such value (up to the pre-decline value of the property) at an annual rate higher than2%, depending on the assessor’s measure of the restoration of value of the damaged property.

Section 4 of Article XIIIA also provides that cities, counties and special districts cannot, without a two-thirds vote of the qualified electors, impose special taxes, which has been interpreted to include special fees inexcess of the cost of providing the services or facility for which the fee is charged, or fees levied for generalrevenue purposes.

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Both the California State Supreme Court and the United States Supreme Court have upheld the validityof Article XIIIA.

Article XIIIB of the California Constitution

On November 6, 1979, California voters approved Proposition 4, the Gann Initiative, which addedArticle XIIIB to the California Constitution. In June 1990, Article XIIIB was amended by the voters throughtheir approval of Proposition 111. Article XIIIB of the California Constitution limits the annual appropriationsof the State and any city, county, school district, authority or other political subdivision of the State to the levelof appropriations for the prior fiscal year, as adjusted annually for changes in the cost of living, population andservices rendered by the governmental entity. The “base year” for establishing such appropriation limit is fiscalyear 1978-79. Increases in appropriations by a governmental entity are also permitted (1) if financialresponsibility for providing services is transferred to the governmental entity, or (2) for emergencies so long asthe appropriations limits for the three years following the emergency are reduced to prevent any aggregateincrease above the Constitutional limit. Decreases are required where responsibility for providing services istransferred from the government entity.

Appropriations subject to Article XIIIB include generally any authorization to expend during the fiscalyear the proceeds of taxes levied by the State or other entity of local government, exclusive of certain Statesubventions, refunds of taxes, benefit payments from retirement, unemployment insurance and disabilityinsurance funds. Appropriations subject to limitation pursuant to Article XIIIB do not include debt service onindebtedness existing or legally authorized as of January 1, 1979, on bonded indebtedness thereafter approvedaccording to law by a vote of the electors of the issuing entity voting in an election for such purpose,appropriations required to comply with mandates of courts or the Federal government, appropriations forqualified outlay projects, and appropriations by the State of revenues derived from any increase in gasoline taxesand motor vehicle weight fees above January l, 1990 levels. “Proceeds of taxes” include, but are not limited to,all tax revenues and the proceeds to any entity of government from (1) regulatory licenses, user charges, anduser fees to the extent such proceeds exceed the cost of providing the service or regulation, (2) the investment oftax revenues and (3) certain State subventions received by local governments. As amended by Proposition 111,the appropriations limit is tested over consecutive two-year periods. Any excess of the aggregate “proceeds oftaxes” received by the City over such two-year period above the combined appropriations limits for those twoyears is to be returned to taxpayers by reductions in tax rates or fee schedules over the subsequent two years.

Article XIIIB permits any government entity to change the appropriations limit by vote of the electoratein conformity with statutory and Constitutional voting requirements, but any such voter-approved change canonly be effective for a maximum of four years.

The City’s appropriation limit was $16,416,571 for fiscal year 2013-14 and $16,531,136 for fiscal year2014-15, which is well above the total City budget amounts for both years.

Proposition 218

On November 5, 1996, the voters of the State approved Proposition 218, a constitutional initiative,entitled the “Right to Vote on Taxes Act” (“Proposition 218”). Proposition 218 added Articles XIIIC and XIIIDto the California Constitution and contained a number of interrelated provisions affecting the ability of localgovernments, including the City, to levy and collect both existing and future taxes, assessments, fees andcharges.

Article XIIIC requires that all new local taxes be submitted to the electorate before they becomeeffective. Taxes for general governmental purposes of the City require a majority vote and taxes for specificpurposes, even if deposited in the City’s general fund, require a two-thirds vote. Further, any general purposetax that the City imposed, extended or increased without voter approval after December 31, 1994 may continueto be imposed only if approved by a majority vote in an election held within two years of November 5, 1996.The City has not enacted, imposed, extended or increased any tax without voter approval since January 1, 1995.These voter approval requirements of Proposition 218 reduce the flexibility of the City to raise revenues through

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general fund taxes, and no assurance can be given that the City will be able to impose, extend or increase suchtaxes in the future to meet increased expenditure requirements.

Article XIIIC also expressly extends to voters the power to reduce or repeal local taxes, assessments,fees and charges through the initiative process, regardless of the date such taxes, assessments, fees or chargeswere imposed. This extension of the initiative power is not limited by the terms of Proposition 218 to feesimposed after November 6, 1996 and absent other legal authority could result in retroactive reduction in anyexisting taxes, assessments or fees and charges. SB 919 provides that the initiative powers extended to votersunder Article XIIIC likely excludes actions construed as impairment of contracts under the contract clause of theUnited States Constitution. SB 919 provides that the initiative power provided for in Proposition 218 “shall notbe construed to mean that any owner or beneficial owner of a municipal security, purchased before or afterNovember 6, 1998, assumes the risk of, or in any way consents to, any action by initiative measure thatconstitutes an impairment of contractual rights” protected by the United States Constitution. However, noassurance can be given that the voters of the City will not, in the future, approve an initiative which reduces orrepeals local taxes, assessments, fees or charges that currently are deposited into the City’s general fund.Further, “fees” and “charges” are not defined in Article XIIIC or SB 919, and it is unclear whether these termsare intended to have the same meanings for purposes of Article XIIIC as they do in Article XIIID. Accordingly,the scope of the initiative power under Article XIIIC could include all sources of general fund monies notreceived from or imposed by the Federal or State government or derived from investment income.

The initiative power granted under Article XIIIC of Proposition 218, by its terms, applies to all localtaxes, assessments, fees and charges. The City is unable to predict whether the courts will ultimately interpretthe initiative provision to be limited to property related local taxes, assessments, fees and charges. No assurancecan be given that the voters of the City will not, in the future, approve an initiative which reduces or repealslocal taxes, assessments, fees or charges which are deposited into the City’s general fund. The City believes thatin the event that the initiative power was exercised so that all local taxes, assessments, fees and charges whichmay be subject to the provisions of Proposition 218 are reduced or substantially reduced, the financial conditionof the City, including its general fund, would be materially adversely affected. As a result, there can be noassurances that the City would be able to pay the Lease Payments as and when due or any of its otherobligations payable from the general fund.

Article XIIID of Proposition 218 adds several new requirements to make it more difficult for localagencies to levy and maintain “assessments” for municipal services and programs. “Assessment” is defined inProposition 218 and SB 919 as any levy or charge upon real property for a special benefit conferred upon thereal property. This includes maintenance assessments imposed in City service areas and in special districts. Inmost instances, in the event that the City is unable to collect assessment revenues relating to specific programsas a consequence of Proposition 218, the City will curtail such services rather than use amounts in the generalfund to finance such programs. Accordingly, the City anticipates that any impact Proposition 218 may have onexisting or future taxes, fees, and assessments will not adversely affect the ability of the City to pay the LeasePayments as and when due. However, no assurance can be given that the City may or will be able to reduce oreliminate such services in the event the assessments that presently finance them are reduced or repealed.

Article XIIID also adds several provisions, including notice requirements and restrictions on use,affecting “fees” and “charges” which are defined as “any levy other than an ad valorem tax, a special tax, or anassessment, imposed by a local government upon a parcel or upon a person as an incident of propertyownership, including a user fee or charge for a property related service.” The annual amount of revenues that arereceived by the City and deposited into its general fund which may be considered to be property related fees andcharges under Article XIIID of Proposition 218 is not substantial. Accordingly, presently the City does notanticipate that any impact Proposition 218 may have on future fees and charges will adversely affect the abilityof the City to pay the Lease Payments as and when due. However, no assurance can be given that the City mayor will be able to reduce or eliminate such services in the event the fees and charges that presently finance themare reduced or repealed.

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Additional implementing legislation respecting Proposition 218 may be introduced in the Statelegislature from time to time that would supplement and add provisions to California statutory law. Noassurance may be given as to the terms of such legislation or its potential impact on the City.

Proposition 1A of 2004

Proposition 1A, proposed by the Legislature in connection with the 2004-05 Budget Act, approved bythe voters in November 2004 and effective in fiscal year 2006-07, provides that the State may not reduce anylocal sales tax rate, limit existing local government authority to levy a sales tax rate or change the allocation oflocal sales tax revenues, subject to certain exceptions. Proposition 1A generally prohibits the State from shiftingto schools or community colleges any share of property tax revenues allocated to local governments for anyfiscal year, as set forth under the laws in effect as of November 3, 2004. Any change in the allocation ofproperty tax revenues among local governments within a county must be approved by two-thirds of both housesof the Legislature. Proposition 1A provides, however, that beginning in Fiscal Year 2008-09, the State may shiftto schools and community colleges up to 8% of local government property tax revenues, which amount must berepaid, with interest, within three years, if the Governor proclaims that the shift is needed due to a severe Statefinancial hardship, the shift is approved by two-thirds of both houses and certain other conditions are met. Suchshifting occurred in the 2009-10 Fiscal Year. The State may also approve voluntary exchanges of local sales taxand property tax revenues among local governments within a county. Proposition 1A also provides that if theState reduces the VLF rate then in effect, 0.65 percent of vehicle value, the State must provide localgovernments with equal replacement revenues. Further, Proposition 1A requires the State, beginning July 1,2005, to suspend State mandates affecting cities, counties and special districts, excepting mandates relating toemployee rights, schools or 25 community colleges, in any year that the State does not fully reimburse localgovernments for their costs to comply with such mandates.

Proposition 1A may result in increased and more stable City revenues. The magnitude of such increaseand stability is unknown and would depend on future actions by the State. However, Proposition 1A could alsoresult in decreased resources being available for State programs. This reduction, in turn, could affect actionstaken by the State to resolve budget difficulties. Such actions could include increasing State taxes, decreasingspending on other State programs or other action, some of which could be adverse to the finances of the City.

Proposition 22

Proposition 22, entitled “The Local Taxpayer, Public Safety and Transportation Protection Act,” wasapproved by the voters of the State in November 2010. Proposition 22 eliminates or reduces the State’s authorityto (i) temporarily shift property taxes from cities, counties and special districts to schools, (ii) use vehicle licensefee revenues to reimburse local governments for State-mandated costs (the State will have to use other revenuesto reimburse local governments), (iii) redirect property tax increment from redevelopment agencies to any otherlocal government, (iv) use State fuel tax revenues to pay debt service on State transportation Bonds, or (v)borrow or change the distribution of State fuel tax revenues.

Proposition 26

On November 2, 2010, the voters passed Proposition 26, which amends the State Constitution to requirethat certain State and local fees be approved by two-thirds of each house of the Legislature instead of a simplemajority, or by local voters. The change in law affects regulatory fees and charges such as oil recycling fees,hazardous materials fees and fees on alcohol containers.

Proposition 26 included a provision that repealed State laws enacted between January 1, 2010, andNovember 2, 2010, that raised fees by a simple majority vote unless they were approved again by two-thirds ofeach house of the Legislature. The repeal become effective November, 2011.

The Legislative Analyst’s Office was unable to specify Proposition 26’s anticipated fiscal impact, but itestimated that passage of Proposition 26 would reduce government revenues and spending over time by up tobillions of dollars annually compared to what otherwise would have occurred.

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Future Initiatives

Article XIIIA, Article XIIIB, Proposition 218, Proposition 1A and Proposition 22 were each adopted asmeasures that qualified for the ballot pursuant to the State’s initiative process. From time to time, other initiativemeasures could be adopted, which may place further limitations on the ability of the State, the City or localdistricts to increase revenues or to increase appropriations which may affect the City’s revenues or its ability toexpend its revenues.

RISK FACTORS

This section provides a general overview of certain risk factors which should be considered, in additionto the other matters set forth in this Official Statement, in evaluating an investment in the Certificates. Thissection is not meant to be a comprehensive or definitive discussion of the risks associated with an investment inthe Certificates, and the order in which this information is presented does not necessarily reflect the relativeimportance of various risks. Potential investors in the Certificates are advised to consider the following factors,among others, and to review this entire Official Statement to obtain information essential to the making of aninformed investment decision. Any one or more of the risk factors discussed below, among others, could lead toa decrease in the market value and/or in the marketability of the Certificates. There can be no assurance thatother risk factors not discussed herein will not become material in the future.

Lease Payments Are Not Debt

The obligation of the City to make the Lease Payments under the Lease Agreement does not constitutean obligation of the City for which the City is obligated to levy or pledge any form of taxation or for which theCity has levied or pledged any form of taxation. The obligation of the City to make Lease Payments does notconstitute a debt of the City, the State of California or any political subdivision thereof within the meaning ofany constitutional or statutory debt limitation or restriction.

Although the Lease Agreement does not create a pledge, lien or encumbrance upon the funds of theCity, the City is obligated under the Lease Agreement to pay the Lease Payments from any source of legallyavailable funds and the City has covenanted in the Lease Agreement that, for so long as the Property is availablefor its use, it will make the necessary annual appropriations within its budget for the Lease Payments. The Cityis currently liable and may become liable on other obligations payable from general revenues, some of whichmay have a priority over the Lease Payments, or which the City, in its discretion, may determine to pay prior tothe Lease Payments.

The City has the capacity to enter into other obligations payable from the City’s general fund, withoutthe consent of or prior notice to the Owners of the Certificates. To the extent that additional obligations areincurred by the City, the funds available to make Lease Payments may be decreased. In the event the City’srevenue sources are less than its total obligations, the City could choose to fund other municipal services beforemaking Lease Payments. The same result could occur if, because of State constitutional limits on expenditures,the City is not permitted to appropriate and spend all of its available revenues. The City’s appropriations,however, have never exceeded the limitations on appropriations under Article XIIIB of the CaliforniaConstitution. For information on the City’s current limitations on appropriations, see “CONSTITUTIONALAND STATUTORY LIMITATIONS ON TAXES, REVENUES AND APPROPRIATIONS–Article XIIIB ofthe California Constitution.”

Valid and Binding Covenant to Budget and Appropriate

Pursuant to the Lease Agreement, the City covenants to take such action as may be necessary to includeLease Payments due in its annual budgets and to make necessary appropriations for all such payments. Suchcovenants are deemed to be duties imposed by law, and it is the duty of the public officials of the City to takesuch action and do such things as are required by law in the performance of the official duty of such officials toenable the City to carry out and perform such covenants. A court, however, in its discretion may decline toenforce such covenants. Upon delivery of the Certificates, Special Counsel will render its opinion, substantially

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in the form of APPENDIX D – “PROPOSED FORM OF FINAL OPINION,” to the effect that, subject to thelimitations and qualifications described therein, the Lease Agreement constitutes a valid and binding obligationof the City.

Earthquakes

The City is not legally obligated under the Lease Agreement to maintain, or cause to be maintained,earthquake insurance on the Site and no assurance is made that any earthquake insurance will be maintained. Ifthere were to be an occurrence of severe seismic activity in the City, there could be substantial damage to andinterference with the City’s right to use and occupy all or a portion of the Site, which could result in LeasePayments being subject to abatement. Additionally, severe seismic activity in the City could impact the City’sgeneral fund expenditures. See “CERTAIN RISK FACTORS - Abatement” above.

Risk of Uninsured Loss

The City covenants under the Lease Agreement to maintain certain insurance policies on the Site. See“SOURCE OF PAYMENT FOR THE CERTIFICATES - Insurance.” These insurance policies do not cover alltypes of risk, and the City need not obtain insurance except as available on the open market from reputableinsurers. For instance, the City does not covenant to maintain earthquake insurance. The Site could be damagedor destroyed due to earthquake or other casualty for which the Site is uninsured. Additionally, the Site could bethe subject of an eminent domain proceeding. Under these circumstances an abatement of Lease Payments couldoccur and could continue indefinitely. There can be no assurance that the providers of the City’s liability andrental interruption insurance will in all events be able or willing to make payments under the respective policiesfor such loss should a claim be made under such policies. Further, there can be no assurances that amountsreceived as proceeds from insurance or from condemnation of the Site will be sufficient to redeem theCertificates.

Under the Lease Agreement the City may obtain casualty insurance which provides for a deductible.Should the City be required to meet such deductible expenses, the availability of general fund revenues to makeLease Payments may be correspondingly affected.

The City is not obligated under the Lease Agreement to procure and maintain, or cause to be procuredand maintained, earthquake insurance on the Site. Depending on its severity, an earthquake could result inabatement of Lease Payments under the Lease Agreement. See “- Abatement.”

Abatement

In the event of loss or substantial interference in the use and possession by the City of all or any portionof the Site caused by material damage, title defect, destruction to or condemnation of the Site, Lease Paymentswill be subject to abatement. In the event that such component of the Site, if damaged or destroyed by aninsured casualty, could not be replaced during the period of time that proceeds of the City’s rental interruptioninsurance will be available in lieu of Lease Payments, or in the event that casualty insurance proceeds orcondemnation proceeds are insufficient to provide for complete repair or replacement of such component of theSite or redemption of the Certificates, there could be insufficient funds to make payments to Owners in full.Reduction in Lease Payments due to abatement as provided in the Lease Agreement does not constitute a defaultthereunder.

It is not possible to predict the circumstances under which such an abatement of rental may occur. Inaddition, there is no statute, case or other law specifying how such an abatement of rental should be measured.For example, it is not clear whether fair rental value is established as of commencement of the lease or at thetime of the abatement. If the latter, it may be that the value of the Site is substantially higher or lower than itsvalue at the time of the execution and delivery of the Certificates. Abatement, therefore, could have an uncertainand material adverse effect on the security for and payment of the Certificates.

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Hazardous Substances

The existence or discovery of hazardous materials may limit the beneficial use of the Site. In general,the Owners and Lessees of the Site may be required by law to remedy conditions of such parcel relating torelease or threatened releases of hazardous substances. The Federal Comprehensive Environmental Response,Compensation and Liability Act of 1980, sometimes referred to as “CERCLA” or the “Superfund Act,” is themost well-known and widely applicable of these laws, but California laws with regard to hazardous substancesare also similarly stringent. Under many of these laws, the owner or lessee is obligated to remedy a hazardoussubstance condition of the property whether or not the owner or lessee had anything to do with creating orhandling the hazardous substance.

Further it is possible that the beneficial use of the Site may be limited in the future resulting from thecurrent existence on the Site of a substance currently classified as hazardous but which has not been released orthe release of which is not presently threatened, or may arise in the future resulting from the current existence onthe Site of a substance not presently classified as hazardous but which may in the future be so classified.Further, such liabilities may arise not simply from the existence of a hazardous substance but from the methodin which it is handled. All of these possibilities could significantly limit the beneficial use of the Site.

The City is unaware of the existence of hazardous substances on the Site which would materiallyinterfere with the beneficial use thereof.

Eminent Domain

If the Site is taken permanently under the power of eminent domain or sold to a government threateningto exercise the power of eminent domain, the term of the Lease Agreement will cease as of the day possession istaken. If less than all of the Site is taken permanently, or if the Site or any part thereof is taken temporarily,under the power of eminent domain, (a) the Lease Agreement will continue in full force and effect and will notbe terminated by virtue of such taking, and (b) there will be a partial abatement of Lease Payments as a result ofthe application of net proceeds of any eminent domain award to the prepayment of the Lease Payments, in anamount to be agreed upon by the City and the Authority such that the resulting Lease Payments represent fairconsideration for the use and occupancy of the remaining usable portion of the Site. The City covenants in theLease Agreement to contest any eminent domain award which is insufficient to either: (i) prepay the LeasePayments in whole, if all the Site is condemned; or (ii) prepay a pro rata share of Lease Payments, in the eventthat less than all of the Site is condemned.

Bankruptcy

The City is a unit of State government and therefore is not subject to the involuntary procedures of theUnited States Bankruptcy Code (the “Bankruptcy Code”). However, pursuant to Chapter 9 of the BankruptcyCode, the City may seek voluntary protection from its creditors for purposes of adjusting its debts. In the eventthe City were to become a debtor under the Bankruptcy Code, the City would be entitled to all of the protectiveprovisions of the Bankruptcy Code as applicable in a Chapter 9 proceeding. Among the adverse effects of such abankruptcy might be: (i) the application of the automatic stay provisions of the Bankruptcy Code, which, untilrelief is granted, would prevent collection of payments from the City or the commencement of any judicial orother action for the purpose of recovering or collecting a claim against the City; (ii) the avoidance of preferentialtransfers occurring during the relevant period prior to the filing of a bankruptcy petition; (iii) the existence ofunsecured or court-approved secured debt which may have a priority of payment superior to that of Owners ofCertificates; and (iv) the possibility of the adoption of a plan for the adjustment of the City’s debt (a “Plan”)without the consent of the Trustee or all of the Owners of Certificates, which Plan may restructure, delay,compromise or reduce the amount of any claim of the Owners if the Bankruptcy Court finds that the Plan is fairand equitable.

In addition, the City could either reject the Lease Agreement or assume the Lease Agreement despiteany provision of the Lease Agreement which makes the bankruptcy or insolvency of the City an event of defaultthereunder. In the event the City rejects the Lease Agreement, the Trustee, on behalf of the Owners of the

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Certificates, would have a pre-petition claim that may be limited under the Bankruptcy Code and treated in amanner under a Plan over the objections of the Trustee or Owners of the Certificates. Moreover, such rejectionwould terminate the Lease Agreement and the City’s obligations to make payments thereunder.

Limitations on Remedies

The rights of the Owners of Certificates are subject to the limitations on legal remedies against cities inthe State, including applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affectingthe enforcement of creditors’ rights generally, now or hereafter in effect, and to the application of generalprinciples of equity, including concepts of materiality, reasonableness, good faith and fair dealing and thepossible unavailability of specific performance or injunctive relief, regardless of whether considered in aproceeding in equity or at law.

Under Chapter 9 of the Bankruptcy Code (Title 11, United States Code), which governs the bankruptcyproceedings for public agencies such as the City, there are no involuntary petitions in bankruptcy. If the Citywere to file a petition under Chapter 9 of the Bankruptcy Code, the Owners of Certificates and the Trustee couldbe prohibited from taking any steps to enforce their rights under the Lease Agreement, and from taking anysteps to collect amounts due from the City under the Lease Agreement.

All legal opinions with respect to the enforcement of the Lease Agreement and the Trust Agreementwill be expressly subject to a qualification that such agreements may be limited by bankruptcy, reorganization,insolvency, moratorium or other similar laws affecting creditors’ rights generally and by applicable principles ofequity if equitable remedies are sought.

Risk of Tax Audit

In December 1999, as a part of a larger reorganization, the Internal Revenue Service (the “Service”),commenced operation of its Tax Exempt and Government Entities Division (the “TE/GE Division”), as thesuccessor to its Employee Plans and Exempt Organizations division. The new TE/GE Division has a subdivisionthat is specifically devoted to tax-exempt bond compliance. Public statements by Service officials indicate thatthe number of tax-exempt bond examinations (which would include securities such as the Certificates) isexpected to increase significantly under the new TE/GE Division. There is no assurance that if an examinationof the Certificates was undertaken that it would not adversely affect the market value of the Certificates. See“TAX MATTERS.” The City has not been contacted by the Service regarding the examination of any of itsbond transactions.

Loss of Tax Exemption

As discussed under the caption “TAX MATTERS,” in order to maintain the exclusion from grossincome for Federal income tax purposes of the interest with respect to the Certificates, the City has covenantedin the Lease Agreement not to take any action, or fail to take any action, if such action or failure to take suchaction would adversely affect the exclusion from gross income of interest with respect to the Certificates undersection 103 of the Code. Interest with respect to the Certificates could become includable in gross income forpurposes of Federal income taxation retroactive to the date the Certificates were delivered, as a result of acts oromissions of the City in violation of the Code. Should such an event of taxability occur, the Certificates are notsubject to early redemption and will remain outstanding to maturity or until prepaid under the optionalredemption or mandatory sinking fund redemption provisions of the Trust Agreement.

Limited Secondary Market

As stated herein, investment in the Certificates poses certain economic risks which may not beappropriate for certain investors, and only persons with substantial financial resources who understand the riskof investment in the Certificates should consider such investment. There can be no guarantee that there will be asecondary market for purchase or sale of the Certificates or, if a secondary market exists, that the Certificatescan or could be sold for any particular price.

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Changes in Law

There can be no assurance that the electorate of the State will not at some future time adopt additionalinitiatives or that the Legislature will not enact legislation that will amend the laws or the Constitution of theState resulting in a reduction of the general fund revenues of the City and consequently, having an adverse effecton the security for the Certificates.

Impact of State Budget

The City receives a significant portion of its general fund revenues from payments made by the State.The City cannot predict the effect that the general economic conditions within the State and the State’sbudgetary problems may have in the future on the City budget or operations or on its ability to make paymentsof principal and interest with respect to the Certificates.

ABSENCE OF LITIGATION

At the time of delivery of and payment for the Certificates, the City will certify that there is no action,suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court or regulatory agency,public board, or body pending or threatened against the City or the Corporation affecting their existence or thetitles of their respective officers or seeking to restrain or to enjoin the execution, sale, or delivery of theCertificates, or the application of the proceeds thereof in accordance with the Trust Agreement, or in any waycontesting or affecting the validity or enforceability of the Certificates, any agreement entered into between theCity and any purchaser of the Certificates, the Lease Agreement, the Trust Agreement, Corporation or any otherapplicable agreements or any action of the City or the Corporation contemplated by any of said documents, or inany way contesting the completeness or accuracy of this Official Statement or any amendment or supplementthereto, or contesting the powers of the City or the Corporation or their authority with respect to the Certificatesor any action of the City or the Corporation contemplated by any of said documents, nor, to the knowledge ofthe City or the Corporation, is there any basis therefor.

CONTINUING DISCLOSURE

Pursuant to Rule 15c2-12 of the Securities and Exchange Commission (the “Rule”), the City hascovenanted for the benefit of holders of the Certificates to provide certain financial information and operatingdata relating to the City relating to the Certificates, by not later than April 1 of each fiscal year commencingwith the report for the 2014-15 fiscal year (the “Annual Report”), and to provide notices of the occurrence ofcertain enumerated events, if deemed by the City to be material. The Annual Report and notices of materialevents will be filed by the City or the Dissemination Agent, with the Municipal Securities Rulemaking Board(the “MSRB”), via its Electronic Municipal Market Access (“EMMA”) system. The nature of the information tobe provided in the Annual Report and the notices of material events is set forth in APPENDIX E – FORM OFCONTINUING DISCLOSURE CERTIFICATE. During the last five years, the City has failed to comply incertain respects with continuing disclosure obligations related to outstanding indebtedness. The failure tocomply fell into two general categories: (i) failure to provide or late filing of significant event notices withrespect to ratings upgrades of outstanding indebtedness; and (ii) late filing of audited financial reports of theCity.

The City has made remedial filings to provide the annual reports and audited financial statements foreach fiscal year and the most recent rating update. The City has established internal policies with regards to thetimely filing of continuing disclosure submittals.

CONCLUDING INFORMATION

Sale of the Certificates

The Certificates were sold by competitive bid on September 1, 2015. The Certificates were awarded toRaymond James and Associates, Inc. (the “Underwriter”), who submitted the lowest true interest cost bid, at a

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purchase price of $3,754,892.20. Under the terms of its bid, the Underwriter will be obligated to purchase all ofthe Certificates if any are purchased, the obligation to make such purchase being subject to the approval ofcertain legal matters by Special Counsel, and certain other conditions to be satisfied by the City.

The Underwriter has provided the reoffering prices or yields for the Certificates set forth on the insidecover of this Official Statement, and the City undertakes no responsibility for the accuracy of those prices oryields. Based on the reoffering prices, the original issue premium on the reoffering of the Certificates is$133,245.90 and the Underwriter’s gross compensation (or “spread”) is $63,353.70.

Legal Opinion

Best Best & Krieger LLP, Riverside, California, Special Counsel, will render an opinion substantially inthe form of APPENDIX D hereto with respect to the validity and enforceability of the City’s obligations underthe Lease Agreement and the validity of the Certificates. Special Counsel undertakes no responsibility for theaccuracy, completeness or fairness of the Official Statement.

Certain matters will passed upon for the City and the Corporation by the City Attorney, Wallin, Kress,Reisman & Krantz, LLP.

Fees payable to Special Counsel are contingent upon execution and delivery of the Certificates.

Tax Matters

In the opinion of Special Counsel, based upon an analysis of existing laws, regulations, rulings andcourt decisions, and assuming, among other matters, compliance with certain covenants, interest on theCertificates is excluded from gross income for federal income tax purposes under Section 103 of the InternalRevenue Code of 1986 (the “Code”) and is exempt from State of California personal income taxes. SpecialCounsel is of the further opinion that interest on the Certificates is not a specific preference item for purposes ofthe federal individual or corporate alternative minimum taxes, provided however, that for the purpose ofcalculating federal corporate alternative minimum tax imposed on corporations (as defined for federal incometax purposes), such interest is taken into account in determining certain income and earnings, and theCertificates are “qualified tax-exempt obligations” within the meaning of section 265(b)(3) of the InternalRevenue Code of 1986, as amended (the “Tax Code”), such that, in the case of certain financial institutions(within the meaning of section 265(b)(5) of the Tax Code), a deduction for federal income tax purposes isallowed for 80% of that portion of such financial institution’s interest expense allocable to interest payable onthe Certificates.

The Code imposes various restrictions, conditions and requirements relating to the exclusion from grossincome for federal income tax purposes of interest on obligations such as the Certificates. The City hascovenanted to comply with certain restrictions designed to insure that interest on the Certificates will not beincluded in federal gross income. Failure to comply with these covenants may result in interest on theCertificates being included in federal gross income, possibly from the date of original delivery of theCertificates, or may cause the Certificates to not be “qualified tax-exempt obligations” within the meaning ofSection 265(b)(3) of the Tax Code. The opinion of Special Counsel assumes compliance with these covenants.Special Counsel has not undertaken to determine (or to inform any person) whether any actions taken (or nottaken) or events occurring (or not occurring) after the date of delivery of the Certificates may adversely affectthe value of, or the tax status of interest on, the Certificates.

Current and future legislative proposals, if enacted into law, clarification of the Code or court decisionsmay cause interest on the Certificates to be subject, directly or indirectly, to federal income taxation or to besubject to or exempted from state income taxation, or otherwise prevent Certificate Owners from realizing thefull current benefit of the tax status of such interest. For example, from time to time legislative proposals areannounced which generally would limit the exclusion from gross income of interest on obligations like theCertificates to some extent for taxpayers who are individuals and whose income is subject to higher marginalincome tax rates. Other proposals have been made that could significantly reduce the benefit of, or otherwise

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affect, the exclusion from gross income of interest on obligations like the Certificates. The introduction orenactment of any such legislative proposals, clarification of the Code or court decisions may also affect, perhapssignificantly, the market price for, or marketability of, the Certificates. PROSPECTIVE PURCHASERS OFTHE CERTIFICATES SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING ANY PENDINGOR PROPOSED FEDERAL OR STATE TAX LEGISLATION, REGULATIONS OR LITIGATION, ANDREGARDING THE IMPACT OF FUTURE LEGISLATION, REGULATIONS OR LITIGATION, AS TOWHICH SPECIAL COUNSEL EXPRESSES NO OPINION.

Certain requirements and procedures contained or referred to in the Trust Agreement, the LeaseAgreement, the Tax Certificate, and other relevant documents may be changed and certain actions (including,without limitation, defeasance of the Certificates) may be taken or omitted under the circumstances and subjectto the terms and conditions set forth in such documents. Special Counsel expresses no opinion as to theexclusion from gross income of interest on any Certificate if any such change occurs or action is taken oromitted upon the advice or approval of counsel other than Best Best & Krieger LLP.

The Internal Revenue Service (the “IRS”) has initiated an expanded program for the auditing of tax-exempt bond issues, including both random and targeted audits. It is possible that the Certificates will beselected for audit by the IRS. It is also possible that the market value of the Certificates might be affected as aresult of such an audit of the Certificates (or by an audit of other similar Certificates).

Although Special Counsel is of the opinion that interest on the Certificates is excluded from grossincome for federal income tax purposes and is exempt from State of California personal income taxes, theownership or disposition of, or the accrual or receipt of interest on, the Certificates may otherwise affect anOwner’s federal or state tax liability. The nature and extent of these other tax consequences will depend uponthe particular tax status of the holder or the Owner’s other items of income or deduction, and Special Counselexpresses no opinion regarding any such other tax consequences.

A copy of the proposed form of opinion of Special Counsel is attached hereto as APPENDIX D.

Litigation

The City is not aware of any pending or threatened litigation concerning the validity of the Certificatesor the Lease Agreement or challenging any action taken by the City or the Corporation with respect to theCertificates or the Lease Agreement. Furthermore, the City is not aware of any pending or threatened litigationto restrain, enjoin, question or otherwise affect the Lease Agreement or the Trust Agreement or in any waycontesting or affecting the validity or enforceability of any of the foregoing or any proceedings of the City takenwith respect to any of the foregoing. Although there are a number of lawsuits and claims pending andthreatened against the City, it is the opinion of the City that such litigation, claims and threatened litigation willnot materially affect the City’s finances or impair its ability to make Lease Payments or otherwise meet itsobligations under the Lease Agreement.

Municipal Advisor

The City has retained Fieldman, Rolapp & Associates, Inc., Irvine, California, as municipal advisor (the“Municipal Advisor”) in connection with the execution, delivery and sale of the Certificates. The MunicipalAdvisor has not undertaken to make an independent verification or to assume responsibility for the accuracy,completeness, or fairness of the information contained in this Official Statement. The fees being paid to theMunicipal Advisor are contingent upon the execution, delivery and sale of the Certificates.

The Municipal Advisor is an independent advisory firm and is not engaged in the business ofunderwriting, trading or distributing municipal or other public securities.

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Ratings

The City expects that Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,Inc. (“S&P”) will assign the Certificates the rating of “AA+.”

Ratings reflect only the views of the rating agency referred to in the previous paragraph. Explanationsof the significance of such ratings must be obtained from the rating agencies. There is no assurance that suchratings will continue for any given period of time or will not be revised downward or withdrawn entirely bysuch rating agency, if, in the judgment of such rating agency, circumstances so warrant. Any such downwardrevision or withdrawal of such ratings may have an adverse effect on the market price of the Certificates.

The City has covenanted in a Continuing Disclosure Certificate to file on EMMA, notices of any ratingchanges on the Certificates. See the caption “CONTINUING DISCLOSURE” above and APPENDIXE - “FORM OF CONTINUING DISCLOSURE CERTIFICATE.” Notwithstanding such covenant, informationrelating to rating changes on the Certificates may be publicly available from the rating agencies prior to suchinformation being provided to the District and prior to the date the District is obligated to file a notice of ratingchange on EMMA. Purchasers of the Certificates are directed to the ratings agencies and their respectivewebsites and official media outlets for the most current ratings changes with respect to the Certificates after theinitial issuance of the Certificates.

Miscellaneous

All of the descriptions of applicable law, the Lease Agreement, the Trust Agreement, the LeasedPremises, the City, the Corporation, agreements and other documents are made subject to the provisions of suchdocuments respectively and do not purport to be complete statements of any or all of such provisions.Reference is hereby made to such documents on file with the City for further information in connectiontherewith.

This Official Statement does not constitute a contract with the purchasers of the Certificates. Anystatements made in this Official Statement involving matters of opinion or estimates, whether or not soexpressly stated, are set forth as such and not as representations of fact, and no representation is made that anyof the estimates will realize.

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The execution and delivery of this Official Statement has been duly authorized by the City Council ofthe City.

CITY OF LOS ALAMITOS, CALIFORNIA

By: /s/ Richard D. MurphyRichard D. Murphy, Mayor

1/'(.!-"&$!(+/$+/(,+"**0!*$%/!#*"+)2!

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APPENDIX A

CITY OF LOS ALAMITOS GENERAL DEMOGRAPHICAND FINANCIAL INFORMATION

The following information regarding the City and the surrounding area of Orange County is presentedas general background data. The Certificates are payable solely from the sources described herein (see“SECURITY FOR THE CERTIFICATES”). None of the taxing power of the City of Los Alamitos, the County ofOrange, the State of California or any political subdivision thereof is pledged to the payment of the Certificates

Profile of the City of Los Alamitos

The City of Los Alamitos, which has a population of approximately 11,779 and is 4.3 square miles, islocated in the northwest section of Orange County. The City is located in Southern California, 30 miles fromdowntown Los Angeles and 10 miles from Anaheim. The City is 10 miles northeast of the seaport terminal ofLong Beach, and 13 miles northeast of the Port of Los Angeles. Neighboring communities include Long Beach,Seal Beach, Cypress and Garden Grove.

The City of Los Alamitos is a Charter City and was incorporated on March 1, 1960. The City has aCouncil-Member form of government. The City Council appoints the City Manager, who is responsible for theday-to-day administration of City business and the coordination of all City departments. The City Council iscomprised of five members elected bi-annually to four-year alternating terms. The City Council annually electsa Mayor from its members. The City employs a staff of 50 full-time employees.

Services and Facilities

Public Safety and Welfare. The City provides law enforcement services. The Police Departmentcurrently employs 23 sworn officers. Fire protection services are provided through a contractual arrangementwith the Orange County Fire Authority and one fire station is located within the City.

Public Services. Water services is provided by Golden State Water Company. Sewer service isprovided by the Los Alamitos Sewer District which provides collection services and Orange County SanitationDistrict which provides sewer treatment services. The Gas Company and Southern California Edison providegas and electric utilities, respectfully.

Public Works. Additional services include parkway and median maintenance improvements, refusemanagement, zoning and development administration, environmental review, code enforcement and street treemaintenance.

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Population

As of January 1, 2015 the population of the City was approximately 11,779, an increase ofapproximately 0.5 % percent over the census population of the City in 2014. The following table presentspopulation data for both the City and County.

TABLE 1POPULATION

YearCity of

Los AlamitosOrangeCounty

1960(1) N/A 719,5001970(2) 10,950 1,421,2331980 11,528 1,691,5001990 11,550 2,398,4002000 11,536 2,846,2892010(3) 11,449 3,010,2322011 11,472 3,028,8462012 11,561 3,057,2332013 11,646 3,087,7152014 11,725 3,114,2092015 11,779 3,147,655

______________________(1) As of July 1, 1960.(2) As of April 1, 1970.(3) As of April 1, 2010.Sources: California Department of Finance, Demographic Research Unit.

Financial Statements

The City’s accounting policies conform to generally accepted accounting principles applicable togovernmental agencies. The audited financial statements also conform to the principles and standards for publicfinancial reporting established by the Governmental Accounting Standards Board, which is the acceptedstandard-setting body for governmental accounting financial reporting principles.

Basis of Accounting and Financial Statement Presentation. The government-wide financial statementsare reported using the accrual basis of accounting. Revenues are recorded when earned and expenses arerecorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes arerecognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenueas soon as all eligibility requirements imposed by the provider have been met.

Governmental fund financial statements are reported using the modified accrual basis of accounting.Revenues are recognized as soon as they are both measurable and available. Revenues are considered to beavailable when they are collectible within the current period or soon enough thereafter to pay liabilities of thecurrent period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.However, debt service expenditures are recorded only when payment is due.

Audited Financial Statements. The City retained the firm of Moss, Levy & Hartzheim, LLP, San Diego,California (the “City’s Auditor”), to examine the general purpose financial statements of the City as of and forthe year ended June 30, 2014. The audited financial statements for fiscal year ended June 30, 2014, are includedin APPENDIX C – “AUDITED FINANCIAL STATEMENTS OF THE CITY FOR FISCAL YEAR 2013-14.”The City has not requested, and the City’s Auditor has not provided, any review or update of such financialstatements in connection with their inclusion in this Official Statement. Each year the City submits for and hashistorically received the Certificate of Achievement for Excellence in Financial Reporting from the GovernmentFinance Officers Association of the United States and Canada.

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City Financial Data

The following tables provide a five-year history of the City’s Comparative Balance Sheet, General Fundrevenues, expenditures, transfers, and ending fund balances. See also “City Budget” below for budgetedrevenues and expenses for Fiscal Year 2014-15.

TABLE 2CITY OF LOS ALAMITOS

GENERAL FUND BALANCE SHEET(AS OF JUNE 30 EACH YEAR)

2010 2011 2012 2013 2014ASSETS:Pooled Cash and Investments $5,942,006 $7,039,093 $7,338,171 $7,421,846 $7,102,246

Receivables:Accounts 697,404 412,340 640,174 559,367 475,736Employee Computer Loans 4,738 3,591 7,018 5,921 8,196Accrued Interest 11,466 11,718 8,840 5,301 4,800Notes -- -- -- -- --Due from other Governments 604,108 411,255 472,876 417,561 445,278Due from other Funds -- 301,987 150,597 226,017 1,213,720

Restricted Assets:Cash and Investments with Fiscal Agent -- -- -- -- --

TOTAL ASSETS $7,259,722 $8,179,984 $8,617,676 $8,636,013 $9,249,976

LIABILITIES AND FUND BALANCES

LIABILITIES:Accounts Payable $ 449,001 $ 359,958 $ 547,115 $ 458,995 $ 523,867Accrued Liabilities 200,951 282,511 188,442 204,110 272,299Due to other Funds -- -- -- -- --Deferred Revenues 355,724 52,126 86,566 69,079 65,203Deposits Payable 31,587 70,620 42,449 42,698 75,832

TOTAL LIABILITIES $1,037,263 $ 765,215 $ 864,572 $ 774,882 $ 937,201

Deferred Inflows of ResourcesUnearned Revenue-Unavailable

-- -- -- -- $ 37,989

TOTAL DEFERRED INFLOWSOF RESOURCES

-- -- -- -- $ 37,989

FUND BALANCES (DEFICIT):Reserved for Encumbrances -- -- -- --Nonspendable -- $ 3,591 $ 7,018 $ 5,921 $ 8,196Restricted -- -- -- -- --Assigned -- 3,250,000 3,250,000 3,770,333 7,048,565Unassigned -- 4,161,178 4,496,086 4,084,877 1,218,025

Reserved For:Loans Receivable $ 4,738 -- -- -- --Debt Service -- -- -- -- --

Unreserved:Designated Reported In:

General Fund 2,800,000 -- -- -- --Special Revenue Funds -- -- -- -- --

Undesignated Reported In:General Fund 3,417,721 -- -- -- --Special Revenue Funds -- -- -- -- --Capital Projects Funds -- -- -- -- --

TOTAL FUND BALANCES (DEFICIT) $6,222,459 $7,414,769 $7,753,104 $7,861,131 $8,274,786

TOTAL LIABILITIESAND FUND BALANCES

$7,259,722 $8,179,984 $8,617,676 $8,636,013 $9,249,976

Source: City of Los Alamitos Comprehensive Annual Financial Report for Fiscal Years ending June 30, 2010 through 2014.

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STATEMENT OF GENERAL FUNDREVENUES, EXPENDITURES AND BALANCES

(Fiscal Year Ending June 30)

2010 2011 2012 2013 2014REVENUES

Taxes $ 7,635,625 $ 7,949,816 $ 7,613,069 $ 8,636,170 $ 8,904,575Licenses and permits 603,776 628,684 1,246,716 693,917 936,914Intergovernmental 321,428 87,636 25,808 24,238 21,338Charges for services 897,830 1,335,210 1,319,167 1,454,247 1,367,472Investment earnings 28,216 20,600 9,991 7,513 1,746Fines and forfeitures 612,442 597,316 438,839 614,835 709,809Contributions -- -- -- -- --Miscellaneous 158,662 224,447 189,225 31,547 374,554

TOTAL REVENUES $10,257,979 $10,843,709 $10,842,815 $11,462,467 $12,316,408

EXPENDITURESCurrent:

General government $ 2,071,156 $ 1,845,374 $ 2,076,986 $ 1,845,032 $ 2,062,217Public safety 4,920,546 4,735,873 4,908,321 5,278,040 5,874,051Community development 562,022 525,541 623,121 737,071 829,492Recreation and community services 1,156,890 1,526,633 1,569,593 1,888,587 1,619,944Public works 1,561,556 1,558,760 1,603,338 1,764,285 1,685,820

Capital outlay -- -- -- -- --Debt Service: -- -- --

Principal -- -- -- -- --Interest and fiscal charges -- -- -- -- --

TOTAL EXPENDITURES $10,272,170 $10,192,181 $10,781,359 $11,513,015 $12,071,524

EXCESS OF REVENUES OVER (UNDER)EXPENDITURES

(14,191) 651,528 61,456 (50,548) 244,884

OTHER FINANCING SOURCES (USES)Transfers in $ 371,081 $ 750,482 $ 502,787 $ 373,339 $ 394,824Transfers out (264,371) (209,700) (212,667) (214,764) (226,053)

TOTAL OTHER FINANCINGSOURCES (USES)

$ 106,710 $ 540,782 $ 290,120 $ 158,575 $ 168,771

NET CHANGE IN FUND BALANCES $ 92,519 $ 1,192,310 $ 351,576 $ 108,027 $ 413,655

PRIOR PERIOD ADJUSTMENT -- -- (13,241) -- --

FUND BALANCES –BEGINNING OF YEAR

$ 6,129,940 $ 6,222,459 $ 7,401,528 $ 7,753,104 $ 7,861,131

FUND BALANCES (DEFICIT) -END OF YEAR

$ 6,222,459 $ 7,414,769 $ 7,753,104 $ 7,861,131 $ 8,274,786

______________________Source: City of Los Alamitos Comprehensive Annual Financial Report for Fiscal Years ending June 30, 2010 through 2014.

Budgetary Process

The Fiscal Year of the City begins on the first day of July each year and ends on the thirtieth day ofJune of the following year.

At such date as the City Manager determines, each department head must furnish to the City Manageran estimate of revenues and expenditures for such department for the ensuing Fiscal Year, detailed in suchmanner as may be prescribed by the City Manager. In preparing the proposed budget, the City Manager reviewsthe estimates, holds conferences thereon with the respective department heads and the citizens’ Budget ReviewCommittee, and revises the estimates as deemed advisable.

Prior to the beginning of each Fiscal Year, the City Manager submits to the City Council the proposedbudget. City Council consideration of said proposed budget takes place at a public hearing held not less than ten

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days after publication of notice of the hearing. Copies of the proposed budget are available for inspection by thepublic in the office of the City Clerk, and on the City’s website at least ten days prior to the hearing.

At the conclusion of the public hearing, the City Council further considers the proposed budget andmakes any revision thereof that it deems advisable. On or before June 30 it adopts the budget with revisions, ifany, by the affirmative vote of the majority of the City Council.

From the effective date of the budget, the amounts stated as proposed expenditures become appropriatedto the various departments for the objects and purposes named, provided that the City Manager may transfer theappropriations of a fund from one object or purpose to another. All appropriations lapse at the end of the FiscalYear to the extent that they have not been amended or lawfully encumbered.

At a public meeting after the adoption of the budget, the City Council may amend or supplement thebudget by motion adopted by the affirmative vote of the majority of the City Council.

The City Council employs, at the beginning of each Fiscal Year, an independent public accountant who,at such time or times as specified by the City Council, at least annually, and at such other times as the CityCouncil shall determine, examines the books, records, inventories and reports of all officers and employees whoreceive, control, handle or disburse public funds and of all such other officers, employees or departments as theCity Council may direct. As soon as practicable after the end of the fiscal year, a final audit and report issubmitted by such accountant to the City Council and a copy of the financial statements as of the close of theFiscal Year is published.

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The following tables summarize the Fiscal Year 2015-16 City Budget and estimated actual results forFiscal Year 2014-15, and summarize the final Fiscal Year 2014-15 General Fund Budget of the City.

TABLE 4CITY OF LOS ALAMITOSGENERAL FUND BUDGET

(Fiscal Years 2014-15 and 2015-16)

2014-2015Budgeted

2014-15ProjectedYear End

2015-2016Budgeted

REVENUES:Property Taxes $ 3,193,049 $ 3,193,049 $ 3,303,616Sales & Use Taxes 2,992,000 3,019,000 3,272,000Utility Users Taxes 2,217,598 2,247,598 2,291,944Transient Occupancy Tax 115,000 115,000 120,000Franchise Fees 676,284 676,284 687,600Licenses and Permits 742,902 742,902 746,915Fines and Forfeitures 594,900 694,900 660,000Investment Earnings 38,000 38,000 57,000Revenue from other Agencies 98,403 98,403 122,330Charges for Services 1,282,564 1,282,564 1,494,074Miscellaneous Revenues 68,519 68,519 75,500Interfund Transfers 388,317 370,817 365,667

Total revenues $12,407,536 $12,547,036 $13,196,646

EXPENDITURES:Operating Expenditures and Transfers $12,295,072 $12,181,826 $13,195,015Non-Operating Expenditures and Transfers 1,215,000 1,300,000 0

Total Expenditures $13,510,072 $13,481,826 $13,195,015

SURPLUS/(DEFICIT) $(1,102,536) $ (934,790) $ 1,631______________________Source: City of Los Alamitos.

In connection with the City’s ongoing policy of maintaining contingency revenues, the City expects itsaccumulated general fund balance to be approximately $7.3 million at the end of fiscal year 2014-15,representing more than 55% of fiscal year 2015-16 budgeted expenditures.

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Taxes and Other Revenue

The City receives the following local taxes and revenue, approximately 50% of sales taxes are producedby 13 sales taxpayers. In the following sections, each of these sources of local tax revenue is discussed ingreater detail.


OTHER TAX REVENUES BY SOURCE

REVENUES:2010-2011

Actual2011-2012

Actual2012-2013

Actual2013-2014

Actual

2014-2015ProjectedYear End

Property Taxes $ 2,904,974 $ 2,848,583 $ 3,005,410 $ 3,109,888 $ 3,193,049Sales & Use Taxes 2,284,711 2,594,047 2,746,011 2,836,328 3,019,000Utility Users Taxes 2,132,011 2,082,642 2,160,281 2,188,435 2,247,598Transient Occupancy Tax 80,080 87,798 103,710 112,866 115,000Franchise Fees 595,092 640,400 620,757 657,058 676,284Licenses and Permits 687,972 640,905 844,285 1,049,678 742,902Fines and Forfeitures 597,317 438,839 614,835 709,809 694,900Investment Earnings 20,600 9,991 7,513 1,746 38,000Revenue From OtherAgencies

87,636 29,509 24,603 116,576 98,403

Charges for Services 1,273,053 1,282,112 1,309,088 1,254,708 1,282,564Miscellaneous Revenues 430,264 187,989 25,977 279,312 68,519Interfund Transfers 500,482 502,787 373,339 394,824 370,817

Total Revenues $11,594,192 $11,345,602 $11,835,809 $12,711,228 $12,547,036______________________Source: City of Los Alamitos.

Sales Taxes

Sales and use taxes represent the largest source of general fund tax revenue to the City. This sectiondescribes the current system for levying, collecting and distributing sales and use tax revenues in the State.However, the State budget situation has resulted in a temporary redirection of sales tax revenues from the Cityto the State. See “- State Budget Information,” herein.

A sales tax is imposed on the privilege of consuming personal property in California. California doesnot tax services. The tax rate is established by the State Legislature, and is presently 7.50%, Statewide. Inaddition, many of California’s cities, counties, towns and communities have special taxing jurisdiction toimpose a transaction (sales) or use tax. These so-called district taxes increase the tax rate in a particular area byadding the local option tax to the Statewide tax. The City does not have a local option tax. These district taxescan vary up to 1%, and more than one district tax may be in effect for a particular location. The City’s share ofsales tax is approximately 1% when one considers the combined City share of 0.75% and the State’s 0.25%Fiscal Recovery Funding (Triple-Flip swap) explained below. With the enactment of the Triple Flip, the Citynow receives the 0.25% as reclassified revenue through property tax as an in lieu remittance, the payment ofwhich heretofore coincides with the County property tax calendar. The State collects and administers the tax,and makes distributions on taxes collected within the City as follows:

In 1978, the voters of the State passed Proposition 8, a constitutional amendment to Article XIIIA thatallows a temporary reduction in assessed value when real property suffers a decline in value. A decline in valueoccurs when the current market value of real property is less than the current assessed (taxable) factored baseyear value as of the lien date, January 1. See “CONSTITUTIONAL AND STATUTORY LIMITATIONS ONTAXES, REVENUES AND APPROPRIATIONS—Article XIIIA of the California Constitution.”

On March 2, 2004, voters approved a Statewide bond initiative formally known as the “CaliforniaEconomic Recovery Act.” This act authorized the issuance of $15 billion of Economic Recovery Certificates tofinance ongoing State budget deficits, which are payable from a fund established by the redirection of tax

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revenues known as the “Triple Flip.” The State issued $11.3 billion of Economic Recovery Certificates prior toJune 30, 2004. Under the “Triple Flip,” one-quarter of local governments’ one percent share of the sales taximposed on taxable transactions within their jurisdiction is being redirected to the State. In an effort to eliminatethe adverse impact of the sales tax revenue redirection on local government, State legislation provides forcertain property taxes to be redirected to local government. Because these property tax monies were previouslyearmarked for schools, the legislation provides for schools to receive other State general fund revenues. It isexpected that the swap of sales taxes for property taxes will terminate once the Economic Recovery Certificatesare repaid, which is currently expected to occur in approximately 9 to 13 years. See “RISK FACTORS - StateBudget Information” herein.

A sales tax is imposed on retail sales or consumption of personal property. The tax rate is establishedby the State Legislature. Effective January 1, 2002, the aggregate tax rate in the State is 7.50%. An additional0.50% is collected in Orange County for transportation purposes.

