CCW Minutes and Attachments 1-3 (revised 03-26-2018 to correct CPI-U figure)

COUNCIL COMMITTEE OF THE WHOLE The Council Committee of the Whole met on March 13, 2018 at 6:00 p.m., with Council President Slavin presiding. Members of Council present were Mr. Anderson (arrived at 6:28 p.m.), Mr. Sudler, Mr. Neil, Mr. Lewis, Mr. Cole, Mr. Polce (departed at 7:52 p.m. and returned at 7:53 p.m.), Mr. Hare (departed at 7:43 p.m.), and Mr. Lindell. Mayor Christiansen (departed at 7:41 p.m. and returned at 7:53 p.m.) was also present. Civilian members present for their Committee meetings were Mr. Caldwell and Dr. Warfield (Parks, Recreation, and Community Enhancement), Mrs. Doyle and Ms. Scarborough (Utility), and Mr. Shevock and Dr. Stewart (Legislative, Finance, and Administration). Mr. Hare moved to amend the agenda to change the order of the committees, as follows: Parks, Recreation, and Community Enhancement Committee; Legislative, Finance, and Administration Committee; and Utility Committee. The motion was seconded by Mr. Sudler and unanimously carried. PARKS, RECREATION, AND COMMUNITY ENHANCEMENT COMMITTEE The Parks, Recreation, and Community Enhancement Committee met with Chairman Sudler presiding. AGENDA ADDITIONS/DELETIONS Mr. Neil moved for approval of the agenda, seconded by Mr. Lewis and unanimously carried. Community Development Block Grant (CDBG) Application Review Mrs. Tracey Harvey, Planner/CDBG Administrator, reviewed her memo to the Parks, Recreation, and Community Enhancement Committee, dated March 13, 2018, regarding CDBG Grant Recommendations for FY 2018, as well as the FY 2018 CDBG Proposed Budget. Staff recommended approval of the proposed Community Development Block Grant (CDBG) allocation recommendations for the FY 2018 CDBG grant renewal fiscal year. Mr. Neil moved to recommend approval of staff’s recommendation, seconded by Mr. Lewis and unanimously carried. Community Development Block Grant (CDBG) Program Semi-Annual Update Mrs. Tracey Harvey, Planner/CDBG Administrator, reviewed the CDBG Semi-Annual Report, December 2017 - February 2018. Mr. Neil moved for adjournment of the Parks, Recreation, and Community Enhancement Committee meeting. The motion was seconded by Mr. Lewis and unanimously carried. Meeting adjourned at 6:08 p.m.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 2 LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE The Legislative, Finance, and Administration Committee met with Chairman Hare presiding. AGENDA ADDITIONS/DELETIONS Mr. Hare moved to amend the agenda to consider item #7 - Proposed Ordinance #2018-03 Amending the Dover Code of Ordinances by Creating a New Chapter 84 - Public Safety Fee (Sponsors: Hare and Neil), following item #2 - Presentation - Comprehensive Annual Financial Report (CAFR). The motion was seconded by Mr. Lewis and unanimously carried. By unanimous consent, the agenda was approved as amended. Report of Independent Public Accountants for the Fiscal Year Ending June 30, 2017 (CliftonLarsonAllen, LLP) On behalf of CliftonLarsonAllen, LLP, Mr. Bill Early, Principal, and Mr. Remi Omisore, Principal, reviewed a presentation entitled “City of Dover, Delaware, Audit Results, Year Ended June 30, 2017” (Attachment #1). Staff recommended acceptance of the report. Mr. Neil noted, for clarification to those audience members present, that this was not the first time that member’s of the Committee were receiving this information. He indicated that the report was included in the Committee meeting packet which was available on the City’s website. Mr. Neil stated that everything is transparent, explaining that if anyone ever wants to know what’s happening, they can go online and view the same material as members. Mr. Neil thanked Mr. Early and Mr. Omisore for their impressive report and members of staff for working with them so closely. Mr. Sudler asked Mr. Omisore to elaborate on his comment that expenses had decreased over the last couple of years. Responding, Mr. Omisore, referring to page 11, Income Statement Summary, of his presentation, explained that the expenses reflected are for the City as a whole and it is a combination of all of the funds. He stated that in looking at that $5M increase, the old accounting for Other Post-Employment Benefits (OPEB) standards related to how much you contributed to the trusts; however, when the new standard came into play, OPEB kind of smoothed out. Mr. Omisore advised that it is not a funding mechanism, it is more of an accounting mechanism of smoothing the expense across the plan. He stated that the best way to explain it is to compare your mortgage payment to the value of your home, explaining that if you bought a home for $400,000, the old standard only required you to record your monthly payment, but now the standard requires you to put the full value of your home, $400,000, and then you decrease those payments over the year. Mr. Omisore noted that it is more of a funding mechanism than a true expenses decreasing; unfortunately, when you see it in the financial statements, it’s hitting as an expense. He stated that it is difficult to compare apples to apples, but when you do that it looks like the expenses decreased. Mr. Omisore noted that there was also some reduction in budgeted expenses on the General Fund, which goes into that process as well.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 3 Mr. Early encouraged members to read Management’s Discussion and Analysis included the in Comprehensive Annual Financial Report (CAFR), noting that it is a very high-level, year-to-year comparison that provides more detail regarding the exact causes for fluctuations in expenditures and revenues. Mr. Sudler asked what the number one expense is for the City. Responding, Mr. Early stated that payroll is definitely the main expenditure. Mr. Neil moved to recommend acceptance of the report, seconded by Mr. Lewis and unanimously carried. Presentation - Comprehensive Annual Financial Report (CAFR) Mrs. Lori Peddicord, Controller/Treasurer, reviewed a presentation entitled “City of Dover, Comprehensive Annual Financial Report, Fiscal Year Ended June 30, 2017”. Staff recommended acceptance of the report. Mr. Anderson noted that the County Water/Wastewater was favorable by more than $400,000 and asked what the reason was for this. He asked if the County went down in their cost or if the City had other usage. Responding, Ms. Peddicord stated that the City may have budgeted higher than normal, expecting an increase in their fees. Mrs. Donna Mitchell, City Manager, stated that the City charged the Inflow and Infiltration (I & I) fee which helps offset the County treatment fees and that overage goes to capital projects for fixing the sewer mains. She explained that the City plans on the fact that the fee is going to be higher, noting that it has been budgeted that way for a while, and staff purposely looks for that extra to help pay the capital projects. Mr. Neil noted that Pump Station #7 (PS #7), located in the Third Council District, is still having problems and being worked on. He asked if the additional costs regarding those problems were yet known and included in these figures. Responding, Ms. Peddicord clarified that the CAFR information was for fiscal year 2017; therefore, those unexpected expenses were not reflected in this report. In response to Mr. Neil, she stated that she did have a budget amendment come through for fiscal year 2018; however, she did not know whether the City had received all of the bills in regard to the problem at PS #7 yet. Mr. Neil moved to recommend acceptance of the report, seconded by Mr. Anderson and unanimously carried. Proposed Ordinance #2018-03 Amending the Dover Code of Ordinances by Creating a New Chapter 84 - Public Safety Fee (Sponsors: Hare and Neil) Mrs. Donna Mitchell, City Manager, reviewed a presentation entitled “City of Dover, Public Safety Fee,” and provided members with a list of owners of tax-exempt developed property, including the exterior square footage and sample fees (Attachment #2) and a list regarding public safety calls for 2016 - 2017 (Attachment #3). She reminded members that during the budget process in May of 2017 there was discussion among Council members regarding a public safety fee and, rather than try to put that into the budget at the last minute last year, she took some time to develop a public safety fee for mid-year consideration. Mrs. Mitchell explained that this would allow time for the

