COUNCIL COMMITTEES
The Council Committees Meeting was held on January 26, 1998, at 6:45 p.m., with Council President Christiansen presiding. Members of Council present were Mr. Lambert, Mr. Pitts, Mr. Leary, Mr. Truitt, Mr. Carey, Mrs. Malone, Mr. Salters, Mr. Weller and Mayor Hutchison.
AGENDA ADDITIONS/DELETIONS
Mr. Leary requested the addition of an executive session to discuss personnel issues. Mr. Leary moved to adjourn into executive session, seconded by Mr. Salters and unanimously carried. Members recessed into executive session at 6:00 p.m. and reconvened at 6:45 p.m.
LEGISLATIVE AND FINANCE COMMITTEE
The Legislative and Finance Committee met with Chairman Salters presiding. Members present were Councilman Leary, Councilwoman Malone and Mr. Merritt. Mr. Carey was deputized to serve as a temporary member.
Comprehensive Annual Financial Report for FY1997
The City's financial books are audited by independent auditors each year as required by the City Charter. All financial transactions were audited by the selected C.P.A. firm of Faw Casson & Company for fiscal year 1997. The Finance Director/Treasurer reported that the auditors have given the City of Dover a clean (unqualified) opinion. The City has followed the generally accepted accounting principles and the financial statements represent a true and fair position of the City as of June 30, 1997. The City received the Award of Excellence in Financial Reporting from the Governmental Finance Officers Association of the United States and Canada (GFOA) for the last eleven years. This report was submitted to the GFOA for evaluation.
Ms. Janis Nesterak, representing Faw Casson & Co., was present to answer any questions on the report. She reiterated that the City has been given a "clean opinion" by Faw Casson & Co., and briefly explained the various sections of the Comprehensive Annual Financial Report. Ms. Nesterak indicated that the goal of an audit is to obtain reasonable assurance that the financial statements are fairly stated and to detect any material misstatements. She stated that fairness is determined by applying criteria that is known as "generally accepted accounting principles". She indicated that the City changed their method of accounting for pension trust funds to conform with new standards issued by the Governmental Accounting Standards Board.
Ms. Nesterak stated that as well as issuing the City's audit report and consulting with the City of Dover on accounting matters, the auditors also review the City's internal controls. She explained that internal control is a process effected by an entity's board of directors, management, and other personnel designed to provide reasonable assurance of the achievement of objectives in the following categories: liability of financial reporting; effectiveness and efficiency of operations; and compliance with laws and regulations. She indicated that support for a good internal control system begins with a Council and a Committee. She stated that Council should display an appropriate attitude about internal controls and the financial reporting process; ensure that management has appropriate background knowledge; have experience regarding the function and responsibilities of government; be committed to and take an active interest in financial reporting; engage reputable, professional, third parties that are appropriate to these needs (auditors, attorneys, investment bankers, creditors); establish a rational and well defined organizational structure that clearly assigns and communicates responsibility and accountability to the individual employees; and establish sound personnel practices and policies. Ms. Nesterak indicated that the City should establish a process for risk assessment which involves identifying, analyzing and managing risks relevant to the preparation of financial statements. She felt that the City should also monitor the continued effectiveness of internal control.
Ms. Nesterak indicated that during the year, she has consulted with Mr. Mike Karia, Finance Director/Treasurer, and Mr. Ray Cola, Accounting Manager, to review any possible changes in the internal accounting control system. She indicated that in the upcoming years, there will be changes to the method of accounting for investments and pensions, changes in the Single Audit Act which will affect the City, format of financial statements, emphasis on fraud risk assessment and changes to the internal control evaluations. Ms. Nesterak stated that the City, as part of its internal control, should consider what risks they may face in financial reporting and decide whether they are allocating sufficient resources to meet that risk.
Committee members expressed their appreciation to Ms. Nesterak for the complimentary letter from Faw, Casson and Company and Mr. Karia, Finance Director/Treasurer, for his excellence in financial reporting.
Mrs. Malone moved to recommend approval of the Comprehensive Annual Financial Report for fiscal year 1997, seconded by Mr. Leary and unanimously carried.