Currently, taxable transactions in the City are subject to the following sales and use tax, of which theCity’s share is only a portion. The State collects and administers the tax, and makes distributions on taxescollected within the City, as follows:


Sales Tax RatesFiscal Year 2015-16

Jurisdiction RateState (General Fund includes K-12/Community College) 3.9375%State (Fiscal Recovery Triple Flip) 0.25State (Local Public Safety Fund) 0.50Realignment (Mental Health/Welfare/Public Safety) 1.5625County 0.25City/County General Fund (Bradley Burns) 0.75Orange County Transportation Authority 0.50

Total: 8.00 %______________________Source: California State Board of Equalization.

History of Taxable Transactions. Total taxable transactions reported in the City during calendar year2014 amounted to $297,050,300, a 3.9% increase over the total taxable transactions of $285,980,400 that werereported during calendar year 2013.

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A summary of historic taxable transactions within the City is shown in the following table.


TAXABLE TRANSACTIONSFOR CALENDAR YEARS 2010 THROUGH 2014

2010 2011 2012 2013 2014Retail Group

Apparel Stores $ 21,893 $ 20,401 $ 23,010 $ 24,674 $ 27,805Auto Dealers and Supplies 68,810 75,204 78,323 78,958 56,849Building Materials 489,547 459,651 563,831 665,222 797,963Drug Stores 25,357 33,937 40,185 42,660 36,069Eating and Drinking Places 360,674 389,836 355,711 420,160 460,782Food Stores 50,456 50,936 50,431 55,705 63,885Furniture and Appliances 47,680 48,281 62,344 82,903 71,402General Merchandise 7,765 5,432 4,117 3,612 2,499Other Retail Stores 126,387 122,904 170,706 208,035 204,770Packaged Liquor 9,588 14,867 8,762 7,408 4,609Service Stations 159,961 196,586 205,235 188,363 200,083

Total Retail Group $1,368,118 $1,508,035 $1,562,653 $1,777,699 $1,926,716

Non-Store & Part Time Retailers $ 5,116 $ 5,110 $ 4,070 $ 4,219 $ 4,717

Business, Service & Repair Group $ 179,194 $ 284,472 $ 200,033 $ 183,639 $ 172,131

Manufacturer & Wholesaler GroupContractors & Material $26,565 $ 20,284 $ 11,988 $ 14,478 $ 13,940Drugs & Chemical 495 7 0 9 0Food/Farm Products & Equipment 54,993 58,932 62,888 26,753 69,392Furniture & Textiles 1,855 2,038 3,744 5,646 6,220Heavy Industrial Equipment 89,989 98,535 99,193 115,140 121,405Industrial Equipment 212,296 255,075 258,603 293,829 277,504All Other Equipment 49,589 58,560 69,777 145,598 59,367

Total Manufacturing & Wholesale Group $ 435,782 $ 493,430 $ 506,193 $ 601,454 $ 547,827

State Adjustments & Transfers 0 (692) (316) 0 171

Total Sales All Outlets $1,988,211 $2,290,355 $2,272,633 $2,567,011 $2,651,562

Retail Group $1,368,118 $1,508,035 $1,562,653 $1,777,699 $1,926,716Non-Store & Part Time Retailers 5,116 5,110 4,070 4,219 4,717Business, Service & Repair Group 179,194 284,472 200,033 183,639 172,131Manufacturer & Wholesaler Group 435,782 493,430 506,193 601,454 547,827State Adjustments & Transfers 0 (692) (316) 0 171

Total Point of Sale $1,988,211 $2,290,355 $2,272,633 $2,567,011 $2,651,562County Pool 214,447 234,263 237,964 291,203 316,650State Pool 1,088 394 1,323 1,590 2,291

Total Sales Tax Receipts $2,203,746 $2,525,012 $2,511,920 $2,859,804 $2,970,503______________________Source: The HdL Companies.

State Budget Information

The following information concerning the State’s budget has been obtained from publicly availableinformation which the City believes to be reliable; however, the City takes no responsibility as to the accuracyor completeness thereof and has not independently verified such information. The following information isprovided as supplementary information only, and it should not be inferred from inclusion of this informationthat the Certificates are payable from State revenues. The Certificates are payable solely from Lease Paymentsto be made by the City under the Lease Agreement and certain other moneys held under the Trust Agreement.The Certificates are not a debt of the City, the State, or any of its political subdivisions, in contravention of any

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constitutional or statutory limitation, nor is the City, the State, or any of its political subdivisions required tolevy or impose any form of taxation.

State Budgeting Process. According to the State Constitution, the Governor is required to propose abudget to the State Legislature no later than January 10 of each year, and a final budget must be adopted by amajority vote of each house of the State Legislature no later than June 15, although this deadline is routinelybreached. The budget becomes law upon the signature of the Governor, who may veto specific items ofexpenditure.

Information about the State budget is regularly available at various State-maintained websites. Text ofthe State budget may be found at the State Department of Finance website, www.govbud.dof.ca.gov. Animpartial analysis of the budget is posted by the Office of the Legislative Analyst at www.lao.ca.gov. Inaddition, various State of California official statements, many of which contain a summary of the current andpast State budgets, may be found at the website of the State Treasurer at www.treasurer.ca.gov. Theinformation referred to is prepared by the respective State agency maintaining each website and not by the City,and the City takes no responsibility for the continued accuracy of the Internet addresses or for the accuracy ortimeliness of information posted there, and such information is not incorporated herein by these references.

Fiscal Year 2015 State Budget. On June 20, 2014, the State Legislature adopted the State’s Fiscal Year2015 Budget (the “2015 State Budget”). For Fiscal Year 2014, the 2015 State Budget projected revised totalState general fund revenues of $102.2 billion, and total State general fund expenditures of $100.7 billion and ageneral fund surplus of $2.9 billion. For Fiscal Year 2015, the 2015 State Budget projects total State generalfund revenues of $109.4 billion and expenditures of $108 billion and a State general fund surplus ofapproximately $2.1 billion. This amount is a combination of $449 million in the traditional general fundreserve, and an authorized deposit of $1.6 billion into the Budget Stabilization Account (the “BSA”) establishedby the California Balanced Budget Act of 2004 (also known as Proposition 58).

As part of implementing certain provisions of the 2015 State Budget, a legislatively-referredconstitutional amendment (Proposition 2) was placed on the ballot, and ultimately approved by the voters at theNovember 4, 2014 statewide election. Among other things, Proposition 2 will create a reserve account that isexpected to smooth fluctuations in State revenues. See “CONSTITUTIONAL AND STATUTORYLIMITATIONS ON TAXES AND APPROPRIATIONS.”

The 2015 State Budget identified a number of risks with potential significant State General Fund impactfor Fiscal Year 2015 including the threat of a future recession, a shifting of costs from the federal government tothe State, a decline in the stock market given the State’s reliance on capital gains as a source of revenue, costsrelated to ongoing litigation over the State prison population, litigation arising from the dissolution ofredevelopment agencies, costs of implementing federal health care reforms and costs associated with the State’ssubstantial unfunded liabilities for pensions and post-employment health care costs.

2015-16 State Budget. On June 24, 2015, Governor Brown signed the Fiscal Year 2015-16 StateBudget (the “2015-16 State Budget”) which expands child care, boosts funding for public schools and opens theState’s public healthcare program to immigrant children who are in the country illegally. The new spendingplan, including a $115.4-billion general fund, takes effect July 1 and provides for an estimated 170,000immigrants 18 and younger to qualify for Medi-Cal. In addition, Governor Brown called special legislativesessions to find sustainable funding for transportation and public healthcare. For K-12 schools, the 2015-16Budget increases funding levels by more than $3,000 per student in Fiscal Year 2015-16 over Fiscal Year 2011-12 levels with implementation of the Local Control Funding Formula. The 2015-16 Budget includes totalfunding of $83.2 billion for all K-12 education programs and also includes Proposition 98 funding of $68.4billion for fiscal year 2015-16, an increase of $7.6 billion over the previous year. Funding for the University ofCalifornia and California State University higher education systems also increased, allowing for tuition forCalifornia undergraduate students to remain flat through fiscal year 2016-17. Components of the 2015-16 StateBudget affecting local agencies include the following:

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" Drought Relief. The 2015-16 State Budget includes appropriations from Proposition 1 in responseto the drought, commencing the first of a three-year funding plan to appropriate $1.8 billionProposition 1 funds allocated to storm-water management, contaminated groundwater cleanup,groundwater management plans, water recycling, public water system infrastructure, anddesalination.

" Mandate Repayments. The 2015-16 State Budget provides that as a result of trigger languageincluded in the 2014-15 State Budget, local agencies are projected to receive an additional paymentof $533 million in mandate repayments owed to local governments from prior to 2004, buildingupon the $100 million repayment received by cities, counties and special districts as part of the2014-15 State Budget.

" Cap-and-Trade. The 2015-16 State Budget also provides continuous funding for 60 percent of Cap-and-Trade auction revenues, with the remaining 40 percent to be used for annual appropriationsreflecting the priorities of the State Legislature and does not make any changes to the 2014-15 StateBudget that provides for continuous appropriations of 60 percent of Cap-and-Trade auctionrevenues for affordable housing, transportation, transit, and high speed rail.

" Law Enforcement. The 2015-16 State Budget includes $20 million for local law enforcement grantsto city police departments, $6 million to be awarded to local law enforcement agencies incompetitive grants for community relations; and $8 million in competitive grants to localgovernments to reduce community recidivism rates.

" Judicial Branch. The 2015-16 State Budget includes an overall increase of trial court funding of$180 million, including an increase of $90.1 million to support trial court operations, $19.8 millionto cover reductions in fines and penalty revenues, and the allocation of $26.9 million for anticipatedtrial court workload increase due to re-sentencing petitions related to drug and theft crimes.

" Social Services. The 2015-16 State Budget contains $35 million for CalWORKs Housing SupportProgram services, an increase of $15 million, which provides additional support to CalWORKsfamilies for whom homelessness is a barrier to self-sufficiency and $17.7 million to counties for thepurpose of recruiting, retaining, and supporting foster care parents and relative caregivers.

" Workforce Development. The 2015-16 State Budget provides $500 million in Proposition 98 fundsfor the Adult Education Block Grant as part of the State’s workforce development strategy,including $250 million in one-time funding for each of the next three years to support a transitionalcareer technical education incentive grant program.

The 2015-16 State Budget may be affected by numerous factors, including but not limited to: (i) shiftsof costs from the federal government to the State, (ii) national, State and international economic conditions, (ii)litigation risk associated with proposed spending reductions, (iii) rising health care costs and (iv) other factors,all or any of which could cause the revenue and spending projections made in the 2015-16 State Budget to beunattainable.

The complete 2015-16 State Budget is available from the California Department of Finance website atwww.dof.ca.gov. An impartial analysis of the 2015-16 Budget is posted by the Office of the Legislative Analystat www.lao.ca.gov. In addition, various State official statements, many of which contain a summary of thecurrent and past State budgets, may be found at the website of the State Treasurer, www.treasurer.ca.gov. Theinformation referred to is prepared by the respective State agency maintaining each website and not by theCounty, and the County can take no responsibility for the continued accuracy of these internet addresses or forthe accuracy, completeness or timeliness of information posted there, and such information is not incorporatedherein by these references. The County cannot predict the impact that the 2015-16 State Budget, or subsequentbudgets, will have on its own finances and operations.

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Ad Valorem Property Taxes

This section describes property tax levy and collection procedures and certain information regardinghistorical assessed values and major property tax payers in the City.

Property Taxes

Tax Levies, Collections and Delinquencies. Property taxes are levied by the County for each fiscal yearon taxable real and personal property which is situated in the County. Property taxes collected in advance arerecorded as deferred revenue and recognized as revenue in the year they become available. The County levies,bills and collects property taxes for the City. Property taxes paid to the City by the County within 60 days afterthe end of the fiscal year are “available” and are, therefore, recognized as revenue.

For assessment and collection purposes, property is classified either as “secured” or “unsecured” and islisted accordingly on separate parts of the assessment roll. The “secured roll” is that part of the assessment rollcontaining State/assessed public utilities property and property the taxes on which are a lien on real propertysufficient, in the opinion of the County Assessor, to secure payment of the taxes. Other property is assessed onthe “unsecured roll.”

Secured and unsecured property taxes are levied based on the assessed value as of January 1, the liendate, of the preceding fiscal year. Secured property tax is levied on October 1 and due in two installments, onNovember 1 and March 1. Collection dates are December 10 and April 10 which are also the delinquent dates.At that time, delinquent accounts are assessed a penalty of 10%. Accounts that remain unpaid on June 30 arecharged an additional 1.5% per month. Such property may thereafter be redeemed by payment of a penalty of1.5% per month to the time of redemption, plus costs and a redemption fee. If taxes are unpaid for a period offive years or more, the property is deeded to the State and then is subject to sale by the County Treasurer.

Unsecured property tax is levied on July 1 and due on July 31, and has a collection date of August 31which is also the delinquent date. A 10% penalty attaches to delinquent unsecured taxes. If unsecured taxes areunpaid at 5:00 p.m. on October 31, an additional penalty of 1.5% attaches to them on the first day of each monthuntil paid. The taxing authority has four ways of collecting delinquent unsecured personal property taxes: (1)bringing a civil action against the taxpayer; (2) filing a certificate in the office of the County Clerk specifyingcertain facts in order to obtain a lien on certain property of the taxpayer; (3) filing a certificate of delinquencyfor record in the County Clerk and County Recorder’s office in order to obtain a lien on certain property of thetaxpayer; and (4) seizing and selling personal property, improvements, or possessory interests belonging orassessed to the assessee.

Historic Secured Property Tax Revenues. Section 4701 through Section 4717 of the California Revenueand Taxation Code permit counties to use a method of apportioning taxes (commonly referred to as the “TeeterPlan”) whereby local agencies receive from the County 100% of their respective shares of the amount of securedad valorem taxes levied, without regard to actual collections of taxes. Due to this allocation method, the citiesin the County receive no adjustments for redemption payments on delinquent collections. The unsecured taxesare allocated based on actual unsecured tax collections.

The County of Orange adopted this method of distributing taxes; however, the City has elected not toparticipate in the Teeter Plan. Consequently, property tax collections allocated to the City reflect actualcollections.

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The following tables illustrate the secured property tax revenues of the City for Fiscal Years 2004-05through 2013-14:


HISTORICAL SECURED PROPERTY TAX REVENUES(1)

(As of June 30)

Collected within theFiscal Year of Levy Total Collections to Date

Fiscal YearEndingJune 30

Taxes Leviedfor the

Fiscal Year Amount

Collectionsfor Prior

Years(1) AmountPercentof Levy

2005 $1,380,625 $1,356,979 $4,428 $1,361,407 98.608%2006 1,493,570 1,460,442 17,572 1,478,014 98.9582007 1,555,871 1,501,044 22,569 1,523,613 97.9272008 1,647,608 1,583,142 32,579 1,615,721 98.0652009 1,680,414 1,619,026 (3,594) 1,615,432 96.1332010 1,677,973 1,358,634 56,169 1,414,803 84.3162011 1,706,675 1,656,579 37,679 1,694,258 99.2722012 1,863,810 1,776,861 36,779 1,813,640 97.3082013 2,013,958 1,962,651 24,090 1,986,741 98.6492014 2,052,538 2,002,409 24,524 2,026,933 98.753

______________________(1) Total amount of delinquent taxes collected in each fiscal year; information regarding levy year to which delinquent tax

collections pertain is not provided by the Orange County Auditor-Controller.Source: Orange County Auditor-Controller.

Taxable Property and Assessed Valuation. All property is assessed using full cash value as defined byArticle XIIIA of the State Constitution. State law provides exemptions from ad valorem property taxation forcertain classes of property such as churches, colleges, nonprofit hospitals and charitable institutions. Set forth inthe tables below are assessed valuation for secured and unsecured property within the City for the ten mostrecent fiscal years. The City has not formed a redevelopment agency under the California Redevelopment Law.

Future assessed valuation growth allowed under Article XIIIA (new construction, certain changes ofownership, 2% inflation) will be allocated on the basis of “situs” among the jurisdictions that serve the tax ratearea within which the growth occurs. Local agencies and schools will share the growth of “base” revenues fromthe tax rate area. Each year’s growth allocation becomes part of each agency’s allocation in the following year.

The passage of Assembly Bill 454 in 1987 changed the manner in which unitary and operatingnonunitary property is assessed by the State Board of Equalization. The legislation deleted the formula for theallocation of assessed value attributed to such property and imposed a State-mandated local program requiringthe assignment of the assessment value of all unitary and operating non-unitary property in each county of eachState assessee other than a regulated railway company. The legislation established formulas for the computationof applicable county-wide rates for such property and for the allocation of property tax revenues attributable tosuch property among taxing jurisdictions in the county beginning in fiscal year 1988-89. This legislationrequires each county to issue each State assessee, other than a regulated railway company, a single tax bill for allunitary and operating nonunitary property.

Assessment Appeals. Property tax values determined by the County Assessor may be subject to appealby property owners. Assessment appeals are annually filed with the Assessment Appeals Board for a hearingand resolution. The resolution of an appeal may result in a reduction to the County Assessor’s original taxablevalue and a tax refund to the applicant/property owner.

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GROSS ASSESSED VALUE OF ALL TAXABLE PROPERTY(in thousands)

Fiscal YearEnding

(June 30) Secured UnsecuredLess:

Exemptions(1)

TaxableAssessed

Value(2)

2005 $1,085,188 $135,892 $ -- $1,221,0802006 1,193,748 159,280 -- 1,353,0282007 1,265,004 151,528 -- 1,416,5322008 1,363,845 157,193 -- 1,521,0382009 1,430,961 149,526 -- 1,580,4872010 1,441,254 148,417 -- 1,589,6712011 1,460,981 155,087 -- 1,616,0682012 1,466,640 137,977 -- 1,604,6172013 1,504,137 133,912 -- 1,638,0492014 1,549,169 119,503 -- 1,668,6722015 1,632,329 143,371 -- 1,775,700

______________________(1) Exemption are netted against the individual property categories.(2) Total includes Nonunitary Taxable Assessed Values.Source: County of Los Alamitos Comprehensive Annual Financial Report for Fiscal Year 2013-14.

Largest Taxpayers. The 10 largest secured property taxpayers for fiscal year 2014-15 are as follows:


LARGEST SECURED TAXPAYERS FOR FISCAL YEAR 2014-15(IN THOUSANDS)

Property Owner

TaxableAssessed

Value

Percent of TotalCity Taxable

Assessed ValueLos Alamitos Medical Center $ 68,098 4.079%Los Alamitos Corporation Center JV 55,585 3.330Henrietta C. Lee Trust -- --Trend Offset Printing Inc. 35,277 2.113Don Wilson Staples LLC 30,797 1.845JCB Inc. 17,303 1.037CGM Katella LLC 13,158 0.788Ganahl Lumber Company 15,274 0.915Bayport Los Alamitos Associates LP 12,602 0.755Arrowhead Products Corporation 12,621 0.756Laeroc 2002 Katella -- --Verizon Directories Distribution -- --Susa Partnership -- --Los Alamitos LLC 11,050 0.662Apartment Unlimited -- --Top Ten Totals $ 271,765 16.280%City Totals $1,669,324______________________Source: City of Los Alamitos Comprehensive Annual Financial Report for Fiscal Year 2013-14.

Other Taxes

Franchise Taxes. The City levies a franchise tax on its cable television, trash collection, and utilityfranchises.

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Business License Taxes. The City levies a business license tax based principally on gross receipts andon number of employees.

Transient Occupancy Taxes. The City levies an 8% transient occupancy tax on hotel and motel bills.

Utility Users Taxes. The City levies a tax equal to 6% for electric, gas and water utility bills and 5% fortelecommunication utility bills, which is collected by the companies providing the services and remittedmonthly to the City.

Property Transfer Taxes. A documentary stamp tax is assessed for recordation of real propertytransfers.

Short-Term Obligations

The City currently has no outstanding short-term obligations.

Long-Term Obligations

Excluding the Certificates, the following provides a summary of the City’s long-term obligations:

TABLE 11CITY OF LOS ALAMITOSLONG-TERM LIABILITY

BalanceJune 30, 2013

Prior PeriodAdjustment Additions Deletions

BalanceJune 30, 2014

Due inOne Year

Claims payable $ 182,611 $ -- $ -- $(133,093) $ 49,518 $ 49,518Compensated absences 567,294 -- 260,421 (301,132) 526,583 169,988PERS side fund 269,507 (8,226) -- (261,281) -- --Other post-employment

benefit obligation 389,271 -- 244,401 (153,026) 480,646 --Total $1,408,683 $(8,2260) $504,822 $(848,532) $1,056,747 $219,506

______________________Source: City of Los Alamitos.

Direct and Overlapping Bonded Debt

The ability of land owners within the City to pay property tax installments as they come due could beaffected by the existence of other taxes and assessments imposed upon the land.

The statement of direct and overlapping debt (the “Debt Report”) set forth below was prepared byCalifornia Municipal Statistics, Inc. as of June 30, 2014. The Debt Report includes only such information as hasbeen reported to California Municipal Statistics, Inc. by the issuers of the debt described therein and by others.The Debt Report is included for general information purposes only. The City takes no responsibility for itscompleteness or accuracy.

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TABLE 12Direct and Overlapping Bonded Debt

(As of July 2, 2015)

2014-15 Assessed Valuation: $1,778,110,229

OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable Debt 7/1/15Metropolitan Water District 0.077% $ 85,023North Orange County Joint Community College District 1.648 3,082,403Garden Grove Unified School District 0.011 26,839Los Alamitos Unified School District School Facilities Improvement District No. 1 21.977 22,100,098Anaheim Union High School District 0.079 119,534Cypress School District 0.524 208,656

TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $ 25,622,553

DIRECT AND OVERLAPPING GENERAL FUND DEBT:Orange County General Fund Obligations 0.377% $ 290,727Orange County Pension Obligation Certificates 0.377 1,360,634Orange County Board of Education Certificates of Participation 0.377 57,266Municipal Water District of Orange County Water Facilities Corporation 0.451 12,493Los Alamitos Unified School District Certificates of Participation 20.027 8,715,124Anaheim Union High School District Certificates of Participation 0.079 28,028Cypress School District Certificates of Participation 0.524 38,593North Orange County Regional Occupational Program Certificates of Participation 1.692 176,814City of Los Alamitos Certificates of Participation 100.000 2,895,000

TOTAL GROSS DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 13,574,679Less: MWDOC Water Facilities Corporation (100% supporting) 12,493

TOTAL NET DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 13,562,186

GROSS COMBINED TOTAL DEBT $ 39,197,232NET COMBINED TOTAL DEBT $ 39,184,739

Ratios to 2014-15 Assessed Valuation:Total Overlapping Tax and Assessment Debt.................................................1.44%Total Direct Debt ($2,895,000) .....................................................................0.16%Gross Combined Total Debt.............................................................................2.20%Net Combined Total Debt ................................................................................2.20%

______________________(1) Excludes issue to be sold.(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.Source: California Municipal Statistics, Inc.

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Retirement Programs

The City of Los Alamitos contributes to the California Public Employees Retirement System(CalPERS), a cost-sharing, multiple-employer defined benefit pension plan. CalPERS acts as a commoninvestment and, administrative agent for participating public entities within the State of California. PERSprovides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to planmembers and beneficiaries. Benefit provisions and all other requirements are established by State statute andCity ordinance. Copies of the PERS' annual financial report may be obtained from the PERS Executive Office400 P Street, Sacramento, California 95814.

Plan Description and Funding Policy

The City has a multiple tier retirement plan with benefits varying by plan for both miscellaneous andsafety employees hired on or before specific dates as follows:

Safety:

" Legacy POA Employees - The retirement formula is 3% at age 50 for safety employees coveredunder the Los Alamitos Police Officers’ Association (POA) that were hired on or before December

31, 2012. The City pays 1/9 of the employee share (9%). Beginning, July 1, 2016, employees will

pay their entire share (9%).

" Non-Represented Safety Employees – The retirement formula for Non-Represented Safety

Employees hired on or before December 31, 2012 is 3% at age 50. The employee is responsible for

the employee share (9%).

" Safety PEPRA Employees – The retirement formula is 2.7% at age 57 for new members hired on

or after January 1, 2013. The employee must pay one-half (1/2) of the normal cost of the benefit.

The normal cost is currently 23% - one-half of which is 11.5%, which is paid by the employee.

Classic members (CalPERS members prior to 12/31/12) hired on or after January 1, 2013 may be placed ina different tier.

Miscellaneous:

" Legacy CEA Employees – The retirement formula is 2.7% at age 55 for miscellaneous employees

covered under the Los Alamitos City Employees Association (CEA) hired on or before December

31, 2012.

o For employees hired on or before April 1, 2011, the City pays 3/8 of the employee share (8%).

Beginning November 1, 2015, the City will pay 1/8 of the employee share.

o For employees hired after April 1, 2011, the City pays 2/8 of the employee share (8%).

Beginning November 1, 2015, employees will pay their entire share (8%).

" Non-Represented Miscellaneous Employees – The retirement formula for Non-Represented

Miscellaneous Employees hired on or before December 31, 2012 is 2.7% at age 55. The employee

is responsible for the employee share (8%) with the exception of the City Manager whereby the Citypays the employee share (8%).

" Miscellaneous PEPRA Employees – The retirement formula is 2% at age 62 for new membershired on or after January 1, 2013. The employee must pay at least one-half (1/2) of the normal cost

of the benefit. The normal cost is currently 12.487% - of which 6.237% is paid by the employer.

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Classic members (CalPERS members prior to 12/31/12) hired on or after January 1, 2013 may be placed ina different tier.

Additionally, the City is required to contribute the actuarially determined amounts necessary to fund thebenefits for its members. The actuarial methods and assumptions used are those adopted by the CalPERS Boardof Administration. The required employer contribution rates for the fiscal years 2014-2015 and 2015-2016 areas follows:

Fiscal Year2014-2015

Fiscal Year2015-2016

Classic Miscellaneous Members 11.33% 25.87% *PEPRA Miscellaneous Members 6.25% 6.25%Classic Safety Members 29.10% 28.12% *PEPRA Safety Members 11.50% 11.50%

*Amounts include the normal cost and additional payments towards the unfunded liability.

The contribution requirements of the plan members are established by State statute and the employercontribution rates were established and may be amended by CalPERS. Since the City had less than 100 activemembers in each plan as of June 30, 2004, the City is required to participate in a risk pool. Mandated poolingbecame effective for the City during the 2005-2006 fiscal year.

On April 17, 2013 CalPERS adopted new amortization and smoothing methods which converted rollingamortization periods to fixed periods. The new amortization and smoothing methods include a 5-year ramp-upin contribution rates beginning in fiscal year 2015-2016, which include additional payments towards theunfunded liability.

The City's contributions to CalPERS for the past three years, which were equal to the requiredcontribution each fiscal year, were as follows:

Fiscal YearEnded June 30 Miscellaneous Safety

2014 $199,867 $646,1392013 204,935 628,9412012 209,656 529,707

Other Post-Employment Benefits (Opeb) Plan

Plan Description

In addition to providing pension benefits, the City provides certain health care benefits for retiredemployees in accordance with a City Council resolution. Substantially all of the City's employees becomeeligible for those benefits if they reach normal retirement age while working for the City. Those and similarbenefits for active employees are provided through PERS whose premiums are based on the benefits paid duringthe year.

Retiree health care coverage is segregated into two tiers as follows:

Tier 1 – Employees Hired Before August 1, 1994(1) receive one of the following:

" Miscellaneous and Safety Employees with 10 years of service with the City, with a regularservice retirement, shall be eligible to receive. 100% of the monthly benefit applicable towards

the employee and one dependent provided that employee plus one dependent coverage was in

effect upon the date of retirement up to Medicare age and up to $300 per month thereafter for

life.

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" Employees age fifty (50) or over receive up to $300 per month for life.

Tier 2 –Employees Hired on or After August 1, 1994(1) receive one of the following:

" Miscellaneous Employees with at least 15 years of continuous service and have reached the age

of fifty-five (55) shall be eligible to receive 100% of the monthly benefit applicable towards the

employee and one dependent provided that employee plus one dependent coverage was in effectupon the date of retirement up to Medicare age and up to $300 per month thereafter for life.

" Safety Employees with 10 years of service with the City shall be eligible to receive 50% of the

monthly benefit applicable towards the employee and one dependent provided that employee

plus one dependent coverage was in effect upon the date of retirement. The percentageincreases by 5% per year to 100% at 20 years of service up to Medicare age and up to $300 per

month thereafter for life.

" Employees age fifty (50) or over receive up to $300 per month for life.

________________________(1) Applies to safety employees hired after January 1, 1995.

Funding Policy

The contribution requirements of plan members and the City are established and may be amended bythe City Council, and/or the employee associations. The City is currently funding this OPEB obligation basedon a pay-as-you-go basis. During the fiscal year ended June 30, 2014, the City paid $153,026 in health carecosts for its retirees and their covered dependents.

Annual OPEB Cost and Net OPEB Obligation

The City's annual OPEB cost (expense) is calculated based on the ARC, an amount actuariallydetermined in accordance with parameters of GASB Statement No. 45. The ARC represents a level of fundingthat, if paid on an ongoing basis, is projected to cover normal cost each year and to amortize any unfundedliabilities of the plan over a period not to exceed thirty years.

The following table shows the components of the City's annual OPEB cost for the fiscal year 2013/14,the amount actually contributed to the plan, and changes in the City's net OPEB obligation to the Retiree HealthPlan:

Annual required contribution $ 243,447Interest on net OPEB obligation 19,464Adjustment to annual required contribution (18,510)Annual OPEB cost (expense 244,401Actual contributions made (153,026)Change in net OPEB obligation 91,375

Net OPEB Obligation – beginning of fiscal year 389,271

Net OPEB Obligation – end of fiscal year $ 480,646

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The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the netOPEB obligation for the fiscal year 2014 and the two preceding fiscal years were as follows:

FiscalYearEnd

AnnualOPEBCost

ActualContribution

Percentageof Annual

OPEB CostContributed

UnfundedAAL

(UAAL)

NetOPEB

Obligation6/30/12 $217,798 $125,785 57.75% $2,695,891 $268,3276/30/13 243,447 122,503 50.32 2,724,394 389,2716/30/14 244,401 153,026 62.61 2,724,394 480,646

Funded Status and Funding Progress

As of December 1, 2012, the initial actuarial valuation, the plan was zero percent funded. The actuarialaccrued liability for benefits was $2,724,394, and the actuarial value of assets was zero, resulting in an unfundedaccrued actuarial liability (UAAL) of $2,724,394. The covered payroll (annual payroll of active employeescovered by the plan) was $4,400,809 and the ratio of the UAAL to the covered payroll was 61.91%.

Risk Management

The City is exposed to various risks of loss related to torts, theft of, damage to and destruction of assets,errors and omissions, injuries, and natural disasters.

The City of Los Alamitos is a member of the CALIFORNIA JOINT POWERS INSURANCEAUTHORITY (Authority). The Authority is composed of 122 California public entities and is organized undera joint powers agreement pursuant to California Government Code §6500 et seq. Each member pays an annualcontribution to cover estimated losses for the coverage period. This initial funding is paid at the beginning ofthe coverage period. After the close of the coverage period, outstanding claims are valued. A retrospectivedeposit computation is then conducted annually thereafter until all claims incurred during the coverage periodare closed on a pool-wide basis. This subsequent cost re-allocation among members based on actual claimdevelopment can result in adjustments of either refunds or additional deposits required. The total fundingrequirement for self-insurance programs is estimated using actuarial models and pre-funded through the annualcontribution. Costs are allocated to individual agencies based on exposure (payroll) and experience (claims)relative to other members of the risk-sharing pool. Additional information regarding the cost allocationmethodology is provided below.

In the liability program claims are pooled separately between police and non-police exposures. (1) Thepayroll of each member is evaluated relative to the payroll of other members. A variable credibility factor isdetermined for each member, which establishes the weight applied to payroll and the weight applied to losseswithin the formula. (2) The first layer of losses includes incurred costs up to $30,000 for each occurrence and isevaluated as a percentage of the pool’s total incurred costs within the first layer. (3) The second layer of lossesincludes incurred costs from $30,000 to $750,000 for each occurrence and is evaluated as a percentage of thepool’s total incurred costs within the second layer. (4) Incurred costs in excess of $750,000 up to thereinsurance attachment point of $5 million are distributed based on the outcome of cost allocation within thefirst and second loss layers. (5) Costs of covered claims from $5 million to $10 million are paid under areinsurance contract subject to a $2.5 million annual aggregate deductible. The $2.5 million annual aggregatedeductible is fully covered under a separate policy; as such no portion of it is retained by the Authority. Costsof covered claims from $10 million to $15 million are paid under two reinsurance contracts subject to acombined $3 million annual aggregate deductible. The $3.0 million annual aggregate deductible is fullyretained by the Authority. (6) Costs of covered claims from $15 million up to $50 million are covered throughexcess insurance policies.

The overall coverage limit for each member including all layers of coverage is $50 million peroccurrence.

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Costs of covered claims for subsidence losses are paid by reinsurance and excess insurance with apooled sub-limit of $25 million per occurrence. This $25 million subsidence sub-limit is composed of (a) $5million retained within the pool’s SIR, (b) $10 million in reinsurance and (c) $10 million in excess insurance.The excess insurance layer has a $10 million annual aggregate.

In the workers’ compensation program claims are pooled separately between public safety (police andfire) and non-public safety exposures. (1) The payroll of each member is evaluated relative to the payroll ofother members. A variable credibility factor is determined for each member, which establishes the weightapplied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includesincurred costs up to $50,000 for each occurrence and is evaluated as a percentage of the pool’s total incurredcosts within the first layer. (3) The second layer of losses includes incurred costs from $50,000 to $100,000 foreach occurrence and is evaluated as a percentage of the pool’s total incurred costs within the second layer. (4)Incurred costs in excess of $100,000 up to the reinsurance attachment point of $2 million are distributed basedon the outcome of cost allocation within the first and second loss layers. (5) Costs of covered claims from $2million up to statutory limits are paid under a reinsurance policy.

Protection is provided per statutory liability under California Workers’ Compensation Law.

Employer’s Liability losses are pooled among members to $2 million. Coverage from $2 million to $5million is purchased as part of a reinsurance policy, and Employer’s Liability losses from $5 million to $10million are pooled among members.

The City of Los Alamitos participates in the all-risk property protection program of the Authority. Thisinsurance protection is underwritten by several insurance companies. City of Los Alamitos property is currentlyinsured according to a schedule of covered property submitted by the City of Los Alamitos to the Authority.City of Los Alamitos property currently has all-risk property insurance protection in the amount of $10 Million.There is a $5,000 deductible per occurrence except for non-emergency vehicle insurance which has a $1,000deductible. Premiums for the coverage are paid annually and are not subject to retrospective adjustments.

The City of Los Alamitos purchases crime insurance coverage in the amount of $3,000,000 with a$2,500 deductible. The fidelity coverage is provided through the Authority. Premiums are paid annually andare not subject to retrospective adjustments.

The City of Los Alamitos further protects against liability damages by requiring tenant users of certainproperty to purchase low-cost tenant user liability insurance for certain activities on agency property. Theinsurance premium is paid by the tenant user and is paid to the City of Los Alamitos according to a schedule.The City of Los Alamitos then pays for the insurance. The insurance is arranged by the Authority.

Settled claims have not exceeded any of the City’s coverage amounts in any of the last three fiscalyears, and there were no reductions in the City’s insurance coverage during the year ended June 30, 2015.

Complete financial statements for the Insurance Authority may be obtained at their administrative officelocated at 8081 Moody Street, La Palma, California 90623.

All self-insurance activity is reported in the City’s General Fund. At June 30, 2014, $49,518 has beenaccrued for general liability and workers’ compensation claims. This amount represents estimates of amounts tobe paid for reported and incurred, but not reported, claims based upon past experience, modified for currenttrends and information.

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Changes in the aggregate liability for claims since June 30, 2014 resulted in the following:


Liability and Claims

Workers’Compensation

GeneralLiability Total

Liability as of June 30, 2011 $ 95,767 $606,076 $701,843Claims and changes in estimates during the fiscal year ended June 30, 2012 138,892 206,887 345,779Claim payments during the fiscal year ended June 30, 2012 (32,111) (47,412) (79,523)Liability as of June 30, 2012 $202,548 $765,551 $968,099Claims and changes in estimates during the fiscal year ended June 30, 2013Claim payments during the fiscal year ended June 30, 2013 (202,548) (582,940) (785,488)Liability balance as of June 30, 2013 $182,611 $182,611Claims and changes in estimates during the fiscal year ended June 30, 2014Claims payments during the fiscal year ended June 30, 2014 (133,093) (133,093)Liability balance as of June 30, 2014 $ 49,518 $ 49,518

______________________Source: City of Los Alamitos.

The ultimate amount of losses incurred through June 30, 2014 is dependent on future developments.Based upon information from the City Attorney, the City’s claims administrators and others involved with theadministration of the insurance programs. City management believes the accrual is adequate to cover suchlosses.

Post-Employment Health Care Benefits

Retirees are reimbursed for medical insurance based upon employee agreements in effect at the time ofretirement. Funds are deducted by PERS from the retirees’ checks for retirement. The City reimburses theretiree for the City’s share of costs. Retirees are eligible to receive this benefit for a period from the date ofretirement up to age 65 based on length of service. Reimbursements are financed on a pay-as-you-go basis.Expenditures for post-employment health care benefits for fiscal year 2014 were $153,026. As of June 30,2014, 25 participants were eligible to receive benefits.

City Investment Policy and Portfolio

The City administers a pooled investment program, except for those funds which are managedseparately by trustees appointed under bond Trust Agreements. This program enables the City to combineavailable cash from all funds and to invest cash that exceeds current needs. The most recently revisedInvestment Policy for the City was adopted April 20, 2015 by the City Council.

In accordance with the Government Code, the City requires certain collateralization for public depositsin banks and savings and loans, and has long-established safekeeping and custody procedures. The CityTreasurer submits a quarterly report to the City Council that contains a statement that the City’s portfolio isinvested in conformance with state law and the Investment Policy, and that there is sufficient liquidity to meetestimated expenditures. At this time, City funds are invested in LAIF (the “Local Agency Investment Fund”),Negotiable Certificates of Deposit and U.S. Government Agency Securities.

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Education

The City is included within the boundaries of the Los Alamitos Unified School District, which alsoserves the County area southwest of the City. This district includes 6 elementary, 2 middle schools and one highschool. There is one private school, kindergarten through eighth grade. Higher education is available at severalnearby institutions: Cerritos Community College, University of California at Irvine and California StateUniversity, Long Beach.

Employment

The following table presents the annual average distribution of persons in various wage and salaryemployment categories for Anaheim Santa Ana-Irvine Metropolitan Statistical Area for 2010 through 2014.

TABLE 14ANAHEIM SANTA ANA-IRVINE METROPOLITAN STATISTICAL AREA

ANNUAL AVERAGE EMPLOYMENT COMPARISON

Title 2010 2011 2012 2013 2014

Civilian Labor Force 1,538,600 1,548,100 1,566,100 1,566,800 1,575,600

Civilian Employment 1,388,900 1,408,300 1,443,400 1,464,900 1,489,200

Civilian Unemployment 149,700 139,800 122,700 101,900 86,400

Civilian Unemployment Rate 9.7% 9.0% 7.8% 6.5% 5.5%

Total, All Industries 1,370,400 1,385,600 1,422,400 1,462,400 1,498,700

Total Farm 3,700 3,200 2,800 2,900 2,800

Mining and Logging 600 600 600 600 700

Construction 68,000 69,200 71,300 76,800 82,000

Manufacturing 150,500 154,300 158,300 158,000 158,800

Wholesale Trade 77,800 77,300 77,200 79,400 81,700

Retail Trade 141,300 142,600 144,000 145,500 148,700

Transportation, Warehousing & Utilities 26,700 27,500 28,000 27,500 26,600

Information 24,800 23,800 24,300 25,000 24,200

Financial Activities 103,500 104,800 108,300 113,100 114,100

Real Estate & Rental & Leasing 34,100 33,600 34,500 36,100 37,900

Professional & Business Services 244,900 247,700 260,600 267,300 275,800

Educational & Health Services 165,500 168,000 173,800 184,200 190,300

Leisure & Hospitality 168,600 174,000 180,600 187,800 193,500

Other Services 42,200 43,200 44,600 45,600 47,700

Government 152,300 149,300 147,900 148,700 151,900

Federal Government 12,400 11,600 11,100 11,000 10,900

State Government 27,300 28,000 28,700 29,100 29,900

Local Government 112,600 109,700 108,100 108,600 111,100

______________________Source: State of California Employment Development Department.

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B-1

APPENDIX B

SUMMARY OF PRINCIPAL LEGAL DOCUMENTS

The following is a summary of certain provisions of the Trust Agreement and the Lease Agreementwhich are not described elsewhere. This summary does not purport to be comprehensive and reference shouldbe made to the respective agreement for a full and complete statement of the provisions thereof.

TRUST AGREEMENTDefinitions

Unless the context otherwise requires, the terms defined below shall, for all purposes of this summary,have the meanings specified in the Trust Agreement.

“2006 Certificates” means the $3,365,000 original principal amount of 2006 Certificates of Participation(Laurel Park Acquisition).

“2006 Trust Agreement” means that certain Trust Agreement, dated as of May 1, 2006 by and amongthe Prior Trustee, the City and the Corporation authorizing the execution and delivery of the 2006 Certificates.

“Business Day” means a day (not including a Saturday or Sunday) on which banks are not required orauthorized to remain closed in the city in which the Principal Corporate Trust Office is located.

“Certificates of Participation” or “Certificates” means the City of Los Alamitos 2015 Certificates ofParticipation to be executed and delivered pursuant to the Trust Agreement.

“City” means the City of Los Alamitos, a city and municipal corporation, duly organized and existingunder the Constitution and laws of the State of California.

“City Representative” means the City Manager and the Director of Administrative Services of the Cityor a person authorized by the City Council to act on behalf of the City under or with respect to the TrustAgreement.

“Closing Date” means the day when the Certificates, duly executed by the Trustee, are delivered to theOriginal Purchaser thereof.

“Continuing Disclosure Certificate” means the Continuing Disclosure Certificate of the City, namedtherein given in favor of the Owners of the Certificates in connection with the sale of the Certificates to theOriginal Purchaser.

“Corporation” means the Los Alamitos Public Facilities Corporation, a California nonprofit publicbenefit corporation duly organized and existing under the laws of the State of California, its successors andassigns.

“Corporation Representative” means the President of the Corporation, the Treasurer of the Corporationor any person authorized to act on behalf of the Corporation under or with respect to the Trust Agreement asevidenced by a resolution conferring such authorization adopted by the Board of the Corporation.

“Delivery Costs” means all items of expense directly or indirectly payable by or reimbursable to theCity or the Corporation relating to the execution, sale and delivery of the Lease Agreement or the Certificates,including but not limited to filing and recording costs, settlement costs, printing costs, reproduction and bindingcosts, initial fees and charges of the Trustee (including legal fees), financing discounts, legal fees and charges,insurance fees and charges, financial and other professional consultant fees, costs of rating agencies or creditratings, costs of municipal certificate insurance, fees for execution, transportation and safekeeping of theCertificates, and charges and fees in connection with the foregoing.

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“Delivery Costs Fund” means the fund by that name established pursuant to the Trust Agreement.

“Defeasance Obligations” means any of the following:

(1) Cash (insured at all times by the Federal Deposit Insurance Corporation),

(2) Obligations of, or obligations guaranteed as to principal and interest by, the U.S. or anyagency or instrumentality thereof, when such obligations are backed by the full faith and credit of theU.S. including:

- U.S. treasury obligations- All direct or fully guaranteed obligations- Farmers Home Administration- General Services Administration- Guaranteed Title XI financing- Government National Mortgage Association (GNMA)- State and Local Government Series

Note: Any security used for defeasance must provide for the timely payment of principal and interestand cannot be callable or prepayable prior to maturity or earlier redemption of the rated debt (excludingsecurities that do not have a fixed par value and/or whose terms do not promise a fixed dollar amount atmaturity or call date).

“Escrow Agreement” means the Escrow Deposit and Trust Agreement dated as of September 1, 2015,by and among the Escrow Bank, the City and the Corporation.

“Escrow Bank” means The Bank of New York Mellon Trust Company, N.A., as escrow bank under theEscrow Agreement.

“Event of Default” means an event of default under the Lease Agreement, as defined in the LeaseAgreement.

“Fiscal Year” means the twelve-month period commencing on July 1 in any year and ending on June 30of the following year.

“Independent Counsel” means an attorney duly admitted to the practice of law before the highest courtof the state in which such attorney maintains an office and who is not an employee of the Corporation, theTrustee or the City.

“Information Services” means the Electronic Municipal Market Access System of the MunicipalSecurities Rulemaking Board; and, in accordance with then current guidelines of the Securities and ExchangeCommission, such other addresses and/or such other services providing information with respect to called bondsas may be designated in a certificate of the City delivered to the Trustee.

“Insurance and Condemnation Fund” means the fund by that name established and held by the Trusteepursuant to the Trust Agreement.

“Interest Payment Date” means each of the dates specified in the Trust Agreement on which interest isdue and payable with respect to the Certificates.

“Lease Agreement” means the Lease Agreement, dated as of September 1, 2015, by and between theCity and the Corporation, together with any duly authorized and executed amendment thereto.

“Lease Payment” means any payment required to be made by the City pursuant to the Lease Agreement,as set forth in Exhibit A to the Lease Agreement.

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“Lease Payment Fund” means the fund by that name established and held by the Trustee pursuant to theTrust Agreement.

“Leased Premises” has the meaning set forth in the Lease Agreement.

“Net Proceeds” means any title or hazard insurance proceeds or condemnation award paid with respectto the Leased Premises remaining after payment therefrom of all expenses incurred in the collection thereof.

“Original Purchaser” means Raymond James & Associates, Inc., as original purchaser of theCertificates.

“Outstanding,” when used as of any particular time with respect to Certificates, means (subject to theprovisions of the Trust Agreement) all Certificates theretofore executed and delivered by the Trustee under theTrust Agreement except:

(1) Certificates theretofore canceled by the Trustee or surrendered to the Trustee forcancellation;

(2) Certificates for the payment or prepayment of which funds or Federal Securities in thenecessary amount shall have theretofore been deposited with the Trustee (whether upon or prior to thematurity or prepayment date of such Certificates), provided that, if such Certificates are to be prepaidprior to maturity, notice of such prepayment shall have been given as provided in the Trust Agreementor provision satisfactory to the Trustee shall have been made for the giving of such notice; and

(3) Certificates in lieu of or in exchange for which other Certificates shall have beenexecuted and delivered by the Trustee pursuant to the Trust Agreement.

“Owner” or “Certificate Owner” or “Owner of a Certificate” or any similar term, when used withrespect to a Certificate, means the person in whose name such Certificate shall be registered.

“Permitted Encumbrances” has the meaning set forth in the Lease Agreement.

“Permitted Investments” means any of the following which at the time of investment are legalinvestments under the laws of the State of California for the moneys proposed to be invested therein (TheTrustee entitled to reply upon the investment direction of the City as a certification that such investment is alegal investment):

(1) Defeasance Obligations

(2) Obligations of any of the following federal agencies which obligations represent the fullfaith and credit of the United States of America, including:

- Export-Import Bank- Rural Economic Community Development Administration- U.S. Maritime Administration- Small Business Administration- U.S. Department of Housing & Urban Development (PHAs)- Federal Housing Administration- Federal Financing Bank

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(3) Direct obligations of any of the following federal agencies which obligations are notfully guaranteed by the full faith and credit of the United States of America:

- Senior debt obligations issued by the Federal National Mortgage Association(FNMA) or Federal Home Loan Mortgage Corporation (FHLMC).

- Obligations of the Resolution Funding Corporation (REFCORP)- Senior debt obligations of the Federal Home Loan Bank System- Senior debt obligations of other Government Sponsored Agencies approved by the

Bond Insurer

(4) U.S. dollar denominated deposit accounts, federal funds and bankers’ acceptances withdomestic commercial banks which may include the Trustee and its affiliates which have a rating on theirshort term certificates of deposit on the date of purchase of “P-1” by Moody’s and “A-1” or “A-1+” byS&P and maturing not more than 360 calendar days after the date of purchase. (Ratings on holdingcompanies are not considered as the rating of the bank);

(5) Commercial paper which is rated at the time of purchase in the single highestclassification, “P-1” by Moody’s and “A-1+” by S&P and which matures not more than 270 calendardays after the date of purchase;

(6) Investments in a money market fund rated “AAAm” or “AAAm-G” or better by S&P,including funds for which the Trustee, or an affiliate receives and retains a fee for services provided tothe fund, whether as a custodian, transfer agent investment advisor or otherwise;

(7) Pre-refunded Municipal Obligations defined as follows: any bonds or other obligationsof any state of the United States of America or of any agency, instrumentality or local governmentalunit of any such state which are not callable at the option of the obligor prior to maturity or as to whichirrevocable instructions have been given by the obligor to call on the date specified in the notice:

(A) which are rated, based on an irrevocable escrow account or fund (the“escrow”), in the highest rating category of Moody’s or S&P or any successors thereto; or

(B) (i) which are fully secured as to principal and interest and redemption premium,if any, by an escrow consisting only of cash or obligations described in paragraph A(2) above,which escrow may be applied only to the payment of such principal of and interest andredemption premium, if any, on such bonds or other obligations on the maturity date or datesthereof or the specified redemption date or dates pursuant to such irrevocable instructions, asappropriate, and (ii) which escrow is sufficient, as verified by a nationally recognizedindependent certified public accountant, to pay principal of and interest and redemptionpremium, if any, on the bonds or other obligations described in this paragraph on the maturitydate or dates specified in the irrevocable instructions referred to above, as appropriate.

(8) Municipal Obligations rated “Aaa/AAA” or general obligations of States with a ratingof “A2/A” or higher by both Moody’s and S&P;

(9) Investment agreements with domestic or foreign banks, insurance companies other thana life or property casualty insurance company, or corporations the long-term debt or claims payingability of which or, in the case of a guaranteed corporation, the long-term debt of the guarantor, or, inthe case of a monoline financial guaranty insurance company, claims paying ability or financialstrength, of the guarantor is rated in at least the double A category by Standard & Poor’s and Moody’s;provided that, by the terms of the investment agreement:

(a) interest payment are to be made to the Trustee at times and in amounts asnecessary to pay debt service on the Certificates (if the funds invested pursuant to theinvestment agreement are from the Reserve Fund);

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(b) the invested funds are available for withdrawal without penalty or premium,upon not more than seven (7) days’ prior notice;

(c) the investment agreement shall provide that it is the unconditional and generalobligation of, and is not subordinated to any other obligation of, the provider thereof;

(d) the City, the Corporation and the Trustee receive the opinion of domesticcounsel (which opinion shall be addressed to the City) that such investment agreement is legal,valid, binding and enforceable upon the provider in accordance with its terms and of foreigncounsel (if applicable) in form and substance acceptable, and addressed to, the City;

(e) the investment agreement shall provide that if during its term:

(1) the provider’s rating by either Standard & Poor’s or Moody’s fallsbelow “AA-“ or “Aa3,” respectively, the provider shall, at its option, within ten (10)business days after the provider’s receipt of a written request from the Fiscal Agent tosatisfy the foregoing, either (i) collateralize the investment agreement by delivering ortransferring in accordance with the applicable state and federal laws (other than bymeans of entries on the provider’s books) to the City, the Trustee, or a third party actingsolely as agent therefor (the “Holder of the Collateral”) collateral free and clear of anythird-party liens or claims, the market value of which collateral is maintained at onehundred five percent (105%) of securities identified in clauses (i) and (ii) of thisdefinition; or (ii) assign the investment agreement and all of its obligations thereunderto, or enter into a repurchase agreement or such other agreement with a financialinstitution mutually acceptable to the provider in the City which is rated either in thefirst or second highest category by Standard & Poor’s and Moody’s; and

(2) the provider’s rating by either Standard & Poor’s or Moody’s iswithdrawn or suspended or falls below “A-“ or “A3,” respectively, the provider must, atthe direction of the City or the Trustee, within ten (10) days of receipt of such direction,repay the principal of and accrued but unpaid interest on the invested funds, in eithercase with no penalty or premium to the City or the Trustee; and

(f) the investment agreement shall provide and an opinion of counsel shall berendered, in the event collateral is required to be pledged by the provider under the terms of theinvestment agreement at the time such collateral is delivered, that the Holder of the Collateralhas a perfected first priority security interest in the collateral, any substituted collateral and allproceeds thereof (in the case of bearer securities, this shall mean the Holder of the Collateral isin possession of such collateral); and

(g) the investment agreement shall provide that if during its term:

(1) the provider shall default in its payment obligations, the provider’sobligations under the investment agreement shall, at the Direction of the City or theTrustee, be accelerated and amounts invested and accrued but unpaid interest thereonshall be paid to the City or the Trustee, as appropriate; and

(2) the provider shall become insolvent, not pay its debts as they becomedue, be declared or petition to be declared bankrupt, etc., the provider’s obligationsshall automatically be accelerated and amounts invested and accrued but unpaid interestthereon shall be paid to the City or the Trustee, as appropriate.