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 4 Committee to vet the proposed ordinance, and if it is approved by Council, it would go into effect in July. She advised that one (1) of her goals in trying to get this out several months earlier than the budget process was to allow time to notify the entities that this would impact, and she also wanted to provide time to review all of the records and make sure they are reconciled. Mrs. Mitchell, referring to page 3 of the presentation, explained that the graph depicted the outlay and receipts for public safety expenses and revenues for governmental activities. She stated this graph was included in the budget and included all public safety. Mrs. Mitchell advised that public safety includes code enforcement, the Fire Marshal’s Office, police, and fire. She explained that to help offset that in the past, staff has shown the property taxes going toward these costs in the budget. Mrs. Mitchell, referring to page 8, Sample Comparison of Fees by Non-Profit Entity, of the presentation, advised that this was only a sample of the entities with the highest calculations and did not include all 95 entities, which is 135 properties. She advised that the presentation did not include information regarding the amounts the City currently receives in payment in lieu of taxes (PILOT) from some entities. Mrs. Mitchell noted that one (1) of the reasons the State of Delaware is not included in the sample and is exempt from the fee is because they make a formula-based PILOT to the City in accordance with State Code. She stated that Luther Towers was not included in the sample because they made a PILOT to the City in the amount of $31,828 in July 2017. She explained that, for example, based on a $.02 per square foot public safety fee, Luther Towers would have paid the City approximately $7,160. Mrs. Mitchell advised that the Delaware State Housing Authority currently pays the City approximately $13,000 per year and based on a $.02 per square foot fee they would pay $2,866. She stated that Dover Housing Authority is budgeted to pay the City $50,000 this year and based on a $.02 per square foot fee they would pay $6,114. Mrs. Mitchell noted that The Milford Housing Development Corporation is budgeted to pay the City $7,500 this year and they would pay $1,726, based on a $.02 per square foot fee. She explained that by using the square footage, the proposed public safety fee would equalize all nonprofits to be paying at the same rate. Staff recommended adoption of Proposed Ordinance #2018-03. Mr. Anderson thanked Mrs. Mitchell, noting that he thought that she did a thorough and comprehensive job on this assignment. He asked if the City would lose money if entities stopped making their PILOT and paid a $.01 per square foot fee. Responding, Mrs. Mitchell stated that yes, at $.01 per square foot, the City would not make as much as it currently makes based on what the four (4) entities pay in-lieu of taxes. Mr. Anderson stated that the City had done a lot to encourage economic development and asked if the proposed ordinance would be negative to organizations that had been partnering with the City to help in this regard. Mr. Anderson noted that organizations that provide affordable housing, such as Milford Housing and Habitat for Humanity, have to hold properties at least one (1) year to avoid the transitional cost. He asked if these types of organizations, including the new Dover housing, if it comes about, would pay a fee if they were to buy a property in order to improve it. He noted that these purchases benefit the City and provide a lot more tax money that if they were to pay a fee. Responding, Mrs. Mitchell stated that the fees for organizations, like Habitat, who build and sell houses are based on the Certificate of Occupancy when the house is built and the property assessment is done. She explained that such a property would not be on the records until it is

