REPORT TO COUNCIL
SUBJECT
Title
Action on the City of Santa Clara Audited Annual Comprehensive Financial Report and Audited Silicon Valley Power Financial Statements for Fiscal Year Ended June 30, 2025, as Recommended by the Audit Committee
Report
BACKGROUND
On November 24, 2025, the Audit Committee took action to accept the City of Santa Clara Audited Annual Comprehensive Financial Report (ACFR) and Silicon Valley Power (SVP) Financial Statements for Fiscal Year Ended June 30, 2025 and referred the reports to the City Council to be noted and filed at the December 9, 2025 Council meeting.
The annual financial audit is a requirement of Section 1319 of the City Charter. The ACFR presents the audited financial information of the City in accordance with Generally Accepted Accounting Principles (GAAP) applicable to government entities, and it also provides the City Council valuable information for financial oversight and informs Santa Clara residents and businesses as well as creditors.
The separate audited annual financial report for SVP is presented to make available additional information and disclosure relevant to the electric industry. The unmodified opinions from the auditor enhance the SVP’s reputation, and its adherence to GAAP applicable to governmental entities.
DISCUSSION
The annual financial audit of the City was recently completed and the City’s external auditor, Maze & Associates (“Maze”), issued an unmodified (“clean”) opinion on the City’s ACFR for fiscal year ended June 30, 2025. The ACFR includes an extensive discussion and presentation of the City’s financial data and its related agencies in accordance with GAAP. The ACFR also includes selected multi-year statistical information about the City. In addition, the City issued a separate, audited comparative financial statement report for SVP for fiscal year ended June 30, 2025.
City Finance staff prepares the financial statements, and Maze audits the financial information contained within them. Part of the audit is to determine whether City staff have the appropriate skills, knowledge, and expertise to prepare the ACFR in accordance with GAAP and other reporting requirements. Based on their audit, Maze determined that the City’s Finance staff has the necessary skills, knowledge, and expertise to compile high quality reports.
Overall, the City’s financial condition was solid at the end of the fiscal year 2024/25. Key financial highlights for fiscal year June 30, 2025 are as follows:
• The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources by $3.1 billion in fiscal year 2024/25.
• The City’s total net position increased by $420 million and primarily includes a $113 million increase in the governmental activities and a $307 million increase in business activities.
• At the close of fiscal year 2024/25, the General Fund had assets of $524 million and a fund balance of $241 million. This represents an increase in fund balance of $60 million, or 33.0% from the prior fiscal year. The increase reflects the steady improvement of the local economy since the pandemic.
• The City’s total outstanding long-term debt increased by $101 million during the fiscal year 2024/25, primarily reflecting the issuance of $112 million in Electric 2024 Series A Revenue Bonds with a $17 million bond premium, partially offset by the repayment of $25 million for Stadium Authority debt, Electric revenue bonds, and Sewer loans.
• The City’s total net pension liability, which includes governmental activities and business-type activities, decreased by $17 million to $669 million at June 30, 2025. This reduction was primarily attributed to higher investment income during the fiscal year 2023-24. The City is a member of the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for participating public entities within the State of California.
City staff and Maze met with the City Council Audit Committee on November 24, 2025. Committee members Chahal and Gonzalez attended the meeting during which Maze gave a presentation about the audit process, scope of work, and the auditor’s opinion. The Director of Finance and staff gave an overview of the financial reports. Maze and staff responded to Committee member questions. The Audit Committee accepted the ACFR and SVP Financial Statements presented at the Committee meeting and recommended that the City Council note and file the reports at a December 9, 2025 Council meeting.
ENVIRONMENTAL REVIEW
There is no action being taken; therefore, the California Environmental Quality Act (CEQA) is not applicable.
FISCAL IMPACT
The staff and the external auditor costs associated with the audit and financial reports production are included in the annual appropriations.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
Note and file, as recommended by the Audit Committee:
1. The audited City of Santa Clara Annual Comprehensive Financial Report (ACFR) for fiscal year ended June 30, 2025; and
2. The audited City of Santa Clara Electric Utility Enterprise Fund (Silicon Valley Power) Financial Statements for fiscal year ended June 30, 2025.
Staff
Reviewed by: Kenn Lee, Director of Finance
Approved by: Jovan D. Grogan, City Manager
ATTACHMENTS
1. Annual Comprehensive Financial Report (ACFR)
2. Silicon Valley Power (SVP) Financial Statements