(10) The Local Agency Investment Fund in the State Treasury of the State of California aspermitted by the State Treasurer pursuant to Section 16429.1 of the California Government Code or any

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similar pooled investment fund administered by the State, to the extent such investment is held in thename and to the credit of the Trustee.

The value of the above investments shall be determined as follows:

(a) For the purpose of determining the amount in any fund, all PermittedInvestments credited to such fund shall be valued at fair market value. The Trustee shalldetermine the fair market value based on accepted industry standards and from acceptedindustry providers;

(b) As to certificates of deposit and bankers’ acceptances: the face amount thereof,plus. accrued interest thereon; and

(c) As to any investment not specified above: the value thereof established by prioragreement among the Issuer and the Trustee.

“Prepayment” means any payment applied towards the prepayment of Lease Payments, in whole or inpart, pursuant to the Lease Agreement as a prepayment of the Lease Payments.

“Principal Corporate Trust Office” means the principal corporate trust office of the Trustee at 400 SouthHope Street, Suite 400, Los Angeles, California 90071 except that with respect to presentation of Certificates forpayment or for registration of transfer and exchange such term shall mean the office or agency of the Trustee atwhich, at any particular time, its corporate trust agency business shall be conducted.

“Prior Certificates” means the 2006 Certificates.

“Prior Trustee” means The Bank of New York Mellon Trust Company, N.A., as trustee under the 2006Trust Agreement.

“Project “ has the meaning set forth in the Lease Agreement.

“Project Costs” means all costs of payment of, or reimbursement for, acquisition, construction andfinancing of the Project, including but not limited to, architect and engineering fees, construction contractorpayments, costs of feasibility and other reports, inspection costs, permit fees, filing and recording costs, printingcosts, reproduction and binding costs, fees and charges of the Trustee, legal fees and charges, financial and otherprofessional consultant fees in connection with the foregoing.

“Project Fund” means the fund by that name established and held by the Trustee pursuant to the TrustAgreement.

“Regular Record Date” means the close of business on the fifteenth day of the month preceding eachInterest Payment Date, whether or not such fifteenth day is a business day.

“Securities Depositories” means The Depository Trust Company, 55 Water Street, 50th Floor, NewYork, N.Y. 10041-0099, Atn. Call Notification Department, Fax (212) 855-7232; and, in accordance with thencurrent guidelines of the Securities and Exchange Commission, such other addresses and/or such other securitiesdepositories as the Corporation may designate in a Written Certificate of the Corporation delivered to theTrustee.

“State” means the State of California.

“Tax Code” means the Internal Revenue Code of 1986, as amended.

“Tax Regulations” means temporary and permanent regulations promulgated under or with respect toSections 103 and 141 through 150, inclusive, of the Tax Code.

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“Term of the Lease Agreement” means the time during which the Lease Agreement is in effect, asprovided in the Lease Agreement.

“Trust Agreement” or “Agreement” means the Trust Agreement, together with any amendments orsupplements thereto permitted to be made thereunder.

“Trustee” means The Bank of New York Mellon Trust Company, N.A., or any successor thereto actingas Trustee pursuant to the Trust Agreement.

“Written Certificate”, “Written Request” and “Written Requisition” of the Corporation or the Citymean, respectively, a written certificate, request or requisition signed in the name of the Corporation by aCorporation Representative or the City by a City Representative. Any such instrument and supporting opinionsor representations, if any, may, but need not, be combined in a single instrument with any other instrument,opinion or representation, and the two or more so combined shall be read and construed as a single instrument.

Authorization

Each of the parties hereby represents and warrants that it has full legal authority and is duly empoweredto enter into the Trust Agreement, and has taken all actions necessary to authorize the execution and delivery ofthe Trust Agreement by the officers and persons signing and delivering it.

Assignment

The Lease Agreement and all rights to receive Lease Payments and all other amounts payablethereunder, except the indemnification payments provided for the Corporation under the Lease Agreement, areassigned under the Trust Agreement without recourse by the Corporation to the Trustee. The Corporation bythese presents does grant, bargain, sell, release, convey, assign, transfer, hypothecate and confirm unto theTrustee, its successors and assigns, and the Trustee accepts and assumes the following described property,rights, privileges and obligations, to wit:

(a) All estate, right, title and interest of the Corporation in and to and (except for theCorporation's rights set forth in the Lease Agreement) all duties and obligations of the Corporationunder the Lease Agreement, including, without limitation, all Lease Payments and Additional Costspayable under such Lease Agreement and including all rights of the Corporation to exercise any electionor option or to make any decision or determination or to give any notice, consent, waiver or approvalunder or in respect of the Lease Agreement as well as all rights, powers and remedies on the part of theCorporation, whether arising under the Lease Agreement or by statute or at law or in equity, orotherwise, arising out of any event of default (as that term is defined in the Lease Agreement);

(b) all the moneys and securities deposited or required to be deposited with the Trusteepursuant to any term of the Trust Agreement not expressly held for the benefit of the City; and

(c) all proceeds of the foregoing.

The Corporation confirms the foregoing constitutes an immediate and present assignment to the Trusteeunder the terms of the Trust Agreement of (i) all rights of the Corporation to exercise any election or option orto make any decision or determination or to give any notice, consent waiver or approval under or in respect ofthe Lease Agreement, and (ii) all rights of the Corporation to receive the full amount of each Lease Payment andeach payment of additional payments provided in the Lease Agreement excepting the indemnity provided for inthe Lease Agreement payable to the Corporation under the Lease Agreement.

The Trustee hereby acknowledges and accepts assignment by the Corporation of the Lease Agreement,and acknowledges and accepts all of the rights of the Corporation under the Lease Agreement, except for therights of the Corporation set forth in the Lease Agreement and except for the right of the Corporation to receiveindemnification pursuant to the Lease Agreement.

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Concurrently with the delivery hereof, the Corporation is delivering to the Trustee the executed originalcounterpart of the Lease Agreement.

Delivery Costs Fund

The Trustee shall establish a special fund designated as the “City of Los Alamitos 2015 Certificates ofParticipation Delivery Costs Fund”; shall keep such fund separate and apart from all other funds and moneysheld by it; and shall administer such fund as provided in the Trust Agreement. There shall be deposited in theDelivery Cost Fund the proceeds of the sale of the Certificates required to be deposited therein pursuant to theTrust Agreement.

Moneys on deposit in the Delivery Costs Fund shall be applied to pay Delivery Costs to the extent thatsuch fees and expenses are approved by the City. Such costs shall be payable upon receipt by the Trustee of aWritten Requisition signed by a City Representative setting forth the amounts to be disbursed for payment orreimbursement of Delivery Costs and the person or person to whom said amounts are to be disbursed, statingthat the amounts to be disbursed are for Delivery Costs properly chargeable to the Delivery Costs Fund. Eachsuch Written Requisition of the City shall be sufficient evidence to the Trustee of the facts stated therein and theTrustee shall have no duty to confirm the accuracy of such facts. Any moneys remaining in the Delivery CostsFund six months after the Closing Date shall be transferred to the Project Fund.

Project Fund

The Trustee shall establish, maintain and hold in trust a separate fund to be known as the “City of LosAlamitos 2015 Certificates of Participation Project Fund.” Except as otherwise provided in the TrustAgreement, moneys in the Project Fund shall be used solely for the acquisition of the Project. The Trustee shallkeep record of draws on the Project Fund by the withdrawal of such fund pursuant to a written requisition. Eachsuch Written Requisition of the City shall be sufficient evidence to the Trustee of the facts stated therein and theTrustee shall have no duty to confirm the accuracy of such facts. Upon completion of the Project by the City,the Project Fund shall be closed and the Trustee shall transfer any funds contained therein to the InterestAccount of the Lease Payment Fund.

Notwithstanding the foregoing provisions of the Trust Agreement, upon the occurrence and continuationof an Event of Default under and as defined in the Trust Agreement, the Trustee shall immediately withdraw allamounts then on deposit in the Project Fund and apply such amounts in accordance with the provisions of theTrust Agreement.

Assignment of Rights in Lease Agreement

The Corporation hereby transfers, assigns and sets over to the Trustee certain of its rights under theLease Agreement as set forth below, including but not limited to all of the Corporation's rights to receive andcollect all of the Lease Payments, the Prepayments and all other amounts required to be deposited in the LeasePayment Fund pursuant to the Lease Agreement or pursuant hereto but excluding the Corporation's right toconsent pursuant to the Lease Agreement. All Lease Payments, Prepayments and such other amounts to whichthe Corporation may at any time be entitled shall be paid directly to the Trustee, and all of the Lease Paymentsand Prepayments collected or received by the Corporation shall be deemed to be held and to have been collectedor received by the Corporation as the agent of the Trustee, and if received by the Corporation at any time shallbe deposited by the Corporation with the Trustee within one business day after the receipt thereof, and all suchLease Payments, Prepayments and such other amounts shall be forthwith deposited by the Trustee upon thereceipt thereof in the Lease Payment Fund.

Establishment of Lease Payment Fund; Deposits

The Trustee shall establish a special fund designated as the “City of Los Alamitos 2015 Certificates ofParticipation Lease Payment Fund.” All moneys at any time deposited by the Trustee in the Lease Payment

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Fund shall be held by the Trustee in trust for the benefit of the City and the Owners of the Certificates, and shallbe used and applied by the Trustee as set forth in the Trust Agreement.

There shall be deposited in the Lease Payment Fund all Lease Payments and Prepayments received bythe Trustee (except as provided in the Trust Agreement), including any moneys received by the Trustee fordeposit therein pursuant to the Lease Agreement, and any other moneys required to be deposited thereinpursuant to the Lease Agreement or pursuant to the Trust Agreement.

Application of Moneys

All amounts in the Lease Payment Fund shall be used and withdrawn by the Trustee solely for thepurpose of paying the principal of and the interest and prepayment premiums (if any) with respect to theCertificates as the same shall become due and payable, in accordance with the provisions of the TrustAgreement.

Surplus

Any surplus remaining in the Lease Payment Fund, after prepayment and payment of all Certificates,including premiums (if any) and accrued interest, and payment of any amounts due to the Trustee, or provisionfor such prepayment and payment having been made to the satisfaction of the Trustee, shall be withdrawn by theTrustee and remitted to the City.

Establishment of Insurance and Condemnation Fund; Application of Net Proceeds of Insurance Award

Any Net Proceeds of insurance against accident to or destruction of any structure constituting any partof the Leased Premises collected by the City in the event of any such accident or destruction shall be transferredto the Trustee pursuant to the Lease Agreement and deposited by the Trustee in a special fund designated as the“Insurance and Condemnation Fund” to be applied and disbursed by the Trustee as provided in the LeaseAgreement.

Application of Net Proceeds of Eminent Domain Award

If all or any part of the Leased Premises shall be taken by eminent domain proceedings (or sold to agovernment threatening to exercise the power of eminent domain) the Net Proceeds therefrom shall be depositedwith the Trustee in the Insurance and Condemnation Fund pursuant to the Lease Agreement and shall be appliedand disbursed by the Trustee as follows:

(a) (1) If the City determines (i) that such eminent domain proceedings have notmaterially affected the operation of the Leased Premises or the ability of the City to meet any of itsobligations under the Lease Agreement, and (ii) that such proceeds are not needed for repair orrehabilitation of the Leased Premises, the Trustee upon the written direction of the City shall transfersuch proceeds to the Lease Payment Fund to be credited towards the Prepayment required to be paidpursuant to the Lease Agreement and applied to the prepayment of Certificates in the manner providedin the Trust Agreement.

(2) If the City determines (i) that such eminent domain proceedings have notmaterially affected the operation of the Leased Premises or the ability of the City to meet any of itsobligations under the Lease Agreement, and (ii) that such proceeds are needed for repair orrehabilitation of the Leased Premises, the Trustee upon the written direction of the City shall pay to theCity, or to its order, from said proceeds such amounts as the City may expend for such repair orrehabilitation, upon the filing of requisitions of the City Representative in the form required by theLease. Each such written direction of the City shall be sufficient evidence to the Trustee of the factsstated therein and the Trustee shall have no duty to confirm the accuracy of such facts.

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(b) If (1) less than all of the Leased Premises shall have been taken in such eminent domainproceedings, and if the City determines and certifies to the Trustee that such eminent domainproceedings have materially affected the operation of the Leased Premises or the ability of the City tomeet any of its obligations under the Lease Agreement or (2) all of the Leased Premises shall have beentaken in such eminent domain proceedings, then the Trustee shall transfer such proceeds to the LeasePayment Fund to be credited toward the Prepayment required to be paid pursuant to the LeaseAgreement and applied to the prepayment of Certificates in the manner provided in the TrustAgreement.

(c) In making any such determination under the Trust Agreement, the City may obtain, butshall not be required to obtain, the report of an independent engineer or other independent professionalconsultant. Any such determination by the City shall be final.

Cooperation

he Corporation and the Trustee shall cooperate fully with the City at the expense of the City in filingany proof of loss with respect to any insurance policy maintained pursuant to the Lease Agreement and in theprosecution or defense of any prospective or pending condemnation proceeding with respect to the LeasedPremises or any part thereof.

Moneys in Funds; Investment

Held in Trust

The moneys and investments held by the Trustee under the Trust Agreement are irrevocably held intrust for the benefit of the City and the Owners of the Certificates, and for the purposes specified in the TrustAgreement, and such moneys, and any income or interest earned thereon, shall be expended only as provided inthe Trust Agreement, and shall not be subject to levy or attachment or lien by or for the benefit of any creditorof the Corporation, the Trustee or the City or any Owner of Certificates, or any of them.

Investments Authorized

Moneys held by the Trustee under the Trust Agreement, upon written order of the City Representativeshall be invested and reinvested by the Trustee in specific Permitted Investments. Such investments, ifregistrable, shall be registered in the name of the Trustee for the benefit of the Certificate Owners and held bythe Trustee. The Trustee may purchase from or sell to itself or any affiliate, as principal or agent, investmentsauthorized by the Trust Agreement. Such investments and reinvestments shall be made, giving fullconsideration to the time at which funds are required to be available. The Trustee may act as purchaser or agentin the making or disposing of any investment. The Trustee may sell or present for prepayment, any PermittedInvestment so purchased by the Trustee whenever it shall be necessary in order to provide moneys to meet anyrequired payment, transfer, withdrawal or disbursement from the fund to which such Permitted Investment iscredited, and the Trustee shall not be liable or responsible for any loss resulting from such investment.

The City and the Corporation acknowledge that to the extent regulations of the Comptroller of theCurrency or other applicable regulatory entity grant the City or the Corporation the rights to receive brokerageconfirmations of security transactions as they occur, the City and the Corporation will not receive suchconfirmations to the extent permitted by law. The Trustee will furnish the City and the Corporation periodiccash transaction statements which include detail for all investment transactions made by the Trustee hereunder.The Trustee may make any investments hereunder through its own bond or investment department or trustinvestment department, or those of its parent or any affiliate. The Trustee or any of its affiliates may act assponsor, advisor or manager in connection with any investments made by the Trustee hereunder.

In the absence of investment direction from the City, the Trustee shall hold such funds uninvestedpending receipt of written investment instructions.

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Accounting

The Trustee shall furnish to the City a monthly statement of all investments made by the Trustee. TheTrustee shall not be responsible or liable for any loss suffered in connection with any investment of funds madeby it in accordance with the Trust Agreement.

Allocation of Earnings

Any income, profit or loss on such investments shall be deposited in or charged to the respective fundsfrom which such investments were made, and any interest on any deposit of funds shall be deposited in the fundfrom which such deposit was made, except as otherwise provided in the Trust Agreement.

Valuation of Investments

For the purpose of determining the amount in any fund, all Permitted Investments credited to such fundshall be valued at the lesser of cost or market value. For purposes of the Trust Agreement, subject to theprovisions set forth in the definition of Permitted Investments, the market value of any Permitted Investmentsshall be determined as follows:

(a) as to Permitted Investments the bid and asked prices of which are published on aregular basis in The Wall Street Journal (or, if not there, then in The New York Times), the value ofsuch Permitted Investments shall be the average of the bid and asked prices for such investments sopublished on or most recently prior to the time of such determination.

(b) as to Permitted Investments the bid and asked prices of which are not published on aregular basis in The Wall Street Journal or The New York Times, the value of such Permitted Invest-ments shall be the average bid price at the time of such determination for such investments by any twonationally recognized government securities dealers (selected by the Trustee in its absolute discretion) atthe time of making a market in such investments;

(c) as to Permitted Investments consisting of certificates of deposit and bankersacceptances, the value of such Permitted Investments shall be the face amount thereof, plus accruedinterest;

(d) as to any other Permitted Investments not specified above, the value of such PermittedInvestments shall be the value thereof established by prior agreement between the City and the Trustee;and

(e) alternatively, the value of the above investments shall be determined as of the end ofeach month by the manner currently employed by the Trustee or any other manner consistent withindustry standard.

If more than one of the above provisions of the Trust Agreement shall apply at any time to anyparticular investment, the value thereof at such time shall be determined in accordance with the provisionestablishing the lowest value for such investment.

Deposit and Investment of Moneys in Funds

The Trustee may, and upon the written request of the City Representative shall, commingle any of thefunds held by it pursuant to the Trust Agreement into a separate fund or funds for investment purposes only;provided, however, that all funds or accounts held by the Trustee hereunder shall be accounted for separatelynotwithstanding such commingling by the Trustee.

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The Trustee

Appointment of Trustee

The Bank of New York Mellon Trust Company, N.A. is hereby appointed Trustee by the Corporationand the City for the purpose of receiving all moneys required to be deposited with the Trustee hereunder and toallocate, use and apply the same as provided in the Trust Agreement. The Corporation and the City agree thatthey will maintain as Trustee a bank, national banking association or trust company having a principal office inLos Angeles, California, with a combined capital and surplus of at least Seventy-Five Million Dollars($75,000,000), and subject to supervision or examination by Federal or state authority, so long as anyCertificates are outstanding. If such bank, national banking association or trust company publishes a report ofcondition at least annually pursuant to law or the requirements of any supervising or examining authority abovereferred to, then for the purpose of the Trust Agreement the combined capital and surplus of such bank, nationalbanking association or trust company shall be deemed to be its combined capital and surplus as set forth in itsmost recent report of condition so published.

The Trustee is hereby authorized to prepay the Certificates when duly presented for payment atmaturity, or on prepayment, or on purchase by the Trustee prior to maturity, and to cancel all Certificates uponpayment thereof. The Trustee shall keep accurate records of all funds administered by it and of all Certificatespaid and discharged. The Trustee shall be compensated by the City for its services rendered pursuant to theprovisions of the Trust Agreement. The Trustee's compensation shall not be limited by any law oncompensation of a Trustee of an express trust, and the Trustee shall be reimbursed upon request for allreasonable out-of-pocket expenses incurred by it; such expenses shall include, but not be limited to, thereasonable compensation and out-of-pocket expenses of the Trustee's agents and counsel. The Trustee shall bereimbursed for any advances of its own funds with interest at the maximum rate allowed by law.

The City may, in the absence of an Event of Default, remove the Trustee initially appointed, and anysuccessor thereto, and may appoint a successor or successors thereto; provided that any such successor shall be abank or trust company meeting the requirements of the Trust Agreement.

The Trustee may at any time resign by giving written notice to the City. Upon receiving such notice ofresignation, the City shall promptly appoint a successor Trustee. Any resignation or removal of the Trustee andappointment of a successor Trustee shall become effective upon acceptance of appointment by the successorTrustee. Upon such acceptance, the City shall mail notice thereof to the Certificate Owners at their respectiveaddresses set forth on the Certificate registration books maintained pursuant to the Trust Agreement. If the Cityfails to appoint a successor Trustee within thirty (30) days after receipt of such notice of resignation, the Trusteemay petition a court of competent jurisdiction for the appointment of a successor Trustee.

Every successor Trustee appointed pursuant to the Trust Agreement shall be a trust company, a nationalbanking association or bank in good standing located in or incorporated under the laws of the State, dulyauthorized to exercise trust powers and subject to examination by federal or state authority, having a reportedcapital and surplus of not less than $75,000,000.

Notwithstanding any other provision of the Trust Agreement, in determining whether the rights of theOwners will be adversely affected by any action taken pursuant to the terms and provisions of the TrustAgreement, the Trustee shall consider the effect on the Owners as if there were no Insurance Policy.

Liability of Trustee

The Trustee shall have only such duties and obligations as are expressly set forth in the TrustAgreement; no implied duties shall be read into the Trust Agreement against the Trustee. The recitals of facts,covenants and agreements in the Trust Agreement and in the Certificates contained shall be taken as statements,covenants and agreements of the Corporation and the City, and the Trustee assumes no liability orresponsibility for the correctness of the same, or makes any representations as to the validity or sufficiency ofthe Trust Agreement or of the Certificates and shall not incur any liability or responsibility in respect thereof,

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other than in connection with the duties or obligations in the Trust Agreement or in the Certificates assigned toor imposed upon the Trustee, including but not limited to the Trustee's obligations under the Trust Agreement.

Merger or Consolidation

Any company into which the Trustee may be merged or converted or with which it may be consolidatedor any company resulting from any merger, conversion or consolidation to which it shall be a party or anycompany to which the Trustee may sell or transfer all or substantially all of its corporate trust business, providedthat such company shall be eligible under the Trust Agreement, shall be the successor to the Trustee without theexecution or filing of any paper or further act, anything in the Trust Agreement to the contrary notwithstanding.

Protection and Rights of Trustee

The Trustee shall be protected and shall incur no liability in acting or proceeding in good faith upon anyresolution, notice, telegram, facsimile request, consent, waiver, certificate, statement, affidavit, voucher, bond,requisition or other paper or document which it shall in good faith believe to be genuine and to have been passedor signed by the proper board or person or to have been prepared and furnished pursuant to any of the provisionsof the Trust Agreement, and the Trustee shall be under no duty to make any investigation or inquiry as to anystatements contained or matters referred to in any such instrument, but may accept and rely upon the same asconclusive evidence of the truth and accuracy of such statements. The Trustee shall not be bound to recognizeany person as an Owner of any Certificate or to take any action at his request unless such Certificate shall bedeposited with the Trustee and satisfactory evidence of the ownership of such Certificate shall be furnished tothe Trustee. The Trustee may consult with counsel, who may be counsel to the City, with regard to legalquestions, and the opinion of such counsel shall be full and complete authorization and protection in respect ofany action taken or suffered by the Trustee in good faith and in accordance therewith.

Whenever in the administration of its duties under the Trust Agreement, the Trustee shall deem itnecessary or desirable that a matter be proved or established prior to taking or suffering any action under theTrust Agreement, such matter (unless other evidence in respect thereof be specifically prescribed in the TrustAgreement) shall be deemed to be conclusively proved and established by the certificate of the CityRepresentative or the Corporation Representative, and such certificate shall be full warranty to the Trustee forany action taken or suffered under the provisions of the Trust Agreement in reliance thereon, but in its discretionthe Trustee may, in lieu thereof, accept other evidence of such matter or may require such additional evidence asto it may seem reasonable.

The Trustee may (i) become the Owner of Certificates with the same rights it would have if it were notthe Trustee; (ii) acquire and dispose of other bonds or evidence of indebtedness of the City with the same rightsit would have if it were not the Trustee; and (iii) act as a depositary for and permit any of its officers or directorsto act as a member of, or in any other capacity with respect to, any committee formed to protect the rights ofOwners of Certificates, whether or not such committee shall represent the Owners of the majority in principalamount of the Certificates then outstanding.

The Trustee may execute any of the trusts or powers hereof and perform the duties required of it underthe Trust Agreement by or through attorneys, agents, or receivers, and shall be entitled to advice of counselconcerning all matters of trust and its duty under the Trust Agreement, and the Trustee shall not be answerablefor the default or misconduct of any such attorney, agent, or receiver selected by it with reasonable care. TheTrustee shall not be answerable for the exercise of any discretion or power under the Trust Agreement or foranything whatever in connection with the funds and accounts established under the Trust Agreement, exceptonly for its own willful misconduct or negligence.

No provision of the Trust Agreement or the Lease Agreement shall require the Trustee to risk or expendits own funds or otherwise incur any financial liability in the performance of its duties under the TrustAgreement.

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The Trustee shall not be responsible for the sufficiency or enforceability of the Lease or the assignmentunder the Trust Agreement or the Lease of its rights to receive Lease Payments.

The Trustee shall not be deemed to have knowledge of an Event of Default under the Trust Agreementor under the Lease unless and until it shall have actual knowledge thereof.

The Trustee is not accountable for the use of any funds disbursed by it in accordance with the provisionsof the Trust Agreement.

The Trustee shall have no responsibility for, and makes no representations with respect to anyinformation, statement or recital in any official statement, offering memorandum or any other disclosurematerial prepared or distributed with respect to the Certificates.

Before taking any action under the Trust Agreement, the Trustee may require indemnity satisfactory tothe Trustee be furnished from any expenses and to protect it against any liability it may incur under the TrustAgreement.

The immunities extended to the Trustee also extend to is directors, officers, employees and agents.

The Trustee shall not be liable for any action taken or not taken by it in accordance with the direction ofmajority (or other percentage provided for in the Trust Agreement) in aggregate principal amount of Certificatesoutstanding relating to the exercise of any right, power or remedy available to the Trustee.

The permissive right of the Trustee to do things enumerated in the Trust Agreement shall not beconstrued as a duty.

The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions(“Instructions”) given pursuant to this Trust Agreement and delivered using Electronic Means (“ElectronicMeans” shall mean the following communications methods: e-mail, facsimile transmission, secure electronictransmission containing applicable authorization codes, passwords and/or authentication keys issued by theTrustee, or another method or system specified by the Trustee as available for use in connection with its serviceshereunder); provided, however, that the City shall provide to the Trustee an incumbency certificate listingofficers with the authority to provide such Instructions (“Authorized Officers”) and containing specimensignatures of such Authorized Officers, which incumbency certificate shall be amended by the City whenever aperson is to be added or deleted from the listing. If the City elects to give the Trustee Instructions usingElectronic Means and the Trustee in its discretion elects to act upon such Instructions, the Trustee’sunderstanding of such Instructions shall be deemed controlling. The City understands and agrees that theTrustee cannot determine the identity of the actual sender of such Instructions and that the Trustee shallconclusively presume that directions that purport to have been sent by an Authorized Officer listed on theincumbency certificate provided to the Trustee have been sent by such Authorized Officer. The City shall beresponsible for ensuring that only Authorized Officers transmit such Instructions to the Trustee and that the Cityand all Authorized Officers are solely responsible to safeguard the use and confidentiality of applicable user andauthorization codes, passwords and/or authentication keys upon receipt by the City. The Trustee shall not beliable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon andcompliance with such Instructions notwithstanding such directions conflict or are inconsistent with a subsequentwritten instruction. The City agrees: (i) to assume all risks arising out of the use of Electronic Means to submitInstructions to the Trustee, including without limitation the risk of the Trustee acting on unauthorizedInstructions, and the risk of interception and misuse by third parties; (ii) that it is fully informed of theprotections and risks associated with the various methods of transmitting Instructions to the Trustee and thatthere may be more secure methods of transmitting Instructions than the method(s) selected by the City; (iii) thatthe security procedures (if any) to be followed in connection with its transmission of Instructions provide to it acommercially reasonable degree of protection in light of its particular needs and circumstances; and (iv) tonotify the Trustee immediately upon learning of any compromise or unauthorized use of the security procedures.

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The Trustee’s rights to immunities and protection from liability hereunder and its rights to payment ofits fees and expenses shall survive its resignation or removal and final payment or defeasance of the Certificates.All indemnifications and releases from liability granted herein to the Trustee shall extend to the directors.Officers, employees and agents of the Trustee.

The Trustee shall not be considered in breach of or in default in its obligations under the TrustAgreement or progress in respect thereto in the event of enforced delay (“unavoidable delay”) in theperformance of such obligations due to unforeseeable causes beyond its control and without its fault ornegligence, including, but not limited to, Acts of God or of the public enemy or terrorists, acts of a government,acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, earthquakes,explosion, mob violence, riot, inability to procure or general sabotage or rationing of labor, equipment, facilities,sources of energy, material or supplies in the open market, litigation or arbitration involving a party or othersrelating to zoning or other governmental action or inaction pertaining to the Project, malicious mischief,condemnation, and unusually severe weather or delays of suppliers or subcontractors due to such causes or anysimilar event and/or occurrences beyond the control of the Trustee.

Modification or Amendment of Agreements

Amendments Permitted

The Trust Agreement and the rights and obligations of the Owners of the Certificates and the LeaseAgreement and the rights and obligations of the parties thereto, may be modified or amended at any time by asupplemental agreement which shall become effective when the written consents of the Owners of sixty percent(60%) in aggregate principal amount of the Certificates then Outstanding, exclusive of Certificates disqualifiedas provided in the Trust Agreement have been obtained and be filed with the Trustee. No such modification oramendment shall (1) extend or have the effect of extending the fixed maturity of any Certificate or reducing theinterest rate with respect thereto or extending the time of payment of interest thereon, or reducing the amount ofprincipal thereof or reducing any premium payable upon the prepayment thereof, without the express consent ofthe Owner of such Certificate or (2) reduce or have the effect or reducing the percentage of Certificates requiredfor the affirmative vote or written consent to an amendment or modification of the Lease Agreement, or (3)modify any of the rights or obligations of the Trustee without its written assent thereto. Any such supplementalagreement shall become effective as provided in the Trust Agreement.

The Trust Agreement and the rights and obligations of the Owners of the Certificates and the LeaseAgreement and the rights and obligations of the parties thereto, may be modified or amended at any time by asupplemental agreement (1) to add to the covenants and agreements of any party other covenants to beobserved, or to surrender any right or power in the Trust Agreement or the Lease Agreement reserved to theCorporation or the City, (2) to cure, correct or supplement any ambiguous or defective provision contained inthe Trust Agreement or the Lease Agreement, or (3) in regard to questions arising under the Trust Agreement orthe Lease Agreement, as the parties to the Trust Agreement or the Lease Agreement may deem necessary ordesirable and which shall not adversely affect the interests of the Owners of the Certificates. Any suchsupplemental agreement shall become effective upon execution and delivery by the parties to the TrustAgreement or the Lease Agreement, as the case may be.

The City shall provide to the Trustee an opinion of counsel that the supplemental Trust Agreement orLease conforms to the requirements of the Trust Agreement.

Procedure for Amendment with Written Consent of Certificate Owners

In the event the consent of the Owners of the Certificates is required pursuant to the Trust Agreementand the Lease Agreement may be amended by supplemental agreement only upon compliance with theprovisions of the Trust Agreement. A copy of the proposed supplemental agreement, together with a request tothe Certificate Owners for their consent thereto, shall be mailed by the Trustee to each Owner of a Certificate athis address as set forth on the Certificate registration books maintained pursuant to the Trust Agreement, but

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failure to mail copies of any such supplemental agreement and request shall not affect the validity of thesupplemental agreement when assented to as provided in the Trust Agreement.

Such a supplemental agreement shall not become effective unless there shall be filed with the Trusteethe written consents of the Owners of sixty percent (60%) in aggregate principal amount of the Certificates thenOutstanding (exclusive of Certificates disqualified as provided in the Trust Agreement), and a notice shall havebeen mailed as provided in the Trust Agreement. Each such consent shall be effective only if accompanied byproof of ownership of the Certificates for which such consent is given, which proof shall be such as is permittedby the Trust Agreement. Any such consent shall be binding upon the owner of the Certificate giving suchconsent and on any subsequent owner thereof (whether or not such subsequent Owner has notice thereof) unlesssuch consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing suchrevocation with the Trustee prior to the date when the notice provided for in the Trust Agreement has beengiven.

After the Owners of the required percentage of Certificates shall have filed their consents to such asupplemental agreement, the Trustee shall mail a notice to the Owners of the Certificates in the manner providedin the Trust Agreement for the mailing of such supplemental agreements of the adoption thereof, stating insubstance that the supplemental agreement has been consented to by the Owners of the required percentage ofCertificates and will be effective as provided in the Trust Agreement (but failure to mail copies of said noticeshall not affect the validity of such a supplemental agreement or consents thereto). Such a supplementalagreement shall become effective upon the mailing of the notice last mentioned above, and the supplementalagreement shall be deemed conclusively binding upon the parties hereto and the Owners of all Certificates at theexpiration of sixty (60) days after such mailing, except in the event of a final decree of a court of competentjurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commencedwithin such sixty (60) day period.

Disqualified Certificates

Certificates owned or held by or for the account of the City or by any person directly or indirectlycontrolled by, or under direct or indirect common control with, the City (except any Certificates held in anypension or retirement fund) shall not be deemed Outstanding for the purpose of any vote, consent, waiver orother action provided for in the Trust Agreement, and shall not be entitled to vote upon, consent to, or take anyother action provided for in the Trust Agreement.

The City or Trustee may adopt appropriate regulations to require each Certificate Owner, before hisconsent provided for in the Trust Agreement shall be deemed effective, to reveal if the Certificates as to whichsuch consent is given are disqualified as provided in the Trust Agreement.

Effect of Supplemental Agreement

From and after the time any supplemental agreement becomes effective pursuant to the TrustAgreement or the Lease Agreement, as the case may be, shall be deemed to be modified and amended inaccordance therewith, and the respective rights, duties and obligations of the parties hereto or thereto, as thecase may be, and all Owners of Certificates Outstanding shall thereafter be determined, exercised and enforcedunder the Trust Agreement subject in all respects to such modification and amendment, and all the terms andconditions of any supplemental agreement shall be deemed to be part of the terms and conditions of the TrustAgreement or the Lease Agreement, as the case may be, for any and all purposes.

Endorsement or Replacement of Certificates Delivered After Amendments

The City may determine that Certificates delivered after the effective date of any action taken asprovided in the Trust Agreement shall bear a notation, by endorsement or otherwise, in form approved by theTrustee as to such action. In that case, upon demand of the Owner of any Certificate outstanding at sucheffective date and presentation of his Certificate at the office of the Trustee, a suitable notation shall be made onsuch Certificate. The City may determine that new Certificates, so modified as in the opinion of the Trustee is

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necessary to conform to action taken pursuant to the Trust Agreement, shall be prepared, executed anddelivered. In that case, upon demand of the Owner of any Certificate then Outstanding, such a new Certificateshall be exchanged for the Outstanding Certificate at the corporate trust office of the Trustee, without cost to theOwner, for a Certificate of the same character then outstanding, upon surrender of such Certificate.

Amendatory Endorsement of Certificates

The provisions of the Trust Agreement shall not prevent any Certificate Owner from accepting anyamendment as to the particular Certificates held by him, provided that due notification thereof is made on suchCertificates.

Covenants; Notices

Compliance With and Enforcement of Lease Agreement

The City covenants and agrees with the owners of the Certificates to perform all obligations and dutiesimposed on it under the Lease Agreement. The Corporation covenants and agrees with the Owners of theCertificates to perform all obligations and duties imposed on it under the Lease Agreement.

The City will not do or permit anything to be done, or omit or refrain from doing anything, in any casewhere any such act done or permitted to be done, or any such omission of or refraining from action, would ormight be a ground for cancellation or termination of the Lease Agreement by the Corporation thereunder. TheCorporation and the City, immediately upon receiving or giving any notice, communication or other documentin any way relating to or affecting their respective estates, or either of them, in the Leased Premises and the Site,which may or can in any manner affect such estate of the City, will deliver the same, or a copy thereof, to theTrustee.

Payment of Taxes

The City will pay or cause to be paid all taxes, assessments and other governmental charges, if any, thatmay be levied, assessed or charged upon the Leased Premises and the Site, or any part thereof, promptly as andwhen the same shall become due and payable; and the City will, upon request of the Trustee, from time to timekeep the Trustee advised of such payments, and deliver such evidence thereof, as the Trustee may reasonablyrequire. The City will not suffer the Leased Premises and the Site, or any part thereof, to be sold for any taxes,assessments or other charges whatsoever, or to be forfeited therefor.

Observance of Laws and Regulations

The City will well and truly keep, observe and perform all valid and lawful obligations or requirementsnow or hereafter imposed on it by contract, or prescribed by any law of the United States, or of the State ofCalifornia, or by any officer, board or commission having jurisdiction or control, as a condition of the continuedenjoyment of any and every right, privilege or franchise now owned or hereafter acquired by the City, includingits right to exist and carry on business as a municipal corporation, to the end that such rights, privileges andfranchises shall be maintained and preserved, and shall not become abandoned, forfeited or in any mannerimpaired.

Prosecution and Defense of Suits

The City shall promptly, upon request of the Trustee, from time to time take such action as may benecessary or proper to remedy or cure any defect in or cloud upon the title to the Leased Premises and the Site,whether now existing or hereafter developing and shall prosecute all such suits, actions and other proceedings asmay be appropriate for such purpose, and shall indemnify and save the Trustee and every Certificate Ownerharmless from all loss, cost, damage and expense, including attorneys' fees, which they or any of them mayincur by reason of any such defect, cloud, suit, action or proceeding.

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Recordation and Filing

The City shall record and file the Lease Agreement, the Site and Second Parking Structure LeaseAgreement and all such documents as may be required by law (together with whatever else may be necessary),all in such manner, at such times and in such places as may be required by law, in order fully to preserve, protectand perfect the security of the Trustee and the Certificate Owners.

City Budgets

The City shall supply to the Trustee, on or before October 1 of each year beginning October 1, 2016, acertificate that the City has made adequate provision in its proposed budget for the Fiscal Year for the paymentof Lease Payments due under the Lease Agreement during the Fiscal Year. The certificate given by the City tothe Trustee shall be that the amounts so budgeted are fully adequate for the payment of all Lease Payments dueunder the Lease Agreement in the then ensuing Fiscal year. If the City is unable to provide such Certificates theCity will take such action as may be necessary to cause such annual budget to be amended, corrected oraugmented so as to include therein the amounts required to be raised by the City in the then ensuing Fiscal Yearfor the payment of Lease Payments due under the Lease Agreement, and will notify the Trustee of theproceedings then taken or proposed to be taken by the City. The City will keep the Trustee advised of allproceedings thereafter taken by the City.

Further Assurances

The Corporation and the City will make, execute and deliver any and all such further resolutions,instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitatethe performance of the Trust Agreement, and for the better assuring and confirming unto the Owners of theCertificates the rights and benefits provided in the Trust Agreement.

Continuing Disclosure

The City hereby covenants and agrees that it will comply with and carry out all of the provisions of theContinuing Disclosure Agreement. Notwithstanding any other provision of the Trust Agreement, failure of theCity to comply with the Continuing Disclosure Agreement shall not be considered an Event of Default;however, the Trustee shall, at the written request of any participating underwriter or the Owners of at least 25%aggregate principal amount of Certificates, but only to the extent the Trustee has been indemnified from andagainst any loss, cost, expense, claim or liability, including, without limitation, fees and expenses of attorneysand additional fees and expenses of the Trustee or any Certificate Owner may take such actions as may benecessary and appropriate, including seeking mandamus or specific performance by court order, to cause theCity to comply with its obligations under the Trust Agreement.

Tax Covenants

The Corporation and the City hereby covenant with the Owners of the Certificates that:

(a) They will not take any action or omit to take any action, which action or omission, ifreasonably expected on the date of the initial execution and delivery of Certificates authorized pursuantto the Trust Agreement, would have caused any of such Certificates to be “arbitrage bonds” within themeaning of Section 148 of the Internal Revenue Code of 1986, as amended from time to time (the“Code”);

(b) They will not take any action or omit to take any action, which action or omission, ifreasonably expected on the date of initial execution and delivery of the Certificates authorized pursuantto the Trust Agreement would result in loss of the exclusion from gross income for purposes of federaltaxation under Section 103(a) of the Code, of interest paid with respect to such Certificates;

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(c) They will not take any action or omit to take any action, which action or omission ifreasonably expected on the date of initial execution and delivery of the Certificates authorized pursuantto the Trust Agreement, would have caused any of such Certificates to be “Private Activity Bonds”within the meaning of Section 141 of the Code; and

(d) In order to maintain the exclusion from gross income for purposes of federal incometaxation of interest paid with respect to the Certificates, the City covenants to comply with eachapplicable requirement of Section 103 and Sections 141 through 150 of the Code.

The covenants of the Corporation and the City contained in the Trust Agreement shall survive thepayment or defeasance of the Trust Agreement pursuant to the Trust Agreement.

Small Issuer Exemption from Bank Nondeductibility Restriction

The City hereby designates the Certificates for purposes of paragraph (3) of Section 265(b) of the TaxCode and represents that not more than $10,000,000 aggregate principal amount of obligations the interest onwhich is excludable (under Section 103(a) of the Tax Code) from gross income for federal income tax purposes(excluding (i) private activity bonds, as defined in Section 141 of the Tax Code, except qualified 501(c)(3)bonds as defined in Section 145 of the Tax Code, and (ii) current refunding obligations to the extent the amountof the refunding obligation does not exceed the outstanding amount of the refunded obligation), including theCertificates, has been or will be issued by the City, including all subordinate entities of the City, during thecalendar year 2015.

Limitation of Liability

Limited Liability of City

Except for the payment of Lease Payments and Prepayments when due in accordance with the LeaseAgreement and the performance of the other covenants and agreements of the City contained in said agreementwithout limitation, including the payment of fees and expenses pursuant to the Lease Agreement, the City shallhave no obligation or liability to any of the other parties hereto or to the Owners of the Certificates with respectto the Trust Agreement or the terms, execution, delivery or transfer of the Certificates, or the distribution ofLease Payments to the Owners by the Trustee.

No Liability for Trustee Performance

Except for those specific instances provided for in the Trust Agreement where the Trustee must act asspecifically requested or ordered by the City or the Corporation, neither the City nor the Corporation shall haveany obligation or liability to any of the other parties hereto or to the Owners of the Certificates with respect tothe performance by the Trustee of any duty imposed upon it under the Trust Agreement.

Limited Liability of Trustee

The Trustee shall have no obligation or responsibility for providing information to the Ownersconcerning the investment character of the Certificates, for the sufficiency or collection of any Lease Paymentsor other moneys required to be paid to it under the Lease Agreement, or for the actions or representations of anyother party to the Trust Agreement. The Trustee shall have no obligation or liability to any of the other partiesor the Owners of the Certificates with respect to the failure or refusal of any other party to perform any covenantor agreement made by any of them under the Trust Agreement or the Lease Agreement, but shall be responsiblesolely for the performance of the duties expressly imposed upon it under the Trust Agreement. The Trusteeshall not be liable in connection with the performance of its duties under the Trust Agreement, except for itsown negligence or willful misconduct.

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Indemnification

The Corporation and the City agree to indemnify and save the Trustee harmless from and against allclaims, suits and actions brought against it, or to which it is made a party, and from all liability, losses, costs,expenses, claims and damages suffered by it as a result thereof, where and to the extent any such claim, suit oraction arises out of the acceptance or performance by the Trustee of its duties under the Trust Agreement orunder the Lease. Such indemnification shall not extend to claims, suits and actions brought against the Trusteefor its own negligence or willful misconduct. In the event the Corporation or the City is required to indemnifythe Trustee as provided in the Trust Agreement, the Corporation or the City (as the case may be) shall besubrogated to the rights of the Trustee to recover losses or damages from any other person or entity. TheTrustee may have its own counsel with respect to such claims, suits and actions, and such counsel shall be paidfor by the City or the Corporation, whichever is appropriate, except in those instances where it is found by acourt of competent jurisdiction that the Trustee acted negligently or that its misconduct was willful.

Such indemnification and right to compensation shall survive termination of the Trust Agreement,resignation or removal of the Trustee or discharge of the Certificates.

Opinion of Counsel

Before being required to take any action, the Trustee may require an opinion of Independent Counselacceptable to the Trustee, which opinion shall be made available to the other parties hereto upon request, whichcounsel may be counsel to any of the parties hereto, or a verified certificate of any party hereto, or both,concerning the proposed action. If it does so in good faith, the Trustee shall be absolutely protected in relyingon such an opinion or certificate.

Limitation of Rights to Parties and Certificate Owners

Nothing in the Trust Agreement or in the Certificates expressed or implied is intended or shall beconstrued to give any person other than the City, the Corporation, the Trustee and the owners of the Certificates,any legal or equitable right, remedy or claim under or in respect of the Trust Agreement or any covenant, condi-tion or provision hereof, and all such covenants, conditions and provisions are and shall be for the sole andexclusive benefit of the City, the Corporation, the Trustee and the Owners of the Certificates.

Events of Default and Remedies of Certificate Owners

Events of Default Defined

The following shall be “Events of Default” under the Trust Agreement and the Lease Agreement andthe terms “Event of Default” and “default” shall mean, whenever they are used in the Trust Agreement and theLease Agreement, any one or more of the following events:

(i) Failure by the City to pay any Lease Payment or other payment required to be paidunder the Lease Agreement at the time specified therein.

(ii) Failure by the City to observe and perform any covenant, condition or agreement on itspart to be observed or performed in the Lease Agreement or in the Trust Agreement, other than asreferred to in clause (i) of the Trust Agreement, for a period of thirty (30) days after written noticespecifying such failure and requesting that it be remedied has been given to the City by the Corporation,the Trustee, or the Owners of not less than five percent (5%) in aggregate principal amount ofCertificates then outstanding; provided, however, if the failure stated in the notice cannot be correctedwithin the applicable period, the Corporation, the Trustee and such Owners shall not unreasonablywithhold their consent to an extension of such time if corrective action is instituted by the City withinthe applicable period and diligently pursued until the default is corrected.

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(iii) The filing by the City of a voluntary petition in bankruptcy, or failure by the Citypromptly to lift any execution, garnishment or attachment, or adjudication of the City as a bankrupt, orassignment by the City for the benefit of creditors, or the entry by the City into an agreement ofcomposition with creditors, or the approval by a court of competent jurisdiction of a petition applicableto the City in any proceedings instituted under the provisions of the Federal Bankruptcy Statute, asamended, or under any similar acts which may hereafter be enacted.

Remedies

If an Event of Default shall happen, then and in each and every such case during the continuance ofsuch Event of Default, the Trustee may exercise any and all remedies available pursuant to law or grantedpursuant to the Lease Agreement; provided, however, that notwithstanding anything in the Trust Agreement orin the Lease Agreement to the contrary, there shall be no right under any circumstances to accelerate thematurities of the Certificates or otherwise to declare any Lease Payment not then in default to be immediatelydue and payable.

Application of Funds

Notwithstanding anything to the contrary in the Lease Agreement, all moneys received by the Trusteepursuant to any right given or action taken under the provisions of the Trust Agreement or the Lease Agreement,(and any moneys in the Project Fund in the event of an Event of Default described in the Trust Agreement),shall be applied by the Trustee in the order following upon presentation of the several Certificates, and thestamping thereon of the payment if only partially paid, or upon the surrender thereof if fully paid:

First, to the payment of the costs and expenses of the Trustee, in declaring the Event of Default,including reasonable compensation to its agents, attorneys and counsel in declaring the Event of Defaultand incurred in and about the performance of its powers and duties under the Trust Agreement andLease Agreement, including reasonable compensation to its agents, attorneys and counsel and then tothe payment of the costs and expenses of the Certificate Owners in in declaring the Event of Default;

Second, to the payment of the whole amount then owing and unpaid with respect to theCertificates for principal and interest, with interest on the overdue principal and installments of interestat the rate of twelve percent (12%) per annum (but such interest on overdue installments of interest shallbe paid only to the extent funds are available therefor following payment of principal and interest andinterest on overdue principal, as aforesaid), and in case such moneys shall be insufficient to pay in fullthe whole amount so owing and unpaid with respect to the Certificates, then to the payment of suchprincipal and interest, without preference or priority of principal over interest, or of interest overprincipal, or of any installments of interest over any other installment of interest, ratably to theaggregate of such principal and interest.

Institution of Legal Proceedings

If one or more Events of Default shall happen and be continuing, the Trustee in its discretion may, andupon the written request of the Owners of a majority in principal amount of the Certificates then Outstanding,and upon being indemnified to its satisfaction therefor, shall, proceed to protect or enforce its rights or the rightsof the Owners of Certificates by a suit in equity or action at law, either for the specific performance of anycovenant or agreement contained in the Trust Agreement, or in aid of the execution of any power granted in theTrust Agreement, or by mandamus or other appropriate proceeding for the enforcement of any other legal orequitable remedy as the Trustee shall deem most effectual in support of any of its rights or duties under theTrust Agreement.

Non-waiver

Nothing in the Trust Agreement or in any other provision of the Trust Agreement, or in the Certificates,shall affect or impair the obligation of the City, which is absolute and unconditional, to pay or prepay the Lease

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Payments as provided in the Lease Agreement, or affect or impair the right of action, which is also absolute andunconditional, of the Certificate Owners to institute suit to enforce such payment. No delay or omission of theTrustee or of any Owner of any of the Certificates to exercise any right or power arising upon the happening ofany Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Eventof Default or an acquiescence therein, and every power and remedy given by the Trust Agreement to the Trusteeor to the Owners of Certificates may be exercised from time to time and as often as shall be deemed expedientby the Trustee or the Certificate Owners.

Remedies Not Exclusive

No remedy in the Trust Agreement conferred upon or reserved to the Trustee or to the Certificateowners is intended to be exclusive of any other remedy, and every such remedy shall be cumulative and shall bein addition to every other remedy given under the Trust Agreement or now or hereafter existing, at law or inequity or by statute or otherwise.

Limitation of Certificate Owners, Right to Sue

No Owner of any Certificate shall have the right to institute any suit, action or proceeding at law or inequity, with respect to any remedy under or upon the Trust Agreement, unless (a) such Owner shall havepreviously given to the Trustee written notice of the occurrence of an Event of Default; (b) the Owners of atleast a majority in aggregate principal amount of all the Certificates then Outstanding shall have made writtenrequest upon the Trustee to exercise the powers granted in the Trust Agreement or to institute such action, suitor proceeding in its own name; (c) said Owners shall have tendered to the Trustee reasonable indemnity againstthe costs, expenses and liabilities to be incurred in compliance with such request; and (d) the Trustee shall haverefused or failed to comply with such request for a period of sixty (60) days after such written request shall havebeen received by, and such tender of indemnity shall have been made to, the Trustee.

Such notification, request, tender of indemnity and refusal or failure are hereby declared, in every case,to be conditions precedent to the exercise by any Owner of Certificates of any remedy under the TrustAgreement; it being understood and intended that no one or more Owners of Certificates shall have any right inany manner whatever by his or their action to enforce any right under the Trust Agreement, except in themanner provided in the Trust Agreement, and that all proceedings at law or in equity with respect to an Event ofDefault shall be instituted, had and maintained in the manner provided in the Trust Agreement and for the equalbenefit of all Owners of the Outstanding Certificates.

The right of any Owner of any Certificate to receive payment of said Owner's proportionate interest inthe Lease Payments as the same become due, or to institute suit for the enforcement of such payment, shall notbe impaired or affected without the consent of such Owner, notwithstanding the foregoing provisions of anyother provision of the Trust Agreement.

Agreement to Pay Attorneys' Fees and Expenses

In the event the City or the Corporation should default under any of the provisions hereof and a non-defaulting party should employ attorneys or incur other expenses for the collection of moneys or theenforcement or performance or observance of any obligation or agreement on the part of the defaulting partycontained in the Trust Agreement, the defaulting party agrees that it will, on demand therefor, pay to the non-defaulting party or parties the reasonable fees of such attorneys and such other expenses so incurred by the non-defaulting party or parties.

No waivers shall be granted under the Trust Agreement without the prior written consent of the Insurer.

Defeasance

If and when all Outstanding Certificates shall be paid and discharged in any one or more of thefollowing ways:

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(a) by well and truly paying or causing to be paid the principal of and interest andprepayment premiums (if any) with respect to all Certificates Outstanding, as and when the samebecome due and payable;

(b) by depositing with the Trustee, in trust, at or before maturity, money which, togetherwith the amounts then on deposit in the Lease Payment Fund and the Reserve Fund, is fully sufficient topay all Certificates Outstanding, including all principal and interest and premium, if any;

(c) by depositing with the Trustee, in trust, Defeasance Obligations in such amount asTrustee, based upon the report of an independent certified public accountant, shall determine will,together with the interest to accrue thereon, and moneys then on deposit in the Lease Payment Fund andthe Reserve Fund, together with the interest to accrue thereon, be fully sufficient to pay and dischargeall Certificates Outstanding (including all principal, interest and prepayment premiums, if any) at orbefore their respective maturity dates; or

(d) by depositing with the Trustee, under an escrow deposit and trust agreement, securityfor the payment of Lease Payments as more particularly described in the Lease Agreement, said securityto be held by the Trustee as agent for the City to be applied by the Trustee to pay the Lease Payments asthe same become due and payable and make a Prepayment in full on any Prepayment Date, pursuant tothe Lease Agreement; notwithstanding that any Certificates shall not have been surrendered forpayment, all obligations of the Corporation, the Trustee and the City with respect to all OutstandingCertificates shall cease and terminate and the Trust Agreement shall be discharged, except only theobligation of the Trustee to pay or cause to be paid, from Lease Payments paid by or on behalf of theCity or from funds or securities deposited pursuant to paragraphs (b) through (d) of the TrustAgreement, to the Owners of the Certificates not so surrendered and paid all sums due with respectthereto, and in the event of deposits pursuant to paragraphs (b) through (d), the Certificates shallcontinue to represent direct and proportionate interests of the Owners thereof in Lease Payments underthe Lease Agreement.