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 5 finalized and the assessed value is taken through the Tax Assessor’s Office. Mrs. Mitchell advised that the bills are done quarterly and if they sold the house, they would never see the fee; however, if they have not sold that house, they would have a fee. She stated that the City provides a lot of economic development incentives through impact fee and permit waivers, and quite a few waivers had been provided over the past five (5) years. She explained that these waivers are tracked and the beneficiaries for the most part are NCALL, Habitat, and Milford Housing. Mr. Sudler asked Mrs. Mitchell whether she had considered a restriction or constraint on the proposed fee. He asked, for example, if she would recommend that the proposed $.02 or $.03 not exceed $.05 or $.10, which would deter nonprofit or 501(c)(3) organizations from coming to the City. Responding, Mrs. Mitchell stated that Council would decide the rate during the budget process and she was not currently recommending any particular rate, this was only a discussion of the ordinance and fee. She explained that she had used $.01 and $.02 as examples, noting that a $.01 fee would garner $72,000, while a $.02 fee would garner $144,000. Mrs. Mitchell reminded members that the fee would only help the City pay for the costs associated with fire and police capital items; it would not pay for all of those items at these levels. Mr. Sudler suggested that members reach out to their State officials to get some input and see how it may affect constituents or 501(c)(3) business partners. Mr. Lindell asked what the exact amount of money is that the City offers in total incentives for the various groups. Responding, Mrs. Mitchell stated that in the downtown district the City offered or waived fees in the amount of $21,811 in FY 17 and $61,545 in FY 16. She advised that there was also commercial development which amounted to $39,252 in FY 16 and $1,000 in FY 17. In response to Mr. Sudler’s suggestion that members reach out to their State legislators, Mr. Hare stated that he had been reaching out to the legislators for the past two (2) to three (3) years and it was obvious to him that the City of Dover was not treated the same as the City of Wilmington at Legislative Hall. He explained that the State distributes $3M to the three county seats, Georgetown, Dover, and Wilmington, and the City of Dover has approximately $275M worth of State properties that are exempt and receives $300,000, while the City of Wilmington has $175M worth of exempt property and receives $2.6M. Mr. Hare indicated that there was a caveat that they get more for less property because they have 50,000 people. He noted that the City of Wilmington also has a city wage tax but the State will not approve a wage tax for the City of Dover. Mr. Hare stated that he agrees that everyone should reach out to the legislature because there is obviously discrimination between Wilmington, Dover, Georgetown, and even Newark. Ms. Judy Diogo, President, Central Delaware Chamber of Commerce (CDCC), stated that, since the public safety fee was announced, the CDCC had received a number of phone calls from nonprofits with concerns that there was a lack of information leading up to the discussion of a public safety fee. She advised that they were trying to figure out if the fee was about equity or need, noting that, from the information that they had heard at the meeting, it appeared that the reason for the fee was need. Ms. Diogo expressed concern that there were no examples of the rate in the ordinance, leading people to jump to conclusions, and she thanked Mrs. Mitchell for the list of owners of tax-exempt developed property, including the exterior square footage and sample fees, that was provided, which made it clearer and helped a great deal.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 6 Ms. Diogo advised that a lot of nonprofits took hits at Legislative Hall last year and were still anticipating budget cuts. She recommended, on behalf of the CDCC’s nonprofits, that the City meet with groups who will be impacted by this particular fee in a huge way. Referring to list of owners of tax-exempt developed property, including the exterior square footage and sample fees, Ms. Diogo noted that the highest fee listed at the $.01 per square foot rate was approximately $19,500 and the lowest was $10.54. She asked if there was a possibility of looking at the situations of organizations with higher fees, such as those ranging from $1,000 to $19,500. Ms. Diogo noted that these organizations are already paying fees to the City for water, electricity, etc., and suggested consideration of a different rate for some of the larger users. Ms. Diogo noted that consideration was being given to implementing the proposed ordinance in April and starting billing in July. She requested, if it absolutely had to be done, that Council set the rate at $.01 per square foot, with a caveat that this would last for three (3) to five (5) years so that nonprofits can plan their budgets. Ms. Diogo asked that the City hold public workshops after this initial period to find out the fee’s impact on nonprofit organizations. She stated that the impact is a missing piece of the puzzle, and she expressed the need to remember that nonprofits are providing services that the government cannot pay for. Ms. Carolyn Fredericks, Modern Maturity Center (MMC), stated that she had called almost all members of Council and expressed thanks for the calls back that she received. She asked members what they considered the value of the MMC to the City, noting that they have paid $188,000 in utilities to the City, and do not receive any type of discount for the services they provide to residents. She noted that her counterpart in Newark had advised that the City of Newark provides Newark Senior Center a credit of $60,000 on their electric bill, which would be really nice for the MMC to receive. Ms. Fredericks stated that the MMC provided 133,000 Meals on Wheels to shut-in residents, just in the Dover area, at a value of $1.1M. She explained that Meals on Wheels is not all paid for by the State or Federal government and the MMC had to supplement that funding by approximately $100,000. Ms. Fredericks informed members that 55-plus communities are tax paying and are locating to Dover in droves. She stated that The Grande, which bought the property adjacent to the MMC and is a big taxpayer, had just added another building. Ms. Fredericks reminded members that years ago the City provided the Senior Surrey for transportation but now the MMC provides transportation. Ms. Fredericks stated that nonprofits had experienced a 20% cut in State funds and, even with those cuts, worked diligently not to reduce the services that they provide to their clients. She advised that the City had never provided any funding to the MMC, and the organization had not gotten any breaks on building or other fees. She noted that they had not received any breaks on the building permit for their current building program and were just assessed an impact fee of $6,000 for one (1) hand sink and one (1) floor drain. Ms. Fredericks advised members that the MMC has provided a social environment and services for older adults for almost 50 years, which makes Dover a great place to live and retire. Mr. Sudler thanked Ms. Fredericks for reaching out to him and educating him about her position and continuing to educate members about the MMC’s services and what they have and have not received.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 7 Ms. Jeanine Kleimo, Chair, Dover Interfaith Mission for Housing (DIMH), stated that, in addition to the points that had already been made, DIMH had already submitted proposals for funding for the program year that will begin in July, so they had not had an opportunity to budget for any increase. She noted that costs are rising, but funding is absolutely not rising. Ms. Kleimo informed members that DIMH has brought homeless people off of the streets and made Dover safer as a result. She stated that this should not result in being charged fees for the services that they receive, noting that DIMH is a net contributor to public safety. Ms. Kleimo stated that DIMH puts approximately $3.5M every year into the local economy in terms of the wages generated by their clients that are hired by local employers, which is more than 10 times their budget and is a part of the economic development of the community of Dover. She asked members to consider the impact of this and other ways to engage with those working with disadvantaged populations to increase public safety in a way that does not cost them more money. Ms. Mamie Charest, Executive Director, People’s Place, requested that members not move forward with the proposed fee. She explained that People’s Place had served Delaware’s most vulnerable population for over 45 years. Ms. Charest advised that their Whatcoat Program is the largest homeless shelter in Dover and the only one that provides shelter for families. She stated that Whatcoat sheltered 417 adults and children and provided 13,500 nights of shelter in 2017, and the agency serves one-third of the homeless population in the State. Ms. Charest indicated that without their program people would be on the streets, and there would be an impact to the City in other ways. She expressed her belief that this fee would be pushed to the first responders in the City, noting that Whatcoat appreciates these responders very much but wants to work in partnership with them. Ms. Charest stated that last year was a very hard year for People’s Place and they received a 20% cut, which meant that their Whatcoat Program, through which they provide homeless shelter, is running at a large deficit. She explained that they had continued to operate that program as a good faith effort, knowing that they are doing good in the community. Ms. Charest asked members not to push the proposed ordinance forward. Mr. Robert Clark II, President, Wesley College, noted that he would not repeat the things that other individuals had stated. He stated that he acknowledged the support and partnership that Wesley College had enjoyed with the City, County, and State. Mr. Clark advised that Wesley College views itself as Dover’s, Kent County’s, and Delaware’s college that shares the privilege of educating and mentoring the future with other institutions of higher learning in this area. He indicated that Wesley is very proud of the education and opportunities they provide their students that will enable them to be catalysts of positive change in the region. Mr. Clark stated that he had been amazed that, since he became a member of the community, he could not go far without finding a Wesley alumnus who had impacted the culture, leadership, and future of the region and State, which he stated was Wesley’s worth. Mr. Clark stated that he thought that the current discussion was not so much about “do we or don’t we” but about a coming together of the community and finding a partnership that works for moving it forward. He expressed the need to find something that is informed and collaborative, where various stakeholders work together to find out the short- and long-term implications and possible solutions. Mr. Clark stated that he thought it was important to gain perspective by finding out what other communities do, noting that Dover is not the only city facing this challenge. He advised that

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 8 Ms. Fredericks had made an excellent point and that the proposal was very focused on tax. Mr. Clark stated that, if members are looking at need and who provides relief, they must look across the board at community service, utilities, water, and the impact if an entity leaves. He indicated that he did not think there had been that type of discussion, noting that he just found out about the proposal a few days ago. Mr. Clark advised that he could not provide a recommendation until he had time to look at the problem and all of the options from an informed standpoint, and come together with a solution. He expressed concern that, in reading the newspaper, he saw things that inferred a lack of contribution by Wesley and others in the room, noting that he knew that was not intended but was how it read. Mr. Clark asked members to look at the jobs that are provided and the monies put forth. He stated that he was unsure whether what the City was trying to do was aligned with 9 Delaware Code, Section 8105. Mr. Clark requested that, before moving forward, everyone get together and perhaps form a group representative of those present, take a look at the realm of possibilities across the board, and find the right equity that will meet the needs for the near and long term. Mr. Clark advised that nonprofits of any sort, whether for education, healthcare, or any of the things that serve the community, are one (1) team and family, with one (1) collective future, and all their voices and efforts are needed to help see this matter through. Responding to Mr. Anderson, Mr. Clark explained that 9 Delaware Code, Section 8105 addresses some of the things being looked at. He stated that Section 8105 referred to the legalities and expressed the need to focus on potential solutions and make sure there is informed input. Ms. Valerie Swayze, Delaware Agricultural Museum, stated that she was speaking as a citizen who was born and raised in Dover and her comments did not apply to the Museum. She explained that she, the director, and Museum staff had seen an article in the newspaper regarding the proposed public safety fee earlier in the day. Ms. Swayze advised that the proposed fee would not apply to the Delaware Agricultural Museum; however, this did not mean that it would not in the future. She noted that the Museum leases its property from Delaware State University and when she saw the amount of approximately $19,000 for the University, she thought that the Museum would have to find a way to come up with the money. Ms. Swayze explained that the Delaware Agricultural Museum is one (1) of the only museums not funded by the State. She noted that they did take a cut like other nonprofits did. Ms. Swayze stated that she asks herself how the Museum can continue to do what they do when they receive a $4,000 per month gas bill or $3,000 electric bill. She explained that they see more than 100,000 kids per year from New Castle, New Jersey, Maryland, etc. Ms. Swayze stated that most museums in Delaware are free; however, the Delaware Agricultural Museum charges admission because they have to. She indicated that she had worked in budget and finance and that there have to be other ways, and she asked that everyone work together and look. Ms. Swayze noted that one (1) or two (2) pennies were currently being discussed; however, she guaranteed that before long it would be more. Ms. Melissa Hopkins, Vice President of Sector Advancement, Delaware Alliance for Nonprofit Advancement (DANA), advised that DANA is a statewide membership organization for nonprofits in Delaware and their goal is to advance the nonprofit sector through advocacy, training, capacity-building, and research. Ms. Hopkins stated that DANA had concerns regarding the legality of the proposed legislation. She stated that, as previously stated, 9 Delaware Code, Section 8105 states “Corporations created for charitable purposes and not held by way of investment that are in existence on July 14, 1988, together with existing and future charitable affiliates of such corporations that are also not held by way of investment, shall not be liable to taxation and