Investment Policy Review
In 1988, City Council adopted an investment policy to formalize the objectives and provide the parameters of investments for all City funds. Although there are no recommended revisions requested by staff, in accordance with Section 14.0, the policy will be reviewed at least once every two years. This allows Mayor and Council to keep apprised of the City’s investments.
Mr. Karia, Finance Director/Treasurer, reviewed the current investment policy, as outlined in the report provided, as well as other possibilities for investments. He noted that the City’s investment policy has remained conservative. As a government, the City’s primary job is to provide services and to hold the funds as the “people’s trustee” with a fiduciary responsibility. Based on this philosophy, staff recommended no revisions and that members recommend that Council reaffirm the current policy.
Mr. Karia advised members that in March 1996, the Municipal Treasurers' Association (MTA) of the United States and Canada awarded a certificate for the City's written investment policy. He stated that Dover is the first City in Delaware and one of 150 cities in the United States and Canada to receive such an award.
Mr. Leary noted that in accordance with Section 10.0, the maximum length for maturity of investments is currently 24 months. Considering that present interest rates are very low, he felt that the Finance Director/Treasurer should be given more flexibility in extending the maximum length for maturity of investments.
In response to Mr. Carey, Mr. Leary indicated that this change would not prevent the Finance Director/Treasurer from investing funds for more than 48 months, when necessary.
Mr. Leary moved to recommend that Council reaffirm the existing investment policy, with the revision to Section 10.0, extending the maximum length for maturity of investments to 48 months. The motion was seconded by Mrs. Malone and unanimously carried.
Purchase of 1998 Step Van
Staff investigated various ways to increase the performance and stock capacity of the "Stock Coordinator's" duties. Currently, this position supplies eight line crews with materials on a basis of 20 trips total per day to the Warehouse. The existing delivery vehicle is a ½ ton pick-up truck with 100,000 miles. Bids were solicited for the purchase of a utility van that will have greater storage capacity, and thereby, reduce Warehouse trips by 50%. Additional advantages will be increased storage of line crew materials for emergency contingency.
One bid was received from Willis Auto Mall in the amount of $36,377. It was noted that the bids were advertised twice and that the closing date was extended until January 13, 1998. Staff recommended that a purchase order be issued to Willis Auto Mall, in the amount of $36,377, for the purchase of a 1998 Step Van.
Responding to Mr. Christiansen, Mr. O'Connor indicated that this purchase was not provided under State Contract. In response to Mr. Salters, Mr. O'Connor stated that since the existing delivery vehicle has over 100,000 miles, it will most likely be sold at the 1998 Public Auction.
Mrs. Malone moved to recommend that a purchase order be issued to Willis Auto Mall, in the amount of $36,377, for the purchase of a 1988 Step Van. The motion was seconded by Mr. Carey and unanimously carried.
Proposed Amendments - Chapter 11 of the City Code - Business Licenses (Sections 11-1, 11-3,11-4, 11-5, 11-11, 11-15 and 11-16)
Members were provided with proposed amendments to Chapter 11, Licenses, of the Dover Code. The amendments pertain to a broad array of issues including: adding new definitions and fee categories; exempting nonprofit organizations from licensing, as well as itinerant merchants who participate in events sponsored by a nonprofit organization; exempt credit unions and insurance agents from licenses because they are already exempt by federal and state law; creating a "per job" fee for "out of County Contractors"; and changing the penalty date from August lst to July 31st.
Mr. DePrima stated that the City has always had a problem with traveling merchants, especially the vendors that come to Dover for race weekend. He stated that if vendors are here for the spring race, they are required to pay the minimum $55 license fee. If they are planning to return to Dover for the September race, they are required to obtain another license. He stated that the proposed amendment to Section 11-1 will require a license on a per event basis. Mr. DePrima indicated that vendors who are participating in an event sponsored by nonprofit organizations will not require a license.
Mr. Salters moved to recommend approval of the proposed amendments to Chapter 11, Licenses, as recommended by staff (Attachment #1). The motion was seconded by Mrs. Malone and unanimously carried.