Any funds held by the Trustee, at the time of one of the events described in paragraphs (a) through (d)of the Trust Agreement, which are not required for the payment to be made to Owners of the Certificates, shallbe paid over to the City.

LEASE AGREEMENTDefinitions

Unless the context otherwise requires, the terms defined in the Lease Agreement shall, for all purposesof the Lease Agreement, have the meanings specified in the Lease Agreement. Capitalized terms not otherwisedefined in the Lease Agreement shall have the meaning given to them in the Trust Agreement.

“Certificates of Participation” or “Certificates” means the City of Los Alamitos 2015 Certificates ofParticipation to be executed and delivered pursuant to the Trust Agreement.

“Certificate Year” means the period commencing as of the Closing Date and ending October 1, 2016,and for each year thereafter the period commencing October 2 and ending on the next succeeding October 1.

“City” means the City of Los Alamitos, a city and municipal corporation duly organized and existingunder the Constitution and laws of the State of California.

“City Representative” means the City Manager, the Director of Administrative Services or a personauthorized by the City Council of the City to act on behalf of the City under or with respect to the Lease.

“Closing Date” means the day when the Certificates of Participation, duly executed by the Trustee, aredelivered to the original purchaser thereof.

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“Corporation” means Los Alamitos Public Facilities Corporation, a California nonprofit public benefitcorporation organized and existing under and by virtue of the laws of the State of California and its successorsand assigns.

“Corporation Representative” means the President of the Corporation, Treasurer of the Corporation, orany person authorized to act on behalf of the Corporation under or with respect to the Lease as evidenced by aresolution conferring such authorization adopted by the Board of the Corporation.

“Delivery Costs” means all items of expense directly or indirectly payable by or reimbursable to theCity or the Corporation relating to the execution, sale and delivery of the Lease Agreement or the Certificates,including but not limited to filing and recording costs, settlement costs, printing costs, reproduction and bindingcosts, initial fees and charges of the Trustee (including legal fees), financing discounts, legal fees and charges,insurance fees and charges, financial and other professional consultant fees, costs of rating agencies or creditratings, Certificate insurance premiums, fees for execution, transportation and safekeeping of the Certificates,and charges and fees in connection with the foregoing.

“Event of Default” means one or more events of default as defined in the Lease.

“Independent Counsel” means an attorney duly admitted to the practice of law before the highest courtof the state in which such attorney maintains an office and who is not an employee of the Corporation, theTrustee or the City.

“Insurance and Condemnation Fund” means the fund by that name established and held by the Trusteepursuant to the Trust Agreement.

“Lease Agreement” or “Lease” means the Lease Agreement together with any duly authorized andexecuted amendment hereto.

“Lease Payment” means any payment required to be made by the City pursuant to the Lease and as setforth in Exhibit A attached to the Lease.

“Lease Payment Date” means the 15th day of the month prior to each Interest Payment Date with respectto the Certificates, and specifically the dates upon which the City is to make the Lease Payments pursuant to theLease and as set forth in Exhibit A attached to the Lease.

“Lease Payment Fund” means the fund by that name established and held by the Trustee pursuant to theTrust Agreement.

“Leased Premises” means Laurel Park which is further described in Exhibit C to the Lease Agreementunder the heading “Leased Premises.”

“Net Proceeds” means any insurance proceeds or condemnation award in excess of $50,000, paid withrespect to the Leased Premises, remaining after payment therefrom of all expenses incurred in the collectionthereof.

“Owner” or “Certificate Owner” or “Owner of a Certificate”, or any similar term, when used withrespect to a Certificate means the person in whose name such fully registered Certificate shall be registered.

“Permitted Encumbrances” means, as of any particular time: (i) liens for general ad valorem taxes andassessments, if any, not then delinquent, or which the City may, pursuant to provisions of the Lease Agreement,permit to remain unpaid; (ii) the Lease Agreement; (iii) any right or claim of any mechanic, laborer,materialman, supplier or vendor not filed or perfected in the manner prescribed by law and which are contestedin good faith by the City; (iv) easements, rights of way, mineral rights, drilling rights and other rights,reservations, covenants, conditions or restrictions which exist of record as of the Closing Date and which theCity certifies in writing will not materially impair the use of the Leased Premises, and (v) easements, rights of

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way, mineral rights, drilling rights and other rights, reservations, covenants, conditions or restrictionsestablished following the date of recordation of the Lease and to which the Corporation and the City consent inwriting which will not impair or impede the operation of the Leased Premises.

“Permitted Investments” shall have the meaning ascribed thereto in the Trust Agreement.

“Prepayment Date” means any date on which the City may exercise its option to prepay all or a portionof the remaining Lease Payments, as set forth in Exhibit B attached to the Lease.

“Prepayment Price” means the price to be paid by the City to exercise its option to prepay all or aportion of the remaining Lease Payments, on any prepayment Date, as set forth in Exhibit B attached to theLease.

“Project” means the design, acquisition and construction of certain public improvements as furtherdescribed in Exhibit D to the Lease Agreement under the heading “Project.”

“S&P” means Standard & Poor's Corporation, 25 Broadway, New York, New York 10004, acorporation organized and existing under the laws of the State of New York.

“Term of the Lease” or “Term” means the time during which the Lease is in effect, as provided for inthe Lease.

“Trustee” means The Bank of New York Mellon Trust Company, N.A., or any successor thereto actingas Trustee pursuant to the Trust Agreement.

“Trust Agreement” means the Trust Agreement, dated as of September 1, 2015, by and among theTrustee, the Corporation and the City, together with any duly authorized and executed amendment thereto.

Representations, Covenants and Warranties of the City

The City represents, covenants and warrants to the Corporation as follows:

(a) Due Organization and Existence. The City is a city and municipal corporation, dulyorganized and existing under the Constitution and laws of the State of California.

(b) Authorization. The Constitution and the laws of the State of California authorize theCity to enter into the Lease and the Trust Agreement and to enter into the transactions contemplated byand to carry out its obligations under all of the Lease Agreement and the Trust Agreement, and the Cityhas duly authorized and executed the Lease Agreement.

(c) No Violations. Neither the execution and delivery of the Lease or the Trust Agreement,nor the fulfillment of or compliance with the terms and conditions hereof or thereof, nor theconsummation of the transactions contemplated hereby or thereby, conflicts with or results in a breachof the terms, conditions or provisions of any restriction or any agreement or instrument to which theCity is now a party or by which the City is bound, or constitutes a default under any of the foregoing, orresults in the creation or imposition of any lien, charge or encumbrance whatsoever upon any of theproperty or assets of the City, or upon the Leased Premises, except Permitted Encumbrances.

(d) Execution and Delivery. The City has duly authorized and executed the Lease inaccordance with the Constitution and laws of the State of California.

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Representations, Covenants and Warranties of the Corporation

The Corporation represents, covenants and warrants to the City as follows:

(a) Due Organization and Existence. The Corporation is a California nonprofit publicbenefit corporation duly organized and existing under and by virtue of the laws of the State ofCalifornia, has power to enter into the Lease and the Trust Agreement; is possessed of full power to ownand hold real and personal property, and to lease and sell the same; and has duly authorized theexecution and delivery of all of the aforesaid Agreements.

(b) No Encumbrances. The Corporation will not pledge the Lease Payments or otheramounts derived from the Leased Premises and from its other rights under the Lease, and will notmortgage or encumber the Leased Premises, except as provided under the terms of the Lease and theTrust Agreement.

(c) No Violations. Neither the execution and delivery of the Lease, or the TrustAgreement, nor the fulfillment of or compliance with the terms and conditions hereof or thereof, nor theconsummation of the transactions contemplated hereby or thereby, conflicts with or results in a breachof the terms, conditions or provisions of any restriction or any agreement or instrument to which theCorporation is now a party or by which the Corporation is bound, or constitutes a default under any ofthe foregoing, or results in the creation or imposition of any lien, charge or encumbrance whatsoeverupon any of the property or assets of the Corporation, or upon the Leased Premises, except PermittedEncumbrances.

(d) No Assignments. Except as provided in the Lease Agreement, the Corporation will notassign the Lease, its right to receive Lease Payments from the City, or its duties and obligations underthe Lease Agreement to any other person, firm or entity so as to impair or violate the representations,covenants and warranties contained in the Lease.

Deposit of Moneys

On the Closing Date, the Corporation shall cause to be deposited with the Trustee the proceeds of saleof the Certificates pursuant to the Trust Agreement.

Deposit in Escrow Fund

Monies shall be deposited in the Escrow Fund, which moneys shall be disbursed for the purpose ofdefeasing the 2006 Certificates on the first date set for prepayment thereof as provided in the Trust Agreement.

Payment of Delivery Costs

Payment of all Delivery Costs shall be made from the moneys deposited with the Trustee in theDelivery Costs Fund, which moneys shall be disbursed for such purpose in accordance with the TrustAgreement.

Deposit to Project Fund

Moneys shall be deposited in the Project Fund, which moneys shall be disbursed to finance the Projectas provided in the Trust Agreement.

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Agreement to Lease; Termination of the Lease; Lease Payments; Title to the Leased Premises

Lease; No Merger

(a) In consideration of the payment of a lease payment of $3,685,000 by the Corporation and inconsideration of the execution of the Lease Agreement by the City, and other good and valuable consideration,the City hereby leases to the Corporation, and the Corporation hereby leases from the City, the Leased Premisesfor the Term of the Lease Agreement, plus one week following the end of the Term of the Lease Agreement.

(b) The Corporation hereby leases the Leased Premises to the City, and the City hereby leases theLeased Premises from the Corporation, upon the terms and conditions set forth in the Lease Agreement.

(c) The City hereby takes possession of the Leased Premises on the Closing Date.

(d) The leasing by the Corporation to the City of the Leases Premises shall not effect or result in amerger of the City's leasehold estate pursuant to the Lease and its leasehold estate as lessor under the Lease andthe Corporation shall continue to have and hold a leasehold estate in the Leased Premises throughout the termthereof and the term of the Lease.

Term of Lease

The Term of the Lease shall commence as of September 1, 2015 and, unless sooner terminated asprovided in the Lease Agreement, shall terminate on October 1, 2045, unless, on October 1, 2045, anyCertificates are Outstanding, the Lease shall continue in full force and effect until 10 days after payment in fullof all of the Certificates.

Termination of Term

The Term of the Lease shall terminate upon the earliest of any of the following events:

(a) the exercise by the City of its option to purchase the Leased Premises and Site, on anyPrepayment Date, by paying the applicable Prepayment Price as provided in the Lease Agreement;

(b) an Event of Default and the Corporation’s election to terminate the Lease Agreementpursuant to the Lease Agreement; or

(c) the arrival of the last day of the Term of the Lease and payment of all Lease Paymentsand all other payments due under the Lease Agreement.

Possession

The City agrees to take possession of the Leased Premises.

Lease Payments

(a) Obligation to Pay. Subject to the provisions of the Lease Agreement, the City agrees to pay tothe Corporation, its successors and assigns, as rental for the use and occupancy of the Leased Premises, theLease Payments (denominated into components of principal and interest) in the respective amounts specified inExhibit A hereto. A portion of each Lease Payment shall be paid as, and represents payment of, interest. Theinterest component of each Lease Payment is set forth in Exhibit A hereto. Any amount held in the LeasePayment Fund on any Lease Payment Date (other than amounts resulting from the prepayment of the LeasePayments in part but not in whole pursuant to the Lease Agreement, and other amounts required for payment ofpast due principal or interest with respect to any Certificates not presented for payment) shall be creditedtowards the Lease Payment then due and payable; and no Lease Payment need be made on any Lease PaymentDate if the amounts then held in the Lease Payment Fund are at least equal to the Lease Payment then required

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to be paid. All Lease Payments for the Leased Premises for the period from the Closing Date to September 30,2016 shall be for the use of the Leased Premises for such period of time. All Lease Payments for the LeasedPremises and Site due during any twelve-month period beginning on October 1, 2016 shall be for the use of theLeased Premises for such twelve-month period.

(b) Effect of Prepayment. In the event that the City prepays all remaining Lease Payments pursuantto the Lease Agreement, the City's obligations under the Lease, including but not limited to the City's obligationto pay Lease Payments under the Lease Agreement but excluding the City's obligation to pay the Trustee anyAdditional Payments due under the Lease Agreement, shall thereupon cease and terminate. In the event the Cityprepays less than all the remaining principal components of the Lease Payments pursuant to the LeaseAgreement, the principal components of the remaining Lease Payments shall be reduced such thatapproximately equal Lease Payments prevail, corresponding to the prevailing payments of principal and interestwith respect to the outstanding Certificates; and the interest component of each subsequent remaining LeasePayment shall be reduced by the aggregate corresponding amount of interest which would otherwise be payablewith respect to the Certificates redeemed as a result of such prepayment.

(c) Fair Rental Value. The Lease Payments for the Leased Premises for each rental payment periodduring the Term of the Lease shall constitute the total rental for the Leased Premises, if any, for such rentalpayment period, and shall be paid by the City in each rental payment period for and in consideration of the rightof the use and occupancy of, and the continued quiet use and enjoyment of the Leased Premises during eachsuch period for which said rental is to be paid. The parties hereto have agreed and determined that the totalLease Payments for the Leased Premises represent the fair rental value of the Leased Premises. In making suchdetermination, consideration has been given to the cost of acquiring, improving, constructing, installing andfinancing the Leased Premises, other obligations of the parties under the Lease, the uses and purposes whichmay be served by the Leased Premises, and the benefits therefrom which will accrue to the City and the generalpublic.

(d) Lease Payments to Constitute Current Expense of the City. The City and the Corporationunderstand and intend that the obligation of the City to pay Lease Payments and other payments under the LeaseAgreement constitutes a current expense of the City and shall not in any way be construed to be a debt of theCity in contravention of any applicable constitutional or statutory limitation or requirement concerning thecreation of indebtedness by the City, nor shall anything contained in the Lease Agreement constitute a pledge ofthe general tax revenues, funds or moneys of the City. Lease Payments due under the Lease Agreement shall bepayable only from current funds which are budgeted and appropriated, or otherwise legally available, for thepurpose of paying Lease Payments or other payments due under the Lease Agreement as consideration for useof the Leased Premises during the fiscal year of the City for which such funds were budgeted and appropriatedor otherwise made legally available for such purpose. The Lease shall not create an immediate indebtedness forany aggregate payments which may become due under the Lease Agreement. The City has not pledged the fullfaith and credit of the City, the State of California or any agency or department thereof to the payment of theLease Payments or any other payments due under the Lease Agreement, the Certificates or the interest thereon.

(e) Continuation of Lease. The City intends to continue the Lease and to pay the Lease Payments.The City reasonably believes that legally available funds of an amount sufficient to make all Lease Paymentsduring the Term of the Lease can be obtained. The City covenants that it will take all procedural steps lawfullywithin its power to obtain and maintain funds from which all payments may be made, including provisions forsuch payments to the extent necessary in each budget submitted for the purpose of obtaining funding, using itsbona fide best efforts to have such portion of the budget approved and exhausting all available administrativereviews and appeals in the event such portion of the budget is not approved.

(f) Budget and Appropriation. The City covenants to take such action as may be necessary toinclude all Lease Payments due under the Lease Agreement in its annual budgets and to make the necessaryannual appropriations for all such Lease Payments. During the Term of the Lease, the City will furnish to theTrustee a certificate annually on or before October 1 of each year beginning October 1, 2016 that it hascomplied with the requirements of the Lease Agreement. The covenants on the part of the City contained in theLease Agreement shall be deemed to be and shall be construed to be duties imposed by law, and it shall be the

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duty of each and every public official of the City to take such action and do such things as are required by law inthe performance of the official duty of such officials to enable the City to carry out and perform the covenantsand agreements in the Lease Agreement agreed to be carried out and performed by the City.

The City and the Corporation understand and intend that the obligation of the City to pay LeasePayments and other payments under the Lease Agreement constitutes a current expense of the City and shall notin any way be construed to be a debt of the City in contravention of any applicable constitutional or statutorylimitation or requirement concerning the creation of indebtedness by the City, nor shall anything contained inthe Lease Agreement constitute a pledge of the general tax revenues, funds or moneys of the City. LeasePayments due under the Lease Agreement shall be payable only from current funds which are budgeted andappropriated, or otherwise legally available, for the purpose of paying Lease Payments or other payments dueunder the Lease Agreement as consideration for use of the Leased Premises during the Fiscal Year for whichsuch funds were budgeted and appropriated or otherwise made legally available for such purpose. The LeaseAgreement shall not create an immediate indebtedness for any aggregate payments which may become dueunder the Lease Agreement. The City has not pledged the full faith and credit of the City, the State or anyagency or department thereof to the payment of the Lease Payments or any other payments due under the LeaseAgreement, the Certificates or the interest thereon.

(g) Assignment. The City understands and agrees that all Lease Payments have been assigned bythe Corporation to the Trustee pursuant to the Trust Agreement and the Assignment Agreement in trust, for thebenefit of the Owners of the Certificates, and the City hereby assents to such assignment. The Corporationhereby directs the City, and the City hereby agrees, to pay to the Trustee at the Trustee's principal corporate trustoffice in Los Angeles, California, or to the Trustee at such other place as the Trustee shall direct in writing, allpayments payable by the City pursuant to the Lease Agreement and all amounts payable by the City pursuant tothe Lease Agreement.

(h) Rate on Overdue Payments. In the event the City should fail to make any of the paymentsrequired in the Lease Agreement, the payment in default shall continue as an obligation of the City until theamount in default shall have been fully paid, and the City agrees to pay the same with interest thereon, to theextent permitted by law, from the date of default to the date of payment at the rate per annum equal to theaverage interest rate on the Certificates. Such interest, if received, shall be deposited in the Payment Fund.

Quiet Enjoyment

During the Term of the Lease, the Corporation shall provide the City with quiet use and enjoyment ofthe Leased Premises, and the City shall during such Term peaceably and quietly have and hold and enjoy theLeased Premises, without suit, trouble or hindrance from the Corporation, except as expressly set forth in theLease. The Corporation will, at the request of the City and at the City's cost, join in any legal action in whichthe City asserts its right to such possession and enjoyment to the extent the Corporation may lawfully do so.Notwithstanding the foregoing, the Corporation shall have the right to re-enter and re-let the Leased Premisesand shall have the right to inspect the Leased Premises as provided in the Lease Agreement.

Additional Payments

In addition to the Lease Payments, the City shall pay when due all costs and expenses incurred by theCorporation to comply with the provisions of the Trust Agreement, including without limitation compensationand indemnification due to the Trustee, the preparation and delivery of Continuing Disclosure, and all costs andexpenses of auditors, engineers and accountants, but excluding Delivery Costs (which shall be paid frommoneys on the Delivery Costs Fund).

Substitution or Release of Leased Premises

The City shall have, and is hereby granted, the option at any time and from time to time during the Termof the Lease Agreement, to substitute other land, facilities or improvements (the “Substitute Leased Premises”)for the Leased Premises and Site or any portion thereof (the “Former Leased Premises”) or to release a portion

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of the Leased Premises and Site (the “Released Premises”) from the lien of the Lease Agreement, provided thatthe City shall satisfy all of the following requirements which are hereby declared to be conditions precedent tosuch substitution or release:

(a) The City shall take all actions and shall execute all documents required to subject theSubstitute Leased Premises to the terms and provisions of the Lease Agreement, including the filingwith the Corporation, and the Trustee an amended Exhibit C which adds thereto a description of theSubstitute Leased Premises and deletes therefrom the description of the Former Leased Premises or theReleased Premises, as applicable;

(b) (i) In the case of a substitution, the City shall determine and certify to theCorporation, and the Trustee that the fair rental value of the Substitute Leased Premises is at least equalto the fair rental value of the Former Leased Premises;

(ii) In the case of a release, the City shall determine and certify to the Corporation,and the Trustee that the fair rental value of the remaining Leased Premises after removal of theReleased Premises is at least equal to the then remaining Lease Payments;

(c) In the case of a substitution, the City shall certify in writing to the Corporation, and theTrustee that the Substitute Leased Premises serve the public purposes of the City and constitute propertywhich the City is permitted to lease under the laws of the State;

(d) In the case of a substitution, the City shall certify in writing to the Corporation, and theTrustee that the estimated useful life of the Substitute Leased Premises at least extends to the date onwhich the final Lease Payment becomes due and payable under the Lease Agreement;

(e) In the case of a substitution other than with respect to the streets portion of the LeasedPremises, the City shall obtain a CLTA policy of title insurance meeting the requirements of the LeaseAgreement with respect to any real property portion of the Substitute Leased Premises;

(f) In the case of a substitution, the substitution of the Substitute Leased Premises shall notcause the City to violate any of its covenants, representations and warranties made in the LeaseAgreement; and

(g) The City shall obtain and cause to be filed with the Trustee, and the Corporation anopinion of nationally-organized bond counsel stating that such substitution or release is permitted underthe Lease Agreement and does not cause the interest component of the Lease Payments to becomeincludable in gross income for federal income tax purposes or subject to State of California personalincome taxes.

From and after the date on which all of the foregoing conditions precedent to such substitution orrelease are satisfied, the Term of the Lease Agreement shall cease with respect to the Former Leased Premisesor Released Premises, as applicable, and shall be continued with respect to the Substitute Leased Premises andthe remaining Leased Premises and all references in the Lease Agreement to the Former Leased Premises shallapply with full force and effect to the Substitute Leased Premises. The City shall not be entitled to anyreduction, diminution, extension or other modification of the Lease Payments whatsoever as a result of suchsubstitution or release.

Maintenance; Taxes; Insurance; and Other Matters

Maintenance, Utilities, Taxes and Assessments

Throughout the Term of the Lease, as part of the consideration for the rental of the Leased Premises, allimprovement, repair and maintenance of the Leased Premises shall be the responsibility of the City, and the Cityshall pay for or otherwise arrange for the payment of all utility services supplied to the Leased Premises, which

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may include, without limitation, janitor service, security, power, gas, telephone, light, heating, water and allother utility services, and shall pay for or otherwise arrange for the payment of the cost of the repair andreplacement of the Leased Premises resulting from ordinary wear and tear or want of care on the part of the Cityor any assignee or sublessee thereof. In exchange for the Lease Payments provided in the Lease Agreement, theCorporation agrees to provide only the Leased Premises, as more specifically set forth in the Lease Agreement.The City waives the benefits of subsections 1 and 2 of Section 1932 of the California Civil Code, but suchwaiver shall not limit any of the rights of the City under the terms of the Lease.

The City shall also pay or cause to be paid all taxes and assessments of any type or nature charged to theCorporation or affecting the Leased Premises or the respective interests or estates therein; provided that withrespect to special assessments or other governmental charges that may lawfully be paid in installments over aperiod of years, the City shall be obligated to pay only such installments as are required to be paid during theTerm of the Lease as and when the same become due.

The City or any sublessee may, at the City's or such sublessee's expense and in its name, in good faithcontest any such taxes, assessments, utility and other charges and, in the event of any such contest, may permitthe taxes, assessments or other charges so contested to remain unpaid during the period of such contest and anyappeal therefrom unless the Corporation or the Trustee shall notify the City or such sublessee that, in the opinionof Independent Counsel, by nonpayment of any such items, the interest of the Corporation in the LeasedPremises will be materially endangered or the Leased Premises, or any part thereof, will be subject to loss orforfeiture, in which event the City or such sublessee shall promptly pay such taxes, assessments or charges orprovide the Corporation with full security against any loss which may result from nonpayment, in formsatisfactory to the Corporation and the Trustee.

Modification of Leased Premises

The City and any sublessee shall, at its own expense, have the right to remodel the Leased Premises orto make additions, modifications and improvements to the Leased Premises. All such additions, modificationsand improvements shall thereafter comprise part of the Leased Premises and be subject to the provisions of theLease. Such additions, modifications and improvements shall not in any way damage the Leased Premises orcause it to be used for purposes other than those authorized under the provisions of state and federal law; and theLeased Premises, upon completion of any additions, modifications and improvements made pursuant to theLease Agreement, shall be of a value which is at least equal to the fair rental value of the Leased Premisesimmediately prior to the making of such additions, modifications and improvements. The City will not permitany mechanic's or other lien to be established or remain against the Leased Premises for labor or materialsfurnished in connection with any remodeling, additions, modifications, improvements, repairs, renewals orreplacements made by the City or any sublessee or assignee pursuant to the Lease Agreement; provided that ifany such lien is established and the City shall first notify or cause to be notified the Corporation of the City's orany sublessee's intention to do so, the City or any sublessee may in good faith contest any lien filed orestablished against the Leased Premises, and in such event may permit the items so contested to remainundischarged and unsatisfied during the period of such contest and any appeal therefrom, and shall provide theCorporation with full security against any loss or forfeiture which might arise from the nonpayment of any suchitem, in form satisfactory to the Corporation. The Corporation will cooperate fully in any such contest, upon therequest and at the expense of the City or such sublessee.

Public Liability and Property Damage Insurance and Workers Compensation Insurance

The City shall maintain or cause to be maintained, throughout the term of the Lease, a standard compre-hensive general liability insurance policy or policies in protection of the City, the Corporation and its members,officers, agents and employees, and the Trustee. Said policy or policies shall provide for indemnification of saidparties against direct or contingent loss or liability for damages for bodily and personal injury, death or propertydamage occasioned by reason of the construction or operation of the Leased Premises. Said policy or policiesshall provide coverage in the minimum liability limits of $1,000,000 for personal injury or death of each personand $3,000,000 for personal injury or deaths of two or more persons in a single accident or event, and in aminimum amount of $250,000 for damage to property (subject to a deductible clause of not to exceed $200,000)

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resulting from a single accident or event. Such public liability and property damage insurance may, however, bein the form of a single limit policy in the amount of $3,000,000 covering all such risks. Such liability insurancemay be maintained as part of or in conjunction with any other liability insurance coverage carried or required tobe carried by the City, and may be maintained in whole or in part in the form of self-insurance by the City. TheNet Proceeds of such liability insurance shall be applied toward extinguishment or satisfaction of the liabilitywith respect to which the Net Proceeds of such insurance shall have been paid.

The City will procure and maintain with responsible workers' compensation insurance against liabilityfor compensation under the Workers Compensation Insurance and Safety Act of California or any actamendatory thereof or supplemental thereto, which insurance shall cover all persons employed in connectionwith the Leased Premises and the Site.

Fire and Extended Coverage Insurance

The City shall procure and maintain, or cause to be procured and maintained, throughout the Term ofthe Lease, insurance against loss or damage to any structures constituting any part of the Leased Premises byfire and lightning, with extended coverage and vandalism and malicious mischief insurance. Said extendedcoverage insurance shall, as nearly as practicable, cover loss or damage by explosion, windstorm, riot, aircraft,vehicle damage, smoke and such other hazards as are normally covered by such insurance. Such insurance shallbe in an amount equal to one hundred percent (100%) of the replacement cost of such structures on the LeasedPremises, or the aggregate coverage of all such policies on the Leased Premises shall at least equal the principalamount of the outstanding Certificates, whichever is greater (except that such insurance may be subject todeductible clauses of not to exceed $100,000 for any one loss). Such insurance may be maintained as part of orin conjunction with any other fire and extended coverage insurance carried or required to be carried by the Cityand may not be maintained in whole or in part in the form of self-insurance by the City. The Net Proceeds ofsuch insurance shall be applied as provided in the Lease Agreement.

Rental Interruption or Use and Occupancy Insurance

The City shall procure, and maintain throughout the Term of the Lease from and after the date when ittakes possession of the Leased Premises rental interruption or use and occupancy insurance to cover loss, totalor partial, of the use of any structures constituting any part of Leased Premises as a result of any of the hazardscovered in the insurance required by the Lease Agreement, in an amount sufficient to pay the maximum LeasePayments with respect thereto payable in any twenty-four month period. The Net Proceeds of such insuranceshall be paid to the Trustee and deposited in the Lease Payment Fund, and shall be credited towards the paymentof the Lease Payments in the order in which such Lease Payments come due and payable.

Title Insurance

Upon the execution and delivery of the Certificates the City will provide, at its own expense, one ormore CLTA leasehold title insurance policies in the aggregate amount of not less than $3,685,000 with respectto the City’s leasehold interest in the Leased Premises. Said policy or policies shall insure the City's leaseholdestate in the Leased Premises, subject only to Permitted Encumbrances. All Net Proceeds received under saidpolicy or policies shall be deposited with the Trustee in the Lease Payment Fund and shall be credited towardsthe prepayment of the remaining Lease Payments pursuant to the Lease Agreement.

Insurance Net Proceeds; Form of Policies

Each policy of insurance required by the Lease Agreement shall provide that all proceeds thereundershall be payable to the Trustee for the benefit of the Certificate Owners. The City shall pay or cause to be paidwhen due the premiums for all insurance policies required by the Lease, and shall promptly furnish or cause tobe furnished evidence of such payments to the Trustee. All such policies shall provide that the Trustee shall begiven thirty (30) days' notice of each expiration, any intended cancellation thereof or reduction of the coverageprovided thereby. The Trustee shall not be responsible for the sufficiency of any insurance required in the LeaseAgreement and shall be fully protected in accepting payment on account of such insurance or any adjustment,

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compromise or settlement of any loss agreed to by the Trustee. The City shall cause to be delivered to theTrustee on each October 1 beginning October 1, 2016 a certificate signed by a City Representative stating thateach of the insurance policies required by Sections 5.3, 5.4, 5.5 and 5.6 of the Lease are in full force and effect.The Trustee may conclusively rely upon such certificate as evidence that the City has complied with Sections5.3, 5.4, 5.5 and 5.6 of the Lease.

Advances

If the City shall fail to perform any of its obligations under the Lease Agreement the Corporation or theTrustee may, but shall not be obligated to, take such action as may be necessary to cure such failure, includingthe advancement of money, and the City shall be obligated to repay all such advances as soon as possible, withinterest at the rate of twelve percent (12%) per annum from the date of the advance to the date of repayment.

Installation of City's Equipment

The City and any sublessee may at any time and from time to time, in its sole discretion and at its ownexpense, install or permit to be installed other items of equipment or other personal property in or upon theLeased Premises. All such items shall remain the sole property of such party, in which neither the Corporationnor the Trustee shall have any interest, and may be modified or removed by such party at any time provided thatsuch party shall repair and restore any and all damage to the Leased Premises resulting from the installation,modification or removal of any such items. Nothing in the Lease shall prevent the City and any sublessee frompurchasing items to be installed pursuant to the Lease Agreement under a conditional sale or lease purchasecontract, or subject to a vendor's lien or security agreement, as security for the unpaid portion of the purchaseprice thereof, provided that no such lien or security interest shall attach to any part of the Leased Premises.

Liens

The City shall not, directly or indirectly, create, incur, assume or suffer to exist any mortgage, pledge,lien, charge, encumbrance or claim on or with respect to the Leased Premises, other than the respective rights ofthe Corporation and the City as provided in the Lease Agreement and Permitted Encumbrances. Except asexpressly provided in the Lease Agreement, the City shall promptly, at its own expense, take such action as maybe necessary to duly discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim, forwhich it is responsible, if the same shall arise at any time. The City shall reimburse the Corporation for anyexpense incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge, encumbrance orclaim.

Self-Insurance

Any insurance required by Lease Agreement, except insurance required under the Lease Agreement,may be maintained by the City in the form of self-insurance. Such self-insurance shall be maintained on a basiswhich is actuarially sound as established by the City's risk manager or an independent insurance consultantwhich determination shall be made annually. Any deficiency shall be corrected within 60 days of the Citybecoming aware of such deficiency.

Tax Covenants

(a) Private Activity Bond Limitation. The City and the Corporation shall assure that the proceedsof the Certificates are not so used as to cause the Certificates to satisfy the private business tests of Section141(b) of the Tax Code or the private loan financing test of Section 141(c) of the Tax Code.

(b) Federal Guarantee Prohibition. The City and the Corporation shall not take any action or permitor suffer any action to be taken if the result of the same would be to cause any of the Certificates to be “federallyguaranteed” within the meaning of Section 149(b) of the Tax Code.

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(c) No Arbitrage. The City and the Corporation shall not take, or permit or suffer to be taken bythe Trustee or otherwise, any action with respect to the proceeds of the Certificates which, if such action hadbeen reasonably expected to have been taken, or had been deliberately and intentionally taken, on the ClosingDate would have caused the Certificates to be “arbitrage bonds” within the meaning of Section 148 of the TaxCode.

(d) Maintenance of Tax Exemption. The City and the Corporation shall take all actions necessaryto assure the exclusion of interest with respect to the Certificates from the gross income of the Owners of theCertificates to the same extent as such interest is permitted to be excluded from gross income under the TaxCode as in effect on the Closing Date.

Payment of Rebatable Amounts

The City agrees to furnish all information to, and cooperate fully with, the Trustee and their respectiveofficers, employees, agents and attorneys, in order to assure compliance with the provisions of the TrustAgreement. If the City has provided the Trustee with the calculations of rebate pursuant to the Trust Agreementand the Trustee does not have on deposit an amount of available moneys (excluding moneys on deposit in thefunds and accounts established for the payment of the principal of or interest or redemption premium, if any,with respect to the Certificates) to make such payment as specified in such calculations, the Trustee shallpromptly notify the City of such fact. Upon receipt of any such notice, the City shall promptly pay the amountsto be due and payable to the United States of America under the Trust Agreement, such payments to be made inaccordance with the applicable provisions of the Tax Code.

Change in Use

The City covenants that in the event any portion of the Leased Premises and Site financed with proceedsof the Certificates is for any reason no longer in public use by the City while the Certificates are Outstanding,the City shall promptly prepay on the next date on which a prepayment can be timely made under the LeaseAgreement and under the Trust Agreement, that portion of the Certificates corresponding to the portion of theproceeds of the Certificates used to finance such portion of the Leased Premises (the “Change in UsePrepayment”) or confirm that the Change in Use Prepayment has previously been prepaid or otherwise take suchaction as the City may determine to be necessary to preserve the exemption from gross income for federalincome tax purposes of interest with respect to the Certificates.

Bank Qualified

The City has designated the Certificates and the Lease Agreement as “qualified tax-exempt obligations”within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986. The City has issued no tax-exempt obligations in calendar year 2015 other than the Certificates. The City represents that it will not issuetax-exempt obligations (including the Certificates) in an aggregate amount of more than $10,000,000 in thecurrent calendar year.

Damage, Destruction and Eminent Domain; Use of Net Proceeds

Eminent Domain

If all of the Leased Premises shall be taken permanently under the power of eminent domain, the term ofthe Lease shall cease as of the day possession shall be so taken. If less than all of the Leased Premises shall betaken permanently, or if all of the Leased Premises or any part thereof shall be taken temporarily, under thepower of eminent domain, (1) the Lease shall continue in full force and effect and shall not be terminated byvirtue of such taking and the parties waive the benefit of any law to the contrary, and (2) there shall be apartial abatement of Lease Payments as a result of the application of the Net Proceeds of any eminentdomain award to the prepayment of the Lease Payments under the Lease Agreement, but in no eventshall the resulting Lease Payments be less than the amount required for the payment of the principaland interest with respect to outstanding Certificates as the same become due and payable.

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Application of Net Proceeds

(a) From Insurance Award. The Net Proceeds of any insurance award resulting from any damageto or destruction of any structure on the Leased Premises by fire or other casualty shall be deposited in theInsurance and Condemnation Fund by the Trustee promptly upon receipt thereof and, if the City determines thatthe replacement, repair, restoration, modification or improvement of such Leased Premises is not economicallyfeasible or in the best interest of the City, the City shall so certify to the Trustee and then such Net Proceedsshall be promptly transferred by the Trustee to the Lease Payment Fund and applied as provided in the LeaseAgreement; provided, however, that in the event of damage or destruction of the Leased Premises in full, suchNet Proceeds may be transferred to the Lease Payment Fund only if sufficient, together with other moneysavailable therefor, to cause the prepayment of all outstanding Certificates. All Net Proceeds deposited in theInsurance and Condemnation Fund and not so transferred to the Lease Payment Fund shall be applied to theprompt replacement, repair, restoration, modification or improvement of the damaged or destroyed LeasedPremises by the City, upon receipt of a requisition signed by the City Representative stating with respect to eachpayment to be made (i) the requisition number, (ii) the name and address of the person, firm or corporation towhom payment is due, (iii) the amount to be paid, and (iv) that each obligation mentioned therein has beenproperly incurred, is a proper charge against the Insurance and Condemnation Fund, has not been the basis ofany previous withdrawal, and specifying in reasonable detail the nature of the obligation. Each such requisitionthe City shall be sufficient evidence to the Trustee of the facts stated therein and the Trustee shall have no dutyto confirm the accuracy of such facts. Any balance of the Net Proceeds remaining after such work has beencompleted shall be paid to the City.

(b) From Eminent Domain Award. The Net Proceeds of any eminent domain award resulting fromany event described in the Lease Agreement shall be deposited in the Insurance and Condemnation Award Fundto be held and applied by the Trustee pursuant to the Trust Agreement.

Abatement of Rental in the Event of Damage or Destruction

The amount of the Lease Payments relating to structures on the Leased Premises shall be abated duringany period in which by reason of damage or destruction (other than by eminent domain which is provided for inthe Lease Agreement) there is substantial interference with the use and occupancy of the structures on theLeased Premises by the City. The amount of such abatement shall be determined by the City such that theresulting Lease Payments represent fair consideration for the use and occupancy of the portions of the LeasedPremises not damaged or destroyed. Such abatement shall continue for the period commencing with suchdamage or destruction and ending with the substantial completion of the work of repair or reconstruction. In theevent of any such damage or destruction, the Lease shall continue in full force and effect and the City waivesany right to terminate the Lease by virtue of any such damage or destruction. Notwithstanding the foregoing,there shall be no abatement of Lease Payments under the Lease Agreement in the event and to the extent that theNet Proceeds of rental interruption insurance are available for such purpose pursuant to the Lease Agreementand to the extent that amounts in the Reserve Fund are available to pay Lease Payments which would otherwisebe abated under the Lease Agreement.

Disclaimer of Warranties

The Corporation makes no warranty or representation, either express or implied, as to the value, design,condition, merchantability or fitness for any particular purpose or fitness for the use contemplated by the City ofthe Leased Premises or any item thereof, or any other representation or warranty with respect to the LeasedPremises or any item thereof. In no event shall the Corporation be liable for incidental, indirect, special orconsequential damages, in connection with or arising out of the Lease, or the Trust Agreement, or for the exis-tence, furnishing or functioning of, or the City's use of the Leased Premises.

Access to the Leased Premises

The City agrees that the Corporation and any Corporation Representative, and the Corporation'ssuccessors or assigns, shall have the right at all reasonable times to enter upon and to examine and inspect the

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Leased Premises. The City further agrees that the Corporation, any such Representative, and the Corporation'ssuccessors or assigns shall have such rights of access to the Leased Premises as may be reasonably necessary tocause the proper maintenance of the Leased Premises in the event of failure by the City to perform itsobligations under the Lease Agreement; provided, however, that the Corporation's assigns shall have noobligation to cause such proper maintenance.

Release and Indemnification Covenants

The City shall and hereby agrees to indemnify and save the Corporation and its assigns harmless fromand against all claims, losses and damages, including legal fees and expenses, arising out of (i) the use,maintenance, condition or management of, or from any work or thing done on the Leased Premises by the City,(ii) any breach or default on the part of the City in the performance of any of its obligations under the Lease, (iii)any act or negligence of the City or of any of its agents, contractors, servants, employees or licensees withrespect to the Leased Premises, (iv) any act or negligence of any assignee or sublessee of the City with respectto the Leased Premises, or (v) the acquisition, construction and installation of the Leased Premises. Noindemnification is made under the Lease Agreement or elsewhere in the Lease for willful misconduct,negligence, or breach of duty under the Lease by the Corporation, its officers, agents, employees, successors orassigns.

Assignment, Subleasing; Amendment; Security Interest

Assignment by the Corporation

The Corporation's rights under the Lease, including the right to receive and enforce payment of theLease Payments to be made by the City under the Lease have been assigned to the Trustee pursuant to the TrustAgreement, to which assignment the City hereby consents.

Assignment and Subleasing by the City

The Lease may not be assigned by the City. The Leased Premises may not be subleased in whole or inpart by the City without the written consent of the Corporation. Any such sublease shall be subject to all of thefollowing conditions:

(i) The Lease and the obligation of the City to make Lease Payments under the LeaseAgreement shall remain obligations of the City; and

(ii) The City shall, within thirty (30) days after the delivery thereof, furnish or cause to befurnished to the Corporation and the Trustee, a true and complete copy of such sublease; and

(iii) No such sublease by the City shall cause the Leased Premises to be used for a purposeother than a governmental or proprietary function authorized under the provisions of the Constitutionand laws of the State of California; and

(iv) The City shall furnish the Corporation and the Trustee with a written opinion ofnationally-recognized bond counsel, with respect to any such sublease, stating that such sublease shallnot cause the interest component of the Lease Payments to become includable in gross income forfederal income tax purposes or to become subject to State of California personal income taxes.

Amendment of the Lease

Without the written consent of the Trustee, the City will not alter, modify or cancel, or agree or consentto alter, modify or cancel the Lease, excepting only as such alteration or modification may be permitted by theTrust Agreement.

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Events of Default and Remedies

Events of Default Defined

The following shall be “Events of Default” under the Lease and the terms “Event of Default” and“default” shall mean, whenever they are used in the Lease, any one or more of the following events:

(i) Failure by the City to pay any Lease Payment or other payment required to be paidunder the Lease Agreement at the time specified in the Lease Agreement.

(ii) Failure by the City to observe and perform any covenant, condition or agreement on itspart to be observed or performed, other than as referred to in clause (i) of the Lease Agreement, for aperiod of thirty (30) days after written notice specifying such failure and requesting that it be remediedhas been given to the City by the Corporation, the Trustee, or the Owners of not less than five percent(5%) in aggregate principal amount of Certificates then outstanding; provided, however, if the failurestated in the notice cannot be corrected within the applicable period, the Corporation, the Trustee andsuch Owners shall not unreasonably withhold their consent to an extension of such time if correctiveaction is instituted by the City within the applicable period and diligently pursued until the default iscorrected.

(iii) The filing by the City of a voluntary petition in bankruptcy, or failure by the Citypromptly to lift any execution, garnishment or attachment, or adjudication of the City as a bankrupt, orassignment by the City for the benefit of creditors, or the entry by the City into an agreement ofcomposition with creditors, or the approval by a court of competent jurisdiction of a petition applicableto the City in any proceedings instituted under the provisions of the Federal Bankruptcy Statute, asamended, or under any similar acts which may hereafter be enacted.

Remedies on Default

Whenever any Event of Default referred to in the Lease Agreement shall have happened and becontinuing, it shall be lawful for the Corporation to exercise any and all remedies available pursuant to law orgranted pursuant to the Lease; provided, however, that notwithstanding anything in the Lease Agreement or inthe Trust Agreement to the contrary, there shall be no right under any circumstances to accelerate the LeasePayments or otherwise declare any Lease Payments not then in default to be immediately due and payable.Each and every covenant hereof to be kept and performed by the City is expressly made a condition hereof andupon the breach thereof the Corporation may exercise any and all rights of entry and re-entry upon the LeasedPremises, and also, at its option, with or without such entry, may terminate the Lease; provided, that no suchtermination shall be effected either by operation of law or acts of the parties hereto, except only in the mannerexpressly provided in the Lease Agreement. In the event of such default and notwithstanding any re-entry bythe Corporation, the City shall, as expressly provided in the Lease Agreement, continue to remain liable for thepayment of the Lease Payments and/or damages for breach of the Lease and the performance of all conditionscontained in the Lease Agreement and, in any event such rent and/or damages shall be payable to theCorporation at the time and in the manner as provided in the Lease Agreement, to wit:

(a) In the event the Corporation does not elect to terminate the Lease in the mannerprovided for in the Lease Agreement, the City agrees to and shall remain liable for the payment of allLease Payments and the performance of all conditions contained in the Lease Agreement and shallreimburse the Corporation for any deficiency arising out of the re-letting of the Leased Premises, or, inthe event the Corporation is unable to re-let the Leased Premises, then for the full amount of all LeasePayments to the end of the Term of the Lease, but said Lease Payments and/or deficiency shall bepayable only at the same time and in the same manner as provided in the Lease Agreement for thepayment of Lease Payments thereunder, notwithstanding such entry or re-entry by the Corporation orany suit in unlawful detainer, or otherwise, brought by the Corporation for the purpose of effecting suchre-entry or obtaining possession of the Leased Premises or the exercise of any other remedy by theCorporation. The City hereby irrevocably appoints the Corporation as the agent and attorney-in-fact of

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the City to enter upon and re-let the Leased Premises in the event of default by the City in theperformance of any covenants contained in the Lease Agreement to be performed by the City and toremove all personal property whatsoever situated upon the Leased Premises and to place such propertyin storage or other suitable place in the County of Orange, State of California, for the account of and atthe expense of the City, and the City hereby exempts and agrees to save harmless the Corporation fromany costs, loss or damage whatsoever arising or occasioned by any such entry upon and re-letting theLeased Premises and the removal and storage of such property by the Corporation or its duly authorizedagents in accordance with the provisions contained in the Lease Agreement. The City hereby waivesany and all claims for damages caused or which may be caused by the Corporation in re-entering andtaking possession of the Leased Premises as provided in the Lease Agreement and all claims fordamages that may result from the destruction of or injury to the Leased Premises and all claims fordamages to or loss of any property belonging to the City that may be in or upon the Leased Premises.The City agrees that the terms of the Lease constitute full and sufficient notice of the right of theCorporation to re-rent the Leased Premises in the event of such re-entry without effecting a surrender ofthe Lease, and further agrees that no acts of the Corporation in effecting such re-renting or re-leasingshall constitute a surrender or termination of the Lease irrespective of the term for which such re-leasingor re-renting is made or the terms and conditions of such re-leasing or re-renting, or otherwise, but that,on the contrary, in the event of such default by the City the right to terminate the Lease shall vest in theCorporation to be effected in the sole and exclusive manner provided for in the Lease Agreement. TheCity further waives the right to any rental obtained by the Corporation in excess of the Lease Paymentsand hereby conveys and releases such excess to the Corporation as compensation to the Corporation forits services in re-leasing the Leased Premises.

(b) In an event of default by the City under the Lease Agreement, the Corporation at itsoption may terminate the Lease and re-rent or re-lease all or any portion of the Leased Premises. In theevent of the termination of the Lease by the Corporation at its option and in the manner provided in theLease Agreement on account of default by the City (and notwithstanding any reentry upon the LeasedPremises by the Corporation in any manner whatsoever or the re-renting or re-leasing of the LeasedPremises), the City nevertheless agrees to pay to the Corporation all costs, loss or damages howsoeverarising or occurring, payable at the same time and in the same manner as is provided in the LeaseAgreement in the case of payment of Lease Payments. Any surplus received by the Corporation fromsuch re-renting or re-leasing shall be the absolute property of the Corporation and the City shall have noright thereto, nor shall the City be entitled to any credit in the event of a deficiency in the rentalsreceived by the Corporation from the Leased Premises. Neither notice to pay rent or to deliver uppossession of the premises given pursuant to law nor any proceeding in unlawful detainer taken by theCorporation shall of itself operate to terminate the Lease, and no termination of the Lease on account ofdefault by the City shall be or become effective by operation of law, or otherwise, unless and until theCorporation shall have given written notice to the City of the election on the part of the Corporation toterminate the Lease. The City covenants and agrees that no surrender of the Leased Premises for theremainder of the Term hereof or any termination of the Lease shall be valid in any manner or for anypurpose whatsoever unless stated or accepted by the Corporation by such written notice.

No Remedy Exclusive

No remedy in the Lease Agreement conferred upon or reserved to the Corporation or the Trustee isintended to be exclusive and every such remedy shall be cumulative and shall be in addition to every otherremedy given under the Lease or now or hereafter existing at law or in equity. No delay or omission to exerciseany right or power accruing upon any default shall impair any such right or power or shall be construed to be awaiver thereof, but any such right and power may be exercised from time to time and as often as may be deemedexpedient. In order to entitle the Corporation to exercise any remedy reserved to it in the Lease Agreement itshall not be necessary to give any notice, other than such notice as may be required in the Lease Agreement orby law. To the extent that the Lease confers upon or gives or grants to the Trustee any right remedy or claimunder or by reason of the Lease Agreement, the Trustee is hereby explicitly recognized as being a third partybeneficiary under the Lease Agreement and may enforce any such right, remedy or claim conferred given orgranted.

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Agreement to Pay Attorneys' Fees and Expenses

In the event either party to the Lease should default under any of the provisions hereof and thenondefaulting party should employ attorneys or incur other expenses for the collection of moneys or theenforcement or performance or observance of any obligation or agreement on the part of the defaulting partycontained in the Lease Agreement, the defaulting party agrees that it will on demand therefor pay to thenondefaulting party the reasonable fees of such attorneys and such other expenses so incurred by thenondefaulting party.

No Additional Waiver Implied by One Waiver

In the event any agreement contained in the Lease should be breached by either party and thereafterwaived by the other party, such waiver shall be limited to the particular breach so waived and shall not bedeemed to waive any other breach under the Lease Agreement.

Application of Proceeds

All Net Proceeds received from the release or other disposition of the Leased Premises or the Site, underthe Lease Agreement, and all other amounts derived by the Corporation or the Trustee as a result of an Event ofDefault under the Lease Agreement, shall be transferred to the Trustee promptly upon receipt thereof and afterpayment of the fees and expenses of the Trustee, including, without limitation those of its attorneys, agents andadvisors shall be deposited by the Trustee in the Acquisition Fund to be applied as provided for in the TrustAgreement.

Trustee and Certificate Owners to Exercise Rights

Such rights and remedies as are given to the Corporation under the Lease Agreement have beenassigned by the Corporation to the Trustee under the Trust Agreement, to which assignment the City herebyconsents. Such rights and remedies shall be exercised by the Trustee and the Owners of the Certificates asprovided in the Trust Agreement.

Prepayment of Lease Payments

Security Deposit

Notwithstanding any other provision of the Lease, the City may on any date secure the payment ofLease Payments by a deposit with the Trustee of: (i) cash in an amount which, together with amounts on depositin the Lease Payment Fund and the Reserve Fund, is sufficient to pay all unpaid Lease Payments, including theprincipal and interest components thereof, in accordance with the Lease Payment Schedule set forth in Exhibit Ahereto, or (ii) Defeasance Obligations together with cash, if required, in such amount as will, in the opinion ofan independent certified public accountant, together with interest to accrue thereon and, if required, all or aportion of moneys, Defeasance Obligations then on deposit in the Lease Payment Fund and Reserve Fund, befully sufficient to pay all unpaid Lease Payments on their respective Lease Payment Dates or by prepaymentthereof pursuant to the Lease Agreement, as the City shall instruct at the time of said deposit. In the event of adeposit pursuant to the Lease Agreement, all obligations of the City under the Lease, and all security providedby the Lease for said obligations, shall cease and terminate, excepting only the obligation of the City to make, orcause to be made, Lease Payments from the deposit made by the City pursuant to the Lease Agreement, and titleto the Leased Premises and the Site shall vest in the City on the date of said deposit automatically and withoutfurther action by the City or the Corporation. Said deposit shall be deemed to be and shall constitute a specialfund for the payment of Lease Payments in accordance with the provisions of the Lease.

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Optional Prepayment

(a) In Whole. The City may exercise its option to purchase the Leased Premises, on anyPrepayment Date, by paying the applicable Prepayment Price as shown in Exhibit B hereto, together with theinterest component of the Lease Payment required to be paid on such Prepayment Date. Such Prepayment Priceshall be deposited by the Trustee in the Lease Payment Fund to be applied to the prepayment of Certificatespursuant to the Trust Agreement. The City Shall give the Trustee notice of its intention to exercise its option notless than sixty (60) days in advance of the date of exercise.

(b) In Part. The City may exercise its option to purchase a portion of the Leased Premises on anyPrepayment Date by paying an amount equal to the principal components of the unpaid Lease Paymentsallocable to a component of the Leased Premises as set forth in Exhibit A hereto, together with the interestcomponent of the Lease Payments required to be paid on such Prepayment Date, plus a premium equal to thepremium to be paid under the Trust Agreement upon the prepayment of Certificates resulting from prepaymentmade pursuant to this paragraph (b). Such pre-payment shall be deposited by the Trustee in the Lease PaymentFund to be applied to the prepayment of Certificates pursuant to the Trust Agreement. The City shall give theTrustee notice of its intention to exercise its option no less than sixty (60) days in advance of the date of exer-cise. In the event the City exercises its option to prepay Lease Payments in part, the City shall provide theTrustee with an amended Exhibit A hereto reflecting the new schedule of Lease Payments.

Mandatory Prepayment From Net Proceeds of Insurance, Eminent Domain or Sale

The City shall be obligated to prepay the Lease Payments with respect to the Leased Premises, in wholeor in part on any April 1 or October 1 from and to the extent of any Net Proceeds of insurance award or condem-nation award or sale with respect to the Leased Premises and Site theretofore deposited in the Lease PaymentFund for such purpose pursuant to the Lease Agreement or pursuant to the Trust Agreement. The City and theCorporation hereby agree that such Net Proceeds, to the extent remaining after payment of any delinquent LeasePayments, if any, shall be credited towards the City's obligations under the Lease Agreement.