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 9 assessment for public purposes by any county, municipality, or other political subdivision of this State.” Ms. Hopkins stated that charitable nonprofits are exempt from this kind of statute and encouraged members to look into this further. In addition, she advised that the rationale behind the tax is that fire and police resources are insufficient, which she could appreciate; however, she thought there was not enough evidence to link the insufficiency of capacity at the Police and Fire Departments to the actions of nonprofits in the City of Dover. Ms. Hopkins questioned whether there was data showing a link between charitable organizations and insufficiencies in these agencies, because otherwise it felt as though the City was demanding a special payment from nonprofit organizations, which she thought was a question of equality. Ms. Hopkins noted that nonprofit organizations in the City want to partner with Dover’s police and fire organizations and requested consideration of how nonprofits are making it easier for law enforcement to do the job that they are intended to do. She noted that DANA’s organizations in the City and statewide are serving homeless populations, feeding the hungry, serving the mentally ill, and serving as community safe spaces for children and teens. Ms. Hopkins cautioned members that the additional expense of one (1) or two (2) pennies being discussed did not seem like much, but does add up and will impact services offered in the City. Ms. Hopkins expressed concern regarding the fee amount and collection process outlined in the legislation. She stated that the fee amount is not really clear, noting that the proposed ordinance states that, “The public safety fee amount and collection process will be examined by the city manager and city council annually during the budget formulation process...The city council will set and adopt the public safety fee amount....” Ms. Hopkins noted that it indicates that if revenues are insufficient to properly operate the public safety department, Council may need to reevaluate. She expressed concern that the language was shifting and that operational expenses were being discussed, versus capital funds, which she thought the proposed ordinance was really intended to serve, and suggested that this language be clarified. Ms. Hopkins stated that nonprofits in Delaware and in the City really want to be a partner to the City’s police and fire organizations, and she expressed her hope that members continue to allow them to do what they do well and serve the City of Dover. Mr. William Garfinkel, Bicentennial Village, congratulated members for bringing forth the proposed ordinance, stating that it was time for exempt corporations that use City services to pay their fair share, and there should be no more cost-shifting to homeowners and small businesses. He advised that the proposal was not something new, noting that federal credit unions are exempt from income tax but are required to pay county and municipal property taxes by federal law, and they had been paying ever since the credit union movement began. Mr. Garfinkel stated that it was only fair that other exempt properties start paying their fair share. He requested, on behalf of himself as a taxpayer and other taxpayers in the City, that members stay the course and pass the proposed ordinance. Mr. Sudler moved to recommend that, due to the sentiment of the majority of the individuals present, the City not move forward with Proposed Ordinance #2018-03 until further discussion with the stakeholders and the legality of the matter has been clarified in lieu of evading legal ramifications. The motion was seconded by Mr. Anderson.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 10 Mr. Slavin asked that members not make negative motions because members would be voting yes for the process to close, which had proved very confusing in the past. Mr. Slavin expressed appreciation for the input received, noting that where members are currently and where they will be when legislation is eventually enacted are two (2) different places, and this is the nature of creating legislation. He advised that he considered the legislation to be organic and noted that it was not something that Council drummed up but came from numerous meetings that members attend with homeowners and neighborhood associations. Mr. Slavin explained that there had been a clarion call from people who were wondering why their real estate taxes offset services for people who do not pay taxes, and he could not defend it. He indicated that maybe those present and some of the things he had heard could help him create a defensible position; however, there is a principle of fairness that must be addressed. Mr. Slavin explained that, while good, honest, and ethical non-for-profits were currently being represented, there were also not-for-profits who clearly operate outside of their stated mission. He advised that they operate bars, campgrounds, and RV parking lots and sell cars on their property, which is not what they are chartered to do, and he expressed the need to tighten this up. Mr. Slavin suggested rewording the motion, if the maker was amenable, to have the City Manager provide analysis of some of the ideas that had been heard, continue the dialogue, and bring forward an amended ordinance based on these ideas in one (1) month at the April meeting of the Committee. Mr. Sudler indicated that his intent was to have further discussion with the community before bringing this matter back to Council or the Committee and did not think that one (1) month would allow enough time. Mr. Slavin advised that the one-month suggestion was meant only as a marker so that members would have a report in a month’s time. Mayor Christiansen yielded to Mr. Lindell, noting that this was a meeting of the Council Committee of the Whole. Mr. Lindell stated that he supported the one-month delay proposed by Mr. Slavin, noting that this was an arbitrary number that could be changed. He stated that this time frame would be reasonable to get the conversation started and if the process was not complete the matter could be moved to another agenda, as had been done previously. Mr. Hare noted that he would not be available for the second Committee meeting in April. Responding to Mr. Hare, Mr. Sudler stated that he would be amenable to amending the motion to state six (6) weeks, and Mr. Anderson concurred stating that one (1) month was not enough time. Mr. Slavin suggested that the motion be withdrawn and restated as a positive motion with a six-week time frame. Mr. Lindell called the question. The motion to recommend that, due to the sentiment of the majority of the individuals present, the City not move forward with Proposed Ordinance #2018-03 until further discussion with the stakeholders and the legality of the matter has been clarified in lieu of evading legal ramifications was withdrawn by Mr. Sudler and Mr. Anderson. Mr. Sudler moved to recommend bringing this matter back for discussion in six (6) weeks, seconded by Mr. Anderson.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 11 Mr. Sudler advised that his original motion had included further discussion with the community. Mr. Hare stated that it would be up to members to go out and talk to people. Mr. Sudler stated that he was more amenable to the City Manager having a meeting with the community. Mr. Lindell advised that he had called the question on Mr. Sudler’s original motion. Mr. Anderson stated, as a point of order, that Mr. Lindell’s motion was not recognized and was irrelevant. Mr. Hare stated that there was a motion and a second and the matter was still open for discussion. Mayor Christiansen raised a point of order, noting that, as a matter of courtesy, he had yielded to Mr. Lindell. Mayor Christiansen suggested that he and the City Manager meet with those who are interested and bring information back to Council in a timely manner, in the interest of bettering the City’s communications. Mr. Hare stated that he would also make himself available if his schedule permitted. Mr. Anderson stated that he felt the discussion should be held; however, he was unsure if there was a fix because members were ignoring that money is brought in by some of the nonprofits. He explained, for example, that Restoring Central Dover and the National Council on Life and Labor Research (NCALL) had brought in a grant to help with lighting project demonstrations. Mr. Anderson advised that this grant alone was for more than the amount that they would pay for the next 10 years under the proposed ordinance. He stated that Restoring Central Dover grants had amounted to more than $0.5M for the community and this had to be taken into account. Mr. Anderson advised that many demolitions that would have cost the City $15,000 - $30,000 apiece had been done by Habitat for Humanity, NCALL, and Milford Housing, saving the City well over $100,000. He stated that nonprofits are bringing in a lot of money through partnering with the City, and he expressed the need to look at the issue comprehensively, not just based on the small amount the City is losing but also on how much the nonprofits are bringing. Mr. Anderson expressed the need to ask questions, such as how much Wesley College’s security footprint downtown saves the City. He noted that Wesley’s security provides an extra set of eyes not just on campus but from Pear Street through State Street, and the comprehensive picture is a lot more than $144,000. He noted that he would like to see a legal opinion on this matter before the six-week period is over to see if it the proposal is legally defensible and if members should spend time on it. Mr. Hare informed members that the City has one of the best police departments in the State. He noted that the Dover Fire Department is also one of the best and has an insurance rating of two (2) because, as a non-paid fire department, they are not allowed to be number one (1). Mr. Hare noted that the Dover Fire Department’s response time in the past had been quicker than the Wilmington Fire Department’s. He advised that, when time, apparatus, etc., are included, the cost every time the alarm goes off and responders go out the door is a minimum of $500 to $1,000. Mr. Hare stated that there is also a cost whenever the police have a call. He advised that there had been 123 fire and police calls to Wesley College in the past two (2) years, 277 fire and police calls to Delaware State University, and 662 police and fire calls to Bayhealth and questioned the cost of these calls. Mr. Hare noted that, as Ms. Fredericks had stated, costs were going up. He questioned if members should advise constituents that their taxes would be raised to cover false alarms.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 12 Mr. Hare suggested the possibility of developing a set run fee for all fire alarms or police calls to a facility, and those who do not use the service would not pay for it. He stated that, as Mr. Anderson had advised, there may be some offsets to the costs; however, he did not think that the costs of close to 1,000 calls in two (2) years would be offset. Mr. Neil stated that he and many of his neighbors, who own homes in a leased land community and pay a lot rent, appreciate the MMC’s facilities and the services they provide. He explained that these same individuals had tried to purchase their homes but could not. Mr. Neil informed members that the company that bought the community’s land had decided they wanted more money and raised their rent by $40. He noted that they are entitled to $3.52 by the Consumer Price Index for All Urban Consumers (CPI-U). Mr. Neil advised that, while the City is trying to bring in businesses, this money was now leaving Delaware’s economy and going to Michigan and, unfortunately, the State was also involved because they guaranteed them a profit and took away all of their risk. Mr. Neil expressed his belief that the City has an obligation and responsibility to protect students at the colleges as well as people who are in Delaware Housing Authority housing, Dover Housing Authority housing, and at Bayhealth. He expressed his hope that taxpayers who are moving into homes created by Habitat are not subsidizing police and fire protection. Mr. Neil suggested seeing if the nonprofits could come up with some suggestions during the interim period and that having the legal questions answered, noting that by that time members would be ready for a discussion about resolving some of the problems without raising taxpayers’ payments. He noted that the PILOT program that Luther Towers had participated in may be an answer. Responding to Mr. Lindell, Mr. Hare stated that there was a motion on the floor to bring this matter back in six (6) weeks. Mr. Lindell called the question, seconded by Mr. Sudler and unanimously carried. The motion to recommend bringing this matter back for discussion in six (6) weeks was unanimously carried. Responding to Mayor Christiansen, Mr. Hare stated that, with the permission of Council, Mayor Christiansen and the City Manager could proceed with speaking to the aggrieved parties. Status of Other Post-Employment Benefits (OPEB) and Pension Funds Mr. Sudler moved to defer consideration of this item, due to time constraints. The motion was seconded by Mr. Lewis and unanimously carried. Project Carry-Forward Budget Balances and Proposed Ordinance #2018-02 - FY 2017-2018 Budget Ordinances - First Amendment Mr. Sudler moved to defer consideration of this item, due to time constraints. The motion was seconded by Mr. Lewis and unanimously carried. Diversity and Inclusion Study Request for Proposal (RFP) Mr. Sudler moved to defer consideration of this item, due to time constraints. The motion was seconded by Mr. Lewis and unanimously carried.