Proposed Amendment - Chapter 19 - Streets, Sidewalks and Public Places
Mr. DePrima, City Planner, submitted a proposed amendment to Section 19-5 of the Dover Code, Removal of Snow or Ice from Sidewalks by Owner or Occupant of Abutting Property. He indicated that the proposed amendment will require property owners to keep adjacent sidewalks clear and to maintain adjacent landscape areas within the requirements of the City's grass cutting regulations. Noting that the current ordinance is specific to the removal of snow and ice only, Mr. DePrima stated that although these requirements have been the City’s practice, the proposed amendment will formalize the requirement.
Mrs. Malone moved to recommend approval of the proposed amendment to Section 19-5 of the Dover Code, as recommended by staff (Attachment #2). The motion was seconded by Mr. Carey and unanimously carried.
Meeting Adjourned at 7:28 P.M.
UTILITY COMMITTEE
At the request of Councilman Lambert, the Utility Committee recessed at 7:28 p.m. to convene into the Regular Council Meeting. The Utility Committee reconvened at 8:00 p.m., with Chairman Lambert presiding. Members present were Councilmen Pitts and Weller and Mr. Farling. In the absence of Mr. Kramedas, Mr. Lambert deputized Mr. Carey to serve as a temporary member.
Due to the complexity of issues brought before the committee for consideration, Mr. Lambert requested that in the future, staff prepare the information (action forms) in layman’s terms.
Material to Construct the Fiber Optic Line - Phase I
The planning and designed construction of Phase I of the City Fiber Optics Communication Line requires a Fiber Optic “Back Bone” (Trunk Line) to be installed from the Electrical Administration's Building to North Street. It also requires tap loops to be provided at key locations including a smaller line to North Street substation, which will allow the protective pilot wire relaying to be re-commissioned for both 69KV lines from McKee Run to North Street Substation. Phase II will include line construction from this "Back Bone" to 5 East Reed Street (Weyandt Hall), the Police Department, and various substations.
The design specifications were prepared by the City of Dover. Bids were received for materials to construct the Fiber Optic Line - Phase I, with the low bid received from United Electric in the amount of $60,702. Staff recommended that a purchase order be issued to United Electric, in the amount of $60,702, for materials to construct the Fiber Optic Line.
Mr. O'Connor informed members that a City vehicle has been equipped with new rollers that will be able to manage fiber optic lines. He stated that employees of the Electric Department were sent for training to learn how to perform the connections of fiber optics. During the HTE conversion process, a fiber optic line was installed from City Hall to Weyandt Hall, where the AS400 main frame is located, and that telephone lines were utilized to connect Weyandt Hall to the Warehouse. Mr. O'Connor stated that during this conversion, problems had occurred with the connection utilizing the telephone lines. The telephone lines were causing interruptions and although the telephone company was quick to respond, their solution to the problem was only temporary. For this reason, staff decided to purchase the fiber optic cable, rather than utilize the telephone company's lines.
Responding to Mr. Lambert, Mr. O'Connor stated that the City currently has fiber optic connections to City substations, City Hall and Weyandt Hall. He stated that the additional fiber optic line from McKee Run to North Street Substation will establish a communication system, providing acknowledgment of any outages. Mr. O’Connor stated that the SCADA System, which is currently utilized at some substations, consists of radio (hard-line) frequencies that inform the Police and Electric Departments of any possible interruptions of service. There have been several occasions that inaccurate readings were received due to tree limbs and other materials interfering with the lines. The fiber optic connections will eliminate the need to use radio frequencies as well as receipt of inaccurate readings.
Responding to Mr. Carey, Mr. O'Connor stated that he has been involved in the demonstrations of the fiber optic lines. He assured members that fiber optic lines are very durable and are as strong as the single phase cable. Mr. O’Connor stated that staff is continuously inspecting our poles for attachments and stated that there are policies and regulations that control usage of City poles.
In response to Mr. Salters, Mr. O'Connor indicated that Phase II of this project will consist of installing the fiber optic cable underground. There will be two (2) additional conduits installed while renovating the lighting system on State Street and extra conduit will be installed underground for future development.
Mr. Carey moved to recommend that the bid be awarded to United Electric, in the amount of $60,702, for materials to construct the Fiber Optic Line - Phase I, as recommended by staff. The motion was seconded by Mr. Weller and unanimously carried.
Meeting Adjourned at 8:08 P.M.
Respectfully submitted,
Robin R. Christiansen
Council President
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