Credit for Amounts on Deposit

In the event of prepayment of the principal components of the Lease Payments in full under the LeaseAgreement, such that the Trust Agreement shall be discharged by its terms as a result of such prepayment, allamounts then on deposit in the Lease Payment Fund or the Reserve Fund shall be credited towards the amountsthen required to be so prepaid.

APPENDIX C

AUDITED FINANCIAL STATEMENTS OF THE CITY FOR FISCAL YEAR 2013-14

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CITY OF LOS ALAMITOS

COMPREHENSIVE ANNUAL FINANCIAL REPORT

FOR THE FISCAL YEAR ENDED JUNE 30, 2014

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Table of Contents

INTRODUCTORY SECTION

FXggXe"bY"NeTaf`\ggT_",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"\"?_XVgXW"IYY\V\T_f"TaW";W`\a\fgeTg\iX"JXefbaaX_",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"i"IeZTa\mTg\ba"=[Teg",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"i\"

FINANCIAL SECTION

" CaWXcXaWXag";hW\gberf"LXcbeg",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/"" GTaTZX`Xagrf">\fVhff\ba"TaW";aT_lf\f,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"2" "

" <Tf\V"@\aTaV\T_"MgTgX`Xagf"

" AbiXea`Xag+j\WX"@\aTaV\T_"MgTgX`Xagf8"" " MgTgX`Xag"bY"HXg"Jbf\g\ba",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/2"" " MgTgX`Xag"bY";Vg\i\g\Xf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/3"

" @haW"@\aTaV\T_"MgTgX`Xagf8"" AbiXea`XagT_"@haWf8"" " <T_TaVX"M[XXg",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/4"" " LXVbaV\_\Tg\ba"bY"g[X"AbiXea`XagT_"@haWf"<T_TaVX"M[XXg"gb"g[X"MgTgX`Xag"" " " bY"HXg"Jbf\g\ba",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/5"" " MgTgX`Xag"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a"@haW"<T_TaVXf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/6"" " LXVbaV\_\Tg\ba"bY"g[X"MgTgX`Xag"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"" " " Ca"@haW"<T_TaVXf"bY"AbiXea`XagT_"@haWf"gb"g[X"MgTgX`Xag"bY";Vg\i\g\Xf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/7"

" Jebce\XgTel"@haWf8"" " MgTgX`Xag"bY"HXg"Jbf\g\ba,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"0."" " MgTgX`Xag"bY"LXiXahXf*"?kcXafXf*"TaW"=[TaZXf"\a"HXg"Jbf\g\ba",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"0/"" " MgTgX`Xag"bY"=Tf["@_bjf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"00"

" " HbgXf"gb"g[X"<Tf\V"@\aTaV\T_"MgTgX`Xagf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"01"

REQUIRED SUPPLEMENTARY SECTION

" " """MV[XWh_X"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a""" " " " " " @haW"<T_TaVX"s"<hWZXg"TaW";VghT_"s"AXaXeT_"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"33"

" " """MV[XWh_X"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a""" " " " " " @haW"<T_TaVX"s"<hWZXg"TaW";VghT_"s"GXTfheX"G"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"34"

" " MV[XWh_X"bY"@haW\aZ"JebZeXff8"" " " " Ig[Xe"Jbfg+?`c_bl`Xag"<XaXY\gf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"35"

Table of Contents (Continued)

OTHER SUPPLEMENTARY INFORMATION SECTION

MV[XWh_Xf"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a""" " " " " @haW"<T_TaVXf"+"<hWZXg"TaW";VghT_"s"NeTYY\V"C`cebiX`Xag"=Tc\gT_"Jeb]XVgf"@haW",,,,,,,,,,,,,,,,,,,"37"" " MV[XWh_Xf"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a""" " " " " @haW"<T_TaVXf"+"<hWZXg"TaW";VghT_"s"L\iXef"TaW"GbhagT\af"=bafXeiTaVl"=Tc\gT_""" " " " " ""Jeb]XVgf"YhaW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"4/"" " Hba`T]be"AbiXea`XagT_"@haWf8"" " " " =bÙ\a\aZ"<T_TaVX"M[XXg",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"40"" " " " =bÙ\a\aZ"MgTgX`Xag"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf""" " " " " " \a"@haW"<T_TaVXf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"44"" " MV[XWh_Xf"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a""" " " " " @haW"<T_TaVXf"+"<hWZXg"TaW";VghT_8""

GXTfheX"G"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"5."" " " " " ATf"NTk"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"5/"" " " " " Fbf";_T`\gbf"NX_Xi\f\ba"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"50"" " " " " IYY\VX"bY"NeTYY\V"TaW"MTYXgl"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"51"" " " " " ;ffXg"MX\mheX"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"52" " " " " JhU_\V"MTYXgl"MT_Xf"NTk"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"53"" " " " " MgTgX"FTj"?aYbeVX`Xag"MXei\VX"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"54"" " " " " ;\e"KhT_\gl"McXV\T_"LXiXahX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"55"" " " " " >XUg"MXei\VX"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"56"" " " " " JTe^">XiX_bc`Xag"=Tc\gT_"Jeb]XVgf"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"57"" " " " " <h\_W\aZ"C`cebiX`Xag"=Tc\gT_"Jeb]XVgf"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"6."" " " " " LXf\WXag\T_"MgeXXgf-;__Xlf"=Tc\gT_"Jeb]XVgf"@haW",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"6/"" " CagXeaT_"MXei\VX"@haWf8""" " " " " =bÙ\a\aZ"MgTgX`Xag"bY"HXg"Jbf\g\ba",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"60"" " " " =bÙ\a\aZ"MV[XWh_X"bY"LXiXahXf*"?kcXaW\gheXf*"TaW"=[TaZXf"\a"HXg"Jbf\g\ba",,,,,,,,,,,,,,,,,,,,,,,,"61"" " " " " =bÙ\a\aZ"MgTgX`Xag"bY"=Tf["@_bjf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"62"" " "STATISTICAL SECTION

" " >XfVe\cg\ba"bY"MgTg\fg\VT_"MXVg\ba"=bagXagf""" " " " " HXg"Jbf\g\ba"Ul"=b`cbaXag"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"64"" " " " " =[TaZXf"\a"HXg"Jbf\g\ba"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"66"" " " " " @haW"<T_TaVXf"bY"AbiXea`XagT_"@haWf"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"7."" " " " " =[TaZXf"\a"@haW"<T_TaVXf"bY"AbiXea`XagT_"@haWf"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,"70"" " " " " " " " 0./1-/2"OfX"=TgXZbel"Mh``Tel+<Tf\V"JebcXegl"PT_hX"NTU_X"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,"72"

" " " " ;ffXffXW"PT_hX"TaW"?fg\`TgXW";VghT_"PT_hX"bY"NTkTU_X"JebcXegl"FTfg"NXa"@\fVT_""" " " " """SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"75"

" " " " " >\eXVg"TaW"IiXe_Tcc\aZ"JebcXegl"NTk"LTgXf"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"76"" " " " " Je\aV\cT_"JebcXegl"NTk"JTlXef"=heeXag"SXTe"TaW"NXa"SXTef";Zb",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.."" " " " " JebcXegl"NTk"FXi\Xf"TaW"=b__XVg\baf"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/./"" " " " " " " " LTg\b"bY"IhgfgTaW\aZ">XUg"Ul"NlcX"FTfg"NXa"@\fVT_"SXTef,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.0"" " " " " >\eXVg"TaW"IiXe_Tcc\aZ"AbiXea`XagT_";Vg\i\gl">XUg",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.1"


Table of Contents (Continued)

STATISTICAL SECTION (Continued)

" " " " " FXZT_">XUg"GTeZ\a"CaYbe`Tg\ba",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.2"" " " " " >X`bZeTc[\V"TaW"?Vbab`\V"MgTg\fg\Vf",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.3"" " " " " " " " Je\aV\cT_"?`c_blXef"=heeXag"SXTe"TaW"NXa"SXTef";Zb",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.4"" " " " " " " " @h__+N\`X"?dh\iT_Xag"=\gl"AbiXea`Xag"?`c_blXXf"Ul"@haVg\ba-JebZeT`"" " " " " " " " """FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"/.6"" " " " " IcXeTg\aZ"CaW\VTgbef"Ul"@haVg\ba-JebZeT`"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"//."" " " " " =Tc\gT_";ffXg"MgTg\fg\Vf"Ul"@haVg\ba-JebZeT`"FTfg"NXa"@\fVT_"SXTef",,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,"//0"" " "

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

Qcpwct{.><7.><=A.

HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL

Pv. ku.o{.rngcuwtg.vq.uwdokv.vjg.Jqortgjgpukxg.Hppwcn.Mkpcpekcn.Ygrqtv.4JHMY5.qh.vjg.Jkv{.qh.Squ.Hncokvqu.4vjg.Jkv{5.hqt.vjg.hkuecn.{gct.gpfgf.Qwpg.?<7.><=@9.

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City of Los Alamitos Profile

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Economic Outlook

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Acknowledgements

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DIRECTORY OF OFFICIALS

CITY COUNCIL

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JVTWYPZL![OL!3P[`bZ!IHZPJ!MPUHUJPHS!Z[H[LTLU[Z!HZ!H!ÔVSL'!COL!9U[YVK\J[VY`!BLJ[PVU%!3VTIPUPUN!HUK!9UKP]PK\HS!

>VU&THQVY! M\UK! MPUHUJPHS! Z[H[LTLU[Z%! >VU&THQVY! M\UKZ! 2\KNL[HY`! 3VTWHYPZVU! BJOLK\SLZ%! =HQVY! 3HWP[HS!

@YVQLJ[! 2\KNL[HY`! 3VTWHYPZVU! BJOLK\SLZ%! 3VTIPUPUN! 9U[LYUHS! BLY]PJL! M\UK! MPUHUJPHS! Z[H[LTLU[Z%! HUK! [OL!

Z[H[PZ[PJHS!ZLJ[PVU!HYL!WYLZLU[LK!MVY!W\YWVZLZ!VM!HKKP[PVUHS!HUHS`ZPZ!HUK!HYL!UV[!H!YLX\PYLK!WHY[!VM![OL!MPUHUJPHS!

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BJOLK\SLZ%!=HQVY!3HWP[HS!@YVQLJ[!2\KNL[HY`!3VTWHYPZVU!BJOLK\SLZ%!HUK![OL!3VTIPUPUN!9U[LYUHS!BLY]PJL!M\UK!

MPUHUJPHS! Z[H[LTLU[Z! HYL! [OL! YLZWVUZPIPSP[`! VM! THUHNLTLU[! HUK! ^LYL! KLYP]LK! MYVT! HUK! YLSH[L! KPYLJ[S`! [V! [OL!

\UKLYS`PUN!HJJV\U[PUN!HUK!V[OLY!YLJVYKZ!\ZLK![V!WYLWHYL![OL!MPUHUJPHS!Z[H[LTLU[Z'!B\JO!PUMVYTH[PVU!OHZ!ILLU!

Z\IQLJ[LK![V![OL!H\KP[PUN!WYVJLK\YLZ!HWWSPLK!PU![OL!H\KP[!VM![OL!IHZPJ!MPUHUJPHS!Z[H[LTLU[Z!HUK!JLY[HPU!HKKP[PVUHS!

WYVJLK\YLZ%!PUJS\KPUN!JVTWHYPUN!HUK!YLJVUJPSPUN!Z\JO!PUMVYTH[PVU!KPYLJ[S`![V![OL!\UKLYS`PUN!HJJV\U[!HUK!V[OLY!

YLJVYKZ!\ZLK![V!WYLWHYL![OL!IHZPJ!MPUHUJPHS!Z[H[LTLU[Z!VY![V![OL!IHZPJ!MPUHUJPHS!Z[H[LTLU[Z![OLTZLS]LZ%!HUK!V[OLY!

HKKP[PVUHS! WYVJLK\YLZ! PU! HJJVYKHUJL! ^P[O! H\KP[PUN! Z[HUKHYKZ! NLULYHSS`! HJJLW[LK! PU! [OL! DUP[LK! B[H[LZ! VM!

1TLYPJH'!9U!V\Y!VWPUPVU%![OL!PUMVYTH[PVU!PZ!MHPYS`!Z[H[LK!PU!HSS!TH[LYPHS!YLZWLJ[Z!PU!YLSH[PVU![V![OL!IHZPJ!MPUHUJPHS!

Z[H[LTLU[Z!HZ!H!^OVSL'!!!

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V\Y!JVUZPKLYH[PVU!VM![OL!3P[`bZ!PU[LYUHS!JVU[YVS!V]LY!MPUHUJPHS!YLWVY[PUN!HUK!VU!V\Y![LZ[Z!VM!P[Z!JVTWSPHUJL!^P[O!

JLY[HPU!WYV]PZPVUZ!VM!SH^Z%!YLN\SH[PVUZ%!JVU[YHJ[Z%!HUK!NYHU[!HNYLLTLU[Z!HUK!V[OLY!TH[[LYZ'!COL!W\YWVZL!VM![OH[!

YLWVY[!PZ![V!KLZJYPIL![OL!ZJVWL!VM!V\Y![LZ[PUN!VM!PU[LYUHS!JVU[YVS!V]LY!MPUHUJPHS!YLWVY[PUN!HUK!JVTWSPHUJL!HUK![OL!

YLZ\S[Z! VM! [OH[! [LZ[PUN%! HUK! UV[! [V! WYV]PKL! HU! VWPUPVU! VU! PU[LYUHS! JVU[YVS! V]LY! MPUHUJPHS! YLWVY[PUN! VY! VU!

JVTWSPHUJL'!COH[! YLWVY[! PZ! HU! PU[LNYHS! WHY[! VM! HU! H\KP[! WLYMVYTLK! PU! HJJVYKHUJL! ^P[O! +AH8D@?8@F! (G7=F=@;!

2F4@74D7E!PU!JVUZPKLYPUN![OL!3P[`bZ!PU[LYUHS!JVU[YVS!V]LY!MPUHUJPHS!YLWVY[PUN!HUK!JVTWSPHUJL!

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MANAGEMENT’S DISCUSSION AND ANALYSIS

[jg.ocpcigogpv.qh.vjg.Jkv{.qh.Squ.Hncokvqu.4�Jkv{�5.qhhgtu.tgcfgtu.qh.vjg.Jkv{�u.hkpcpekcn.uvcvgogpvu. vjku. pcttcvkxg. qxgtxkgy. cpf. cpcn{uku. qh. vjg. Jkv{�u. hkpcpekcn. cevkxkvkgu. hqt. vjg.hkuecn. {gct. gpfgf. Qwpg. ?<7. ><=@9. . ^g. gpeqwtcig. tgcfgtu. vq. eqpukfgt. vjg. kphqtocvkqp.rtgugpvgf.jgtg. kp.eqplwpevkqp.ykvj.cffkvkqpcn. kphqtocvkqp. vjcv. ku.rtqxkfgf. kp.qwt. ngvvgt.qh.vtcpuokvvcn9. .[jg.rtgugpvcvkqp.qh. vjg.Jkv{�u.hkpcpekcn.fcvc. kp. vjku.cpcn{uku.cpf.uvcvgogpvu.yknn.fkhhgt.htqo.vjg.Jkv{�u.dwfigv7.kp.vjcv.vjg.cpcn{uku.cpf.uvcvgogpvu.ctg.tgswktgf.vq.hqnnqy.Nqxgtpogpvcn.Heeqwpvkpi.Zvcpfctfu.Iqctf.Zvcvgogpv.Uwodgt.?@.cpf.qvjgt.Zvcvgogpvu.vq. cnnqecvg. equvu. cuuqekcvgf. ykvj. ecrkvcn. tgncvgf. kvgou7. nqpi8vgto. fgdv. vtcpucevkqpu7.ceetwgf. kpvgtguv7.eqorgpucvgf.cdugpegu. kpvgtpcn.ugtxkeg. hwpf.cevkxkv{7.cpf.fgrtgekcvkqp.vq.vjg.xctkqwu.hwpevkqpu.qh.vjg.Jkv{G.yjgtgcu.vjg.Jkv{�u.dwfigv.ku.cp.qrgtcvkqpcn.hkpcpekcn.rncp.hqt.vjg.wreqokpi.hkuecn.{gct9.

OVERVIEW OF THE FINANCIAL STATEMENTS

[jku. fkuewuukqp. cpf. cpcn{uku. rtqxkfgu. cp. kpvtqfwevkqp. vq. vjg. Jkv{�u. dcuke. hkpcpekcn.uvcvgogpvu9..[jg.Jkv{�u.dcuke.hkpcpekcn.uvcvgogpvu.ctg.eqortkugf.qh.vjtgg.eqorqpgpvuF.=5.iqxgtpogpv8ykfg. hkpcpekcn.uvcvgogpvu7.>5. hwpf. hkpcpekcn. uvcvgogpvu7.cpf.?5.pqvgu. vq. vjg.hkpcpekcn.uvcvgogpvu9.

Government-wide financial statements...[jg.iqxgtpogpv8ykfg.hkpcpekcn.uvcvgogpvu.ctg.fgukipgf. vq. rtqxkfg. tgcfgtu.ykvj. c. dtqcf. qxgtxkgy. qh. vjg.Jkv{�u. hkpcpegu7. kp. c.ocppgt.ukoknct.vq.c.rtkxcvg8ugevqt.dwukpguu9.

[jg. uvcvgogpv. qh. pgv. rqukvkqp. rtgugpvu. kphqtocvkqp. qp. cnn. qh. vjg. Jkv{�u. cuugvu. cpf.nkcdknkvkgu7. ykvj. vjg. fkhhgtgpeg. dgvyggp. vjg. vyq. tgrqtvgf. cu. pgv. rqukvkqp9. . Vxgt. vkog7.kpetgcugu. qt. fgetgcugu. kp. pgv. rqukvkqp. oc{. ugtxg. cu. c. wughwn. kpfkecvqt. qh. yjgvjgt. vjg.hkpcpekcn.rqukvkqp.qh.vjg.Jkv{.ku.kortqxkpi.qt.fgvgtkqtcvkpi9.

[jg. uvcvgogpv. qh. cevkxkvkgu. rtgugpvu. kphqtocvkqp. ujqykpi. jqy. vjg. Jkv{�u. pgv. rqukvkqp.ejcpigf. fwtkpi. vjg. oquv. tgegpv. hkuecn. {gct9 Hnn. ejcpigu. kp. pgv. rqukvkqp. ku. tgrqtvgf. cu.uqqp.cu.vjg.wpfgtn{kpi.gxgpv.ikxkpi.tkug.vq.vjg.ejcpig.qeewtu7.tgictfnguu.qh.vjg.vkokpi.qh.tgncvgf.ecuj.hnqyu9..[jwu7.tgxgpwgu.cpf.gzrgpugu.ctg.tgrqtvgf.kp.vjku.uvcvgogpv.hqt.uqog.kvgou.vjcv.yknn.qpn{.tguwnv.kp.ecuj.hnqyu.kp.hwvwtg.hkuecn.rgtkqfu.4g9i97.wpeqnngevgf.vczgu.cpf.gctpgf.dwv.wpwugf.xcecvkqp.ngcxg59.

[jg. iqxgtpogpv8ykfg. hkpcpekcn. uvcvgogpvu. fkuvkpiwkuj. hwpevkqpu. qh. vjg. Jkv{. vjcv. ctg.rtkpekrcnn{. uwrrqtvgf. d{. vczgu. cpf. kpvgtiqxgtpogpvcn. tgxgpwgu. 4iqxgtpogpv. cevkxkvkgu5.htqo.qvjgt.hwpevkqpu.vjcv.ctg.kpvgpfgf.vq.tgeqxgt.cnn.qt.c.ukipkhkecpv.rqtvkqp.qh.vjgkt.equvu.vjtqwij.wugt.hggu.cpf.ejctigu.4dwukpguu8v{rg.cevkxkvkgu59..[jg.iqxgtpogpvcn.cevkxkvkgu.qh.vjg. Jkv{. kpenwfg.igpgtcn. iqxgtpogpv7. rwdnke. uchgv{7. eqoowpkv{. fgxgnqrogpv7. tgetgcvkqp.cpf.eqoowpkv{.ugtxkegu7.cpf.rwdnke.yqtmu9..[jg.Jkv{.jcu.pq.dwukpguu8v{rg.cevkxkvkgu9.

[jg.Nqxgtpogpvcn.Hevkxkvkgu.ctg.rtgugpvgf.qp.vjg.ceetwcn.dcuku.qh.ceeqwpvkpi7.c.dcuku.qh.ceeqwpvkpi.vjcv.fkhhgtu. htqo.vjg.oqfkhkgf.ceetwcn.dcuku.qh.ceeqwpvkpi.wugf. kp.rtgugpvkpi.iqxgtpogpvcn. hwpf. hkpcpekcn. uvcvgogpvu9. Uqvg. =. qh. vjg. Uqvgu. vq. vjg. Icuke. Mkpcpekcn.Zvcvgogpvu.hwnn{.fguetkdg.vjgug.dcugu.qh.ceeqwpvkpi9

Fund financial statements. H. hwpf. ku. c. itqwrkpi. qh. tgncvgf. ceeqwpvu. vjcv. ku. wugf. vq.ockpvckp. eqpvtqn. qxgt. tguqwtegu. vjcv. jcxg. dggp. ugitgicvgf. hqt. urgekhke. cevkxkvkgu. qt.qdlgevkxgu9. .[jg.Jkv{7. nkmg.qvjgt. nqecn.iqxgtpogpvu7.wugu. hwpf.ceeqwpvkpi. vq.gpuwtg.cpf.

#"("#

fgoqpuvtcvg.eqornkcpeg.ykvj. hkpcpeg8tgncvgf. ngicn.tgswktgogpvu9. .Hnn.qh. vjg. hwpfu.qh. vjg.Jkv{.ecp.dg.fkxkfgf.kpvq.vyq.ecvgiqtkguF iqxgtpogpvcn.hwpfu.cpf.rtqrtkgvct{.hwpfu9.

Governmental funds...Nqxgtpogpvcn.hwpfu.ctg.wugf.vq.ceeqwpv.hqt.guugpvkcnn{.vjg.ucog.hwpevkqpu. tgrqtvgf. cu. iqxgtpogpvcn. cevkxkvkgu. kp. vjg. iqxgtpogpv8ykfg. hkpcpekcn.uvcvgogpvu9. . Oqygxgt7. wpnkmg. vjg. iqxgtpogpv8ykfg. hkpcpekcn. uvcvgogpvu7. iqxgtpogpvcn.hwpf. hkpcpekcn. uvcvgogpvu. hqewu. qp. pgct8vgto. cpf. qwvhnqyu. qh. urgpfcdng. tguqwtegu7. cu.ygnn.cu.qp.dcncpegu.qh.urgpfcdng.tguqwtegu.cxckncdng.cv.vjg.gpf.qh.vjg.hkuecn.{gct9..Zwej.kphqtocvkqp.oc{.dg.wughwn.kp.gxcnwcvkpi.c.iqxgtpogpv3u.pgct8vgto.hkpcpekpi.tgswktgogpvu9.

Igecwug.vjg. hqewu.qh.iqxgtpogpvcn. hwpfu. ku.pcttqygt. vjcp.vjcv.qh. vjg.iqxgtpogpv8ykfg.hkpcpekcn.uvcvgogpvu7. kv. ku.wughwn. vq.eqorctg. vjg. kphqtocvkqp.rtgugpvgf. hqt.iqxgtpogpvcn.hwpfu. ykvj. ukoknct. kphqtocvkqp. rtgugpvgf. hqt. iqxgtpogpvcn. cevkxkvkgu. kp. vjg. iqxgtpogpv8ykfg. hkpcpekcn. uvcvgogpvu9. . I{. fqkpi. uq7. tgcfgtu. oc{. dgvvgt. wpfgtuvcpf. vjg. nqpi8vgto.korcev.qh. vjg.iqxgtpogpv3u.pgct8vgto. hkpcpekpi.fgekukqpu9. .Iqvj. vjg.iqxgtpogpvcn. hwpf.dcncpeg. ujggv. cpf. vjg. iqxgtpogpvcn. hwpf. uvcvgogpv. qh. tgxgpwgu7. gzrgpfkvwtgu7. cpf.ejcpigu. kp. hwpf. dcncpegu.rtqxkfg.c. tgeqpeknkcvkqp. vq. hceknkvcvg. vjku. eqorctkuqp.dgvyggp.iqxgtpogpvcn.hwpfu.cpf.iqxgtpogpvcn.cevkxkvkgu9.

[jg. Jkv{. ockpvckpu. ugxgpvggp. kpfkxkfwcn. iqxgtpogpvcn. hwpfu9. . Pphqtocvkqp. ku. rtgugpvgf.ugrctcvgn{. kp. vjg. iqxgtpogpvcn. hwpf. dcncpeg. ujggv. cpf. kp. vjg. iqxgtpogpvcn. hwpf.uvcvgogpv. qh. tgxgpwgu7. gzrgpfkvwtgu7. cpf. ejcpigu. kp. hwpf. dcncpegu. hqt. vjg. Ngpgtcn.Mwpf7. vjg.[tchhke. Portqxgogpv. Mwpf7. Wtqrqukvkqp.=I.Mwpf.cpf. vjg.Ykxgtu. 2.Tqwpvckpu.Jqpugtxcpe{.Mwpf7.yjkej.ctg.eqpukfgtgf.vq.dg.oclqt.hwpfu9..Kcvc.htqo.vjg.qvjgt.vjktvggp.iqxgtpogpvcn.hwpfu.ctg.eqodkpgf.kpvq.c.ukping7.ciitgicvgf.rtgugpvcvkqp9..Ppfkxkfwcn.hwpf.fcvc.hqt.gcej.qh.vjgug.pqpoclqt.iqxgtpogpvcn.hwpfu.ku.rtqxkfgf.kp.vjg.hqto.qh.eqodkpkpi.uvcvgogpvu.gnugyjgtg.kp.vjku.tgrqtv9.

[jg. Jkv{. cfqrvu. cp. cppwcn. crrtqrtkcvgf. dwfigv. hqt. kvu. Ngpgtcn. Mwpf9. . H. dwfigvct{.eqorctkuqp. uvcvgogpv. jcu. dggp. rtqxkfgf. hqt. vjg. Ngpgtcn. Mwpf. vq. fgoqpuvtcvg.eqornkcpeg.ykvj.vjku.dwfigv9.

Proprietary funds.. .Wtqrtkgvct{. hwpfu.ctg.wugf. vq.ceeqwpv. hqt.cevkxkvkgu.yjgtg. vjg.Jkv{.pggfu. vq.ujqy. vjg. hwnn. equvu.qh.rtqxkfkpi. vjg.ugtxkegu7. kpenwfkpi.fgrtgekcvkqp9. .[jg.Jkv{.ockpvckpu.vyq.kpvgtpcn.ugtxkeg.hwpfu9.

[jg. Jkv{. wugu. kpvgtpcn. ugtxkeg. hwpfu. vq. ceeqwpv. hqt. kvu. hnggv. qh. xgjkengu. cpf. vgejpqnqi{.writcfgu. cpf. tgrncegogpvu9. Igecwug. vjgug. ugtxkegu. dgpghkv. iqxgtpogpvcn. hwpevkqpu7.vjg{.jcxg.dggp.kpenwfgf.ykvjkp.iqxgtpogpvcn.cevkxkvkgu.kp.vjg.iqxgtpogpv8ykfg.hkpcpekcn.uvcvgogpvu9. Ppvgtpcn. ugtxkeg. hwpfu. ctg. rtgugpvgf. cu. rtqrtkgvct{. hwpfu. dgecwug. kpvgtpcn.ugtxkeg.hwpfu.hqnnqy.vjg.ceetwcn.dcuku.qh.ceeqwpvkpi9.

Notes to the financial statements.. . [jg. pqvgu. rtqxkfg. cffkvkqpcn. kphqtocvkqp. vjcv. ku.guugpvkcn. vq.c. hwnn. wpfgtuvcpfkpi.qh. vjg.fcvc.rtqxkfgf. kp. vjg.iqxgtpogpv8ykfg.cpf. hwpf.hkpcpekcn.uvcvgogpvu9

Combining statements...[jg.eqodkpkpi.uvcvgogpvu.tghgttgf.vq.gctnkgt.kp.eqppgevkqp.ykvj.pqpoclqt.iqxgtpogpvcn.hwpfu.ctg.rtgugpvgf.koogfkcvgn{.hqnnqykpi.vjg.pqvgu9.

#")"#

Government-wide Financial Analysis

[cdngu. =. cpf. >. hqewu. qp. vjg. pgv. rqukvkqp. cpf. ejcpigu. kp. pgv. rqukvkqp. qh. vjg. Jkv{�u.iqxgtpogpvcn.cevkxkvkgu9

TABLE 1Net Position

. Nqxgtpogpvcn.Hevkxkvkgu.�.Qwpg.?<7.

. ><=@. ><=?.

Jwttgpv.cpf.qvjgt.cuugvu. . .0.==7AA=7=><. .0....==7@<B7ABE..

Jcrkvcn.cuugvu. . ....=B7AAA7>?<. .......=B7=CD7>?>

[qvcn.cuugvu. . ....>D7=<B7?A<. .......>C7AD@7D<=

Sqpi8vgto.fgdv.qwvuvcpfkpi. . ......@7<>B7C@C. .........@7@?D7B><

Vvjgt.nkcdknkvkgu. . ......=7>>?7CA<. .........=7<AB7=?D

[qvcn.nkcdknkvkgu. . ......A7>A<7@EC. .........A7@E@7CAD

Ugv.rqukvkqpF.

Ugv.kpxguvogpv.kp.ecrkvcn.cuugvu. . ....=?7ADA7>?<. .......=?7=?D7>?>

Yguvtkevgf . ..........DCD7>B>. .........D@<7CBB

\ptguvtkevgf . ......D7?E>7?B=. D7<??7CE>..

[qvcn.pgv.rqukvkqp. . .0.>>7DAA7DA?. .0....>>7<=>7CE<..

[jg.Jkv{�u.cuugvu.gzeggfgf. nkcdknkvkgu.d{.0>>7DAA7DA?.cv. Qwpg.?<7.><[email protected]. kpetgcug.qh.0D@?7<B?.htqo.Qwpg.?<7.><=?9

[jg.nctiguv.rqtvkqp.qh.vjg.Jkv{�u.pgv.rqukvkqp.4AE.rgtegpv5.tghngevu.kvu.kpxguvogpv.kp.ecrkvcn.cuugvu.4k9g97. ncpf7.dwknfkpiu7.ocejkpgt{7.gswkrogpv.cpf.kphtcuvtwevwtg57.pgv.qh.cp{.tgncvgf.fgdv. vjcv. ku. uvknn. qwvuvcpfkpi. wugf. vq. ceswktg. vjqug. cuugvu9. [jg. Jkv{. wugu. vjgug. ecrkvcn.cuugvu. vq. rtqxkfg. ugtxkegu. vq. ekvk|gpuG. eqpugswgpvn{7. vjgug. cuugvu. ctg. pqv. cxckncdng. hqt.hwvwtg.urgpfkpi9.

#"*"#

Governmental Activities. Nqxgtpogpvcn. cevkxkvkgu. kpetgcugf. vjg.Jkv{�u.pgv.rqukvkqp.d{.0D@?7<[email protected]{.gngogpvu.qh.vjg.kpetgcug.ctg.knnwuvtcvgf.kp.[cdng.>.dgnqyF.

TABLE 2Changes in Net Position

Nqxgtpogpvcn.Hevkxkvkgu.

><=@ ><=?

Ygxgpwgu.

Wtqitco.tgxgpwguF.

Jjctigu.hqt.ugtxkegu. .0.....>7=<C7B=A .0...>7?BB7D@D.

Vrgtcvkpi.eqpvtkdwvkqpu.cpf.itcpvu. ............?>?7<AA ..........>=A7DDC.

Jcrkvcn.eqpvtkdwvkqpu.cpf.itcpvu. ........=7ABA7EB>.. ..........AE>7=AC.

Ngpgtcn.tgxgpwguF.

[czguF

Wtqrgtv{.vczgu. ........>7C?>7C<< .......>7BCC7DBC.

\vknkv{.wugtu.vcz. ......>7=DD7@?B .......>7=B<7>D=.

Zcngu.vczgu. .....>7D?B7?>D .......>7C@B7<==.

Mtcpejkug.vczgu. ........BDD7A@? ..........BA>7DA<.

Iwukpguu.nkegpug.cpf.rgtokvu. ............E?B7E=@ ..........BE?7E=C.

Vvjgt.vczgu. .......B=E7<B@ ..........@C@7?BE.

Tqvqt.xgjkeng.kp.nkgw. .......8.. ..............A7><B.

Ppxguvogpv.kpeqog. ..........=?7>AE ............>C7<?=.

Nckp.qp.ucng.qh.rtqrgtv{. ..................8.. ............?C7>BA.

Vvjgt .....>BC7<BA ............?A7ECD.

[qvcn.tgxgpwgu. ......=@7>CD7E@= ....=>7BDA7BBC.

Lzrgpugu.

Ngpgtcn.iqxgtpogpv. .......>7>>?7>DE. .......=7?CC7<@C.

Wwdnke.uchgv{. ........A7BE<7A<< .......A7?E>7DD?.

Jqoowpkv{.fgxgnqrogpv. .........D@>7EEA ..........C@A7>B@.

Ygetgcvkqp.cpf.eqoowpkv{.ugtxkegu. ........=7BEE7B?C.. .......=7EAB7@@<.

Wwdnke.yqtmu. ........>7D?E7@D? .......>7C<D7ED=.

Ppvgtguv.qp.nqpi8vgto.fgdv. ..........=?E7EC@ ..........=BC7ED>.

[qvcn.gzrgpfkvwtgu. ......=?7@?A7DCD ....=>7?@D7AEC.

Jjcpig.kp.pgv.rqukvkqp. .........D@?7<B? ..........??C7<C<.

Ugv.rqukvkqp7.dgikppkpi7.cu.tguvcvgf. ......>>7<=>7CE<.. ....>=7BCA7C><.

Ugv.rqukvkqp7.gpfkpi. .0...>>7DAA7DA?.. .0.>>7<=>7CE<.

#"+"#

[cdng. ?. dgnqy. rtgugpvu. vjg. equv. qh. gcej. qh. vjg. Jkv{�u. ukz. nctiguv. rtqitcou~igpgtcn.iqxgtpogpv7.rwdnke.uchgv{7.eqoowpkv{.fgxgnqrogpv7.tgetgcvkqp.cpf.eqoowpkv{.ugtxkegu7.rwdnke. yqtmu7. cpf. kpvgtguv. qp. nqpi8vgto. fgdv. ~cu. ygnn. cu. vjgkt. tgurgevkxg. rtqitco.tgxgpwgu9

TABLE 3Expenses and Program Revenues

Zgg. vjg. Zvcvgogpv. qh. Hevkxkvkgu. hqt. hwtvjgt. fgvckn. qp. rtqitco. tgxgpwgu. cpf. igpgtcn.tgxgpwgu9

FINANCIAL ANALYSIS OF THE CITY’S MAJOR FUNDS

[jg. Jkv{. wugu. hwpf. ceeqwpvkpi. vq. gpuwtg. cpf. fgoqpuvtcvg. eqornkcpeg. ykvj. hkpcpeg8tgncvgf.ngicn.tgswktgogpvu9.

Governmental funds9. . [jg. hqewu. qh. vjg. Jkv{�u. iqxgtpogpvcn. hwpfu. ku. vq. rtqxkfg.kphqtocvkqp.qp.pgct8vgto.kphnqyu7.qwvhnqyu7.cpf.dcncpegu.qh.urgpfcdng.tguqwtegu9..Zwej.kphqtocvkqp. ku. wughwn. kp. cuuguukpi. vjg. Jkv{�u. hkpcpekpi. tgswktgogpvu9. . Pp. rctvkewnct7.wpcuukipgf. hwpf. dcncpeg. oc{. ugtxg. cu. c. wughwn. ogcuwtg. qh. c. iqxgtpogpv3u. pgv.tguqwtegu.cxckncdng.hqt.urgpfkpi.cv.vjg.gpf.qh.vjg.hkuecn.{gct9.

Hu.qh.vjg.gpf.qh.vjg.ewttgpv.hkuecn.{gct7.vjg.Jkv{�u.iqxgtpogpvcn.hwpfu.tgrqtvgf.eqodkpgf.gpfkpi. hwpf.dcncpeg.qh. 0D7A@<[email protected]. 0DD?7@B=. htqo. vjg. rtkqt. hkuecn. {gct�u.

#","#

dcncpeg9..0C7C>B7=AA.qt.E<1.qh.hwpf.dcncpeg.ku.eqpuvtckpgf.d{.vjg.Jkv{�u.kpvgpv.vq.wvknk|g.hwpf.dcncpeg.hqt.urgekhke.rwtrqugu7.yjkej.ku.tgrqtvgf.ykvjkp.vjg.hwpf.dcncpeg.encuukhkecvkqp.assigned9. .Hffkvkqpcnn{7. =<1.qh. hwpf.dcncpeg. 40D>D7E?D5. ku. tguvtkevgf7.yjkej. tgrtgugpvu.vjg. rqtvkqp. qh. hwpf. dcncpeg. vjcv. ku. uwdlgev. vq. gzvgtpcnn{. gphqtegcdng. nkokvcvkqpu. d{. ncy7.gpcdnkpi.ngikuncvkqp.qt.nkokvcvkqpu.korqugf.d{.etgfkvqtu.qt.itcpvqtu9

[jg.hwpf.dcncpeg.qh. vjg.Jkv{�u.Ngpgtcn.Mwpf. kpetgcugf.0@=?7BAA.fwtkpi.vjg. hkuecn.{gct9.[jg. kpetgcug. ku. rtkoctkn{. cvvtkdwvcdng. vq. cp. 0DCA7@>B. kpetgcug. kp. tgxgpwgu7. yjkej. ycu.rctvkcnn{.qhhugv.d{.c.0ABE7CED.kpetgcug.kp.gzrgpfkvwtgu9...

[jg. kpetgcug. kp. tgxgpwgu. ycu. nctign{. fwg. vq. kpetgcugu. kp. ucngu. vcz. tgxgpwg. fwg. vq.kpetgcugf. eqpuwogt. urgpfkpi. cpf. rgtokvu. tgxgpwg. tgncvgf. vq. vjg. ogfkecn. egpvgt.kortqxgogpvu9..Lzrgpfkvwtgu.ygtg.jkijgt.kp.vjg.ewttgpv.{gct.rtkoctkn{.fwg.vq.vjg.rc{ogpv.vq.JcnWLYZ.kp.vjg.coqwpv.qh.0>B=7>D=.vq.rc{qhh.vjg.ukfg8hwpf.nkcdknkv{9..Hnuq7.eqpvtcevwcn.ugtxkegu.hqt.rncp.ejgemu.cpf.kpurgevkqpu.ygtg.jkijgt.kp.vjg.ewttgpv.hkuecn.{gct.fwg.vq.vjg.ogfkecn.egpvgt.kortqxgogpvu7.yjkej.ycu.qhhugv.ykvj.dwknfkpi.rgtokv.tgxgpwg9.

[jg. [tchhke. Portqxgogpv. Mwpf7. Wtqrqukvkqp. =I. Mwpf. cpf. Ykxgtu. 2. Tqwpvckpu.Jqpugtxcpe{. Mwpf. ujqygf. fgetgcugu. kp. hwpf. dcncpeg. qh. 0=A?7A==7. 0?><7<>A. cpf.0BED7?=C7.tgurgevkxgn{9.[jg.fgetgcug.kp.vjg.[tchhke.Portqxgogpv.Mwpf.ycu.cvvtkdwvcdng.vq.rncppgf. urgpfkpi. qh. hwpf. dcncpeg. tgncvgf. vq. ecrkvcn. rtqlgevu9. . [jg. fgetgcugu. kp. vjg.Wtqrqukvkqp.=I.Mwpf.cpf.Ykxgtu.2.Tqwpvckpu.Jqpugtxcpe{.Mwpf.tgncvgf.vq.urgpfkpi.qp.ecrkvcn.rtqlgevu.yjkej.yknn.dg.qhhugv.ykvj.itcpv. tgxgpwg.tgegkxgf.kp.vjg.uwdugswgpv.hkuecn.{gct9..Vvjgt.iqxgtpogpvcn.hwpfu.tgcnk|gf.c.fgetgcug.kp.hwpf.dcncpeg.qh.0=>A7>B?7.yjkej.ku. rtkoctkn{. cvvtkdwvcdng. vq. rncppgf. urgpfkpi. qh. hwpf. dcncpeg. kp. vjg. Tgcuwtg. T. Mwpf.tgncvgf.vq.ecrkvcn.rtqlgevu9.

General Fund Budgetary Highlights

Hevwcn. tgxgpwgu. ygtg. 0DA?7=ED.oqtg. vjcp. vjg. hkpcn. dwfigvgf.coqwpv. dghqtg. vtcpuhgtu7.yjkej. ku. rtkoctkn{. fwg. vq. dgvvgt. vjcp. rtqlgevgf. ucngu. vcz. tgxgpwg. fwg. vq. kpetgcugf.eqpuwogt. urgpfkpi. cpf. rgtokvu. tgxgpwg. tgncvgf. vq. vjg. ogfkecn. egpvgt. kortqxgogpvu9..[jg.gzrgpfkvwtgu. hqt. vjg.Ngpgtcn.Mwpf.cv. hkuecn.{gct8gpf.ygtg.0?>@7<ED.oqtg. vjcp.vjg.hkpcn.dwfigvgf.gzrgpfkvwtgu7.yjkej.ku.rtkoctkn{.fwg.vq.vjg.rc{ogpv.vq.JcnWLYZ.vq.rc{qhh.vjg.ukfg8hwpf.nkcdknkv{9.

Iwfigv.cogpfogpvu.cpf.uwrrngogpvcn.crrtqrtkcvkqpu.ygtg.ocfg.fwtkpi. vjg. hkuecn.{gct.yjkej. kpetgcugf. tgxgpwg. rtqlgevkqpu. d{. crrtqzkocvgn{. 0><<7<<<. cpf. cnuq. kpetgcugf.crrtqrtkcvkqpu. kp. vjg. coqwpv. qh. crrtqzkocvgn{. 0=@<7<<<9. . [jg. kpetgcugu. kp. dwfigvgf.tgxgpwgu. cpf. gzrgpfkvwtgu. nctign{. tgncvg. vq. eqpvtcevwcn. ugtxkegu. hqt. rncp. ejgemu. cpf.kpurgevkqpu. cpf. tgncvgf. dwknfkpi. rgtokv. tgxgpwg. cuuqekcvgf. ykvj. vjg. ogfkecn. egpvgt.kortqxgogpvu9

#"-"#

CAPITAL ASSETS AND DEBT ADMINISTRATION

Capital Assets. Hv.vjg.gpf.qh.M`.><[email protected]{.jcf.0=B9B.oknnkqp. kpxguvgf.kp.ecrkvcn.cuugvu7.kpenwfkpi.ncpf7.dwknfkpiu7.kphtcuvtwevwtg7.cpf.gswkrogpv9..[jku.coqwpv.tgrtgugpvu.c.pgv.kpetgcug.4kpenwfkpi.cffkvkqpu.cpf.fgfwevkqpu5.qh.0@B?7?DC7.qt.?.rgtegpv7.oqtg.vjcp.vjg.rtkqt.hkuecn.{gct9.

TABLE 4City of Los Alamitos Capital Assets Net of Depreciation

...........Nqxgtpogpvcn.Hevkxkvkgu.

><=@ ><=?

Scpf .0......A7E=C7C=A. .0....A7E=C7C=A

Iwknfkpiu.cpf.kortqxgogpvu. .........=7<D>7<AE. ........=7=@E7==B

Lswkrogpv ............?<B7>ED. ...........?@D7D=?

]gjkengu. ............?@C7ED<. ...........?@C7?E>

Pphtcuvtwevwtg. .........C7DA=7D<A. ........C7EA=7<AE

Jqpuvtwevkqp.kp.rtqitguu. .........=7<@E7?C?. ...........?CC7CAA

[qvcnu. .0....=B7AAA7>?<. .0..=B7<E=7DA<

Tqtg.fgvckn.qp.vjg.Jkv{�u.ecrkvcn.cuugvu.ecp.dg.hqwpf.kp.Uqvg.A.vq.vjg.hkpcpekcn.uvcvgogpvu.qh.vjku.tgrqtv9.

Long-term liabilities. Hv.vjg.gpf.qh.hkuecn.{gct.><[email protected]{[email protected]. nqpi8vgto. nkcdknkvkgu. yjkej. kpenwfgu. cp. qwvuvcpfkpi. dqpf. kpfgdvgfpguu. qh. 0?. oknnkqp. cpf. 0=.oknnkqp. qh. enckou. rc{cdng7. eqorgpucvgf. cdugpegu7. cpf. qvjgt. rquv. gornq{ogpv. dgpghkv.qdnkicvkqpu7.tgrtgugpvkpi.c.E.rgtegpv.fgetgcug.qxgt.vjg.rtkqt.hkuecn.{gct9..

TABLE 5City of Los Alamitos Long-Term Liabilities

...........Nqxgtpogpvcn..Hevkxkvkgu.

><=@. ><=?

><<B.Jgtvkhkecvgu.qh.rctvkekrcvkqp. .0..>7EC<7<<<. .0....?7<@<7<<<.

Jnckou.rc{cdng. ..........@E7A=D. ...........=D>7B==.

Jqorgpucvgf.cdugpegu. ........A>B7AD?. ...........AAC7>?=.

WLYZ.Zkfg.Mwpf. ..........8. ...........>BE7A<C.

Vvjgt.rquv8gornq{ogpv.dgpghkv.qdnkicvkqp. ........@D<7B@B. ...........?DE7>C=.

[qvcn.nkcdknkvkgu. .0..@7<>B7C@C. .0...@7@?D7B><.

#"%$"#

Tqtg. fgvckn. qp. vjg. Jkv{�u. nqpi8vgto. nkcdknkvkgu. ecp. dg. hqwpf. kp. Uqvgu. B. cpf. =<. vq. vjg.hkpcpekcn.uvcvgogpvu.ugevkqp.qh.vjku.tgrqtv9.

ECONOMIC FACTORS AND NEXT YEAR’S BUDGET

[jg.Jkv{�u.geqpqoke.qwvnqqm.hqt.Mkuecn.`gct.><=@8=A.tghngevu.c.itqykpi.geqpqo{7.dwv.cv.c.xgt{. oqfguv. rceg9. . Pp. urkvg. qh. vjg. pgicvkxg. korcev. qh. qpg. qh. vjg. yqtuv. geqpqoke.fqypvwtpu.kp.ogoqt{.fwtkpi.vjg.rcuv.ugxgtcn.{gctu7.yjkej.tguwnvgf.kp.ukipkhkecpvn{.nqygt.tgxgpwg. uvtgcou7. vjg. qwvnqqm. hqt. vjg. Jkv{. tgockpu. tgncvkxgn{. rqukvkxg9. Iwknfkpi. tgncvgf.tgxgpwgu. itgy. uwduvcpvkcnn{. kp. M`. ><=?8=@7. cpf. cnvjqwij. rtqlgevgf. vq. dg. nqygt. kp. M`.><=@8=A7.ctg.uvknn.swkvg.jgcnvj{7.cpf.ctg.fgenkpkpi.rtkoctkn{.cu.c.tguwnv.qh.vjg.gzrcpukqp.qh.Squ.Hncokvqu.Tgfkecn.Jgpvgt.kp.vjg.rtgxkqwu.hkuecn.{gct7.cpf.pqv.dgecwug.qh.c.fqypvwtp.kp.nqecn.eqpuvtwevkqp9.

[jg.Jkv{.jcu.uggp.itqyvj.kp.ucngu.vcz.tgxgpwgu.ukpeg.M`.><<E8=<9.Hffkvkqpcn.kpetgcugu.ctg. rtqlgevgf. kp. vjg. eqokpi. {gct7. dwv. rtqlgevgf. itqyvj. ku. hqtgecuvgf. cv. c. xgt{. oqfguv.>9D1.kp.M`.><=@8=A7.eqorctgf.vq.M`.><=?8=@9.

[jg.Jkv{�u.rtqrgtv{.vcz.tgxgpwgu.ctg.gzrgevgf.vq.ujqy.xgt{.rqukvkxg.itqyvj.kp.M`.><=@8=A7.dcugf.wrqp.cp.kpetgcug.kp.cuuguugf.xcnwcvkqpu.qh.B9@19

[jg.vjktf.oclqt.tgxgpwg.uqwteg7.\vknkv{.\ugtu�.[cz7.ku.rtqlgevgf.vq.dg.?9?1.itgcvgt.kp.M`.><=@8=A9..Kgurkvg.c.xqvgt.crrtqxgf.tgfwevkqp.kp.vjg.[gngrjqpg.\ugtu.[cz.4[\[5.htqo.B1.vq.A1.hqt.M`.><[email protected]{.itqyvj.kp.ycvgt.wvknkv{.wugtu�.vcz.cpf.oqfguv.kpetgcugu.kp.gngevtke.cpf.icu9.

^kvj. fgrctvogpvcn. okuukqp. uvcvgogpvu7. iqcnu7. ceeqornkujogpvu7. rtqitco. fguetkrvkqpu7.ugtxkeg. qdlgevkxgu. cpf. yqtm. rncpu7. vjg. Jkv{. eqpvkpwgu. vq. cfqrv. c. dwfigv. vjcv. pqv. qpn{.ugtxgu. cu. hkpcpekcn. rncp7. dwv. cnuq. c. eqoowpkecvkqp. fgxkeg7. rqnke{. vqqn. cpf. qrgtcvkqpu.iwkfg.hqt.vjg.Jkv{.Jqwpekn.cpf.ekvk|gpu.qh.Squ.Hncokvqu9..Pv.ku.cpvkekrcvgf.vjcv.vjg.Jkv{.yknn.tgockp.kp.iqqf.hkpcpekcn.eqpfkvkqp.vjtqwijqwv.vjg.hkuecn.{gct.cpf.dg{qpf9

CONTACTING THE CITY’S FINANCIAL MANAGEMENT

[jku. hkpcpekcn. tgrqtv. ku.fgukipgf. vq.rtqxkfg. vjg.Jkv{.qh.Squ.Hncokvqu.ekvk|gpu7. vczrc{gtu7.ewuvqogtu7.kpxguvqtu7.cpf.etgfkvqtu.ykvj.c.igpgtcn.qxgtxkgy.qh.vjg.Jkv{�u.hkpcpegu.cpf.vq.knnwuvtcvg.vjg.Jkv{�u.ceeqwpvcdknkv{.hqt.vjg.oqpg{.kv.tgegkxgu9..Ph.{qw.jcxg.swguvkqpu.cdqwv.vjku. tgrqtv. qt. pggf. cffkvkqpcn. hkpcpekcn. kphqtocvkqp7. eqpvcev. vjg. Jkv{�u. Hfokpkuvtcvkxg.Zgtxkegu. Kgrctvogpv. cv. vjg. Jkv{. qh. Squ. Hncokvqu7. ?=E=. Rcvgnnc. Hxgpwg7. Squ. Hncokvqu7.Jcnkhqtpkc7.E<C><7.4AB>5.@?=8?A?D9.

#"%%"#

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

GOVERNMENT – WIDE FINANCIAL STATEMENTS

CITY OF LOS ALAMITOSStatement of Net PositionJune 30, 2014

GovernmentalActivities

ASSETSJbb_XW"VTf["TaW"\aiXfg`Xagf 6*633*27/#"""""""""""""""

LXVX\iTU_Xf8

"" ;VVbhagf /*26/*.65"""""""""""""""""

>hX"Yeb`"X`c_blXXf 6*/74""""""""""""""""""""""""

" ;VVehXW"\agXeXfg 2*6..""""""""""""""""""""""""

>hX"Yeb`"bg[Xe"ZbiXea`Xagf 651*3.6""""""""""""""""""""

G\fVX__TaXbhf8

J?LM"f\WX"YhaW"TffXg /.5*631""""""""""""""""""""

LXfge\VgXW"TffXgf8

=Tf["TaW"\aiXfg`Xagf"j\g["Y\fVT_"TZXag 00.*/63""""""""""""""""""""

=Tc\gT_"TffXgf8

Hba+WXceXV\TU_X"TffXgf 4*745*.66"""""""""""""""""

>XceXV\TU_X"TffXgf*"aXg 7*366*/20"""""""""""""""""

NbgT_";ffXgf 06*/.4*13."""""""""""""""

LIABILITIES;VVbhagf"cTlTU_X 360*/14""""""""""""""""""""

;VVehXW"_\TU\_\g\Xf 1.3*560""""""""""""""""""""

CagXeXfg"cTlTU_X 23*620""""""""""""""""""""""

>Xcbf\gf"cTlTU_X 53*610""""""""""""""""""""""

OaXTeaXW"eXiXahX 0/2*/36""""""""""""""""""""

FbaZ+gXe`"_\TU\_\g\Xf8

>hX"j\g[\a"baX"lXTe 072*3.4""""""""""""""""""""

>hX"\a"`beX"g[Ta"baX"lXTe 1*510*02/"""""""""""""""""

" NbgT_"F\TU\_\g\Xf 3*03.*275"""""""""""""""""

NET POSITIONHXg"\aiXfg`Xag"\a"VTc\gT_"TffXgf /1*363*01."""""""""""""""