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 13 Ambulance Services Proposal Mrs. Donna Mitchell, City Manager, informed members that City staff issued a Request for Proposals (RFP #18-0010CM) on November 15, 2017 for Ambulance Services, with proposals to be received by December 19, 2017. Two (2) proposals were received from Mid-Atlantic Care, LLC and PrimeCare Medical Transport, LLC, the current provider. In completing the review of the current proposals, staff also reviewed their financial statements, the Center for Public Safety Management (CPSM) Report of March 2016, and previous City Council minutes pertaining to the Ambulance Services. She explained that she had several conversations with the City Fire Marshal, Mr. Jason Osika, and Mrs. Kay Sass to help her understand the services provided and the current contract. Mrs. Mitchell advised that her findings indicated that RFP #18-0010CM was not sent to national firms as recommended in the CPSM Report, and staff had not followed through on Council’s motion of May 22, 2015. Mrs. Mitchell explained that staff was requesting to re-issue the RFP with the understanding that the recommendations of the March 2016 Report will be included. She noted that staff would also like to form an Administrative Committee of Medical and Paraprofessionals to assist the City with development and review of Ambulance Service Proposals and future contracts. The Committee would be established by the City Manager and approved by the Safety Advisory and Transportation Committee. The City Manager would be the Committee Chair, and the Emergency Management Coordinator would serve on the Committee as well. Mrs. Mitchell advised that while the Mid-Atlantic Care, LLC proposal has a lower cost, staff has concerns with their ability to staff crews and provide ambulances with the current contract expiring on March 31. She noted that she did reach out to the CEO and COO to explain her concerns and let them know of the plans to reissue the RFP. Mrs. Mitchell stated that she had negotiated a six-month extension with PrimeCare Medical Transport, LLC, whose contract had a provision for two (2), one- year extensions. She explained that PrimeCare’s new proposal contained a rate increase and the City would absorb this increase for six (6) months. Mrs. Mitchell noted that the public safety risk is too great to change a contract without several months’ notice. She stated that a revised RFP will be drafted upon Council approval of the six-month extension of the current contract. Staff recommended authorizing the City Manager to execute a six-month extension of the current contract with PrimeCare Medical Transport, LLC at the rates provided. Responding to Mr. Lewis, Mrs. Mitchell stated that the current provider’s proposed rate had increased from $40 to $45. She advised that there had been no rate increase over the three-year contract and she had agreed to absorb the rate increase for six (6) months while another RFP is issued. Mr. Neil moved to recommend approval of staff’s recommendation to authorize the City Manager to execute a six-month extension of the current contract with PrimeCare Medical Transport, LLC at the rates provided, re-issue the RFP with the understanding that the recommendations of the March 2016 Report will be included, and form an Administrative Committee of Medical and Paraprofessionals to assist the City with development and review of Ambulance Service Proposals and future contracts, with the Committee to be established

