2025-city-of-oakland-acfr_final-123025.pdf

of payroll. With the exception of a one-year pause during the COVID pandemic, the City has maintained this schedule since its inception and made $14.8 million of prefunding contributions in FY 2024-25. These amounts are in addition to pay-as-you-go requirements and are intended to support the sustainability of the City’s retiree medical program. Single Audit As a recipient of Federal, State, and County financial assistance, the City is responsible for providing assurance that adequate internal controls are in place to ensure compliance with applicable laws and regulations. These controls are periodically evaluated by management, the City Auditor’s Office (internal), and the City’s independent auditors (external). As part of the City’s single audit procedures, tests are performed to determine the effectiveness of the internal controls over major federal award programs and the City’s compliance with applicable laws and regulations related to these federal award programs. Debt Management and Credit Ratings The City’s Debt Management Policy is reviewed and adopted annually by the City Council. The goal of the Debt Management Policy is to set prudent guidelines to ensure that the City’s debt portfolio is fiscally stable. It is in place to maintain long-term financial flexibility while ensuring that the City’s capital needs are adequately supported. The Debt Management Policy establishes the following equally important objectives: • To achieve the lowest possible cost of capital for the City; • To achieve the highest practical credit rating; • Maintain full and complete financial disclosure and reporting; • Ensure timely repayment of debt; • Maintain a prudent level of financial risk; • Utilize local and disadvantaged banking and financial firms, whenever possible; and • Ensure compliance with applicable State and Federal laws. The City is committed to securing its long-term financial health by taking direct actions to address unfunded liabilities. These actions include: improving the funded ratios of CalPERS Safety and Miscellaneous pension plans, reducing the City's unfunded liability for other postemployment benefits through ongoing prefunding contributions and benefit reforms, and continued progress in reducing longstanding negative fund balances. The City’s general obligation bond credit ratings of Aa2/AA-/A from Moody’s Ratings, S&P Global Ratings, and Fitch Ratings, respectively, reflect recent rating actions taken in response to projected structural imbalances and reserve pressures, while continuing to recognize the City’s large and diverse tax base and management’s ongoing efforts to stabilize its financial position. The MD&A section of this report provides additional information on the City's credit ratings. Awards The City was awarded a Certificate of Achievement for Excellence in Financial Reporting for its Annual Comprehensive Financial Report for the fiscal year ended June 30, 2024 by the Government Finance Officers Association of the United States and Canada (GFOA). The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized ACFR whose contents vii