LXfge\VgXW"Ybe8

J?A //3*2.7""""""""""""""""""""

MgeXXg"TaW"heUTa"WXiX_bc`Xag"ceb]XVgf 3.5*750""""""""""""""""""""

JhU_\V"fTYXgl 33*237""""""""""""""""""""""

>XUg"fXei\VX /52*121""""""""""""""""""""

;\e"dhT_\gl"\`cebiX`Xag 03*.57""""""""""""""""""""""

OaeXfge\VgXW 6*170*14/"""""""""""""""""

NbgT_"HXg"Jbf\g\ba 00*633*631#

"""""""""""""""""""""""""""" "

MXX"abgXf"gb"UTf\V"Y\aTaV\T_"fgTgX`Xagf +"/2"+

For the Fiscal Year Ended June 30, 2014

HXg"'?kcXafXf(

LXiXahXf"TaW

=[TaZXf"\a"

HXg"Jbf\g\ba

JebZeT`"LXiXahXf Je\`Tel

IcXeTg\aZ" =Tc\gT_ AbiXea`Xag

=[TeZXf"Ybe =bage\Uhg\baf =bage\Uhg\baf AbiXea`XagT_

?kcXafXf MXei\VXf TaW"AeTagf TaW"AeTagf ;Vg\i\g\Xf

AbiXea`XagT_";Vg\i\g\Xf8

AXaXeT_"ZbiXea`Xag 0*001*067#""""""" #"""""""""""""" + #"""""""""""""" + #"""""""""""""""+ '0*001*067(#

JhU_\V"fTYXgl 3*47.*3..""""""""" 513*/5/"""""""" 101*.33"""""""" '2*410*052(

=b``ha\gl"WXiX_bc`Xag 620*773"""""""""""" //1*.15"""""""" 041*711"""""""""" '244*.03(

LXVeXTg\ba"TaW"Vb``ha\gl"fXei\VXf /*477*415""""""""" /*02/*11/""""" 556*342"""""""""" 10.*036

JhU_\V"jbe^f 0*617*261""""""""" /6*.54"""""""""" 301*243"""""""""" '0*075*720(

CagXeXfg"ba"_baZ+gXe`"WXUg /17*752"""""""""""" '/17*752(

""NbgT_"AbiXea`XagT_";Vg\i\g\Xf /1*213*656#""""" 0*/.5*4/3#"""" 101*.33#""""""" /*343*740#""""" '7*217*024(

AXaXeT_"LXiXahXf8

NTkXf8

JebcXegl"gTkXf*"_Xi\XW"Ybe"ZXaXeT_"checbfX 0*510*5..

Og\_\gl"hfXef"gTk 0*/66*214

NeTaf\Xag"bVVhcTaVl"gTkXf //0*644

MT_Xf"gTkXf 0*614*106

@eTaV[\fX"gTkXf 466*321

<hf\aXff"_\VXafXf"TaW"cXe`\gf 714*7/2

Ig[Xe"gTkXf 3.4*/76

CaiXfg`Xag"XTea\aZf /1*037

Ig[Xe 045*.43

NbgT_"ZXaXeT_"eXiXahXf" /.*060*1.7

=[TaZX"\a"aXg"cbf\g\ba 621*.41

HXg"cbf\g\ba"+"UXZ\aa\aZ"bY"Y\fVT_"lXTe 00*..1*44/

Je\be"cXe\bW"TW]hfg`Xagf 7*/07

HXg"cbf\g\ba"+"UXZ\aa\aZ"bY"Y\fVT_"lXTe*"eXfgTgXW 00*./0*57.

HXg"cbf\g\ba"+"XaW"bY"Y\fVT_"lXTe" 00*633*631#

CITY OF LOS ALAMITOSStatement of Activities

@haVg\baf-JebZeT`f

Rivers &Traffic Mountains Other Total

General Improvement Proposition Conservancy Governmental GovernmentalFund Fund 1B Fund Fund Funds Funds

Assets"Jbb_XW"VTf["TaW"\aiXfg`Xagf 5*/.0*024#""""" 206*451#""""""" #"""""""""""" + #""""""""""""""" + 727*37.#"""""""" 6*26.*3.7#

"LXVX\iTU_Xf8

"" ;VVbhagf 253*514"""""""""" /*../*111"""""" 2*./6"""""""""""""" /*26/*.65

>hX"Yeb`"X`c_blXXf 6*/74"""""""""""""" """"""""""""""""" 6*/74

" ;VVehXW"\agXeXfg 2*6.."""""""""""""" """"""""""""""""" 2*6..

>hX"Yeb`"bg[Xe"ZbiXea`Xagf 223*056"""""""""" """"""113*221 70*565"""""""""""" 651*3.6

>hX"Yeb`"bg[Xe"YhaWf /*0/1*50.""""""" """"""""""""""""" """"""""""""""""""" /*0/1*50.

"LXfge\VgXW"TffXgf8 """""""""""""""""

=Tf["TaW"\aiXfg`Xagf"j\g["""Y\fVT_"TZXag """"""""""""""""" 00.*/63"""""""""" 00.*/63

"""NbgT_";ffXgf 7*027*754#""""" 206*451#""""""" 113*221#""""" /*../*111#""""" /*044*36.#""""" /0*060*..3#

Liabilities, Deferred Inflows of Resources,and Fund BalancesF\TU\_\g\Xf

;VVbhagf"cTlTU_X 301*645#"""""""" 0*454#""""""""""" #"""""""""""" + 1*702#"""""""""""" 06*6/5#"""""""""" 337*062#

;VVehXW"_\TU\_\g\Xf 050*077"""""""""" 1/*151""""""""""" """"""""""""""""""" 1.1*450

>hX"gb"bg[Xe"YhaWf """"""113*221 65.*...""""""""" 6*055"""""""""""""" /*0/1*50.

OaXTeaXW"eXiXahX 43*0.1"""""""""""" /26*733"""""""" 0/2*/36

>Xcbf\gf"cTlTU_X 53*610"""""""""""" """"""""""""""""" """"""""""""""""""" 53*610

"""NbgT_"F\TU\_\g\Xf 715*0./"""""""""" /3/*41/"""""""" """"""113*221 7.3*075""""""""" 15*.72"""""""""""" 0*144*444

>XYXeeXW"CaY_bjf"bY"LXfbheVXf

OaXTeaXW"eXiXahX+"haTiT\_TU_X 15*767"""""""""""" """"""113*221 /*../*111"""""" /*152*543

NbgT_">XYXeeXW"CaY_bjf"bY

"""LXfbheVXf 15*767"""""""""""" """"""""""""""""" """"""113*221 /*../*111"""""" """"""""""""""""""" /*152*543

@haW"<T_TaVXf"

HbafcXaWTU_X 6*/74"""""""""""""" 6*/74

LXfge\VgXW """"""""""""""""""" 606*716"""""""""" 606*716

;ff\ZaXW 5*.26*343""""""" 055*.20"""""""" 2..*326"""""""""" 5*504*/33

OaTff\ZaXW /*0/6*.03""""""" '113*221("""" '7.3*075(""""""" '00*5/3(

"""NbgT_"@haW

"""""<T_TaVXf"'>XY\V\gf( 6*052*564""""""" 055*.20"""""""" '113*221("""" '7.3*075(""""""" /*007*264""""""" 6*32.*352

"""""NbgT_"F\TU\_\g\Xf*">XYXeeXW

"""""""""CaY_bjf"bY"LXfbheVXf*"

"""""""""TaW"@haW"<T_TaVXf 7*027*754#""""" 206*451#""""""" 113*221#""""" /*../*111#""""" /*044*36.#""""" /0*060*..3#

CITY OF LOS ALAMITOSBalance SheetGovernmental FundsJune 30, 2014

CITY OF LOS ALAMITOSReconciliation of the Governmental FundsBalance Sheet to the Statement of Net PositionJune 30, 2014

@haW"<T_TaVXf"+"NbgT_"AbiXea`XagT_"@haWf 6*32.*352#"""""""""

;`bhagf"eXcbegXW"Ybe"AbiXea`XagT_";Vg\i\g\Xf"\a"g[X"MgTgX`Xag"bY"HXg"Jbf\g\ba

TeX"W\YYXeXag"UXVThfX8

=Tc\gT_"TffXgf"aXg"bY"WXceXV\Tg\ba"[TiX"abg"UXXa"\aV_hWXW"Tf"Y\aTaV\T_"

eXfbheVXf"ZbiXea`XagT_"YhaW"TVg\i\gl, /4*333*01."""""""""

FbaZ+gXe`"_\TU\_\g\Xf"Tcc_\VTU_X"gb"g[X"=\gl"ZbiXea`XagT_"TVg\i\g\Xf"TeX"abg

WhX"TaW"cTlTU_X"\a"g[X"VheeXag"cXe\bW"TaW"TVVbeW\aZ_l"TeX"abg"eXcbegXW

Tf"YhaW"_\TU\_\g\Xf,"";__"_\TU\_\g\Xf*"Ubg["VheeXag"TaW"_baZ+gXe`*"TeX"eXcbegXW"

\a"g[X"MgTgX`Xag"bY"HXg"Jbf\g\ba,"<T_TaVXf"Tg"DhaX"1.*"0./2"TeX8

=Xeg\Y\VTgXf"bY"cTeg\V\cTg\ba '0*75.*...(#""""""""

=_T\`f"TaW"]hWZ`Xagf '27*3/6("""""""""""""""

=b`cXafTgXW"TUfXaVXf '304*361("""""""""""""

HXg"IJ?<"bU_\ZTg\ba '26.*424("""""""""""""

'2*.04*525(""""""""""

;VVehXW"\agXeXfg"cTlTU_X"Yeb`"g[X"VheeXag"cbeg\ba"bY"\agXeXfg"WhX"ba"UbaWf

cTlTU_X"[Tf"abg"UXXa"eXcbegXW"\a"g[X"ZbiXea`XagT_"YhaWf, '23*620("""""""""""""""

FbaZ+gXe`"TffXgf"g[Tg"TeX"abg"TiT\_TU_X"Ybe"VheeXag"hfX"TeX"eXVbeWXW"Tf

haXTeaXW"eXiXahX"haWXe"g[X"`bW\Y\XW"TVVehT_"UTf\f"bY"TVVbhag\aZ, /*152*543"""""""""""

FbaZ+gXe`"TffXg"Yeb`"fhcXe+YhaWXW"J?LM"f\WX"YhaW"Ybe"`\fVX__TaXbhf

X`c_blXXf"g[Tg"\f"abg"TiT\_TU_X"Ybe"VheeXag"hfX"[Tf"abg"UXXa"eXcbegXW

\a"ZbiXea`XagT_"YhaWf, /.5*631""""""""""""""

CagXeaT_"fXei\VX"YhaWf"TeX"hfXW"Ul"`TaTZX`Xag"gb"V[TeZX"Vbfgf"bY"

VXegT\a"TVg\i\g\Xf*"fhV["Tf"Xdh\c`Xag"`TaTZX`Xag"gb"\aW\i\WhT_"YhaWf,

N[X"TffXgf"TaW"_\TU\_\g\Xf"bY"g[X"\agXeaT_"fXei\VX"YhaWf"`hfg"UX"TWWXW

gb"g[X"MgTgX`Xag"bY"HXg"Jbf\g\ba"'aXg"bY"VTc\gT_"TffXgf"TaW"Vb`cXafTgXW

TUfXaVfXf"eXcbegXW"TUbiX(, 13.*.0.""""""""""""""

HXg"Jbf\g\ba"bY"AbiXea`XagT_";Vg\i\g\Xf 00*633*631#"""""""

Rivers &Traffic Mountains Other Total

General Improvement Proposition 1B Conservancy Governmental GovernmentalFund Fund Fund Fund Funds Funds

RevenuesNTkXf 6*7.2*353#"""""" #""""""""""""""" + +#""""""""""""""""""" #""""""""""""""""+ 3/3*216#"""""""""" 7*20.*./1#

F\VXafXf"TaW"cXe`\gf 714*7/2""""""""""" 714*7/2

CagXeZbiXea`XagT_ 0/*116""""""""""""" /06*116"""""""""""" /27*454

=[TeZXf"Ybe"fXei\VXf /*145*250"""""""" 07*.0."""""""""""""" /*174*270

CaiXfg`Xag"XTea\aZf /*524""""""""""""""" /.0"""""""""""""""" /60""""""""""""""""""" 0*.1.

@\aXf"TaW"YbeYX\gheXf 5.7*6.7""""""""""" 5.7*6.7

JebZeT`"eXiXahX """""""""""""""""""" """""""""""""""""" /67*/25"""""""""""" /67*/25

G\fVX__TaXbhf 152*332""""""""""" /5*/.4"""""""""""""" 17/*44.

NbgT_"LXiXahXf /0*1/4*2.6"""""" /.0"""""""""""""""" """"""""""""""""""""" """""""""""""""""" 657*01/"""""""""""" /1*/73*52/

Expenditures=heeXag8

AXaXeT_"ZbiXea`Xag 0*.40*0/5"""""""" 15*252"""""""""""""" 0*.77*47/

JhU_\V"fTYXgl 3*652*.3/"""""""" 3*652*.3/

=b``ha\gl"WXiX_bc`Xag 607*270""""""""""" 607*270

LXVeXTg\ba"TaW"Vb``ha\gl

"fXei\VXf /*4/7*722"""""""" /*4/7*722

JhU_\V"jbe^f /*463*60."""""""" 240""""""""""""""""""" /*464*060

=Tc\gT_"bhg_Tl /31*4/1""""""""" 10.*.03"""""""""""" 476*1/5""""""""" 35/*5.2"""""""""""" /*521*437

>XUg"fXei\VX8

Je\aV\cT_ 5.*..."""""""""""""" 5.*...

CagXeXfg"TaW"Y\fVT_"V[TeZXf /2.*76/"""""""""""" /2.*76/

NbgT_"?kcXaW\gheXf /0*.5/*302"""""" /31*4/1""""""""" 10.*.03"""""""""""" 476*1/5""""""""" 60.*40/"""""""""""" /2*.42*/..

?kVXff"bY"LXiXahXf"IiXe"'OaWXe(

"?kcXaW\gheXf 022*662""""""""""" '/31*3//("""""""" '10.*.03(""""""""""" '476*1/5("""""""" 36*4/."""""""""""""" '646*137(

Other Financing Sources (Uses)NeTafYXef"\a 172*602""""""""""" 0/.*73/"""""""""""" 4.3*553

NeTafYXef"bhg '004*.31("""""""""" '172*602("""""""""" '40.*655(

NbgT_"Ig[Xe"@\aTaV\aZ"

""MbheVXf"'OfXf( /46*55/""""""""""" '/61*651("""""""""" '/3*/.0(

HXg"=[TaZXf"\a"@haW"<T_TaVXf 2/1*433""""""""""" '/31*3//("""""""" '10.*.03(""""""""""" '476*1/5("""""""" '/03*041("""""""""" '661*24/(

@haW"<T_TaVXf"'>XY\V\gf(*

""Dh_l"/*"0./1 5*64/*/1/"""""""" 21.*331""""""""" '/3*2/6(""""""""""""" '0.4*76.("""""""" /*132*527""""""""" 7*202*.13

@haW"<T_TaVXf"'>XY\V\gf(*

""DhaX"1.*"0./2 6*052*564#"""""" 055*.20#""""""" '113*221(#"""""""""" '7.3*075(#""""""" /*007*264#""""""" 6*32.*352#

CITY OF LOS ALAMITOSStatement of Revenues, Expenditures, and Changes in Fund BalancesGovernmental FundsFor the Fiscal Year Ended June 30, 2014

CITY OF LOS ALAMITOSReconciliation of the Statement of Revenues, Expenditures, and Changes inFund Balances of Governmental Funds to the Statement of ActivitiesFor the Fiscal Year Ended June 30, 2014

HXg"V[TaZX"\a"YhaW"UT_TaVXf"+"gbgT_"ZbiXea`XagT_"YhaWf '661*24/(#

AbiXea`XagT_"YhaWf"eXcbeg"VTc\gT_"bhg_Tl"Tf"Ta"XkcXaW\gheX,""BbjXiXe*"\a"g[X

MgTgX`Xag"bY";Vg\i\g\Xf"g[X"Vbfg"bY"g[bfX"TffXgf"\f"T__bVTgXW"biXe"g[X\e"

Xfg\`TgXW"_\iXf"TaW"eXcbegXW"Tf"WXceXV\Tg\ba"XkcXafX,""N[\f"\f"g[X"T`bhag"Ul

j[\V["VTc\gT_\mTU_X"VTc\gT_"bhg_Tl"_Xff"g[X"W\fcbf\g\ba"bY"VTc\gT_"TffXgf"XkVXXWXW

WXceXV\Tg\ba"\a"g[X"VheeXag"cXe\bW8

=Tc\gT_"XkcXaW\gheXf" 6/4*./2#

>XceXV\Tg\ba"XkcXafX" '1/3*54/(

>X_Xg\baf '/1*13.(""""""""""""" 264*7.1

N[X"\ffhTaVX"bY"_baZ+gXe`"WXUg"cebi\WXf"Y\aTaV\T_"eXfbheVXf"gb"

ZbiXea`XagT_"YhaWf*"j[\_X"g[X"eXcTl`Xag"bY"g[X"ce\aV\cT_"bY"_baZ+gXe`"WXUg

Vbafh`Xf"g[X"VheeXag"Y\aTaV\T_"eXfbheVXf"bY"ZbiXea`XagT_"YhaWf,"";_fb*

ZbiXea`XagT_"YhaWf"eXcbeg"g[X"XYYXVg"bY"ceX`\h`f*"W\fVbhagf*"TaW"f\`\_Te

\gX`f"j[Xa"g[X"WXUg"\f"Y\efg"\ffhXW*"j[XeXTf"g[XfX"T`bhagf"TeX"WXYXeeXW"TaW"

T`beg\mXW"\a"g[X"MgTgX`Xag"bY";Vg\i\g\Xf,""N[\f"T`bhag"\f"g[X"aXg"XYYXVg"bY

g[\f"W\YYXeXaVX"\a"g[X"geXTg`Xag"bY"_baZ+gXe`"WXUg"TaW"eX_TgXW"\gX`f8

Je\aV\cT_"cTl`Xagf 5.*...#J?LM"M\WX"@haW 04/*06/""""""""""" 11/*06/

Mb`X"XkcXafXf"eXcbegXW"\a"g[X"MgTgX`Xag"bY";Vg\i\g\Xf"Wb"abg"eXdh\eX"g[X"

hfX"bY"VheeXag"Y\aTaV\T_"eXfbheVXf"TaW"g[XeXYbeX"TeX"abg"eXcbegXW"Tf

XkcXaW\gheXf"\a"g[X"ZbiXea`XagT_"YhaWf8

CagXeXfg"XkcXafX /*..5#

J?LM"f\WX"YhaW '71*.47(

IJ?<"Vbage\Uhg\ba '7/*153(""""""""""""" '/61*215(

JTl`Xag"bY"TVVehXW"V_T\`f"\f"Ta"XkcXaW\gheX"\a"g[X"ZbiXea`XagT_"YhaWf*"Uhg"g[X"

cTl`Xag"eXWhVXf"_baZ+gXe`"_\TU\_\g\Xf"\a"g[X"MgTgX`Xag"bY"HXg"Jbf\g\ba"'aXg"V[TaZX(, /11*.71

=b`cXafTgXW"TUfXaVXf"XkcXafX"eXcbegXW"\a"g[X"MgTgX`Xag"bY";Vg\i\g\Xf

Wb"abg"eXdh\eX"g[X"hfX"bY"VheeXag"Y\aTaV\T_"eXfbheVXf"TaW*"g[XeXYbeX*"TeX"abg

eXcbegXW"Tf"XkcXaW\gheXf"\a"ZbiXea`XagT_"YhaWf"'aXg"V[TaZX(, 1.*153

Mb`X"eXiXahXf"eXcbegXW"\a"g[X"MgTgX`Xag"bY";Vg\i\g\Xf"TeX"abg"Vbaf\WXeXW"gb"

UX"TiT\_TU_X"gb"Y\aTaVX"VheeXag"XkcXaW\gheXf"TaW"g[XeXYbeX"TeX"abg"eXcbegXW

Tf"eXiXahXf"\a"g[X"ZbiXea`XagT_"YhaWf"'aXg"V[TaZX(8

CagXeZbiXea`XagT_"\aVb`X /*.76*367#

MT_Xf"gTk 2*./.G\fVX__TaXbhf '13*/..( /*.45*277

CagXeaT_"fXei\VX"YhaWf"TeX"hfXW"Ul"`TaTZX`Xag"gb"V[TeZX"Vbfgf"bY"VXegT\a

TVg\i\g\Xf"fhV["Tf*"Xdh\c`Xag"`TaTZX`Xag"TaW"fX_Y+\afheTaVX"gb"\aW\i\WhT_"YhaWf,

N[X"aXg"eXiXahXf"'XkcXafXf("bY"g[X"\agXeaT_"fXei\VX"YhaWf"TeX"eXcbegXW"j\g[

ZbiXea`XagT_"TVg\i\g\Xf, '/17*/7.(

=[TaZX"\a"aXg"cbf\g\ba"bY"ZbiXea`XagT_"TVg\i\g\Xf 621*.41#

GovernmentalActivities -

InternalService Funds

Assets=heeXag";ffXgf8

=Tf["TaW"\aiXfg`Xagf" 152*760#""""""""""

NbgT_"=heeXag";ffXgf 152*760""""""""""""

HbaVheeXag";ffXgf8

=Tc\gT_"TffXgf*"aXg" 125*224""""""""""""

NbgT_"HbaVheeXag";ffXgf 125*224""""""""""""

NbgT_";ffXgf" 500*206""""""""""""

Liabilities=heeXag"F\TU\_\g\Xf8

;VVbhagf"cTlTU_X 00*630""""""""""""""

;VVehXW"_\TU\_\g\Xf 0*//.""""""""""""""""

=b`cXafTgXW"TUfXaVXf 0*70/""""""""""""""""

NbgT_"=heeXag"F\TU\_\g\Xf 05*661""""""""""""""

FbaZ+NXe`"F\TU\_\g\Xf8

=b`cXafTgXW"TUfXaVXf /0*647""""""""""""""

NbgT_"FbaZ"+"NXe`"F\TU\_\g\Xf /0*647""""""""""""""

NbgT_"F\TU\_\g\Xf 2.*530""""""""""""""

Net PositionHXg"\aiXfg`Xag"\a"VTc\gT_"TffXgf 125*224""""""""""""

OaeXfge\VgXW 112*01.""""""""""""

NbgT_"HXg"Jbf\g\ba 46/*454#""""""""""

CITY OF LOS ALAMITOSStatement of Net PositionProprietary FundsJune 30, 2014

MXX"abgXf"gb"UTf\V"Y\aTaV\T_"fgTgX`Xagf +"0."+

CITY OF LOS ALAMITOSStatement of Revenues, Expenses, and Changes in Fund Net PositionProprietary FundsFor the Fiscal Year Ended June 30, 2014

GovernmentalActivities -

InternalService Funds

IcXeTg\aZ"LXiXahXf8

=[TeZXf"Ybe"fXei\VXf 16/*4/5#"""""""""""""""""""

NbgT_"IcXeTg\aZ"LXiXahXf 16/*4/5"""""""""""""""""""""

IcXeTg\aZ"?kcXafXf8

JXefbaaX_"fXei\VXf 62*.//"""""""""""""""""""""""

Mhcc_\Xf"TaW"`TgXe\T_f /53*17."""""""""""""""""""""

Ihgf\WX"fXei\VXf /06*76."""""""""""""""""""""

>XceXV\Tg\ba /30*..."""""""""""""""""""""

NbgT_"IcXeTg\aZ"?kcXafXf 32.*16/"""""""""""""""""""""

IcXeTg\aZ"Fbff '/36*542(""""""""""""""""""""

Hba+IcXeTg\aZ"LXiXahXf8

CafheTaVX"LX\`UhefX`Xag 2*250"""""""""""""""""""""""""

NbgT_"Hba+IcXeTg\aZ"LXiXahXf" 2*250"""""""""""""""""""""""" "

?kVXff"'>XY\V\g("bY"LXiXahXf"biXe

""?kcXafXf '/32*070(""""""""""""""""""""

Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf(

NeTafYXef"\a /3*/.0"""""""""""""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( /3*/.0"""""""""""""""""""""""

=[TaZX"\a"HXg"Jbf\g\ba '/17*/7.(""""""""""""""""""""

HXg"Jbf\g\ba*"Dh_l"/*"0./1 512*262"""""""""""""""""""""

Je\be"JXe\bW";W]hfg`Xag 64*160"""""""""""""""""""""""

HXg"Jbf\g\ba*"Dh_l"/*"0./1*"Tf"eXfgTgXW 60.*644"""""""""""""""""""""

HXg"Jbf\g\ba*"DhaX"1.*"0./2 46/*454#

MXX"abgXf"gb"UTf\V"Y\aTaV\T_"fgTgX`Xagf +"0/"+

CITY OF LOS ALAMITOSStatement of Cash FlowsProprietary FundsFor the Fiscal Year Ended June 30, 2014

GovernmentalActivities -Internal

Service Funds=Tf["@_bjf"Yeb`"IcXeTg\aZ";Vg\i\g\Xf8

=Tf["eXVX\iXW"Yeb`"hfXe"WXcTeg`Xagf 16/*4/5#

=Tf["cT\W"gb"fhcc_\Xef"Ybe"ZbbWf"TaW"fXei\VXf '073*5.1(

=Tf["cT\W"gb"X`c_blXXf"Ybe"fXei\VXf '61*671(

HXg"=Tf["Jebi\WXW"'OfXW("Ul"IcXeTg\aZ";Vg\i\g\Xf 0*.0/

=Tf["@_bjf"Yeb`"=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf8

;Vdh\f\g\ba"bY"VTc\gT_"TffXgf '20*.73(

HXg"=Tf["Jebi\WXW"'OfXW("Ul"=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf '20*.73(

=Tf["@_bjf"Yeb`"Hba+=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf8

CafheTaVX"eX\`UhefX`Xag 2*250

NeTafYXef"\a /3*/.0

HXg"=Tf["Jebi\WXW"'OfXW("UlHba+=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf /7*352

HXg">XVeXTfX"\a"=Tf["TaW"=Tf["?dh\iT_Xagf '0.*3..(

=Tf["TaW"=Tf["?dh\iT_Xagf"Tg"g[X"<XZ\aa\aZ"bY"g[X"@\fVT_"SXTe 173*260

=Tf["TaW"=Tf["?dh\iT_Xagf"Tg"g[X"?aW"bY"g[X"@\fVT_"SXTe 152*760#

LXVbaV\_\Tg\ba"bY"IcXeTg\aZ"Fbff"gb"

"""HXg"=Tf["Jebi\WXW"'OfXW("Ul"IcXeTg\aZ";Vg\i\g\Xf8

IcXeTg\aZ"_bff '/36*542(#

>XceXV\Tg\ba /30*...

=[TaZX"\a"TffXgf"TaW"_\TU\_\g\Xf8

CaVeXTfX"'WXVeXTfX("\a"TVVbhagf"cTlTU_X 6*445

CaVeXTfX"'WXVeXTfX("\a"TVVehXW"_\TU\_\g\Xf 17/

CaVeXTfX"'WXVeXTfX("\a"Vb`cXafTgXW"TUfXaVXf '051(

HXg"=Tf["Jebi\WXW"'OfXW("Ul"IcXeTg\aZ";Vg\i\g\Xf 0*.0/#

MXX"abgXf"gb"UTf\V"Y\aTaV\T_"fgTgX`Xagf +"00"+

NOTES TO THE BASIC FINANCIAL STATEMENTS!

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

City of Los AlamitosNotes to the Basic Financial StatementsJune 30, 2014

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<," <Tf\f"bY";VVbhag\aZ"TaW"GXTfheX`Xag"@bVhf"

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Government-Wide Financial Statements

N[X" =\glrf" ZbiXea`Xag+j\WX" Y\aTaV\T_" fgTgX`Xagf" \aV_hWX" T" MgTgX`Xag" bY" HXg" Jbf\g\ba" TaW" T"MgTgX`Xag"bY";Vg\i\g\Xf,"N[XfX"fgTgX`Xagf"eXcbeg"\aYbe`Tg\ba"ba"T__"bY"g[X"TVg\i\g\Xf"bY"g[X"ce\`Tel"ZbiXea`Xag"TaW"\gf"Vb`cbaXag"ha\g,"

#"&("#

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<," <Tf\f"bY";VVbhag\aZ"TaW"GXTfheX`Xag"@bVhf"'=bag\ahXW("

Government-Wide Financial Statements (Continued)

N[X"ZbiXea`Xag+j\WX"Y\aTaV\T_"fgTgX`Xagf"TeX"ceXfXagXW"ba"Ta"qXVbab`\V"eXfbheVXfp"`XTfheX`Xag"YbVhf" TaW" g[X" TVVehT_" UTf\f" bY" TVVbhag\aZ," ;VVbeW\aZ_l*" T__" bY" g[X" =\glrf" TffXgf" TaW" _\TU\_\g\Xf*"\aV_hW\aZ"VTc\gT_"TffXgf"TaW"eX_TgXW"\aYeTfgehVgheX"TffXgf"TaW"_baZ+gXe`"_\TU\_\g\Xf*"TeX"\aV_hWXW"\a"g[X"TVVb`cTal\aZ" MgTgX`Xag" bY" HXg" Jbf\g\ba," N[X" MgTgX`Xag" bY" ;Vg\i\g\Xf" ceXfXagf" V[TaZXf" \a" aXg"cbf\g\ba,"OaWXe"g[X"TVVehT_"UTf\f"bY"TVVbhag\aZ*"eXiXahXf"TeX"eXVbZa\mXW"\a"g[X"cXe\bW"\a"j[\V["g[Xl"TeX"XTeaXW"j[\_X"XkcXafXf"TeX"eXVbZa\mXW"\a"g[X"cXe\bW"\a"j[\V["g[X"_\TU\_\gl"\f"\aVheeXW,"

=XegT\a"glcXf"bY"geTafTVg\baf"TeX"eXcbegXW"Tf"cebZeT`"eXiXahXf"Ybe"g[X"=\gl"\a"g[eXX"VTgXZbe\Xf8"

n" =[TeZXf"Ybe"fXei\VXf"

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Governmental Fund Financial Statements

AbiXea`XagT_" YhaW" Y\aTaV\T_" fgTgX`Xagf" \aV_hWX" T"<T_TaVX"M[XXg" TaW" T"MgTgX`Xag" bY"LXiXahXf*"?kcXaW\gheXf*" TaW" =[TaZXf" \a" @haW" <T_TaVXf" Ybe" T__" `T]be" ZbiXea`XagT_" YhaWf" TaW" bg[Xe"ZbiXea`XagT_" YhaWf" TZZeXZTgXW," ;VVb`cTal\aZ" eXVbaV\_\Tg\baf" TeX" ceXfXagXW" gb" Xkc_T\a" g[X"W\YYXeXaVXf" \a" YhaW"UT_TaVX"Tf"ceXfXagXW" \a" g[XfX"fgTgX`Xagf" gb" g[X"aXg"cbf\g\ba"ceXfXagXW" \a" g[X"ZbiXea`Xag+j\WX"Y\aTaV\T_"fgTgX`Xagf,"

;__" ZbiXea`XagT_" YhaWf" TeX" TVVbhagXW" Ybe" ba" T" fcXaW\aZ" be" oVheeXag" Y\aTaV\T_" eXfbheVXfp"`XTfheX`Xag"YbVhf"TaW"g[X"`bW\Y\XW"TVVehT_"UTf\f"bY"TVVbhag\aZ,";VVbeW\aZ_l*"ba_l"VheeXag"TffXgf"TaW"VheeXag"_\TU\_\g\Xf"TeX"\aV_hWXW"ba"g[X"<T_TaVX"M[XXg,"N[X"MgTgX`Xag"bY"LXiXahXf*"?kcXaW\gheXf*"TaW" =[TaZXf" \a" @haW" <T_TaVXf" ceXfXag" \aVeXTfXf" 'eXiXahXf" TaW" bg[Xe" Y\aTaV\aZ" fbheVXf(" TaW"WXVeXTfXf" 'XkcXaW\gheXf" TaW" bg[Xe" Y\aTaV\aZ" hfXf(" \a" aXg" VheeXag" cbf\g\ba," OaWXe" g[X" `bW\Y\XW"TVVehT_"UTf\f"bY"TVVbhag\aZ*"eXiXahXf"TeX"eXVbZa\mXW"\a"g[X"TVVbhag\aZ"cXe\bW"\a"j[\V["g[Xl"UXVb`X"Ubg["`XTfheTU_X"TaW"TiT\_TU_X"gb"Y\aTaVX"XkcXaW\gheXf"bY"g[X"VheeXag"cXe\bW,"

LXiXahXf"TeX"eXVbeWXW"j[Xa"eXVX\iXW"\a"VTf[*"XkVXcg"g[bfX"eXiXahXf"fhU]XVg"gb"TVVehT_"'ZXaXeT__l"4."WTlf"TYgXe"lXTe+XaW("TaW"eXVbZa\mXW"j[Xa"WhX,"N[X"ce\`Tel"eXiXahX"fbheVXf*"j[\V["[TiX"UXXa"geXTgXW" Tf" fhfVXcg\U_X" gb" TVVehT_" Ul" g[X" =\gl*" TeX" cebcXegl" gTkXf*" fT_Xf" gTkXf*" \agXeZbiXea`XagT_"eXiXahXf*"TaW"bg[Xe" gTkXf,"MT_Xf"TaW"bg[Xe" gTkXf"UXVb`X"`XTfheTU_X"TaW"TiT\_TU_X"j[Xa"VTf[" \f"eXVX\iXW"Ul"g[X"=\gl"TaW"TeX"eXVbZa\mXW"Tf"eXiXahX"Tg"g[Tg"g\`X,"?kcXaW\gheXf"TeX"ZXaXeT__l"eXVbeWXW"\a" g[X"TVVbhag\aZ"cXe\bW" \a"j[\V[" g[X" eX_TgXW" YhaW" _\TU\_\gl" \f" \aVheeXW*"XkVXcg" Ybe"ce\aV\cT_"TaW"\agXeXfg"ba"_baZ+gXe`"_\TU\_\g\Xf*"TaW"Vb`cXafTgXW"TUfXaVXf*"j[\V["TeX"eXVbZa\mXW"Tf"XkcXaW\gheXf"ba_l"j[Xa"cTl`Xag"\f"WhX,"

#"&)"#

Governmental Fund Financial Statements (Continued)

>XYXeeXW"\aY_bjf"Te\fX"j[Xa"cbgXag\T_"eXiXahXf"Wb"abg"`XXg"Ubg["g[X"o`XTfheTU_Xp"TaW"oTiT\_TU_Xp"Ve\gXe\T" Ybe" eXVbZa\g\ba" \a" g[X" VheeXag" cXe\bW,">XYXeeXW" \aY_bjf" T_fb" Te\fX"j[Xa" g[X" ZbiXea`Xag"eXVX\iXf"eXfbheVXf"UXYbeX"\g"[Tf"T"_XZT_"V_T\`"gb"g[X`*"Tf"j[Xa"ZeTag"`ba\Xf"TeX"eXVX\iXW"ce\be"gb"\aVhee\aZ"dhT_\Yl\aZ"XkcXaW\gheXf,"Ca"fhUfXdhXag"cXe\bWf"j[Xa"Ubg["eXiXahX"eXVbZa\g\ba"Ve\gXe\T"TeX"`Xg"be"j[Xa"g[X"ZbiXea`Xag"[Tf"T"_XZT_"V_T\`"gb"g[X"eXfbheVXf*"g[X"WXYXeeXW"\aY_bj"\f"eX`biXW"Yeb`"g[X"UT_TaVX"f[XXg"TaW"eXiXahX"\f"eXVbZa\mXW,"

N[X"YhaWf"WXf\ZaTgXW"Tf"`T]be"YhaWf"TeX"WXgXe`\aXW"Ul"T"`Tg[X`Tg\VT_"VT_Vh_Tg\ba"Vbaf\fgXag"j\g["A;M<"MgTgX`Xag"Hb,"12,"N[X"=\gl"eXcbegf"g[X"Yb__bj\aZ"`T]be"ZbiXea`XagT_"YhaWf8"

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N[X"Jebcbf\g\ba"/<"@haW"\f"WXe\iXW"Yeb`"N[X"MgTgX+FbVT_"JTegaXef[\c"JebZeT`"'MFJJ("@be`h_T"AeTag"=T__"Ybe"ceb]XVgf*"j[\V["\aV_hWX"g[X"Fbf"PTdhXebf"=\eV_X"MgeXXg"LX[TU\_\gTg\ba*"LXTZTa"MgeXXg"LX[TU\_\gTg\ba"TaW"iTe\bhf"<hf\aXff";eXT"MgeXXg"LX[TU\_\gTg\ba"ceb]XVgf,"

N[X"L\iXef"%"GbhagT\a"=bafXeiTaVl"@haW"WXW\VTgXf"YhaW\aZ"Ybe"g[X"ceXfXeiTg\ba"bY"heUTa"bcXa"fcTVX"TaW"[TU\gTg"\a"Fbf";aZX_Xf"TaW"IeTaZX"=bhag\Xf"

";WW\g\baT__l*"g[X"=\gl"eXcbegf"g[X"Yb__bj\aZ"YhaW"glcXf8"

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N[X">XUg"MXei\VX"@haW" \f"hfXW" gb"TVVbhag" Ybe" TaW" eXcbeg" Y\aTaV\T_" eXfbheVXf" g[Tg"TeX" eXfge\VgXW*"Vb``\ggXW*"be"Tff\ZaXW"Ybe"g[X"cTl`Xag"bY*"_baZ+gXe`"WXUg"ce\aV\cT_*"\agXeXfg*"TaW"eX_TgXW"Vbfgf"Ybe"g[X"0..4"=Xeg\Y\VTgXf"bY"JTeg\V\cTg\ba"'FTheX_"JTe^";Vdh\f\g\ba(,"

N[X"=Tc\gT_"Jeb]XVgf"@haWf"TeX"hfXW"gb"TVVbhag"Ybe"TaW"eXcbeg"Y\aTaV\T_"eXfbheVXf"g[Tg"TeX"eXfge\VgXW*"Vb``\ggXW*"be" Tff\ZaXW" Ybe" g[X"TVdh\f\g\ba"be" VbafgehVg\ba"bY"`T]be"VTc\gT_" YTV\_\g\Xf*"bg[Xe" g[Ta"g[bfX"Y\aTaVXW"Ul"CagXeaT_"MXei\VX"@haWf,"

N[X" CagXeaT_"MXei\VX"@haWf"TeX"hfXW" gb" TVVbhag" Ybe" \agXeWXcTeg`XagT_"bcXeTg\baf"j[XeX" \g" \f" g[X"fgTgXW"\agXag"g[Tg"Vbfgf"bY"cebi\W\aZ"fXei\VXf"gb"g[X"WXcTeg`Xagf"bY"g[X"=\gl"ba"T"Vbag\ah\aZ"UTf\f"UX"Y\aTaVXW"be"eXVbiXeXW"ce\`Te\_l"Ul"V[TeZXf"gb"g[X"hfXe"WXcTeg`Xagf,"N[X"=\glrf"gjb"\agXeaT_"fXei\VX"YhaWf"TeX"hfXW"gb"TVVbhag"Ybe"NXV[ab_bZl"LXc_TVX`Xag"TaW"ATeTZX,"

#"&*"#

HbgX"/"MOGG;LS"I@"MCAHC@C=;HN";==IOHNCHA"JIFC=C?M"'=IHNCHO?>(


Proprietary Fund Financial Statements

Jebce\XgTel"YhaW"Y\aTaV\T_"fgTgX`Xagf"\aV_hWX"T"MgTgX`Xag"bY"HXg"Jbf\g\ba*"T"MgTgX`Xag"bY"LXiXahXf*"?kcXafXf*"TaW"=[TaZXf"\a"HXg"Jbf\g\ba*"TaW"T"MgTgX`Xag"bY"=Tf["@_bjf,"N[X"=\glrf"ba_l"cebce\XgTel"YhaWf" TeX" \gf" gjb" \agXeaT_" fXei\VX" YhaWf," N[X" ATeTZX" CagXeaT_" MXei\VX" @haW" TVVbhagf" Ybe" g[X"TVdh\f\g\ba*"`T\agXaTaVX*"eXcT\e*"TaW"eXc_TVX`Xag"bY"T__"=\gl"iX[\V_Xf"TaW"`XV[Ta\VT_"Xdh\c`Xag,"N[X"NXV[ab_bZl"LXc_TVX`Xag"CagXeaT_"MXei\VX"@haW"TVVbhagf"Ybe"g[X"Vbfgf"bY"baZb\aZ"gXV[ab_bZl"hcZeTWXf"TaW"eXc_TVX`Xagf,"

Jebce\XgTel"YhaWf"TeX"TVVbhagXW"Ybe"hf\aZ"g[X"oXVbab`\V"eXfbheVXfp"`XTfheX`Xag"YbVhf"TaW"g[X"TVVehT_"UTf\f"bY"TVVbhag\aZ,";VVbeW\aZ_l*"T__"TffXgf"TaW"_\TU\_\g\Xf"'j[Xg[Xe"VheeXag"be"abaVheeXag("TeX"\aV_hWXW"ba"g[X"MgTgX`Xag"bY"HXg"Jbf\g\ba,"N[X"MgTgX`Xag"bY"LXiXahXf*"?kcXafXf*"TaW"=[TaZXf"\a"HXg"Jbf\g\ba"ceXfXag"\aVeXTfXf"'eXiXahXf("TaW"WXVeXTfXf"'XkcXafXf("\a"gbgT_"aXg"cbf\g\ba,"OaWXe"g[X"TVVehT_"UTf\f"bY"TVVbhag\aZ*"eXiXahXf"TeX"eXVbZa\mXW" \a" g[X"cXe\bW" \a"j[\V["g[Xl"TeX"XTeaXW"j[\_X"XkcXafXf"TeX"eXVbZa\mXW"\a"g[X"cXe\bW"\a"j[\V["g[X"_\TU\_\gl"\f"\aVheeXW,"

IcXeTg\aZ"eXiXahXf"\a"g[X"cebce\XgTel"YhaWf"TeX"g[bfX"eXiXahXf"g[Tg"TeX"ZXaXeTgXW"Yeb`"g[X"ce\`Tel"bcXeTg\baf" bY" g[X" YhaW," ;__" bg[Xe" eXiXahXf" TeX" eXcbegXW" Tf" aba+bcXeTg\aZ" eXiXahXf," " IcXeTg\aZ"XkcXafXf"TeX" g[bfX"XkcXafXf" g[Tg"TeX"XffXag\T_" gb" g[X"ce\`Tel"bcXeTg\baf" Ybe" g[X" YhaW," ";__"bg[Xe"XkcXafXf"TeX"eXcbegXW"Tf"aba+bcXeTg\aZ"XkcXafXf,"

Ca"TVVbeWTaVX"j\g["A;M<"Hb,"40*"Codification of Accounting and Financial Reporting GuidanceContained in Pre-November 30, 1989 FASB and AICPA Pronouncements*" \a" Ubg[" g[X"ZbiXea`Xag+j\WX"TaW"cebce\XgTel"YhaW"Y\aTaV\T_"fgTgX`Xagf*"g[X"=\gl"Tcc_\Xf"T__"Tcc_\VTU_X"A;M<"cebabhaVX`Xagf" '\aV_hW\aZ" T__" HTg\baT_" =bhaV\_" ba" AbiXea`XagT_" ;VVbhag\aZ" 'H=A;("MgTgX`Xagf"TaW"CagXeceXgTg\baf"VheeXag_l"\a"XYYXVg("Tf"jX__"Tf"g[X"Yb__bj\aZ"cebabhaVX`Xagf"\ffhXW"ba"be"UXYbeX"HbiX`UXe"1.*"/7678"@\aTaV\T_";VVbhag\aZ"MgTaWTeWf"<bTeW"'@;M<("MgTgX`Xagf"TaW"CagXeceXgTg\baf*";VVbhag\aZ"Je\aV\c_Xf"<bTeW"';J<("Ic\a\baf*"TaW";VVbhag\aZ"LXfXTeV["<h__Xg\af"';L<("bY"g[X"Vb``\ggXX"ba";VVbhag\aZ"JebVXWheX,"

Q[Xa"Ubg["eXfge\VgXW"TaW"haeXfge\VgXW"eXfbheVXf"TeX"TiT\_TU_X"Ybe"hfX*"\g"\f"g[X"ZbiXea`Xagrf"cb_\Vl"gb"hfX"eXfge\VgXW"eXfbheVXf"Y\efg*"TaW"g[Xa"haeXfge\VgXW"eXfbheVXf"Tf"g[Xl"TeX"aXXWXW,"

=," ;ffXgf*" >XYXeeXW" CaY_bjf" bY" LXfbheVXf*" F\TU\_\g\Xf*" >XYXeeXW" IhgY_bjf" bY" LXfbheVXf*" TaW" HXg"Jbf\g\ba"be"?dh\gl"

Deposits and Investments

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CaiXfg`Xagf" TeX" eXcbegXW" Tg" YT\e" iT_hX,"N[X" =\glrf" cb_\Vl" \f" ZXaXeT__l" gb" [b_W" \aiXfg`Xagf" hag\_"`Tghe\gl"be"hag\_"`Te^Xg"iT_hXf"XdhT_"be"XkVXXW"Vbfg,"

#"&+"#



=," ;ffXgf*">XYXeeXW"CaY_bjf"bY"LXfbheVXf*"F\TU\_\g\Xf*">XYXeeXW"IhgY_bjf"bY"LXfbheVXf*"TaW"HXg"Jbf\g\ba"be"?dh\gl"'=bag\ahXW("

Receivables and Payables

;Vg\i\gl"UXgjXXa"YhaWf"g[Tg"TeX"eXceXfXagTg\iX"bY"_XaW\aZ-Ubeebj\aZ"TeeTaZX`Xagf"bhgfgTaW\aZ"Tg"g[X"XaW"bY"g[X"Y\fVT_"lXTe"TeX"eXYXeeXW"gb"Tf"X\g[Xe"oWhX"gb-Yeb`"bg[Xe"YhaWfp"'\,X,*"g[X"VheeXag"cbeg\ba"bY" \agXeYhaW" _bTaf(" be" oTWiTaVXf" gb-Yeb`" bg[Xe" YhaWfp" '\,X,*" g[X" abaVheeXag" cbeg\ba" bY" \agXeYhaW"_bTaf(,";__"bg[Xe"bhgfgTaW\aZ"UT_TaVXf"UXgjXXa"YhaWf"TeX"eXcbegXW"Tf"oWhX"gb-Yeb`"bg[Xe"YhaWfp,"

Property Taxes

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N[X"=bhagl"bY"IeTaZX"Vb__XVgf"cebcXegl"gTkXf"Ybe"g[X"=\gl,"NTk"_\Xaf"TggTV["TaahT__l"ba"g[X"Y\efg"WTl"bY"DTahTel"ceXVXW\aZ"g[X"Y\fVT_"lXTe"Ybe"j[\V["g[X"gTkXf"TeX"_Xi\XW,"NTkXf"TeX"_Xi\XW"ba"Dh_l"/*"TaW"VbiXe"g[X"Y\fVT_"cXe\bW"Dh_l"/"gb"DhaX"1.,";__"fXVheXW"cXefbaT_"cebcXegl"gTkXf"TaW"baX+[T_Y"bY"g[X"gTkXf"ba"eXT_"cebcXegl"TeX"WhX"HbiX`UXe"/9"g[X"fXVbaW"\afgT__`Xag"\f"WhX"@XUehTel"/,";__"gTkXf"TeX"WX_\adhXag*" \Y"hacT\W*"ba">XVX`UXe"/."TaW";ce\_"/.*" eXfcXVg\iX_l,"OafXVheXW"cXefbaT_"cebcXegl"gTkXf"UXVb`X"WhX"ba"GTeV["/"XTV["lXTe"TaW"TeX"WX_\adhXag*"\Y"hacT\W"ba";hZhfg"1/,"

Functional Classifications

?kcXaW\gheXf"bY"g[X"AbiXea`XagT_"@haWf"TeX"V_Tff\Y\XW"Ul"YhaVg\ba,"@haVg\baT_"V_Tff\Y\VTg\baf"TeX"WXY\aXW"Tf"Yb__bjf8"

AXaXeT_"AbiXea`Xag"\aV_hWXf"_XZ\f_Tg\iX"TVg\i\g\Xf*"j[\V["[TiX"T"ce\`Tel"bU]XVg\iX"bY"cebi\W\aZ"_XZT_"TaW"cb_\Vl"Zh\WX_\aXf"Ybe"g[X"=\gl,";_fb"\aV_hWXW"\a"g[\f"V_Tff\Y\VTg\ba"TeX"g[bfX"TVg\i\g\Xf"g[Tg"cebi\WX"`TaTZX`Xag"be"fhccbeg"fXei\VXf"TVebff"`beX"g[Ta"baX"YhaVg\baT_"TeXT,"

JhU_\V"MTYXgl"\aV_hWXf"g[bfX"TVg\i\g\Xf"g[Tg"\aib_iX"g[X"cebgXVg\ba"bY"cXbc_X"TaW"cebcXegl,"

=b``ha\gl" >XiX_bc`Xag" \aV_hWXf" g[bfX" TVg\i\g\Xf" fhV[" Tf" c_Taa\aZ*" VbWX" XaYbeVX`Xag*" TaW"Uh\_W\aZ"TaW"fTYXgl"\afcXVg\baf,"

LXVeXTg\ba"TaW"=b``ha\gl"MXei\VXf"\aV_hWXf"g[bfX"TVg\i\g\Xf"g[Tg"\aib_iX"g[X"Vb``ha\gl"Vh_gheT_"TaW"_X\fheX"TVg\i\g\Xf,"

JhU_\V" Qbe^f" \aV_hWXf" g[bfX" TVg\i\g\Xf" g[Tg" \aib_iX" g[X" `T\agXaTaVX" TaW" \`cebiX`Xag" bY" =\gl"fgeXXgf*"ebTWf*"TaW"cTe^"WXiX_bc`Xag"TaW"`T\agXaTaVX,"

#"&,"#

=," ;ffXgf*">XYXeeXW"CaY_bjf"bY"LXfbheVXf*"F\TU\_\g\Xf*">XYXeeXW"IhgY_bjf"bY"LXfbheVXf*"TaW"HXg"Jbf\g\ba"be"?dh\gl"'=bag\ahXW("

Functional Classifications (Continued)

=Tc\gT_"Ihg_Tl"\aV_hWXf"cheV[TfXf"bY"cebcXegl*"c_Tag"TaW"Xdh\c`Xag"j[\V["TeX"XkcXafXW"\a"g[X"ZbiXea`XagT_"YhaWf"UXVThfX"ZbiXea`XagT_"YhaWf"hfX"g[X"VheeXag"Y\aTaV\T_"eXfbheVXf"`XTfheX`Xag"YbVhf,

CagXeXfg"TaW"@\fVT_"=[TeZXf"\aV_hWXf"VheeXag"cTl`Xagf"Ybe"\agXeXfg"ba"g[X"=\glrf"_baZ+gXe`"WXUg,"""

Capital Assets

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" ;f"cXe`\ggXW"haWXe"A;M<"MgTgX`Xag"Hb,"12"Ybe"f`T__"ZbiXea`XagT_"Xag\g\Xf*"g[X"=\gl"[Tf"X_XVgXW"gb"eXcbeg"\aYeTfgehVgheX"TffXgf"cebfcXVg\iX_l"UXZ\aa\aZ"Dh_l"/*"0..1,"

" N[X"Vbfgf"bY"abe`T_"`T\agXaTaVX"TaW"eXcT\ef"g[Tg"Wb"abg"TWW"gb"g[X"iT_hX"bY"g[X"TffXg"be"`TgXe\T__l"XkgXaW"TffXgf"_\iXf"TeX"abg"VTc\gT_\mXW,"

" GT]be" bhg_Tlf" Ybe" VTc\gT_" TffXgf" TaW" \`cebiX`Xagf" TeX" VTc\gT_\mXW" Tf" ceb]XVgf" TeX" VbafgehVgXW,"CagXeXfg"\aVheeXW"Whe\aZ"g[X"VbafgehVg\ba"c[TfX"bY"VTc\gT_"TffXgf"\f"\aV_hWXW"Tf"cTeg"bY"g[X"VTc\gT_\mXW"iT_hX"bY"g[X"TffXgf"VbafgehVgXW"ba"g[X"ZbiXea`Xag+j\WX"TaW"cebce\XgTel"YhaW"Y\aTaV\T_"fgTgX`Xagf,"Hb"\agXeXfg"jTf"VTc\gT_\mXW"Whe\aZ"g[X"Y\fVT_"lXTe"XaWXW"DhaX"1.*"0./2,"

" JebcXegl*"c_Tag*"TaW"Xdh\c`Xag"bY" g[X"ce\`Tel"ZbiXea`Xag*"Tf"jX__"Tf" g[X"Vb`cbaXag"ha\gf*"TeX"WXceXV\TgXW"hf\aZ"g[X"fgeT\Z[g+_\aX"`Xg[bW"biXe"g[X"Yb__bj\aZ"Xfg\`TgXW"hfXYh_"_\iXf8"