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 14 by the City Manager and approved by the Safety Advisory and Transportation Committee. The motion was seconded by Mr. Lewis and unanimously carried. Mr. Lewis moved for adjournment of the Legislative, Finance, and Administration Committee meeting. The motion was seconded by Mr. Anderson and unanimously carried. Meeting adjourned at 7:43 p.m. UTILITY COMMITTEE The Utility Committee met with Chairman Cole presiding. AGENDA ADDITIONS/DELETIONS Mr. Neil moved for approval of the agenda, seconded by Mr. Anderson and unanimously carried. Update - U.S. Route 13 East Pump Station #7 (PS #7) Emergency Response (Requested by Mr. Lewis) Mrs. Sharon Duca, Public Works Director/City Engineer, provided an update regarding the U.S. Route 13 East Pump Station #7 (PS #7) emergency response in relation to the sanitary sewer overflow that occurred at PS #7 on February 19, 2018. Mr. Lewis thanked Mrs. Duca and her staff for their due diligence in addressing this matter in an expeditious time frame, and asked if the City had any warranties on any of the related equipment. Responding, Mrs. Duca stated that some of the equipment was outside the time frame of a standard warranty and typical warranties would not cover the occurrence, due to the fact that the failure was related to the corrosive environment. Mr. Lewis asked if there was a proposed final cost yet. In response, Mrs. Duca explained that based on the costs that she had received so far, which included emergency hauling services, environmental services, bypass pumping, the materials to change out the station, as well as the new pump components which were ordered, they were looking at more than $200,000. She stated that she was still waiting for some final estimates, and that amount does not include future component change-out that staff would like to do once the air scrubber is in place and the environment is more controlled. Mr. Lewis noted that the City was collaborating with the County on the air scrubber and asked what the status was in that regard. Responding, Mrs. Duca advised that the air scrubber had been ordered after Council had approved it and, based on the most recent update, the manufacturing of the device was ahead of schedule so staff is hoping that it could be in by the end of April rather than the end of May. She explained that they would install it upon completion of the manufacturing. Mr. Anderson stated that he knew that there had been samples collected and asked if there was any indication of environmental impact or potential problems. In response, Mrs. Duca advised that, as explained in her memo dated March 6, 2018, because of the sampling results received, staff had to go back and remove all liquid from the stormwater management pond located at the old Berry Van

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 15 Lines site, and apply lime to help control the area. She explained that Silver Lake involves much more complex chemical analysis due to the nature of the lake and staff is waiting to receive the report from the Department of Natural Resources and Environmental Control (DNREC). Mrs. Duca stated that it did appear as though there may be some kind of effect; however, she could not speak to the analysis in terms of the extent or whether it is within tolerable ranges. Mr. Anderson asked whether there were anticipated environmental costs related to this and if the City would be solely responsible or if the cost would be split between the City and County. Responding, Mrs. Duca stated that as the City moves forward with the data, further discussions with the County would definitely involve the City Manager. She advised that at this time she could not assess the actual cost of what may have to be done for further clean-up, explaining that it is difficult to surmise what may have to be done in regard to the lake, for example. Mrs. Duca explained that the City is paying for the costs at this point but future arrangements are still up in the air. Mr. Neil stated that PS #7 is located in his neighborhood and is known as “Big Stinky,” which is why it was planned to have the scrubber clean it out. He noted that the problem was fortunately not affecting water. Mr. Neil advised that this would be a long-term project because the City is tied very closely to the County. He explained that the pipeline extending from Denneys Road to Capital Station will be replaced in two (2) years, which will affect traffic along Route 13. He noted that the current problem is a City problem; however, it is also a City/County problem because of its connection with this pipeline. He advised that he had tried to alert his neighborhood area, which was being affected, and he complimented staff for taking care of the immediate problem. In response to Mr. Neil’s comments, Mrs. Duca stated that she completely agreed that it is in the City’s best interest for the County to get the line repaired. She explained that the County is planning to re-line it rather than dig it up. Mrs. Duca advised that this project will have a tremendous impact on traffic because the line runs down the median of Route 13, where turn lanes into facilities are located. She stated her understanding that the County’s plans for the project are currently being reviewed and discussed with the Delaware Department of Transportation (DelDOT). Mrs. Duca indicated that part of the project could hopefully move forward toward the end of this year. Responding to Mrs. Doyle, Mrs. Duca stated that the City has 44 pump stations, noting that the County owns and operates a few of these stations, such as the stations off Denneys Road and Water Street. She advised that, in the past, an odor could often be experienced coming from the Water Street station, and the County had installed an air scrubber unit at that location. Mrs. Duca explained that the solution for the City’s station had been identified through working with the County, based on their experience and research at County stations. In response to Mrs. Doyle, Mrs. Duca advised that, because of the environment that PS #7 experiences, its wires are cleaned on a regular basis. She stated that, depending on the station, wires may be inspected weekly. Mrs. Duca explained that some things in pump stations are checked daily, but there are some things that operators cannot check without taking the station out of operation, which creates a tremendous issue. She advised that, for this reason, while PS #7 had been down staff had been moving forward with trying to install more corrosive resistant materials, etc., in it. Mrs. Duca stated that all City stations have a regular maintenance schedule, and the amount of flow that goes through them determines the frequency of maintenance, because this, as well as the environment that it’s faced with, could factor in the mechanical wear and tear. She noted that some