" ?dh\c`Xag" 3 -"/."lXTef"" PX[\V_Xf" 1 -"5 lXTef"" @hea\gheX" 5"lXTef"" <h\_W\aZf" 3."lXTef"" C`cebiX`Xagf" 3 -"0."lXTef"" CaYeTfgehVgheX" 3."lXTef"

#"&-"#

=," ;ffXgf*" >XYXeeXW" CaY_bjf" bY" LXfbheVXf*" F\TU\_\g\Xf*" >XYXeeXW" IhgY_bjf" bY" LXfbheVXf*" TaW" HXg"Jbf\g\ba"be"?dh\gl"'=bag\ahXW("

Deferred Outflows and Inflows of Resources

JhefhTag" gb" A;M<" MgTgX`Xag" Hb," 41*" g[X" =\gl" eXVbZa\mXf" WXYXeeXW" bhgY_bjf" TaW" \aY_bjf" bY"eXfbheVXf,">XYXeeXW"bhgY_bj"TaW"\aY_bj"bY"eXfbheVXf"TeX"WXY\aXW"Tf"T"Vbafh`cg\ba"be"eXfbheVX"bY"aXg"cbf\g\ba"Ul"g[X"ZbiXea`Xag"g[Tg"\f"Tcc_\VTU_X"gb"T"YhgheX"eXcbeg\aZ"cXe\bW,"N[X"WXYXeeXW"\aY_bjf"\aV_hWX"haTiT\_TU_X"eXiXahXf,""

Claims and Judgments

" N[X"=\gl"eXVbeWf"T"_\TU\_\gl"Ybe"V_T\`f*"]hWZ`Xagf*"TaW"_\g\ZTg\ba"j[Xa"\g"\f"cebUTU_X"g[Tg"Ta"TffXg"[Tf"UXXa"\`cT\eXW"be"T"_\TU\_\gl"[Tf"UXXa"\aVheeXW"ce\be"gb"Y\fVT_"lXTe+XaW"TaW"g[X"cebUTU_X"T`bhag"bY"_bff"'aXg"bY"Tal"\afheTaVX"VbiXeTZX("VTa"UX"eXTfbaTU_l"Xfg\`TgXW,"

N[X"=\gl"\f"XkcbfXW"gb"iTe\bhf"e\f^f"bY"_bffXf"eX_TgXW"gb"gbegf9"g[XYg"bY*"WT`TZXf"gb*"TaW"WXfgehVg\ba""""bY" TffXgf9"Xeebef"TaW"b`\ff\baf9" \a]he\Xf" gb" X`c_blXXf9"TaW"aTgheT_"W\fTfgXef,"N[X"=\gl" VheeXag_l"eXcbegf"T__"bY"\gf"e\f^"`TaTZX`Xag"TVg\i\g\Xf"\a"\gf"AXaXeT_"@haW,"=_T\`f"XkcXaW\gheXf"TaW"_\TU\_\g\Xf"TeX" eXcbegXW" j[Xa" \g" \f" cebUTU_X" g[Tg" T" _bff" [Tf" bVVheeXW" TaW" g[X" T`bhag" bY" g[X" _bff" VTa" UX"eXTfbaTU_l"Xfg\`TgXW,"N[XfX"_bffXf"\aV_hWX"Ta"Xfg\`TgX"bY"V_T\`f"g[Tg"[TiX"UXXa"\aVheeXW*"Uhg"abg"eXcbegXW,

"Cg"\f"g[X"=\glrf"cb_\Vl"gb"_\dh\WTgX"V_T\`f"TaW"]hWZ`Xagf"Xk\fg\aZ"Tg"DhaX"1.*"j\g["YhgheX"eXfbheVXf,";VVbeW\aZ_l*" g[X" _\TU\_\g\Xf" TeX" eXVbeWXW" \a" g[X" MgTgX`Xag" bY" HXg" Jbf\g\ba," N[XfX" abaVheeXag"T`bhagf"j\__"UX"eXVbeWXW"Tf"YhaW"XkcXaW\gheXf"\a"g[X"Y\fVT_"lXTe"\a"j[\V["g[Xl"TeX"cT\W"be"UXVb`X"WhX"ba"WX`TaW,"

Cash and Cash Equivalents

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Fund Equity

Ca" g[X" YhaW" Y\aTaV\T_" fgTgX`Xagf*" ZbiXea`XagT_" YhaWf" eXcbeg" YhaW" UT_TaVX" Tf" abafcXaWTU_X*"eXfge\VgXW*"Vb``\ggXW*"Tff\ZaXW*"be"haTff\ZaXW"UTfXW"ce\`Te\_l"ba"g[X"XkgXag"gb"j[\V["g[X"=\gl"\f"UbhaW"gb"[babe"VbafgeT\agf"ba"[bj"fcXV\Y\V"T`bhagf"VTa"UX"fcXag,"

n Nonspendable fund balance"s" g[Tg"cbeg\ba"bY"T" YhaW"UT_TaVX" g[Tg" \aV_hWXf"T`bhagf" g[Tg"VTaabg"UX"fcXag"UXVThfX" g[Xl"TeX"X\g[Xe"abg"\a"T"fcXaWTU_X"Ybe`*"fhV["Tf"ceXcT\W" \gX`f*"\aiXagbe\Xf*"be"_bTaf"eXVX\iTU_X,"

#"'$"#




Fund Equity (Continued)

n Restricted fund balance"s"g[Tg"cbeg\ba"bY"T"YhaW"UT_TaVX"g[Tg"eXY_XVgf"VbafgeT\agf"c_TVXW"ba"g[X"hfX"bY"eXfbheVXf"'bg[Xe"g[Ta"aba+fcXaWTU_X"\gX`f("g[Tg"TeX"X\g[Xe"'T("XkgXeaT__l"\`cbfXW"Ul"VeXW\gbef"'fhV["Tf"g[ebhZ["WXUg"VbiXaTagf*"ZeTagbef*"Vbage\Uhgbef*"be"_Tjf"be"eXZh_Tg\baf"bY"bg[Xe"ZbiXea`Xagf(9"be"'U("\`cbfXW"Ul"_Tj"g[ebhZ["Vbafg\ghg\baT_"cebi\f\baf"be"XaTU_\aZ"_XZ\f_Tg\ba," "?kT`c_Xf" bY" eXfge\VgXW" YhaW"UT_TaVXf" \aV_hWX"ATf"NTk*";ffXg" MX\mheX*" TaW"GXTfheX"G"YhaWf,"

n Committed fund balance"s"g[Tg"cbeg\ba"bY"T"YhaW"UT_TaVX"g[Tg"\aV_hWXW"T`bhagf"g[Tg"VTa"ba_l"UX"hfXW"Ybe"fcXV\Y\V"checbfXf"chefhTag"gb"VbafgeT\agf"\`cbfXW"Ul"Ybe`T_"TVg\ba"bY"g[X"ZbiXea`Xagrf" [\Z[Xfg" _XiX_" bY" WXV\f\ba+`T^\aZ" Thg[be\gl*" TaW" eX`T\a" U\aW\aZ" ha_Xff"eX`biXW"\a"g[X"fT`X"`TaaXe,"""

T( N[X" =\gl" =bhaV\_*" Tf" g[X" =\glrf" [\Z[Xfg" _XiX_" bY" WXV\f\ba+`T^\aZ" Thg[be\gl*" `Tl"Vb``\g"YhaW"UT_TaVX"Ybe"fcXV\Y\V"checbfXf"chefhTag"gb"VbafgeT\agf"\`cbfXW"Ul"Ybe`T_"TVg\baf"gT^Xa*"fhV["Tf"T"eXfb_hg\ba,"

U( N[XfX" Vb``\ggXW" T`bhagf" VTaabg" UX" hfXW" Ybe" Tal" bg[Xe" checbfX" ha_Xff" g[X" =\gl"=bhaV\_"eX`biXf"be"V[TaZXf"g[X"fcXV\Y\XW"hfX"g[ebhZ["g[X"fT`X"glcX"bY"Ybe`T_"TVg\ba"gT^Xa"gb"XfgTU_\f["g[X"Vb``\g`Xag,"

V( =\gl"=bhaV\_";Vg\ba"gb"Vb``\g"YhaW"UT_TaVX"aXXWf"gb"bVVhe"j\g[\a"g[X"Y\fVT_"eXcbeg\aZ"cXe\bWf9"[bjXiXe"g[X"T`bhag"VTa"UX"WXgXe`\aXW"fhUfXdhXag_l,""""

n Assigned fund balance s"T`bhagf"g[Tg"TeX"VbafgeT\aXW"Ul"g[X"=\glrf"\agXag"gb"UX"hfXW"Ybe"fcXV\Y\V" checbfXf*" Uhg" TeX" aX\g[Xe" LXfge\VgXW" abe" =b``\ggXW*" f[bh_W" UX" eXcbegXW" Tf";ff\ZaXW"YhaW"UT_TaVX,""N[\f"cb_\Vl"[XeXUl"WX_XZTgXW"g[X"Thg[be\gl"gb"Tff\Za"T`bhagf"gb"UX"hfXW"Ybe"fcXV\Y\V"checbfXf"gb"g[X"=\gl"GTaTZXe"Ybe"g[X"checbfX"bY"eXcbeg\aZ"g[XfX"T`bhagf"\a"g[X"=\glrf"TaahT_"Y\aTaV\T_"fgTgX`Xagf,""?kT`c_Xf"bY";ff\ZaXW"YhaW"UT_TaVX"TeX"YhaWf"\agXaWXW"Ybe"=Tc\gT_"C`cebiX`Xag"Jeb]XVgf"TaW"?dh\c`Xag"LXc_TVX`Xag*"XaVh`UeTaVXf*"WbaTg\baf"eXVX\iXW"Ybe"fcXV\Y\V"ceb]XVgf"Tf"jX__"Tf"g[X"=\glrf"X`XeZXaVl"eXfXeiX,"""

n Unassigned fund balance s"g[XfX"TeX"eXf\WhT_"cbf\g\iX"aXg"eXfbheVXf"\a"XkVXff"bY"j[Tg"VTa"cebcXe_l" UX" V_Tff\Y\XW" \a" baX" bY" g[X" bg[Xe" Ybhe" VTgXZbe\Xf" TaW" Wb" abg" [TiX" Tal" fcXV\Y\V"fcXaW\aZ"_\`\gTg\baf,""N[X"AXaXeT_"@haW"\f"g[X"ba_l"YhaW"g[Tg"f[bh_W"eXcbeg"g[\f"VTgXZbel"bY"YhaW"UT_TaVX,"""

#"'%"#

Fund Balance Policy

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Investments Authorized by Debt Agreements

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Disclosures Relating to Interest Rate Risk

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Disclosures Relating to Interest Rate Risk (Continued)

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Disclosures Relating to Credit Risk

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HbgX"6" L?NCL?G?HN"JF;HM

Plan Description

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Funding Policy

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HbgX"/."INB?L"JIMN+?GJFISG?HN"<?H?@CNM"'IJ?<("JF;H

Plan Description

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N\Xe"/"+...?`c_blXXf"B\eXW"<XYbeX";hZhfg"/*"/772"'/(8"

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#"('"#

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Plan Description (Continued)

n Jb_\VX" ?`c_blXXf" j\g[" /." lXTef" bY" J?LM" fXei\VX" f[T__" UX" X_\Z\U_X" gb" eXVX\iX" 3.$" bY" g[X"`bag[_l"UXaXY\g"Tcc_\VTU_X"gbjTeWf"g[X"X`c_blXX"TaW"baX"WXcXaWXag"cebi\WXW"g[Tg"X`c_blXX"c_hf" baX" WXcXaWXag" VbiXeTZX" jTf" \a" XYYXVg" hcba" g[X" WTgX" bY" eXg\eX`Xag," N[X" cXeVXagTZX"\aVeXTfXf"Ul"3$ cXe"lXTe"gb"/..$"Tg"0."lXTef"bY"fXei\VX,"

'/(" ;cc_\Xf"gb"cb_\VX"X`c_blXXf"[\eXW"TYgXe"DTahTel"/*"/773"

Funding Policy

N[X"Vbage\Uhg\ba"eXdh\eX`Xagf"bY"c_Ta"`X`UXef"TaW"g[X"=\gl"TeX"XfgTU_\f[XW"TaW"`Tl"UX"T`XaWXW"Ul"g[X"=\gl"=bhaV\_*"TaW-be"g[X"X`c_blXX"TffbV\Tg\baf,"N[X"=\gl"\f"VheeXag_l"YhaW\aZ"g[\f"IJ?<"bU_\ZTg\ba"UTfXW"ba"T"cTl+Tf+lbh+Zb"UTf\f,">he\aZ"g[X"Y\fVT_"lXTe"XaWXW"DhaX"1.*"0./2*"g[X"=\gl"cT\W"#/31*.04"\a"[XT_g["VTeX"Vbfgf"Ybe"\gf"eXg\eXXf"TaW"g[X\e"VbiXeXW"WXcXaWXagf,

Annual OPEB Cost and Net OPEB Obligation

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YhaW\aZ"g[Tg*"\Y"cT\W"ba"Ta"baZb\aZ"UTf\f*"\f"ceb]XVgXW"gb"VbiXe"abe`T_"Vbfg"XTV["lXTe"TaW"gb"T`beg\mX"Tal"haYhaWXW"_\TU\_\g\Xf"bY"g[X"c_Ta"biXe"T"cXe\bW"abg"gb"XkVXXW"g[\egl"lXTef,"

N[X" Yb__bj\aZ" gTU_X" f[bjf" g[X" Vb`cbaXagf"bY" g[X"=\glrf" TaahT_"IJ?<"Vbfg" Ybe" g[X" Y\fVT_" lXTe*" g[X"T`bhag"TVghT__l"Vbage\UhgXW"gb"g[X"c_Ta*"TaW"V[TaZXf"\a"g[X"=\glrf"aXg"IJ?<"bU_\ZTg\ba"gb"g[X"LXg\eXX"BXT_g["J_Ta8""""""""""""""""""""""""""""

"""""""""""""""""""""""""" """"""""""""""""""""""""""""""""""""""""N[X"=\glrf"TaahT_"IJ?<"Vbfg*"g[X"cXeVXagTZX"bY"TaahT_"IJ?<"Vbfg"Vbage\UhgXW"gb"g[X"c_Ta*"TaW"g[X"aXg"IJ?<"bU_\ZTg\ba"Ybe"g[X"Y\fVT_"lXTe"0./2"TaW"g[X"gjb"ceXVXW\aZ"Y\fVT_"lXTef"jXeX"Tf"Yb__bjf8"

;aahT_"eXdh\eXW"Vbage\Uhg\ba 021*225#""""""""

CagXeXfg"ba"aXg"IJ?<"bU_\ZTg\ba /7*242""""""""""""

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"""=[TaZX"\a"aXg"IJ?<"bU_\ZTg\ba 7/*153""""""""""""

HXg"IJ?<"IU_\ZTg\ba"+"UXZ\aa\aZ"bY"Y\fVT_"lXTe 167*05/""""""""""

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#"(("#

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Annual OPEB Cost and Net OPEB Obligation (Continued)

JXeVXagTZX

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4-1.-/2 022*2./""" """""/31*.04 40,4/$ """"0*502*172 26.*424"""

Funded Status and Funding Progress

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Actuarial Methods and Assumptions

Jeb]XVg\baf"bY"UXaXY\gf"Ybe"Y\aTaV\T_"eXcbeg\aZ"checbfXf"TeX"UTfXW"ba"g[X"fhUfgTag\iX"c_Ta"'g[X"c_Ta"Tf"haWXefgbbW"Ul"g[X"X`c_blXe"TaW"g[X"c_Ta"`XÙXef("TaW"\aV_hWX"g[X"glcXf"bY"UXaXY\gf"cebi\WXW"Tg"g[X"

g\`X"bY"XTV["iT_hTg\ba"TaW"g[X"[\fgbe\VT_"cTggXea"bY"f[Te\aZ"bY"UXaXY\g"Vbfgf"UXgjXXa"g[X"X`c_blXe"TaW"c_Ta"`XÙXef"gb"g[Tg"cb\ag,"N[X"TVghTe\T_"`Xg[bWf"TaW"Tffh`cg\baf"hfXW"\aV_hWX"gXV[a\dhXf"g[Tg"TeX"WXf\ZaXW"gb"eXWhVX"g[X"XYYXVgf"bY"f[beg+gXe`"ib_Tg\_\gl"\a"TVghTe\T_"TVVehXW"_\TU\_\g\Xf"TaW"g[X"TVghTe\T_"iT_hX"bY"TffXgf*"Vbaf\fgXag"j\g["g[X"_baZ+gXe`"cXefcXVg\iX"bY"g[X"VT_Vh_Tg\baf,"Ca"g[X">XVXÙXe"0./0"TVghTe\T_"iT_hTg\ba*"g[X"Xagel"TZX"abe`T_"Vbfg"`Xg[bW"jTf"hfXW,"N[X"TVghTe\T_"Tffh`cg\baf"\aV_hWXW"Ta"\aiXfg`Xag"eXghea-W\fVbhag"eTgX"bY"3,.$"cXe"Taah`*"ceb]XVgXW"fT_Tel"\aVeXTfXf"bY"1,.$"cXe"Taah`*"T"ZXaXeT_" \aY_Tg\ba" eTgX"bY" 1,.$"cXe" Taah`*" TaW" T"`XW\VT_" geXaW" eTgX"bY"2,.$,";" _XiX_"cXeVXagTZX"bY"cTleb__" Xg[bW"jTf"hfXW"gb"T__bVTgX"T`beg\mTg\ba"Vbfg"Ul"lXTe,";"V_bfXW"T`beg\mTg\ba"cXe\bW"bY"1."lXTef"jTf"hfXW,"

#"()"#

HbgX"//""DICHN"P?HNOL?M

Orange County Fire Authority

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Joint Forces Training Base Swimming Facilities

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West Communications Financing Authority

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#"(*"#

HbgX"//" DICHN"P?HNOL?M"'=IHNCHO?>(

West Communications Financing Authority (Continued)

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Integrated Law and Justice Agency for Orange County

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" """@\aTaV\T_"\aYbe`Tg\ba"Ybe"g[\f"TeeTaZX`Xag"`Tl"UX"bUgT\aXW"Yeb`"g[X"=\gl"bY"Fbf";_T`\gbf,"

HbgX"/0"FC;<CFCNS*"JLIJ?LNS";H>"QILE?LMr"=IGJ?HM;NCIH"JLIN?=NCIH

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Self-Insurance Programs of the Insurance Authority

" AXaXeT_"F\TU\_\gl"CafheTaVX

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#"(+"#

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Self-Insurance Programs of the Insurance Authority (Continued)

" AXaXeT_"F\TU\_\gl"CafheTaVX"'=bag\ahXW(

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#"(,"#



Self-Insurance Programs of the Insurance Authority (Continued)

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Purchased Insurance

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Self-Insurance

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REQUIRED SUPPLEMENTARY INFORMATION!

Variance withBudgeted Amounts Final Budget

PositiveOriginal Final Actual (Negative)

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=\gl"TggbeaXl /33*..."""""""" /33*..."""""""" /.2*541""""""""" 3.*015

Hba+WXcTeg`XagT_ 4.1*553"""""""" 4.1*553"""""""" 67/*0.6""""""""" '065*211(

NbgT_"AXaXeT_"AbiXea`Xag /*7/0*072""""" /*7/0*071""""" 0*.40*0/5""""" '/27*702(

JhU_\V"fTYXgl 3*461*035""""" 3*505*/.5""""" 3*652*.3/""""" '/24*722(

=b``ha\gl"WXiX_bc`Xag 5/4*315"""""""" 53.*235"""""""" 607*270""""""""" '57*.13(

LXVeXTg\ba"TaW"Vb``ha\gl"fXei\VXf /*372*074""""" /*371*6/3""""" /*4/7*722""""" '04*/07(

JhU_\V"jbe^f /*455*532""""" /*541*532""""" /*463*60.""""" 55*712

=Tc\gT_"bhg_Tl 2.*..."""""""""" """"""""""""""""" """"""""""""""""" " """"""""""""""""""

NbgT_"?kcXaW\gheXf //*402*/16""" //*525*204""" /0*.5/*302""" '102*.76(

?kVXff"bY"LXiXahXf"IiXe"'OaWXe(

?kcXaW\gheXf '142*314(""""""" '062*0/4(""""""" 022*662""""""""" 307*/..


NeTafYXef"\a 160*..."""""""" 160*..."""""""" 172*602""""""""" /0*602

NeTafYXef"bhg '0/.*73/(""""""" '007*73/(""""""" '004*.31(""""""" 1*676

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( /5/*.27"""""""" /30*.27"""""""" /46*55/""""""""" /4*500

HXg"=[TaZX"\a"@haW"<T_TaVX '/71*265(""""""" '/10*/45(""""""" 2/1*433""""""""" 323*600

@haW"<T_TaVX"'>XY\V\g(*"Dh_l"/*"0./1 5*64/*/1/""""" 5*64/*/1/""""" 5*64/*/1/""""" """"""""""""""""""

@haW"<T_TaVX"'>XY\V\g(*"DhaX"1.*"0./2 5*445*422#"""" 5*506*742#"""" 6*052*564#"""" 323*600#

CITY OF LOS ALAMITOSBudgetary Comparison ScheduleGeneral FundFor the Fiscal Year Ended June 30, 2014

+33+

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual

Proposition 1B Special Revenue Fund


Variance with

Final Budget

Budgeted Amounts Positive

Original Final Actual (Negative)

LXiXahXf

CagXeZbiXea`XagT_ 070*...#"""""""""""" 1/6*...#"""""""""""" +#"""""""""""""""""""" '1/6*...(#"""""""""""

NbgT_"LXiXahXf 070*..."""""""""""""" 1/6*..."""""""""""""" """"""""""""""""""""""" '1/6*...("""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 1/6*..."""""""""""""" 1/6*..."""""""""""""" 10.*.03"""""""""""""" '0*.03("""""""""""""""""

NbgT_"?kcXaW\gheXf 1/6*..."""""""""""""" 1/6*..."""""""""""""" 10.*.03"""""""""""""" '0*.03("""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '04*...(""""""""""""""" """"""""""""""""""""""" '10.*.03(""""""""""""" '10.*.03("""""""""""""

@haW"<T_TaVX"'>XY\V\g(*"Dh_l"/*"0./1 '/3*2/6(""""""""""""""" '/3*2/6(""""""""""""""" '/3*2/6(""""""""""""""" """""""""""""""""""""""

@haW"<T_TaVX"'>XY\V\g(*"DhaX"1.*"0./2 '2/*2/6(#"""""""""""" '/3*2/6(#"""""""""""" '113*221(#"""""""""" '10.*.03(#"""""""""""


+34+


MV[XWh_X"bY"@haW\aZ"JebZeXff

@be"g[X"@\fVT_"SXTe"?aWXW"DhaX"1.*"0./2

OTHER POST-EMPLOYMENT BENEFITS PLAN

?agel";ZX OaYhaWXW OaYhaWXW

;VghTe\T_ Hbe`T_ ;VghTe\T_ @haWXW 'IiXeYhaWXW(

;VghTe\T_ PT_hX"bY" ;VVehXW ;VVehXW LTg\b =biXeXW $"bY"=biXeXW

PT_hTg\ba ;ffXgf F\TU\_\gl F\TU\_\gl ;P; JTleb__ JTleb__

>TgX 'T( 'U( 'U("+"'T( 'T("-"'U( 'V( ''T"+"U("-"V(

/0-/-0./0 #"""""""""""+" 0*502*172#" 0*502*172#" .$ 2*2..*6.7#" 4/,7/$

+35+

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

OTHER SUPPLEMENTARY INFORMATION

Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualTraffic Improvement Capital Projects FundFor the Fiscal Year Ended June 30, 2014

Variance withFinal Budget

Final PositiveBudget Actual (Negative)

LXiXahXf

NeTYY\V"`\g\ZTg\ba"YXXf 45*.44#"""""""""""""" +#""""""""""""""""""""""" " '45*.44(#"""""""""""""

CaiXfg`Xag"XTea\aZf 3..""""""""""""""""""""" /.0""""""""""""""""""""" '176(""""""""""""""""""""

NbgT_"LXiXahXf 45*344"""""""""""""""" /.0""""""""""""""""""""" '45*242("""""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 13.*..."""""""""""""" /31*4/1"""""""""""""" /74*165""""""""""""""

NbgT_"?kcXaW\gheXf 13.*..."""""""""""""" /31*4/1"""""""""""""" /74*165""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '060*212(""""""""""""" '/31*3//(""""""""""""" /06*701""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 21.*331"""""""""""""" 21.*331""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 /26*//7#""""""""""" 055*.20#""""""""""" /06*701#""""""""""""


+"4."+

Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualRivers and Mountain Conservancy Capital Projects FundFor the Fiscal Year Ended June 30, 2014

Variance with

Final Budget

Positive

Final Actual (Negative)

LXiXahXf

CagXeZbiXea`XagT_ /*165*...#""""""""" +#"""""""""""""""""""" '/*165*...(#""""""""

CaiXfg`Xag"XTea\aZf 03.""""""""""""""""""""" '03.(""""""""""""""""""""

NbgT_"LXiXahXf /*165*03.""""""""""" """"""""""""""""""""""" '/*165*03.(""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl /*/67*70."""""""" 476*1/5"""""""""""""" 27/*4.1""""""""""""""

NbgT_"?kcXaW\gheXf /*/67*70.""""""""""" 476*1/5"""""""""""""" 27/*4.1""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX /75*11."""""""""""""" '476*1/5(""""""""""""" '673*425("""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 '0.4*76.("""""""""" '0.4*76.(""""""""""""" """""""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 '7*43.(#""""""""""""""" '7.3*075(#"""""""""" '673*425(#


+"4/"+

Measure Gas Los AlamitosM Tax Television

;ffXgf

=Tf["TaW"\aiXfg`Xagf 26*565#"""""""" 1.3*57.#"""""" //3*51/#""""""

LXVX\iTU_Xf8

;VVbhagf 2*./6""""""""""""

>hX"Yeb`"bg[Xe"ZbiXea`Xagf 11*.44"""""""""" 16*127""""""""""

LXfge\VgXW"TffXgf8

=Tf["TaW"\aiXfg`Xagf"j\g["Y\fVT_"TZXagf

NbgT_";ffXgf" 6/*631#""""""" 122*/17#""""" //7*527#

F\TU\_\g\Xf"TaW"@haW"<T_TaVXf

F\TU\_\g\Xf8

;VVbhagf"cTlTU_X #"""""""""""""+" /2*.34#"""""""" 2*12.#""""""""""

>hX"gb"bg[Xe"YhaWf

NbgT_"F\TU\_\g\Xf """"""""""""""""""""" /2*.34"""""""""" 2*12.""""""""""""

@haW"<T_TaVXf8

LXfge\VgXW 6/*631"""""""""" 11.*.61"""""""" //3*2.7""""""""

;ff\ZaXW" """""""""""""""""""""

"""""""""""""""""""""

NbgT_"@haW"<T_TaVXf"'>XY\V\gf( 6/*631"""""""""" 11.*.61"""""""" //3*2.7""""""""

NbgT_"F\TU\_\g\Xf"TaW"@haW"<T_TaVXf 6/*631#""""""" 122*/17#""""" //7*527#

CITY OF LOS ALAMITOSCombining Balance SheetNonmajor Governmental FundsJune 30, 2014

Special Revenue Funds

+40+

Public State TotalOffice of Safety Law Special

Traffic and Asset Sales Enforcement Air RevenueSafety Seizure Tax Service Quality Funds

#"""""""1*.43 #"""""21*7/2 #""""""""""+ #"""""""""""+ #""""0/*112 316*40/#"""""""

""""""""""""""""""""""

2*./6"""""""""""""

""""""/" 4*535 """"""""""""65. """"""""1*523 70*565"""""""""""

"""""""""""""""""" """""""""""""""""" """""""""""""""""" " """""""""""""""""" " """""""""""""""""

#"""""""1*.43 #"""""21*7/2 #""""/" 4*535 #""""""""" 65. #""" 03*.57 413*204#

#"""""""""""+ #"""""""""""+ #""""""""""+ #"""""""""""+ #""""""""""+ /6*174#"""""""""

""""""""6" *055 6*055"""""""""""""

"""""""""""""""""" """""""""""""""""" """"""""6" *055 """""""""""""""""" """"""""""""""""" 04*451"""""""""""

"""""""""1*.43 """""""21*7/2 """"""""6" *26. """"""""""""65. """"""03*.57 4.6*531"""""""""

"""""""""""""""""" """""""""""""""""" """""""""""""""""" " """""""""""""""""" " """"""""""""""""" """"""""""""""""""""""

"""""""""1*.43 """""""21*7/2 """"""""6" *26. """"""""""""65. """"""03*.57 4.6*531"""""""""

#"""""""1*.43 #"""""21*7/2 #""""/" 4*535 #""""""""" 65. #""" 03*.57 413*204#

'=bag\ahXW(


+41+

(Continued)

DebtService Park BuildingFund Development Improvement

;ffXgf

=Tf["TaW"\aiXfg`Xagf 17*//1#""""""""""" 053*5/5#""""""""""""""""""""" 27*/54#"""""""""""""""""

LXVX\iTU_Xf8

;VVbhagf

>hX"Yeb`"bg[Xe"ZbiXea`Xagf

LXfge\VgXW"TffXgf8

=Tf["TaW"\aiXfg`Xagf"j\g["Y\fVT_"TZXagf 00.*/63""""""""""" """"""""""""""""""""""""""""" "

NbgT_";ffXgf" 037*076#"""""""" 053*5/5#"""""""""""""""""""" 27*/54#

F\TU\_\g\Xf"TaW"@haW"<T_TaVXf

F\TU\_\g\Xf8

;VVbhagf"cTlTU_X #""""""""""""""""+ /*173#""""""""""""""""""""""""" 7*.04#"""""""""""""""""""

>hX"gb"bg[Xe"YhaWf

NbgT_"F\TU\_\g\Xf """""""""""""""""""""""" /*173""""""""""""""""""""""""""" 7*.04"""""""""""""""""""""

@haW"<T_TaVXf8

LXfge\VgXW 00.*/63"""""""""""

;ff\ZaXW" 17*//1""""""""""""" 052*100""""""""""""""""""""""" 2.*/3."""""""""""""""""""

""""""""""""""""""""""""""""" "

NbgT_"@haW"<T_TaVXf"'>XY\V\gf( 037*076""""""""""" 052*100""""""""""""""""""""""" 2.*/3."""""""""""""""""""

NbgT_"F\TU\_\g\Xf"TaW"@haW"<T_TaVXf 037*076#"""""""" 053*5/5#"""""""""""""""""""" 27*/54#

Capital Projects Funds

CITY OF LOS ALAMITOSCombining Balance SheetNonmajor Governmental FundsJune 30, 2014

+42+

TotalCapital

Residential ProjectsStreets/Alleys Funds Total

24*741#""""""""""""""""" 15/*634#""""""""""""""" 727*37.#"""""""""""""

""""""""""""""""""""""""""""" " 2*./6"""""""""""""""""""

""""""""""""""""""""""""""""" " 70*565"""""""""""""""""

""""""""""""""""""""""""""""" " """"""""""""""""""""""""""" "

""""""""""""""""""""""""""""" " """"""""""""""""""""""""""""" " 00.*/63"""""""""""""""

24*741#""""""""""""""""" 15/*634#""""""""""""""" /*044*36.#

+#""""""""""""""""""""""" /.*20/#""""""""""""""""" 06*6/5#"""""""""""""""

6*055"""""""""""""""""""

""""""""""""""""""""""""""""" " /.*20/""""""""""""""""""" "" 15*.72"""""""""""""""""

606*716"""""""""""""""

24*741""""""""""""""""""" 14/*213""""""""""""""""" 2..*326"""""""""""""""

""""""""""""""""""""""""""""" "

24*741""""""""""""""""""" 14/*213""""""""""""""""" /*007*264""""""""""""

24*741#""""""""""""""""" 15/*634#""""""""""""""" /*044*36.#


+43+

CITY OF LOS ALAMITOSCombining Statement of Revenues, Expenditures, andChanges in Fund BalancesNonmajor Governmental FundsFor the Fiscal Year Ended June 30, 2014

Office ofMeasure Gas Los Alamitos Traffic and

M Tax Television SafetyLXiXahXf8

NTkXf #"""""""""""""+" #"""""1" 66*712 1/*263#"""""""" #"""""""""""+

CagXeZbiXea`XagT_ """""""""6" *5.2

=[TeZXf"Ybe"fXei\VXf """""""/" .*722CaiXfg`Xag"XTea\aZf """""""""""""""31 02"""""""""""""""""

JebZeT`"eXiXahX /67*/25""""""""

G\fVX__TaXbhf 4*3..""""""""""""

NbgT_"LXiXahXf /67*/25"""""""" """""""1" 66*765 16*..7"""""""""" """""""/" 7*426

?kcXaW\gheXf8

=heeXag8

AXaXeT_"ZbiXea`Xag 15*252""""""""""

JhU_\V"jbe^f

=Tc\gT_"bhg_Tl 115*.21"""""""" """""""/" /2*575

>XUg"fXei\VX8

Je\aV\cT_

CagXeXfg"TaW"Y\fVT_"V[TeZXf

NbgT_"?kcXaW\gheXf 115*.21"""""""" """""""/" /2*575 15*252"""""""""" """""""""""""""""""


""?kcXaW\gheXf '/25*674("""""" """""""0" 52*/7. 313""""""""""""""" """""""/" 7*426


NeTafYXef"\a

NeTafYXef"bhg '/55*...("""""" """"""'/7*426(

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( """"""""""""""""""""" '/55*...("""""" """"""""""""""""""""" """"""'/7*426(

HXg"=[TaZX"\a"@haW"<T_TaVXf '/25*674("""""" 75*/7."""""""""" 313""""""""""""""" """""""""""""""""""

@haW"<T_TaVXf"'>XY\V\gf(*"Dh_l"/*"0./1 007*527"""""""" """""""0" 10*671 """""""/" /2*652 """""""""1" *.43

@haW"<T_TaVXf"'>XY\V\gf(*"DhaX"1.*"0./2 6/*631#""""""" #"""""11.*.61 #"""""/" /3*2.7 # 1*.43

""""""""""""""""" """""""""""""""""


+"44"+

Public State TotalSafety Law Special

Asset Sales Enforcement Air RevenueSeizure Tax Service Quality Funds

#"""""""""""+ #"""""7" 3*./7 #"""""""""""+ #""""""""""+ 3/3*216#""""""

"""""""""/*1/2 """""/" .2*.05 """"""/" 2*071 /06*116""""""""

/.*722""""""""""""""""""""""""/2 """"""""""""""1 72

/67*/25""""""""

4*3..""""""""""""

"""""""""/*106 """""""7" 3*./7 """""/" .2*.05 """"""/" 2*074 63.*24/""""""""

15*252""""""""""

"""""""""""""""""

"""""""03*... 254*62.""""""""

"""""""""""""""""

"""""""""""""""""

"""""""""""""""""

"""""""03*... """"""""""""""""""" """"""""""""""""""" """""""""""""""""" 3/2*1/2""""""""

""""""'01*450( """""""7" 3*./7 """""/" .2*.05 """"""/" 2*074 114*/25""""""""

""""""'73*./7( """"'/.1*/35( '172*602("""""""

"""""""""""""""""" """"""'73*./7( """"'/.1*/35( " """""""""""""""""" '172*602("""""""

""""""'01*450( """"""""""""""""""" """"""""""""6" 5. """"""/" 2*074 '36*455("""""""""

"""""""45*364 """""""""6" *26. """"""/" .*561 445*21.""""""""

#"""""21*7/2 #"""""""6" *26. #""""""""""6" 5. #""""03*.57 4.6*531#

'=bag\ahXW(


+"45"+

City of Los AlamitosCombining Statement of Revenues, Expenditures, andChanges in Fund BalancesNonmajor Governmental FundsFor the Fiscal Year Ended June 30, 2014(Continued)

DebtService Park BuildingFund Development Improvement

LXiXahXf8

NTkXf #""""""""""""""""+ +#"""""""""""""""""""""""""""" " +#"""""""""""""""""""""" "

CagXeZbiXea`XagT_

=[TeZXf"Ybe"fXei\VXf /6*.54"""""""""""""""""""""""" "CaiXfg`Xag"XTea\aZf 43"""""""""""""""""""""""""""""" " /1

JebZeT`"eXiXahX

G\fVX__TaXbhf /.*4.4"""""""""""""""""""

NbgT_"LXiXahXf """"""""""""""""""""""" " /6*/2/"""""""""""""""""""""""" " /.*4/7"""""""""""""""""""

?kcXaW\gheXf8

=heeXag8

AXaXeT_"ZbiXea`Xag

JhU_\V"jbe^f 240""""""""""""""""""""""""""""" "

=Tc\gT_"bhg_Tl 06*112"""""""""""""""""""""""" " 44*31."""""""""""""""""""

>XUg"fXei\VX8

Je\aV\cT_" 5.*..."""""""""""""

CagXeXfg"TaW"Y\fVT_"V[TeZXf /2.*76/"""""""""""

NbgT_"?kcXaW\gheXf 0/.*76/""""""""""" 06*574"""""""""""""""""""""""" " 44*31."""""""""""""""""""


""?kcXaW\gheXf '0/.*76/(""""""""" '/.*433(""""""""""""""""""""""" " '33*7//(""""""""""""""""""


NeTafYXef"\a 0/.*73/"""""""""""

NeTafYXef"bhg

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( 0/.*73/""""""""""" """"""""""""""""""""""""""""""""""" " """"""""""""""""""""""""""""" "

HXg"=[TaZX"\a"@haW"<T_TaVXf '1.("""""""""""""""""" '/.*433(""""""""""""""""""""""" " '33*7//(""""""""""""""""""

@haW"<T_TaVXf"'>XY\V\gf(*"Dh_l"/*"0./1 037*106""""""""""" 062*755""""""""""""""""""""""" 74*.4/"""""""""""""""""""

@haW"<T_TaVXf"'>XY\V\gf(*"DhaX"1.*"0./2 037*076#"""""""" 052*100#"""""""""""""""""""" 2.*/3.#

""""""""""""""""""""""""" "


+"46"+

TotalCapital

Residential ProjectsStreets / Alleys Funds Total

+#""""""""""""""""""""""" +#"""""""""""""""""""""" " 3/3*216#"""""""""""""

""""""""""""""""""""""""" " /06*116"""""""""""""""

/6*.54""""""""""""""""""" 07*.0."""""""""""""""""/.""""""""""""""""""""""""" " 66"""""""""""""""""""""""""" /60

/67*/25"""""""""""""""

/.*4.4""""""""""""""""""" /5*/.4"""""""""""""""""

/.""""""""""""""""""""""""" " 06*55.""""""""""""""""""" 657*01/"""""""""""""""

""""""""""""""""""""""""""""" " 15*252"""""""""""""""""

240"""""""""""""""""""""""" 240""""""""""""""""""""""

72*642""""""""""""""""""" 35/*5.2"""""""""""""""

""""""""""""""""""""""""""""" " """"""""""""""""""""""""

""""""""""""""""""""""""""""" " 5.*..."""""""""""""""""

""""""""""""""""""""""""""""" " /2.*76/"""""""""""""""

""""""""""""""""""""""""""""" " 73*104""""""""""""""""""" "" 60.*40/"""""""""""""""

/.""""""""""""""""""""""""" " '44*334("""""""""""""""""" 36*4/."""""""""""""""""

""""""""""""""""""""""""""""" " 0/.*73/"""""""""""""""

""""""""""""""""""""""""""""" " '172*602("""""""""""""

"" """"""""""""""""""""""""""""" " "" """"""""""""""""""""""""""""" " '/61*651("""""""""""""

/.""""""""""""""""""""""""" " '44*334("""""""""""""""""" '/03*041("""""""""""""

24*731""""""""""""""""""" 205*77/""""""""""""""""" /*132*527""""""""""""

24*741#""""""""""""""""" 14/*213#""""""""""""""" /*007*264#

""""""""""""""""""""""""" "


+"47"+

Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and ActualMeasure M Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CagXeZbiXea`XagT_ 045*321#""""""""" #"""""""""""""""""+ '045*321(#""""""""

JebZeT`"eXiXahX """""""""""""""""""" /67*/25""""""""""" /67*/25"""""""""""

NbgT_"LXiXahXf 045*321""""""""""" /67*/25""""""""""" '56*174(""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 207*...""""""""""" 115*.21""""""""""" 7/*735"""""""""""""

NbgT_"?kcXaW\gheXf 207*...""""""""""" 115*.21""""""""""" 7/*735"""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '/4/*235("""""""""" '/25*674("""""""""" /1*34/"""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 007*527""""""""""" 007*527""""""""""" """"""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 46*070#"""""""""" 6/*631#"""""""""" /1*34/#"""""""""""


+"5."+

Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual

Gas Tax Special Revenue Fund


Variance with

Final Budget

Final Positive

Budget Actual (Negative)

LXiXahXf

NTkXf 1/1*146#"""""""""""" 166*712#"""""""""""" 53*344#""""""""""""""

CaiXfg`Xag"XTea\aZf 0..""""""""""""""""""""" 31""""""""""""""""""""""" '/25(""""""""""""""""""""

NbgT_"LXiXahXf 1/1*346"""""""""""""" 166*765"""""""""""""" 53*2/7""""""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 203*..."""""""""""""" //2*575"""""""""""""" 1/.*0.1""""""""""""""

NbgT_"?kcXaW\gheXf 203*..."""""""""""""" //2*575"""""""""""""" 1/.*0.1""""""""""""""


""?kcXaW\gheXf '///*210(""""""""""""" 052*/7."""""""""""""" 163*400""""""""""""""


NeTafYXef"bhg '/55*...(""""""""""""" '/55*...("""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( '/55*...(""""""""""""" '/55*...("""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '066*210(""""""""""""" 75*/7."""""""""""""""" 163*400""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 010*671"""""""""""""" 010*671""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 '33*317(#"""""""""""" 11.*.61#""""""""""" 163*400#""""""""""""


+"5/"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualLos Alamitos Television Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

NTkXf 1.*...#""""""""""""" 1/*263#""""""""""""" /*263#"""""""""""""""

CaiXfg`Xag"XTea\aZf 0.."""""""""""""""""""" 02"""""""""""""""""""""" '/54("""""""""""""""""""

G\fVX__TaXbhf 4*3..""""""""""""""""" 4*3..""""""""""""""""" """"""""""""""""""""""

NbgT_"LXiXahXf 14*5..""""""""""""""" 16*..7""""""""""""""" /*1.7"""""""""""""""""

?kcXaW\gheXf

=heeXag8

AXaXeT_"ZbiXea`Xag 14*5..""""""""""""""" 15*252""""""""""""""" '552("""""""""""""""""""

NbgT_"?kcXaW\gheXf 14*5..""""""""""""""" 15*252""""""""""""""" '552("""""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX """""""""""""""""""""" 313"""""""""""""""""""" 313""""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 //2*652""""""""""""" //2*652""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 //2*652#"""""""""" //3*2.7#"""""""""" 313#


+"50"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualOffice of Traffic and Safety Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CagXeZbiXea`XagT_ /.*...#""""""""""""" 6*5.2#""""""""""""""" '/*074(#""""""""""""""

=[TeZXf"Ybe"fXei\VXf 3*...""""""""""""""""" /.*722""""""""""""""" 3*722"""""""""""""""""

NbgT_"LXiXahXf /3*...""""""""""""""" /7*426""""""""""""""" 2*426"""""""""""""""""

?kcXaW\gheXf

=heeXag8

JhU_\V"fTYXgl 3*...""""""""""""""""" """""""""""""""""""""" 3*..."""""""""""""""""

NbgT_"?kcXaW\gheXf 3*...""""""""""""""""" """""""""""""""""""""" 3*..."""""""""""""""""


?kcXaW\gheXf /.*...""""""""""""""" /7*426""""""""""""""" 7*426"""""""""""""""""


NeTafYXef"bhg '/.*...("""""""""""""" '/7*426("""""""""""""" '7*426(""""""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( '/.*...("""""""""""""" '/7*426("""""""""""""" '7*426(""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX """""""""""""""""""""" """""""""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 1*.43""""""""""""""""" 1*.43""""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 1*.43#"""""""""""""" 1*.43#"""""""""""""" +#


+"51"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualAsset Seizure Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CagXeZbiXea`XagT_ +#"""""""""""""""""""""" " /*1/2#""""""""""""""" /*1/2#"""""""""""""""

CaiXfg`Xag"XTea\aZf /3."""""""""""""""""""" /2"""""""""""""""""""""" '/14("""""""""""""""""""

NbgT_"LXiXahXf /3."""""""""""""""""""" /*106""""""""""""""""" /*/56"""""""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 17*3..""""""""""""""" 03*...""""""""""""""" /2*3.."""""""""""""""

NbgT_"?kcXaW\gheXf 17*3..""""""""""""""" 03*...""""""""""""""" /2*3.."""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '17*13.("""""""""""""" '01*450("""""""""""""" /3*456"""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 45*364""""""""""""""" 45*364""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 06*014#"""""""""""" 21*7/2#"""""""""""" /3*456#


+"52"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualPublic Safety Sales Tax Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

NTkXf 7.*...#""""""""""""" 73*./7#""""""""""""" 3*./7#"""""""""""""""

NbgT_"LXiXahXf 7.*...""""""""""""""" 73*./7""""""""""""""" 3*./7"""""""""""""""""


NeTafYXef"bhg '73*...("""""""""""""" '73*./7("""""""""""""" '/7("""""""""""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( '73*...("""""""""""""" '73*./7("""""""""""""" '/7("""""""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '3*...("""""""""""""""" """""""""""""""""""""" 3*..."""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 6*26.""""""""""""""""" 6*26.""""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 1*26.#"""""""""""""" 6*26.#"""""""""""""" 3*...#


+"53"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualState Law Enforcement Service Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CagXeZbiXea`XagT_ /..*...#""""""""""" /.2*.05#""""""""""" 2*.05#"""""""""""""""

NbgT_"LXiXahXf /..*...""""""""""""" /.2*.05""""""""""""" 2*.05"""""""""""""""""


NeTafYXef"bhg '/..*...("""""""""""" '/.1*/35("""""""""""" '1*/35(""""""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( '/..*...("""""""""""" '/.1*/35("""""""""""" '1*/35(""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX """""""""""""""""""""" 65."""""""""""""""""""" 65.""""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 +#"""""""""""""""""" 65.#""""""""""""""""" 65.#


+"54"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualAir Quality Special Revenue FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CagXeZbiXea`XagT_ /2*...#""""""""""""" /2*071#""""""""""""" 071#""""""""""""""""""

CaiXfg`Xag"XTea\aZf /.."""""""""""""""""""" 1"""""""""""""""""""""""" '75("""""""""""""""""""""

,

NbgT_"LXiXahXf /2*/..""""""""""""""" /2*074""""""""""""""" /74""""""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX /2*/..""""""""""""""" /2*074""""""""""""""" /74""""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 /.*561""""""""""""""" /.*561""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 02*661#"""""""""""" 03*.57#"""""""""""" /74#


+"55"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualDebt Service FundFor the Fiscal Year Ended June 30, 2014



?kcXaW\gheXf

>XUg"fXei\VX8

Je\aV\cT_" 5.*...#""""""""""""" 5.*...#""""""""""""" +#"""""""""""""""""""""""

CagXeXfg"TaW"Y\fVT_"V[TeZXf /2.*73/""""""""""""" /2.*76/""""""""""""" '1.("""""""""""""""""""""

NbgT_"?kcXaW\gheXf 0/.*73/""""""""""""" 0/.*76/""""""""""""" '1.("""""""""""""""""""""


?kcXaW\gheXf '0/.*73/("""""""""""" '0/.*76/("""""""""""" '1.("""""""""""""""""""""


NeTafYXef"\a 0/.*73/""""""""""""" 0/.*73/""""""""""""" """"""""""""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( 0/.*73/""""""""""""" 0/.*73/""""""""""""" """"""""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX """""""""""""""""""""" '1.(""""""""""""""""""""" '1.("""""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 037*106""""""""""""" 037*106""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 037*106#"""""""""" 037*076#"""""""""" '1.(#


+"56"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualPark Development Capital Projects FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

=[TeZXf"Ybe"fXei\VXf +#""""""""""""""""""" /6*.54#""""""""""""" /6*.54#"""""""""""""

CaiXfg`Xag"XTea\aZf 3."""""""""""""""""""""" 43"""""""""""""""""""""" /3""""""""""""""""""""""

NbgT_"LXiXahXf 3."""""""""""""""""""""" /6*/2/""""""""""""""" /6*.7/"""""""""""""""

?kcXaW\gheXf

=heeXag8

JhU_\V"jbe^f """""""""""""""""""""" 240"""""""""""""""""""" '240("""""""""""""""""""

=Tc\gT_"bhg_Tl 12*...""""""""""""""" 06*112""""""""""""""" 3*444"""""""""""""""""

NbgT_"?kcXaW\gheXf 12*...""""""""""""""" 06*574""""""""""""""" 3*0.2"""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '11*73.("""""""""""""" '/.*433("""""""""""""" 01*073"""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 062*755""""""""""""" 062*755""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 03/*.05#"""""""""" 052*100#"""""""""" 01*073#


+"57"+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualBuilding Improvement Capital Projects FundFor the Fiscal Year Ended June 30, 2014



LXiXahXf

CaiXfg`Xag"XTea\aZf +#""""""""""""""""""" /1#"""""""""""""""""""" /1#""""""""""""""""""""

G\fVX__TaXbhf /.*4.4""""""""""""""" /.*4.4"""""""""""""""

NbgT_"LXiXahXf """""""""""""""""""""" /.*4/7""""""""""""""" /.*4/7"""""""""""""""

?kcXaW\gheXf

=Tc\gT_"bhg_Tl 0/7*7..""""""""""""" 44*31.""""""""""""""" /31*15."""""""""""""

NbgT_"?kcXaW\gheXf 0/7*7..""""""""""""" 44*31.""""""""""""""" /31*15."""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX '0/7*7..("""""""""""" '33*7//("""""""""""""" /41*767"""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 74*.4/""""""""""""""" 74*.4/""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 '/01*617(#""""""""" 2.*/3.#"""""""""""" /41*767#


+"6."+

Schedule of Revenues, Expenditures, and Changes in Fund Balance - Budget and ActualResidential Streets/Alleys Capital Projects FundFor the Fiscal Year Ended June 30, 2014


PositiveFinal Actual (Negative)

LXiXahXf

CaiXfg`Xag"XTea\aZf 0..#"""""""""""""""""" /.#"""""""""""""""""""" '/7.(#"""""""""""""""""

NbgT_"LXiXahXf 0.."""""""""""""""""""" /."""""""""""""""""""""" '/7.("""""""""""""""""""

HXg"=[TaZX"\a"@haW"<T_TaVX 0.."""""""""""""""""""" /."""""""""""""""""""""" '/7.("""""""""""""""""""

@haW"<T_TaVX*"Dh_l"/*"0./1 24*731""""""""""""""" 24*731""""""""""""""" """"""""""""""""""""""

@haW"<T_TaVX*"DhaX"1.*"0./2 25*/31#"""""""""""" 24*741#"""""""""""" '/7.(#"""""""""""""""""


+"6/"+

CITY OF LOS ALAMITOSCombining Statement of Net PositionInternal Service FundsJune 30, 2014

TechnologyGarage Replacement Total

Assets=heeXag";ffXgf8

=Tf["TaW"\aiXfg`Xagf" /24*130#"""""""" 006*41.#"""""""""" 152*760#""""""""""

NbgT_"=heeXag";ffXgf /24*130"""""""""" 006*41."""""""""""" 152*760""""""""""""

HbaVheeXag";ffXgf8

=Tc\gT_"TffXgf*"aXg 1//*657"""""""""" 13*345"""""""""""""" 125*224""""""""""""

NbgT_"HbaVheeXag";ffXgf 1//*657"""""""""" 13*345"""""""""""""" 125*224""""""""""""

NbgT_";ffXgf" 236*01/"""""""""" 042*/75"""""""""""" 500*206""""""""""""

Liabilities=heeXag"F\TU\_\g\Xf8

;VVbhagf"cTlTU_X /4*052"""""""""""" 4*356"""""""""""""""" 00*630""""""""""""""

;VVehXW"_\TU\_\g\Xf 0*//."""""""""""""" 0*//.""""""""""""""""

=b`cXafTgXW"TUfXaVXf 0*70/"""""""""""""" 0*70/""""""""""""""""

FbaZ+gXe`"F\TU\_\g\Xf8

=b`cXafTgXW"TUfXaVXf /0*647"""""""""""" /0*647""""""""""""""

NbgT_"F\TU\_\g\Xf 12*/52"""""""""""" 4*356"""""""""""""""" 2.*530""""""""""""""

Net PositionHXg"\aiXfg`Xag"\a"VTc\gT_"TffXgf 1//*657"""""""""" 13*345"""""""""""""" 125*224""""""""""""

OaeXfge\VgXW //0*/56"""""""""" 000*.30"""""""""""" 112*01.""""""""""""