COUNCIL COMMITTEE OF THE WHOLE MEETING OF MARCH 13, 2018 PAGE 16 stations have very little flow going through them. Mrs. Duca advised that the overall goal is to get to each station every day, Monday through Friday, noting that this particular station will be monitored seven (7) days a week for some time in the immediate future. Responding to Mrs. Doyle, Mrs. Duca explained that outflow would have gotten into Silver Lake due to the effects of stormwater management throughout the state. She stated that anywhere that there are roadways, there are ditches to help control the drainage off the roads. Mrs. Duca advised that there may be storm sewers that ultimately run off some properties into these drainage ditches. She stated that the ditches at the location of the pump station along Leipsic Road ultimately go to other ditches that discharge to Silver Lake. Mrs. Duca advised that there are sampling locations at multiple places because of the ultimate discharge location. In response to Mrs. Doyle, Mrs. Duca stated that the City does not treat its stormwater, noting that this could be a matter of debate based upon current stormwater regulations if bio-filters, etc., could be considered treatment of stormwater. She noted that bio-filters are relatively new and are not everywhere. Mr. Cole expressed thanks to Mrs. Kay Sass, Public Affairs and Emergency Management Coordinator, who was instrumental in getting the word out to the businesses along the route during the time period of the event, and to Mrs. Duca for the update and her hard work. Mr. Neil moved for adjournment of the Utility Committee meeting. The motion was seconded by Mr. Lewis and unanimously carried. Meeting adjourned at 8:01 p.m. Mr. Cole moved for adjournment of the Council Committee of the Whole meeting. The motion was seconded by Mr. Lindell and unanimously carried. Meeting adjourned at 8:01 p.m. Timothy A. Slavin Council President TAS/TM/dd/js S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\Committee-Minutes\2018\03-13-2018 CCW Minutes (revised 03-26-2018 to correct CPI-U figure).wpd Attachments Attachment #1 - Presentation entitled “City of Dover, Delaware, Audit Results, Year Ended June 30, 2017”, provided by CliftonLarsonAllen, LLP Attachment #2 - A list of owners of tax-exempt developed property, including the exterior square footage and sample fees, provided by Mrs. Donna Mitchell, City Manager Attachment #3 - A list regarding public safety calls for 2016 - 2017, provided by Mrs. Donna Mitchell, City Manager

ATTACHMENT #1 Council Committee of the Whole Meeting of 03/13/2018 City of Dover, Delaware Audit Results Year Ended June 30, 2017 Bill Early, Principal Remi Omisore, Principal Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor. | ©2015 CliftonLarsonAllen LLP WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING

©2015 CliftonLarsonAllen LLP Presentation Agenda • Scope and Responsibilities in a Financial Statement Audit • Required Communications • Audit Approach Summary • Financial Statement Summary • Federal Grant Audit Results • GASB Update/Emerging Issues • Questions WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 2

©2015 CliftonLarsonAllen LLP Cannot be reproduced without the approval of City Council. Scope • Audit of the June 30, 2017 Financial Statements • Management letter to communicate other matters • Letter to governance on key components of the audit • Available for Consultation PHASE 1 PHASE 2 PHASE 3 PHASE 4 Planning & Systems Testing & Reporting & Strategy Evaluation Analysis Follow-Up WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 3

©2015 CliftonLarsonAllen LLP Scope of Services (continued) Enterprise Funds/Business Type Activities •Water/ Wastewater •Electric Revenue •Internal Service Governmental Funds Fiduciary Funds •General •Pension (General and •Police Grants Employees) •Library Grants •OPEB •Municipal Street Aid •Downtown Dover •CDBG •4th of July Celebration •State DOT •Substance Abuse •ERLSP •Realty Transfer City of Dover, Delaware WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 4

©2015 CliftonLarsonAllen LLP Auditors Required Communications • We have performed an audit of the financial statements in accordance with Generally Accepted Auditing Standards (GAAS) . • Purpose of an audit is to: – Obtain reasonable (not absolute) assurance about whether the financial statements are free from material misstatement – Assess accounting principles used and significant estimates made by management – Evaluate the overall financial statement presentation • Unmodified Opinion • Significant Accounting Polices – City’s significant accounting policies are described in Note 2 to the financial statements and are in accordance with generally accepted accounting principles and consistent with industry practices and standards WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 5

©2015 CliftonLarsonAllen LLP Auditors Required Communication • Significant Disclosures – Deposits and Investments (Page 63-66) – Capitals Assets (Page 67) Accounting Principles – Long Term Liabilities (page 69/82/92) Other Auditors Estimates – Implementation of Gasb 74/75 (Page 76) Required – Fund Balance (Page 75) Communications – Restatement (Page 76) Representations Disclosures • Significant Management Judgments & Estimates Misstatements – Allowance for uncollectible receivables – Useful lives of capital assets – Incurred but not reported claims – Pension and other post-employment benefits (OPEB) liabilities WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 6

©2015 CliftonLarsonAllen LLP Auditors Required Communication • Significant corrected or uncorrected misstatements included in governance communication • No disagreements with management • Management was very cooperative and professional during the audit process • Management did not consult with other accountants on the application of GAAP or GASB • No major issues were discussed with management prior to us being selected as the auditors WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 7

©2017 CliftonLarsonAllen LLP Audit Approach Summary • During our planning and risk assessment process and have identified the following areas to be of focus: Payables/Accruals/ Revenue -recognition, cutoff, and proper Cash and investments Capital assets other liabilities/Self classification and (existence and accounting insurance (cutoff and collectability valuation) completeness) Long term Debt and Compliance and Financial statement Implementation of pension and opeb disclosures GASB 74/75 liability estimates WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 8

©2017 CliftonLarsonAllen LLP System and Control Evaluation Understanding of the Process Control Environment Test of Design Revenue Generation- Appropriations Revenue Generation- Grants Control Environment Test of Controls Revenue Generation- Sanitation/Water/Electric Revenue Generation- Appropriations Revenue Generation- Contributions Revenue Generation- Grants Cash receipts Treasury (Cash, Investments and Debt) Revenue Generation- Sanitation/Water/Electric Expenditure- Cash Disbursements Expenditure- Cash Disbursements Revenue Generation- Contributions Expenditure- Payroll Disbursements Expenditure- Payroll Disbursements Treasury (Cash, Investments and Debt) Expenditure- Capital Assets Expenditure- Cash Disbursements Expenditure- Self Insurance Expenditure- Payroll Disbursements Information Technology Expenditure- Capital Assets Financial Close and Reporting Expenditure- Self Insurance Estimation Information Technology Financial Close and Reporting Estimation WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 9

©2015 CliftonLarsonAllen LLP Balance Sheet Summary $350,000,000 $300,000,000 $250,000,000 $200,000,000 $150,000,000 $100,000,000 $50,000,000 $- Assets Deferred Liabilities Deferred Net Outflows Inflows Position 2015 296,938,681 3,964,029 107,771,874 1,986,999 191,143,837 2016 304,162,438 4,561,184 99,861,060 1,269,206 207,593,356 2017 312,023,786 5,947,440 120,083,565 11,294,044 186,593,617 WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 10

©2015 CliftonLarsonAllen LLP Income Statement Summary $120,000,000 $100,000,000 $80,000,000 $60,000,000 $40,000,000 $20,000,000 $- Charges for Operating Capital Taxes Investment Expenses Services Grants and Grants Earnings Contributio ns 2015 104,627,984 2,298,936 1,683,311 12,890,268 637,103 112,834,294 2016 106,124,769 2,759,367 720,739 15,038,689 1,321,695 109,515,740 2017 110,361,596 2,025,522 1,562,501 14,530,304 511,388 104,410,784 WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 11

©2015 CliftonLarsonAllen LLP GASB Update Effective Dates—December 31 • 2017 • Statement 74—Other postemployment benefits (OPEB) plan reporting • Statement 77—Tax abatements • Statement 78—Pension provided through certain multiemployer plans • 2018 • Statement 75—Other postemployment benefits (OPEB) plan reporting-employers • Statement 80—Blending Requirements for Certain Component Units • Statement 81—Irrevocable Split-Interest Agreements • Statement 82—Pension Issues • 2019 • Statement 83—Asset Retirement Obligations • 2020 • Statement 84—Fiduciary Activities WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 12