NbgT_"HXg"Jbf\g\ba 202*.35#""""""" 035*4/7#"""""""""" 46/*454#

+"60"+

CITY OF LOS ALAMITOSCombining Statement of Revenues, Expenses, and Changes in Net PositionInternal Service FundsFor the Fiscal Year Ended June 30, 2014


IcXeTg\aZ"LXiXahXf8

=[TeZXf"Ybe"fXei\VXf 011*71.#"""""""" /25*465#""""""""" 16/*4/5#"""""""""

NbgT_"IcXeTg\aZ"LXiXahXf 011*71."""""""""" /25*465""""""""""" 16/*4/5"""""""""""

IcXeTg\aZ"?kcXafXf8

JXefbaaX_"fXei\VXf 62*.//"""""""""""" 62*.//"""""""""""""

Mhcc_\Xf"TaW"cTegf /1/*672"""""""""" 21*274""""""""""""" /53*17."""""""""""

Ihgf\WX"fXei\VXf 04*30."""""""""""" /.0*24.""""""""""" /06*76."""""""""""

>XceXV\Tg\ba /04*550"""""""""" 03*006""""""""""""" /30*..."""""""""""

NbgT_"IcXeTg\aZ"?kcXafXf 147*/75"""""""""" /5/*/62""""""""""" 32.*16/"""""""""""

IcXeTg\aZ"Fbff '/13*045(""""""""" '01*275("""""""""""" '/36*542(""""""""""

Hba+IcXeTg\aZ"LXiXahXf"'?kcXafXf(8

CafheTaVX"LX\`UhefX`Xag 2*250"""""""""""""" """""""""""""""""""" 2*250"""""""""""""""

NbgT_"Hba+IcXeTg\aZ"LXiXahXf"'?kcXafXf( 2*250"""""""""""""" """""""""""""""""""" 2*250"""""""""""""""


""?kcXaW\gheXf '/1.*573(""""""""" '01*275("""""""""""" '/32*070(""""""""""


NeTafYXef"\a /3*/.0"""""""""""" /3*/.0"""""""""""""

NbgT_"Ig[Xe"@\aTaV\aZ"MbheVXf"'OfXf( /3*/.0"""""""""""" /3*/.0"""""""""""""

=[TaZX"\a"HXg"Jbf\g\ba '//3*471(""""""""" '01*275("""""""""""" '/17*/7.(""""""""""

HXg"Jbf\g\ba*"Dh_l"/*"0./1 231*146"""""""""" 06/*//4""""""""""" 512*262"""""""""""

Je\be"JXe\bW";W]hfg`Xag 64*160"""""""""""" 64*160"""""""""""""

HXg"Jbf\g\ba*"Dh_l"/*"0./1*"eXfgTgXW 317*53."""""""""" 06/*//4""""""""""" 60.*644"""""""""""

HXg"Jbf\g\ba*"DhaX"1.*"0./2 202*.35#""""""" 035*4/7#"""""""" 46/*454#

+"61"+

CITY OF LOS ALAMITOSCombining Statement of Cash FlowsInternal Service FundsFor the Fiscal Year Ended June 30, 2014


=Tf["@_bjf"Yeb`"IcXeTg\aZ";Vg\i\g\Xf8

=Tf["eXVX\iXW"Yeb`"hfXe"WXcTeg`Xagf 011*71.#"""""""""" /25*465#"""""""""" 16/*4/5#""""""""""

=Tf["cT\W"gb"fhcc_\Xef"Ybe"ZbbWf"TaW"fXei\VXf" '/33*510("""""""""" '/17*75/("""""""""" '073*5.1(""""""""""

=Tf["cT\W"gb"X`c_blXXf"Ybe"fXei\VXf '61*671("""""""""""" """"""""""""""""""""" '61*671(""""""""""""

HXg"=Tf["Jebi\WXW"'OfXW("Ul"IcXeTg\aZ";Vg\i\g\Xf '3*473("""""""""""""" 5*5/4"""""""""""""""" 0*.0/""""""""""""""""

=Tf["@_bjf"Yeb`"=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf8

;Vdh\f\g\ba"bY"VTc\gT_"TffXgf '20*.73("""""""""""" """"""""""""""""""""" '20*.73(""""""""""""

HXg"=Tf["Jebi\WXW"'OfXW("Ul"=Tc\gT_"TaW

"""LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf '20*.73("""""""""""" """"""""""""""""""""" '20*.73(""""""""""""

=Tf["@_bjf"Yeb`"Hba+=Tc\gT_"TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf8 """""""""""""""""""""

CafheTaVX"LX\`UhefX`Xag 2*250"""""""""""""""" """"""""""""""""""""" 2*250""""""""""""""""

NeTafYXef"Ca /3*/.0"""""""""""""" """"""""""""""""""""" /3*/.0""""""""""""""

HXg"=Tf["Jebi\WXW"'OfXW("Ul"Hba+=Tc\gT_"

"""TaW"LX_TgXW"@\aTaV\aZ";Vg\i\g\Xf /7*352"""""""""""""" """"""""""""""""""""" /7*352""""""""""""""

HXg"CaVeXTfX"'>XVeXTfX("\a"=Tf["TaW"=Tf["?dh\iT_Xagf '06*0/4("""""""""""" 5*5/4"""""""""""""""" '0.*3..(""""""""""""

=Tf["TaW"=Tf["?dh\iT_Xagf"Tg"g[X"<XZ\aa\aZ"bY"g[X"@\fVT_"SXTe /52*346"""""""""""" 00.*7/2"""""""""""" 173*260""""""""""""

=Tf["TaW"=Tf["?dh\iT_Xagf"Tg"g[X"?aW"bY"g[X"@\fVT_"SXTe /24*130#""""""""" 006*41.#"""""""""" 152*760#

LXVbaV\_\Tg\ba"bY"IcXeTg\aZ"CaVb`X"'Fbff("gb"HXg"=Tf["Jebi\WXW"'OfXW("Ul"

""IcXeTg\aZ";Vg\i\g\Xf8

IcXeTg\aZ"_bff '/13*045(#"""""""" '01*275(#"""""""""" '/36*542(#""""""""

;WW"UTV^"WXceXV\Tg\ba"XkcXafX /04*550"""""""""""" 03*006"""""""""""""" /30*...""""""""""""

=[TaZX"\a"TffXgf"TaW"_\TU\_\g\Xf8 """""""""""""""""""""CaVeXTfX"'>XVeXTfX("\a"IcXeTg\aZ"F\TU\_\g\Xf8 """""""""""""""""""

CaVeXTfX"'WXVeXTfX("\a"TVVbhagf"cTlTU_X 0*460"""""""""""""""" 3*763"""""""""""""""" 6*445""""""""""""""""

CaVeXTfX"'WXVeXTfX("\a"TVVehXW"_\TU\_\g\Xf 17/""""""""""""""""""" 17/"""""""""""""""""""

CaVeXTfX"'WXVeXTfX("\a"Vb`cXafTgXW"TUfXaVXf '051("""""""""""""""""" '051(""""""""""""""""""

HXg"=Tf["Jebi\WXW"'OfXW("Ul"IcXeTg\aZ";Vg\i\g\Xf '3*473(#""""""""""" 5*5/4#"""""""""""""" 0*.0/#

+"62"+

STATISTICAL SECTION

!!!!!!!!!!!!!!

!

!!!!!!!!!!!!!

DESCRIPTION OF STATISTICAL SECTION CONTENTS

JUNE 30, 2014

N[\f" cTeg" bY" g[X" =\gl" bY" Fbf" ;_T`\gbfrf" =b`ceX[Xaf\iX" ;aahT_" @\aTaV\T_" LXcbeg" ceXfXagf" WXgT\_XW"\aYbe`Tg\ba" Tf" T" VbagXkg" Ybe" haWXefgTaW\aZ" j[Tg" g[X" \aYbe`Tg\ba" \a" g[X" Y\aTaV\T_" fgTgX`Xagf*" abgX"W\fV_bfheXf*"TaW"eXdh\eXW"fhcc_X`XagTel"\aYbe`Tg\ba"fTl"TUbhg"g[X"ZbiXea`Xagrf"biXeT__"Y\aTaV\T_"[XT_g[,"""

=bagXagf8" " " " " " " " " " " """"""""""J;A?@\aTaV\T_"NeXaWf8"g[XfX"fV[XWh_Xf"VbagT\a"geXaW"\aYbe`Tg\ba"gb"[X_c""g[X"eXTWXe"haWXefgTaW"[bj"g[X"=\glrf"Y\aTaV\T_"cXeYbe`TaVX"TaW""jX__+UX\aZ"[TiX"V[TaZXW"biXe"g\`X," " " " 64"

LXiXahX"=TcTV\gl8"g[XfX"fV[XWh_Xf"VbagT\a"geXaW"\aYbe`Tg\ba"gb"[X_c""g[X"eXTWXe"TffXff"g[X"YTVgbef"TYYXVg\aZ"g[X"=\glrf"`bfg"f\Za\Y\VTag"eXiXahX"fbheVX*""cebcXegl"gTk,"" " " " 72"

>XUg"=TcTV\gl8"g[XfX"fV[XWh_Xf"ceXfXag"\aYbe`Tg\ba"gb"[X_c""g[X"eXTWXe"TffXff"g[X"TYYbeWTU\_\gl"bY"g[X"=\glrf"VheeXag"_XiX_f"bY""bhgfgTaW\aZ"WXUg"TaW"g[X"=\glrf"TU\_\gl"gb"\ffhX"TWW\g\baT_"WXUg"\a"g[X"YhgheX," " " /.0"

>X`bZeTc[\V"TaW"?Vbab`\V"CaYbe`Tg\ba8"g[XfX"fV[XWh_Xf"bYYXe"WX`bZeTc[\V"TaW"XVbab`\V"\aW\VTgbef"gb"[X_c"g[X"eXTWXe"haWXefgTaW"g[X"Xai\eba`Xag"j\g[\a""j[\V["g[X"=\glrf"Y\aTaV\T_"TVg\i\g\Xf"gT^X"c_TVX," " " " " " " /.3"

IcXeTg\aZ"CaYbe`Tg\ba8"g[XfX"fV[XWh_Xf"VbagT\a"fXei\VX"TaW"\aYeTfgehVgheX"WTgT"gb"[X_c"g[X"eXTWXe"haWXefgTaW"[bj"g[X"\aYbe`Tg\ba"\a"g[X"=\glrf"Y\aTaV\T_"eXcbeg"eX_TgXf"gb"g[X"fXei\VXf"g[X"=\gl"cebi\WXf"TaW"g[X"TVg\i\g\Xf"\g"cXeYbe`f," " " /.6"

><<A ><<<C ><<D

Nqxgtpogpvcn.cevkxkvkgu

Ugv.kpxguvogpv.kp.ecrkvcn.cuugvu 0 B7D@A...... 0 ......E7>DE 0 ......D7EB> 0 E7?EB

Yguvtkevgf =7DDB...... ......>7<7@@E >7?<E

\ptguvtkevgf E7<>A...... ......C7?AB ......D7<>E C7AA?

[qvcn.iqxgtpogpvcn.cevkxkvkgu.pgv.rqukvkqp 0 .. =C7CAB 0 .. =D7BA= 0 =E7@@<.... 0 =E7>AD

ZqwtegF.Jkv{.qh.Squ.Hncokvqu7.Hfokpkuvtcvkxg.Zgtxkegu.Kgrctvogpv

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JP[`.VM.SVZ.HSHTP[VZ

Ugv.Wqukvkqp.d{.Jqorqpgpv

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+"64"+

><<E ><=< ><== ><=> ><=? ><=@

0 ==7@=A.... 0 ....=>7?C< 0 ....=>7BAE 0 ....=?7=@? 0 ....=?7=?D 0 =?7ADA

>7<E?...... ......=7A?? ......=7A<< D?>......... .........D@= .........DCD

C7=@B...... ......C7=@@ ......C7ED@ ......C7BD= ......D7<?@ D7?E?

0 ><7BA@.... 0 ....>=7<@C 0 ....>>7=@? 0 >=7BAB.. 0 ..>>7<=? 0 >>7DAB

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+"65"+

><<A ><<<C ><<D

ExpensesNqxgtpogpvcn.cevkxkvkguF

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Ppvgtguv.qp.nqpi8vgto.fgdv .............8 ............8 .........=>A .........><E[qvcn.iqxgtpogpvcn.cevkxkvgu.gzrgpugu E7EC=.......... ......==7?E< ....==7=DC ....=>7CB?

Program RevenuesNqxgtpogpvcn.cevkxkvkguF

Jjctigu.hqt.ugtxkeguNgpgtcn.iqxgtpogpv =>............... .............=C ...........=< ...........??

Wwdnke.uchgv{ =E>............. ...........@D> .........BAE .........CC<Jqoowpkv{.fgxgnqrogpv AB............... .............C@ ...........A@ ...........A>

Ygetgcvkqp.cpf.eqoowpkv{.ugtxkegu D=D............. ...........EED .........CB> ......=7<=AWwdnke.yqtmu .............8 ............8 ..........8 ..........8

Vrgtcvkpi.itcpvu =7A@=.......... ...........C@< .........B?D .........E>=

Jcrkvcn.itcpvu.cpf.eqpvtkdwvkqpu EBA............. ...........AA@ ...........?< .........=E=[qvcn.iqxgtpogpvcn.cevkxkvgu.rtqitco.tgxgpwgu ?7AD@.......... ........>7DBA ......>7=A? ......>7ED>

Net (expense)/revenueNqxgtpogpvcn.cevkxkvkgu 4B7?DC5........ 4D7A>A5....... .....4E7<?@5 .....4E7CD=5

General Revenues and Other Changes in Net PositionNqxgtpogpvcn.cevkxkvkguF

[czguWtqrgtv{ =7?C>.......... ........>7?<= ......>7?A@ ......>7@D@

\vknkv{.wugtu.vcz =7B?B.......... ........=7EBE ......>7=BA . ......>7=CD[tcpukgpv.qeewrcpe{ C>............... .............C? ...........E? .........=<=

Zcngu ?7=@@.......... ........>7E<C ......?7<ED ......>7E=>Mtcpejkug A?E............. ...........ABB .........B<> .........AEA

Iwukpguu.Skegpug.vczgu.cpf.rgtokvu A??............. ...........BA> .........@CA .........B<BVvjgt DC............... ...........=<@ .........=>E ...........B?

C7?D?.......... ........D7AC> ......D7E=B ......D7E?E

Tqvqt.xgjkeng.kp.nkgw CB<............. .............CD ...........C< [email protected] >=E............. ...........?D> .........@A> .........>CC

Nckp.qp.Zcng.qh.rtqrgtv{ .............8 ............8 ..........8 .............EVvjgt AAE............. ...........?DD .........B>= .........?DE

[qvcn.iqxgtpogpvcn.cevkxkvkgu D7E>=.......... ........E7@>< ....=<7<AE ......E7BBD

Changes in Net PositionNqxgtpogpvcn.cevkxkvkgu 0 ........>7A?@ 0 ......... DEA 0 ......=7<>A 0 4==?5


Jjcpigu.kp.Ugv.Wqukvkqp


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+"66"+

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0 ......>7C<@ 0 ......>7>>@ 0 ......=7BAE 0 ......>7?CB 0 ......=7?CC 0 ......>7>>?......A7<EA ......A7<BD ......@7E=> ......A7A@A ......A7?E? ......A7BE=.........ACD .........ACD .........A>C .........C<A .........C@A .........D@?

......>7==@ ......=7AD? ......=7ABD ......=7CC< ......=7EAC ......=7C<<

......=7B=B ......=7E>> ......=7E<A ......>7<<C ......>7C<E ......>7D?E

.........=AA .........=AB .........=A? .........=A< .........=BD .........=@<

....=>7>B> ....==7A?= ....=<7C>@ ....=>7AA? ....=>7?@E ....=?7@?B

...........DD .........==C ...........@? .............? ..........8 ..........8

.........BB? .........B=D .........B@= .........A== .........B?C .........C?A

...........CA ...........C? .........=A< .........>D< .........@?A .........==?

......=7=<< ......=7=D< ......=7>?< ......=7>BB ......=7>EA ......=7>@>

..........8 ..........8 ..........8 ..........8 ..........8 ...........=D

......=7?=A .........?DD .........A?? .........==> .........==E .........?>?

......=7=>? .........C<D .........DE< .........A>@ .........?@E ......=7ABB

......@7?B@ ?7<D@...... ......?7@DC ......>7BEB ......>7D?A ......?7EEC

.....4C7DED5 .....4D7@@C5 .....4C7>?C5 .....4E7DAC5 ......E7A=@ ......E7@?E

......>7A@A ......>7BA@ ......>7A>E ......?7=@? ......?7C?@ ......>7C??

......>7>?> ......>7=CD ......>7=?> ......>7<D? ......>7=B< ......>7=DD

...........CD ...........C< ...........D< ...........DD .........=<@ .........==?

......>7A=@ ......>7?@E ......>7=@D ......>7><< ......>7==C ......>7D?B

.........B<? .........AD@ .........AEA .........BD? .........BA? .........BDE

.........CDD .........AC@ .........@C= .........B=D .........BE@ .........E?C

...........AA ...........BA ...........DA .........?@C .........>D@ .........A ......E7C@B ....=<7<<>

...........@= ...........?B ...........B> .............B .............A ..........8

.........=@> ...........?E ...........>C ...........=A ...........>C ...........=?

.............B .............A .........=@< .............? ...........?C ..........8

.........>DE .........>DC ...........DE .........><C ...........?B .........>BC

......E7>E? ......D7D@= ......D7?AD ......E7?E? E7DA=...... ....=<7>D>

0 ......=7?EA 0 .........?E@ 0 ......=7=>= 0 ...... 4@B@5 0 ....... ??C 0 D@?

Mkuecn.`gct

+"67"+

><<A ><<<C ><<DGeneral Fund

UqpurgpfcdngYguvtkevgfHuukipgf\pcuukipgf

Ygugtxgf 0 ............. .=B 0 .........=C< 0 .............. .B 0 .......... .>A\ptgugtxgf7.fgukipcvgf ......>7D<<\ptgugtxgf7.wpfgukipcvgf .........C7ED> ......B7=@D ........B7CCB ......?7<CD

[qvcn.Ngpgtcn.Mwpf .........C7EED ......B7?=D ........B7CD> ......A7E<?

All Other Governmental FundsUqpurgpfcdngYguvtkevgfHuukipgf\pcuukipgf

Ygugtxgf ................ 8. ............. 8. ...............8. ............. 8.\ptgugtxgf7.fgukipcvgf.tgrqtvgf.kpF

Zrgekcn.tgxgpwg.hwpfu ................ 8. ............. 8. ............... 8. .........>=E\ptgugtxgf7.tgrqtvgf.kpF

Zrgekcn.tgxgpwg.hwpfu .........=7E>A ......=7CA> ........>7<CD ......>7<EDKgdv.ugtxkeg.hwpfu ................ 8. .........>A@ ...........>AB .........>B>Jcrkvcn.rtqlgevu.hwpfu ........... .D?B .........E>A ...........E<> ......=7<@<

[qvcn.Hnn.Vvjgt.Nqxgtpogpvcn.Mwpfu .........>7CB= ......>7E?= ........?7>?B ......?7B=E[qvcn.Hnn.Nqxgtpogpvcn.Mwpfu 0 ..... =<7CAE 0 .... E7>@E 0 .... =<7<=D 0 E7A>>

6UqvgF.[jg.Jkv{[email protected].{gct.><==.yjkej.ejcpigf.jqy.hwpf.dcncpeg.ku.rtgugpvgf.kp.vjg.JHMY


Mwpf.Icncpegu.qh.Nqxgtpogpvcn.MwpfuJP[`.VM.SVZ.HSHTP[VZ

Mkuecn.`gct

4coqwpvu.gzrtguugf.kp.vjqwucpfu54oqfkhkgf.ceetwcn.dcuku.qh.ceeqwpvkpi5Scuv.[gp.Mkuecn.`gctu

+"7."+

><<E ><=< ><== ><=> ><=? ><=@

0 @............ . 0 ..........C 0 ............ .B 0 ............ .D............. 8. .......... .8 ............. 8.......?7>A< ...?. 7>A< ......?7CC< ......C7<@E......@7=B= ...@. 7@EB ......@7<DA ......=7>=D

0 >A........... 0 ............ .A......>7D<< ......>7D<<......?7?<A ......?7@=D......B7=?< ......B7>>? ......C7@=A ...C. 7CA? ......C7DB= ......D7>CA

.......... .8 ............. 8.......=7AA< ...=. 7<C? .........DDD .........D>E......=7><= ......C. >@ .........DED .........BCC........4=BC5 .....4=@B5 ........4>>?5 .....4=7>@<5

.........>C@ .........>B=

.........>=A .........>=B

......=7>== ......=7=><

............. 8. ............. 8.

......=7<BC ......=7<<D

......>7CBC ......>7B<A ......>7AD@ ...=. 7BA= ......=7AB? .........>BB0 ......D7DEC 0 ......D7D>D 0 ......E7EEE 0 ..E7@<@ 0 .... E7@>@ 0 .....D7A@=

Mkuecn.`gct

+"7/"+

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Revenues

[czgu 0 .........B7B>E 0 ......D7<<@ 0 ........D7>>D 0 ......D7C>A

Skegpugu.cpf.rgtokvu ............A?? .........BA? ...........@CA .........B ........=7=BA .........E@E

Jjctigu.hqt.ugtxkegu ............E<= ......=7<EA ...........D@? ......=7=<A

Ppxguvogpv.gctpkpiu ............><? .........?A= ...........@=? .........?BE

Mkpgu.cpf.hqthgkvwtgu ............=BC .........@B? ...........B?@ .........CA=

Vvjgt ............>A= .........==A ...........>?= .........>EE

[qvcn.Ygxgpwgu .......=>7>D< ....=>7@?? ......==7EDE ....=>7D<@

Expenditures

Ngpgtcn.iqxgtpogpv .........>7<E@ ......>7D>C ........>7B<@ ......>7C?E

Wwdnke.uchgv{ .........@7<@A ......@7@@D ........@7A== ......@7CED

Jqoowpkv{.Kgxgnqrogpv ............AD> .........C?A ...........B<C .........BE@

Ygetgcvkqp.cpf.eqoowpkv{.ugtxkegu .........?7D@A ......>7>E= ........>7>AD ......>7==D

Wwdnke.yqtmu .........=7D@> ......B7BDE ........=7?ED ......=7@B=

Jcrkvcn.qwvnc{ ..............E< .........><C ............8 .........AAB

Kgdv.Zgtxkeg .............8 .........=== ...........=>= .........=C>

[qvcn.Lzrgpfkvwtgu .......=>7@ED ....=C7?<D ......==7@EE ....=>7A?D

Lzeguu.qh.tgxgpwgu.qxgt;4wpfgt5.gzrgpfkvwtgu 4>=D5........... .....4@7DCA5 ...........@E< .........>BB

Other Financing Sources (Uses)

[tcpuhgtu.kp .........?7=@? ......?7B<? ...........EBE .........C?=

[tcpuhgtu.qwv 4?7=BA5........ .....4?7B<?5 ..........4EBE5 .....4=7@>A5

Sqpi.vgto.fgdv.kuuwgf .............8 ?7?BA...... ............8 ..........8

[qvcn.qvjgt.hkpcpekpi.uqwtegu 4>>5............. ......?7?BA ............8 ........4BE@5

Ugv.ejcpig.kp.hwpf.dcncpegu 0 ......... 4>@<5 0 ... 4=7A=<5 0 ..........@E< 0 4@>D5

Kgdv.ugtxkeg.cu.c.rgtegpvcig.qh.pqpecrkvcn.gzrgpfkvwtgu <9<1 <9B@E1 =9<A>1 =9@?A1


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+"70"+

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0 ......D7?DC 0 ......C7E=A 0 ......D7<>C 0 ......D7<DC 0 ......E7<@> 0 ......E7@><

.........DE ......=7>@C .........BE@ .........E?C

......=7BC= ......=7A@> ......=7<@C .........@CA .........A?= .........=A<

......=7>@D ......=7>AB ......=7?CE ......=7?>< ......=7CA> ......=7?EB

.........=ED ...........?E ...........>C ...........=A .............E .............>

.........BA= .........B>> .........B<> .........@A< .........B=A .........C=<

...........B< .........=DE .........>@A .........=EC ...........?B .........AD=

....=?7<>= ....=>7=BC ....==7EAB ....==7CE= ....=>7BCE ....=?7=EB

......>7>=E ......>7=?> ......=7DE> ......>7=7<EC

......@7EE? ......@7E>? ......@7C@D ......@7E=? ......A7>D< ......A7DC@

.........AC@ .........AB> .........A>B .........B>? .........C?C .........D?<

......>7<C? ......=7A=C ......=7A>C ......=7AC< ......=7DDE ......=7B><

......=7@D? ......=7C=C ......=7BA@ ......=7CCE ......=7D?= ......=7BDB

......>7=BA ......=7>B< .........A>? ......=7=D? .........D=< >=?......... .........>=< .........>=> .........>=B .........>==

....=?7C=C ....=>7?>@ ....==7<D< ....=>7?DB ....=>7BAE ....=@7

........4BEB5 ........4=AC5 .........DCB ........4AEA5 ...........>< ........4DBB5

.........D=B .........B?A .........EB< .........C=A .........ADD .........B=5 ........4C=A5 ........4ADD5 ........4B>=5

..........8 ..........8 ..........8

...........C= ...........DE .........??E ..........8 ..........8 ..........4=A5

0 ........4B>A5 0 ..........4BD5 0 ......=7>=A 0 ...... 4AEA5 0 ......... >< 0 4DD=5

=9D=D1 =9E>A1 =9EDE1 =9DE>1 =9D>>1 =9C=?1

Mkuecn.`gct

+"71"+

Jcvgiqt{ ><<A ><<<C ><<D ><<E ><=<

Ygukfgpvkcn BBC7?BA....... CAD7ADA........ D<@7?=D......... DBA7?C=...... DED7=CB...... DEC7==D

Jqoogtekcn >=@7C>=....... >>@7<>A........ >@<7D?C......... >B>7EC=...... >D@7>AE...... >DE7<<E

Ppfwuvtkcn =CE7=A<....... =D?7?<?........ =E<7?CD......... ><A7D<>...... >@?7@@>...... >@D7C>=

Ppuvkvwvkqpcn @7>BA........... AC................. AE.................. B<............... B=............... B>...............

Tkuegnncpgqwu =C7C><......... >@7D=C.......... >C7?DC........... >D7D<>........ B>C............. =7CA?..........

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ZIL.Uqpwpkvct{ @B?.............. @B>............... @B>................ @AE............. >>>............. >>>.............

Jtquu.Yghgtgpeg 8................... 8.................... 8.................... 8.................. ?7=<B.......... ?7>DA..........

\pugewtgf =?A7EBB....... =AE7>D<........ =A=7<BC......... =AB7C?@...... =@E7C?A...... =@D7B>A

Vvjgt 4A?C5............. 8.................... 4>5.................. 8.................. 8.................. 8..................

[qvcnu =7>>=7<D<0.. =7?A?7<>D0... =7@=B7A?>0.... =7A>=7<?D0. =7AD<7@DC0. =7ADE7BC=0

Kktgev.tcvg <9=<<BB1 <9=<<BB1 <9=<<BA1 <9=<<B@1 <9=<<C>1 <9=<<BC1

..............UqvgF

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rtqrgtv{.ku.qpn{.tgcuuguugf.cv.vjg.vkog.vjcv.kv.ku.uqnf.vq.c.pgy.qypgt9..Hv.vjcv.rqkpv7.vjg.

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Squ.Hncokvqu.\pkhkgf.Ngpgtcn.Mwpf <9@=> <9@=> <9@=> <9@=> <9@=> <9@=> <9@=>

Uqtvj.Vtcpig.Jq9.Jqoowpkv{.Jqnngig.Kkuvtkev <9<AE <9<AE <9<AE <9<AE <9<AE <9<AE <9<AE

Vtcpig.Jqwpv{.Kgrctvogpv.qh.Lfwecvkqp <9<?= <9<?= <9<?= <9<?= <9<?= <9<?= <9<?=Vtcpig.Jqwpv{.Mktg.Kgrctvogpv <9<EA <9<EA <9<EA <9<EA <9<EA <9<EA <9<EA

Vtcpig.Jqwpv{.Mnqqf.Jqpvtqn.Kkuvtkev.Ngpgtcn <9<=C <9<=C <9<=C <9<=C <9<=C <9<=C <9<=C

Vtcpig.Jqwpv{.Ngpgtcn.Mwpf <9<A> <9<A> <9<A> <9<A> <9<A> <9<A> <9<A>

Vtcpig.Jqwpv{.Octdqtu.Igcejgu.2.Wctmu.Juc <9<=? <9<=? <9<=? <9<=? <9<=? <9<=? <9<=?

Vtcpig.Jqwpv{.Skdtct{.Kkuvtkev.Ngpgtcn.Mwpf <9<=@ <9<=@ <9<=@ <9<=@ <9<=@ <9<=@ <9<=@

Vtcpig.Jqwpv{.Zcpkvcvkqp.Kkuvtkev.?.Vrgtcvkpi <9<>C <9<>C <9<>C <9<>C <9<>C <9<>C <9<>C

Vtcpig.Jqwpv{.[tcpurqtvcvkqp.Hwvjqtkv{ <9<<> <9<<> <9<<> <9<<> <9<<> <9<<> <9<<>Vtcpig.Jqwpv{.]gevqt.Jqpvtqn <9<<= <9<<= <9<<= <9<<= <9<<= <9<<= <9<<=

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Vtcpig.Jqwpv{.^cvgt.Kkuvtkev.tgugtxg <9<<= <9<<= <9<<= <9<<< <9<<= <9<<< <9<<<

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[qvcn.]qvgt.Hrrtqxgf.vcz.Ycvg <9<@D <9<@B <9<@? <9<@A <9<@? <9<DE <9=@=

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APPENDIX D

PROPOSED FORM OF FINAL OPINION

September 16, 2015

City of Los Alamitos3191 Katella AvenueLos Alamitos, CA 90720

Re: $3,685,000 2015 Certificates of Participation Evidencing the Fractional Proportionate Interestsof the Owners Thereof in Lease Payments to be Made by the City of Los Alamitos to LosAlamitos Public Facilities Corporation

Ladies and Gentlemen:

We have reviewed the Constitution and the laws of the State of California and certain proceedings takenby the City of Los Alamitos (the “City”) in connection with the authorization, execution and delivery by theCity of the Lease Agreement dated as of September 1, 2015 (the “Lease Agreement”) by and between LosAlamitos Public Facilities Corporation (the “Corporation”) and the City. We have also reviewed the executedLease Agreement; the executed Trust Agreement, dated as of September 1, 2015 (the “Trust Agreement”), byand among The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), the Corporationand the City; and such other information and documents as we consider necessary to render this opinion.

Pursuant to the Trust Agreement, the Trustee has executed and delivered the above-captionedcertificates of participation (the “Certificates of Participation”) evidencing proportionate undivided interests inlease payments to be made by the City pursuant to the Lease Agreement dated as of September 1, 2015, by andbetween the City and the Corporation (the “Lease Agreement”).

In such connection, we have reviewed the Trust Agreement, the Lease Agreement, the tax certificate ofthe City for the Certificates dated the date hereof (the “Tax Certificate”), certificates of the City and others, andsuch other documents, opinions and matters to the extent we deemed necessary to render the opinions set forthherein.

The opinions expressed herein are based on an analysis of existing laws, regulations, rulings and courtdecisions and cover certain matters not directly addressed by such authorities. Such opinions may be affectedby actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine, orto inform any person, whether any such actions are taken or omitted or events do occur or any other events cometo our attention after the date hereof. Accordingly, this opinion speaks only as of its date and is not intended to,and may not, be relied upon in connection with any such actions, events or matters. Our engagement withrespect to the Certificates has concluded with their delivery, and we disclaim any obligation to update this letter.We have assumed the genuineness of all documents and signatures presented to us (whether as originals or ascopies) and the due and legal execution and delivery thereof by, and validity against, any parties other than theCity. We have assumed, without undertaking to verify, the accuracy of the factual matters represented,warranted or certified in the documents, and of the legal conclusions contained in the opinions, referred to in thesecond paragraph hereof. Furthermore, we have assumed compliance with all covenants and agreementscontained in the Trust Agreement, the Lease Agreement and the Tax Certificate, including (without limitation)covenants and agreements compliance with which is necessary to ensure that future actions, omissions or eventswill not cause interest on the Certificate to be included in gross income for federal income tax purposes. Wecall attention to the fact that the rights and obligations under the Certificate, the Trust Agreement, the LeaseAgreement and the Tax Certificate and their enforceability may be subject to bankruptcy, insolvency,reorganization, arrangement, fraudulent conveyance, moratorium and other laws relating to or affectingcreditors’ rights, to the application of equitable principles, to the exercise of judicial discretion in appropriatecases, and to the limitations on legal remedies against cities and their subordinate entities in the State of

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California. We express no opinion with respect to any indemnification, contribution, penalty, choice of law,choice of forum, choice of venue, waiver or severability provisions contained in the documents mentioned in thepreceding sentence. Finally, we undertake no responsibility for the accuracy, completeness or fairness of theOfficial Statement or other offering materials relating to the Certificate and express no opinion with respectthereto.

Based on the foregoing, we are of the opinion that the obligation of the City to pay Lease Paymentsunder the Lease Agreement is a valid and binding obligation payable from any source of available revenues andcertain amounts held in the funds and accounts created by the Trust Agreement for the benefit of the Owners ofthe Certificates of Participation and that the Trust Agreement establishes a valid lien on the funds and accountsestablished thereunder.

We are further of the opinion that the Lease Agreement and the Trust Agreement have been dulyauthorized, executed and delivered by the City and constitute valid and legally binding agreements of the Cityenforceable in accordance with their terms, except as the same may be limited by bankruptcy, insolvency,reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rightsand except as their enforcement may be subject to the application of equitable principles and exercise of judicialdiscretion in appropriate cases. The Certificates of Participation have been duly executed and delivered by theTrustee and are entitled to the benefits of the Trust Agreement.

We are of the opinion that under existing statutes, regulations, rulings and judicial decisions, the portionof each lease payment due under the Lease Agreement designated as and comprising interest and received by theowners of the Certificates of Participation (the “Interest Component”) is excluded from gross income for federalincome tax purposes and is not an item of tax preference for purposes of calculating the federal alternativeminimum tax imposed on individuals and corporations; however, it should be noted that, with respect tocorporations, such interest may be included as an adjustment in the calculation of alternative minimum taxableincome, which may affect the alternative minimum tax liability of corporations. This opinion is based uponcertain representations of fact and certifications made by the City and others and is subject to the condition thatthe City comply with all requirements of the Internal Revenue Code of 1986, as amended (the “Code”), thatmust be satisfied subsequent to the delivery of the obligation of the City under the Lease Agreement to assurethat such interest will not become includable in gross income for federal income tax purposes. Failure tocomply with such requirements of the Code might cause the Interest Component to be included in gross incomefor federal income tax purposes retroactive to the date of delivery of the obligation of the City under the LeaseAgreement. The City has covenanted to comply with all such requirements. The opinions expressed herein maybe affected by actions taken (or not taken) or events occurring (or not occurring) after the date hereof. We havenot undertaken to determine, or to inform any person, whether any such actions or events are taken or do occur.Other than expressly stated herein, we express no other opinion regarding tax consequences of the obligation ofthe City under the Lease Agreement. The Certificates and the Lease Agreement are “qualified tax-exemptobligations” within the meaning of section 265(b)(3) of the Internal Revenue Code of 1986 (the “Code”), and, inthe case of certain financial institutions (within the meaning of section 265(b)(5) of the Code), a deduction isallowed for 80 percent of that portion of such financial institutions’ interest expense allocable to interest payableon the Certificates. Although the interest on the Certificates is excluded from gross income for purposes offederal income taxation, the accrual or receipt of interest on the Certificates, or any portion thereof, mayotherwise affect the federal income tax liability of the recipient. The extent of these other tax consequences willdepend on the recipient’s particular tax status or other items of income or deduction. We express no opinionregarding any such consequences.

We are further of the opinion that the Interest Component is exempt from personal income taxationimposed by the State of California.

The opinions expressed herein are based upon our analysis and interpretation of existing laws,regulations, rulings and judicial decisions and cover certain matters not directly addressed by such authorities.

Very truly yours,

APPENDIX E

FORM OF CONTINUING DISCLOSURE CERTIFICATE

This Continuing Disclosure Certificate (the “Disclosure Certificate”) is executed and delivered by theCity of Los Alamitos (the “City”) in connection with the issuance of the City’s $3,685,000 aggregate principalamount 2015 Certificates of Participation (Bank Qualified) (the “Certificates”). The Certificates have beenissued pursuant to Trust Agreement dated as of September 1, 2015, among the City, the Los Alamitos PublicFacilities Corporation and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) (the“Trust Agreement”). The City covenants and agrees as follows:

Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executedand delivered by the City for the benefit of the holders and beneficial owners of the Certificates.

Section 2. Definitions.

(a) “Annual Report” means any Annual Report provided by the City pursuant to, and as describedin, Sections 3 and 4 of this Disclosure Certificate.

(b) “Dissemination Agent” means, initially, Applied Best Practices, as Dissemination Agent, or anysuccessor Dissemination Agent designated in writing by the City which has filed with the City a writtenacceptance of such designation.

(c) “Participating Underwriter” means Raymond James & Associates, Inc., or any other financialinstitution required to comply with the Rule in connection with the reoffering of the Certificates.

(d) “Official Statement” means the Official Statement dated September 1, 2015, prepared inconnection with the issuance of the Certificates.

(e) “Repository” means the Municipal Securities Rulemaking Board’s Electronic Municipal MarketAccess (EMMA) system, and any other Nationally Recognized Municipal Securities Information Repository forpurposes of the Rule.

(f) “Rule” means Rule 15c2-12 adopted by the Securities and Exchange Commission under theSecurities Exchange Act of 1934, as the same may be amended from time to time.

(g) “Significant Events” shall mean any of the events listed in Section 5 of this DisclosureCertificate.

(h) “MSRB” means the Municipal Securities Rulemaking Board. The current address of the MSRBis 1640 King Street, #300, Alexandria, Virginia 22314, Attn: The Interim CDI System, telephone: (202) 223-9503.

(i) “SEC” means the Securities and Exchange Commission.

Section 3. Provision of Annual Reports.

(a) The City shall, or shall cause the Dissemination Agent to, not later than April 1 in each yearwhile the Certificates are outstanding commencing on April 1, 2016, provide to each Repository an AnnualReport which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later thanfifteen (15) business days prior to said date, the City shall provide the Annual Report to the DisseminationAgent (if other than the City). The Annual Report may be submitted as a single document or separatedocuments comprising a package, and may cross-reference other information as provided in Section 4 of thisDisclosure Certificate; provided that the audited financial statements of the City may be submitted separatelyfrom the balance of the Annual Report.

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(b) If the City is unable to provide to the Repository an Annual Report by the date required insubsection (a), the City shall send a notice to the MSRB in substantially the form attached as Exhibit A hereto.

(c) The Dissemination Agent shall:

(i) Determine each year prior to the date for providing the Annual Report the name andaddress of the Repository; and (if the Dissemination Agent is other than the City).

(ii) File a report with the City certifying that the Annual Report has been provided pursuantto this Disclosure Certificate, stating the date it was provided and listing all Repositories to which it wasprovided.

Section 4. Content of Annual Reports. The City’s Annual Report shall contain or incorporate byreference the following:

(a) A copy of its annual financial statements prepared in accordance with generally acceptedaccounting principles, audited by a firm of certified public accountants. If audited annual financial statementsare not available by the time specified in Section 3(a) above, unaudited financial statements will be provided aspart of the Annual Report and audited financial statements will be provided when and if available. In such anevent, the Disclosure Certificate shall contain a statement as to the estimated date on which the City’s auditedfinancial statements are expected to be available.

(b) The following information, to the extent not included in the audited financial statements of theCity, shall include the following:

(i) information concerning the actual revenues, expenditures and beginning and endingfund balances relating to the General Fund of the City for the most recently completed Fiscal Year,including information showing tax revenue collections by source (Table 3);

(ii) information showing the aggregate principal amount of long-term Certificates, leasesand other obligations of the City which are payable out of the General Fund of the City, as of the closeof the most recently completed Fiscal Year;

(iii) information concerning the assessed valuation of properties within the City for the mostrecently completed Fiscal Year, showing the valuation for secured, public utility and unsecured property(Table 9);

(iv) information showing the total secured property tax levy and actual amounts collectedfor the most recently completed Fiscal Year (Table 8); and

(v) information showing the balance sheet of the General Fund of the City as of the close ofthe most recently completed Fiscal Year, including categorized assets, liabilities and reserved andunreserved fund balances (Table 2).

(c) In addition to any of the information expressly required to be provided under paragraphs (a) and(b) of this Section, the City shall provide such further information, if any, as may be necessary to make thespecifically required statements, in the light of the circumstances under which they are made, not misleading.

Any or all of the items listed above may be incorporated by reference from other documents, includingofficial statements of debt issues of the City or related public entities, which have been submitted to each of theRepositories or the SEC. If the document incorporated by reference is a final official statement, it must beavailable from the MSRB. The City shall clearly identify each such document incorporated by reference.

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Section 5. Reporting of Significant Events.

(a) Pursuant to the provisions of this Section 5, the City shall give, or cause to be given, notice ofthe occurrence of any of the following events with respect to the Certificates in a timely manner not in excess of10 business days after the occurrence of the event:

1. principal and interest payment delinquencies.

2. tender offers.

3. defeasances.

4. rating changes.

5. adverse tax opinions, or the issuance by the Internal Revenue Service of proposed orfinal determinations of taxability, or Notices of Proposed Issue (IRS Form 5701-TEB).

6. unscheduled draws on the debt service reserves reflecting financial difficulties.

7. unscheduled draws on credit enhancement reflecting financial difficulties.

8. substitution of the credit or liquidity providers or their failure to perform.

9. bankruptcy, insolvency, receivership or similar event of the City. For the purposes ofthe event identified in this Section 5(a)(9), the event is considered to occur when any of the followingoccur: the appointment of a receiver, fiscal agent or similar officer for the City in a proceeding under theU.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court orgovernmental authority has assumed jurisdiction over substantially all of the assets or business of theCity, or if such jurisdiction has been assumed by leaving the existing governmental body and officials orofficers in possession but subject to the supervision and orders of a court or governmental authority, orthe entry of an order confirming a plan of reorganization, arrangement or liquidation by a court orgovernmental authority having supervision or jurisdiction over substantially all of the assets or businessof the City.

(b) Pursuant to the provisions of this Section 5, the City shall give, or cause to be given, notice ofthe occurrence of any of the following events with respect to the Certificates, if material:

1. non-payment related defaults.

2. modifications to rights of bondholders.

3. optional, contingent or unscheduled note calls.

4. unless described under Section 5(a)(5) above, material notices or determinations withrespect to the tax status of the Certificates, or other material events affecting the tax status of theCertificates.

5. release, substitution or sale of property securing repayment of the Certificates.

6. the consummation of a merger, consolidation, or acquisition involving the City or thesale of all or substantially all of the assets of the City, other than in the ordinary course of business, theentry into a definitive agreement to undertake such an action or the termination of a definitiveagreement relating to any such actions, other than pursuant to its terms.

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7. Appointment of a successor or additional trustee or paying agent with respect to theCertificates or the change of name of such a trustee or paying agent.

(c) Whenever the City obtains knowledge of the occurrence of a Listed Event under Section 5(b)hereof, the City shall as soon as possible determine if such event would be material under applicable federalsecurities laws.

(d) If the City determines that knowledge of the occurrence of a Listed Event under Section 5(c)hereof would be material under applicable federal securities laws, the City shall (i) file a notice of suchoccurrence with the Repository in a timely manner not in excess of 10 business days after the occurrence of theevent or (ii) provide notice of such reportable event to the Dissemination Agent in format suitable for filing withthe Repository in a timely manner not in excess of 10 business days after the occurrence of the event. TheDissemination Agent shall have no duty to independently prepare or file any report of Listed Events. TheDissemination Agent may conclusively rely on the City’s determination of materiality pursuant to Section 5(c).

Section 6. Termination of Reporting Obligation. The City’s obligations under this DisclosureCertificate shall be in effect from and after the execution and delivery of the Certificates and shall extend to theearlier of (i) the date all principal and interest on the Certificates shall have been deemed paid pursuant to theterms of the Trust Agreement; (ii) the date that the City shall no longer constitute an “obligated person” withinthe meaning of the Rule.

Section 7. Enforcement. The obligations of the City hereunder shall be for the benefit of theParticipating Underwriter and the Owners of the Certificates, including Beneficial Owners of the Certificates.Unless otherwise required by law, no owners of the Certificates shall be entitled to damages for the City’s non-compliance with its undertakings set forth in this Disclosure Certificate; however, the Participating Underwriter,and Owners of the Certificates, including Beneficial Owners of the Certificates, may enforce specificperformance of such undertakings by any judicial proceeding available. Breach of the undertakings of the Cityhereunder shall not constitute an event of default under the Trust Agreement and none of the rights and remediesprovided by the Trust Agreement with respect to an event of default, shall be available to the ParticipatingUnderwriter, Owners of the Certificates, including Beneficial Owners.

Section 8. Dissemination Agent; Duties. The City may, from time to time, appoint or engage aDissemination Agent to assist the City in carrying out its obligations under this Disclosure Certificate, and maydischarge any such Dissemination Agent, with or without appointing a successor Dissemination Agent.

The Dissemination Agent shall have only such duties as are specifically set forth in this DisclosureCertificate. The obligations of the City under this Disclosure Certificate shall survive resignation or removal ofthe Dissemination Agent.

The Dissemination Agent shall be paid compensation by the City for its services provided hereunder inaccordance with its schedule of fees as amended from time to time and shall be reimbursed by the City allexpenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its dutieshereunder. Neither the Dissemination Agent nor the Trustee shall have any duty or obligation to review anyinformation provided to it hereunder or shall be deemed to be acting in any fiduciary capacity for the City, theowners of the Certificates or any other party. Any company succeeding to all or substantially all of theDissemination Agent’s corporate trust business shall be the successor to the Dissemination Agent hereunderwithout the execution or filing of any document or any further act.

Section 9. Amendment; Waiver. Notwithstanding any other provision of this DisclosureCertificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate maybe waived, if (i) such amendment or waiver does not, in and of itself, cause the undertakings herein to violatethe Rule, but taking into account any subsequent change in or official interpretation of the Rule and theamendment or waiver either (i) is approved by the Owners of the Certificates in the same manner as provided inthe Trust Agreement for amendments to the Trust Agreement with the consent of Owners, or (ii) does not, in the

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opinion of nationally recognized bond counsel, materially impair the interests of the Owners or BeneficialOwners of the Certificates. The City shall provide notice of any such amendment or waiver to each Repository.

In the event of any amendment or waiver of a provision of this Disclosure Certificate, the City shalldescribe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation ofthe reason for the amendment or waiver and its impact on the type (or, in the case of a change of accountingprinciples, on the presentation) of financial information or operating data being presented by the City. Inaddition, if the amendment related to the accounting principles to be followed in preparing financial statements,(i) notice of such change shall be given in the same manner as for a Listed Event under Section 5 and (ii) theAnnual Report for the year in which the change is made should represent a comparison (in narrative form andalso, if feasible, in quantitative form) between the financial statements as prepared on the basis of the newaccounting principles and those prepared on the basis of the formed accounting principles.

Section 10. Default. In the event of a failure of the City to comply with any provision of thisDisclosure Certificate, the Trustee at the written direction of the Participating Underwriter or the Owners of atleast 25% aggregate principal amount of Outstanding Certificates, shall, or any Owner or Beneficial Owner ofthe Certificates may take such actions as may be necessary and appropriate, including seeking mandate orspecific performance by court order, to cause the City to comply with its obligations under this DisclosureCertificate, but only to the extent funds have been provided to it or it has been otherwise indemnified to itssatisfaction from any cost, liability, expense or additional charges of the Trustee whatsoever, including, withoutlimitation, fees and expenses of its attorney. A default under this Disclosure Certificate shall not be deemed anEvent of Default under the Trust Agreement, and the sole remedy under this Disclosure Certificate shall be anaction to compel performance.

Section 11. Additional Information. Nothing in this Disclosure Certificate shall be deemed toprevent the City from disseminating any other information, using the means of dissemination set forth in thisDisclosure Certificate or any other means of communication, or including any other information in any AnnualReport or notice of occurrence of an event other than a Significant Event, in addition to that which is required bythis Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of theoccurrence of an event other than a Significant Event in addition to what is specifically required by thisDisclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update suchinformation or include it in any future Annual Report or notice of occurrence of a Significant Event.

Section 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City,the Trustee, the Dissemination Agent, the Underwriter and Owners and Beneficial Owners from time to time ofthe Certificates, and shall create not rights in any other person or entity.

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Section 13. Counterparts. This Disclosure Certificate may be executed in several counterparts,each of which shall be an original and all of which shall constitute but one and the same instrument.

DATE: September 1, 2015


By:Authorized Signature

ACCEPTED BY:

APPLIED BEST PRACTICES, as Dissemination Agent


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EXHIBIT A

NOTICE TO REPOSITORY OF FAILURE TO FILE ANNUAL REPORT

Name of Issuer: City of Los Alamitos (the “Issuer”)

Issue: 2015 Certificates of Participation (Bank Qualified)

Date of Delivery: September 16, 2015

NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to theabove-referenced Certificates as required by resolution of the governing board of the Issuer and by theContinuing Disclosure Certificate executed on September 16, 2015 by the Issuer. The Issuer anticipates that theAnnual Report will be filed on or before ___________________.

Dated: ___________________



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APPENDIX F

BOOK-ENTRY PROVISIONS

The information in this Appendix F, concerning The Depository Trust Company, New York, New York(“DTC”), and DTC’s book-entry system, has been furnished by DTC for use in official statements and the City takesno responsibility for the completeness or accuracy thereof. The City cannot and does not give any assurances thatDTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest orprincipal with respect to the Certificates, (b) certificates representing ownership interest in or other confirmation ofownership interest in the Certificates, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, asthe registered owner of the Certificates, or that they will so do on a timely basis, or that DTC, DTC Participants orDTC Indirect Participants will act in the manner described in this Appendix F. The current “Rules” applicable toDTC are on file with the Securities and Exchange Commission and the current “Procedures” of DTC to be followedin dealing with DTC Participants are on file with DTC. Information Furnished by DTC Regarding its Book-EntryOnly System.

1. The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for theCertificates (as used in this Appendix F, the “Securities”). The Securities will be issued as fully- registered securitiesregistered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by anauthorized representative of DTC. One fully-registered Security certificate will be issued for each maturity of theSecurities, in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, theaggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500million of principal amount, and an additional certificate will be issued with respect to any remaining principalamount of such issue.

2. DTC, the world’s largest securities depository, is a limited-purpose trust company organized underthe New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a memberof the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform CommercialCode, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues,corporate and municipal debt issues, and money market instruments from over 100 countries that DTC’s participants(“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants ofsales and other securities transactions in deposited securities, through electronic computerized book-entry transfersand pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securitiescertificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies,clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust &Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporationand Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users ofits regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S.securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain acustodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC is ratedAA+ by Standard & Poor’s. The DTC Rules applicable to its Participants are on file with the Securities and ExchangeCommission. More information about DTC can be found at www.dtcc.com and www.dtc.org.

3. Purchases of Securities under the DTC system must be made by or through Direct Participants,which will receive a credit for the Securities on DTC’s records. The ownership interest of each actual purchaser ofeach Security (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records.Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are,however, expected to receive written confirmations providing details of the transaction, as well as periodic statementsof their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into thetransaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books ofDirect and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificatesrepresenting their ownership interests in Securities, except in the event that use of the book-entry system for theSecurities is discontinued.

4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC areregistered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an

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authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede &Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of theactual Beneficial Owners of the Securities; DTC’s records reflect only the identity of the Direct Participants to whoseaccounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and IndirectParticipants will remain responsible for keeping account of their holdings on behalf of their customers.

5. Conveyance of notices and other communications by DTC to Direct Participants, by DirectParticipants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will begoverned by arrangements among them, subject to any statutory or regulatory requirements as may be in effect fromtime to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them ofnotices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposedamendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that thenominee holding the Securities for their benefit has agreed to obtain and transmit the notices to Beneficial Owners. Inthe alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request thatcopies of notices be provided directly to them.

6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are beingredeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue tobe redeemed.

7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to theSecurities unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usualprocedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxyassigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts the Securities arecredited on the record date (identified in a listing attached to the Omnibus Proxy).

8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede& Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is tocredit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Cityor the paying agent or bond trustee, on payable date in accordance with their respective holdings shown on DTC’srecords. Payments by Participants to Beneficial Owners will be governed by standing instructions and customarypractices, as is the case with securities held for the accounts of customers in bearer form or registered in “streetname,” and will be the responsibility of such Participant and not of DTC nor its nominee, the paying agent or bondtrustee, or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Paymentof redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may berequested by an authorized representative of DTC) is the responsibility of the City or the paying agent or bondtrustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement ofsuch payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

9. DTC may discontinue providing its services as depository with respect to the Securities at any timeby giving reasonable notice to the City or the paying agent or bond trustee. Under such circumstances, in the eventthat a successor depository is not obtained, Security certificates are required to be printed and delivered.

10. The City may decide to discontinue use of the system of book-entry-only transfers through DTC (ora successor securities depository). In that event, Security certificates will be printed and delivered to DTC.

11. The information in this section concerning DTC and DTC’s book-entry system has been obtainedfrom sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof.

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