©2015 CliftonLarsonAllen LLP GASB is seeking feedback on three alternative recognition approaches as well as other potential changes that could be made to reporting rules for governmental fund financial statements. In an invitation to comment, GASB introduced the approached, which it describes as: • Near-term financial resources • Short-term financial resources • Long term financial resources The near-term model is a closer-to-cash approach, while the long-term model is a closer to economic resources approach. The short-term model is also known as a working capital approach and is situated between the other two models on a cash vs economic resources continuum. In addition to the recognition approaches, these potential improvements include: • Format of the government funds statement of resource flow • Changes to terminology • Reconciliation to the government-wide statements • For certain recognition approaches, a statement of cash flows. WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 13

©2015 CliftonLarsonAllen LLP Cybersecurity Examination In response to growing market demand for information about the effectiveness of an entity’s cybersecurity risk management program, the AICPA ,is developing a new engagement that CPAs can use to assist boards of directors, senior management, and other pertinent stakeholders as they evaluate the effectiveness of an entity’s cybersecurity risk management program. The AICPA Assurance Services Executive Committee (ASEC), through its Cybersecurity Working Group, has developed a set of benchmarks, known as description criteria, to be used when preparing, and evaluating the presentation of, a description of the entity’s cybersecurity risk management program. The description criteria included in the draft is categorized into the following sections: a) Nature of Operations. b) Nature of Information at Risk c) Cybersecurity Risk Management Program Objectives (Cybersecurity Objectives) d) Inherent Risks Related to the Use of Technology e) Cybersecurity Risk Governance Structure f) Cybersecurity Risk Management Process g) Cybersecurity Communications and the Quality of Cybersecurity Information h) Monitoring of the Cybersecurity Risk Management Program. i) Cybersecurity Control Activities WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 14

©2015 CliftonLarsonAllen LLP Other Relevant Governmental Issues 2017 Legislative and Regulatory Agenda Tax Reform Majority of Public Pension Plans Have Made Recent • While there has been a great deal of discussion Reforms both pre and post-election on fixing and building A new issue brief from the Center for State and Local new public infrastructure – and how to pay for it – Government Excellence, “State and Local Pension reform tax writers are already drafting legislation that Since the Financial Crisis” examines how, why, and to could have a significant impact on the preservation what extent state and local government have enacted of the tax exemption on municipal bond interest. pension reforms in the aftermath of the financial Crisis. Other Municipal Bonds Initiatives The study examines data from 2009 to 2014 for all 114 state plans and 46 local plans in the Public Plans • In 2014-2016 SEC’s Enforcement Division increased Database (http;//publicplansdata.org) along with an its focus on improving continuing disclosure additional 86 local plans. The briefs key findings include: compliance through the Municipalities Continuing Disclosure Cooperation (MCDC) initiative. In mid- • 74% of state plans and 57% of large local plans have December 2016, the SEC stated that it has cut benefits or raised employee contributions to concluded actions against issuers and underwriters curb rising costs that self-reported in the MCDC program and will • States with the strongest legal protections for now turn their attention to issuers, underwriters current workers were more likely to limit the cuts and obligors that did not participate. to new hires Marketplace Fairness & the Preemption of State and • New Employees most commonly experienced Local Government Taxes increases in the age and tenure required to claim • These measures threaten to reduce State and benefits local tax revenues even as States and localities • Higher employee contributions were the most struggle to fund critical services like education, common benefit reduction for current employees health care, and public safety. followed by reductions to the COLA WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 15

©2015 CliftonLarsonAllen LLP GFOA Approves New Best Practices GFOA’s Executive Board recently approved five best practices in the areas of treasury and investment management, retirement and benefits, and municipal debt. GFOA best practices identify specific policies and procedures that contribute to improved government management. They aim to promote and facilitate positive change rather than merely to codify current accepted practice. GFOA has emphasized that these practices be proactive steps that a government should be taking. Best practices are applicable to all governments (both large and small), are approved by the GFOA executive board, and represent the official position of the organization. • New best practices include: – Procurement of Financial Services, recommends that governments review their financial services contracts every five years and use a competitive process for the procurement of financial services. – Investment Program for Public Funds, recommends that all governments establish a public funds investment program by completing several steps: developing an investment leadership team, identifying the funds being invested and their cash flow characteristics, reviewing all applicable laws and regulations, establishing a risk profile, determining the portfolio management team, and creating an investment policy. – Defined Contribution Retirement Plan Design, clarifies and updates the design elements governments should include if they choose to provide a defined contribution (DC) plan as a primary retirement vehicle. These include analysis to determine the cost of providing the benefit and determining whether employees are eligible for a federal insurance program that provides benefits to retired people (e.g., Social Security). – Electronic Payments, recommends that governments use electronic payments for all payments. – Refunding Municipal Bonds recommends that issuers include guidelines in their debt management policies that address preservation of future refunding flexibility. Issuers should also analyze their refunding objectives, the efficiency of any related escrow, and the unique aspects of executing the refunding transaction. WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 16

©2015 CliftonLarsonAllen LLP Spotlight on Retiree Health Care Benefits for State Employees in FY 2015 The National Association of State Retirement Administrators and the Center for State and Local Government Excellence examined the finances of the health insurance benefit plans offered by state governments to retired employees in all 50 states, key findings included the following: • Nearly every state and most local governments provide access to health benefits to retired employees and, in most cases, this coverage includes spouses and dependents; • Thirty-one states hold approximately $41 billion in assets to pay for future retiree health benefit costs; • The median state retiree health unfunded actuarial accrued liabilities is approximately $2.7 billion, and the mean average is just over $12 billion; and • Ten states - New Jersey, Texas, New York, California, Illinois, North Carolina, Connecticut, Pennsylvania, Florida, and Massachusetts - are responsible for $451 billion, or nearly 77 percent of the aggregate state retiree health unfunded actuarial accrued liabilities. WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 17

©2015 CliftonLarsonAllen LLP QUESTIONS? WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 18

©2015 CliftonLarsonAllen LLP Bill Early, CPA Principal Bill.Early@CLAConnect.com (410) 453-5586 Remi Omisore, CPA Principal Remi.Omisore.@CLAConnect.com (410)308-8157 CLAconnect.com linkedin.com/company/ facebook.com/ twitter.com/CLAconnect cliftonlarsonallen cliftonlarsonallen

ATTACHMENT #2 Council Committee of the Whole Meeting of 03/13/2018 Exterior Sq. Owner Ft. $.01 per sq ft $.02 per sq ft A & I HOUSING INC 4,328 43.28 86.56 ADC I INC 1,732 17.32 34.64 AFRICAN M E CHURCH OF DOVER 10,166 101.66 203.32 AMERICAN LEGION 19,863 198.63 397.26 BAYHEALTH MEDICAL CENTER INC 901,184 9,011.84 18,023.68 BETHEL SEVENTH DAY ADVENTIST 2,194 21.94 43.88 BIBLE CHURCH OF GOD INC 2,000 20.00 40.00 BIBLE WAY TEMPLE CHURCH 23,155 231.55 463.10 BLOOD BANK 12,507 125.07 250.14 CAESAR RODNEY SCHOOL DISTRICT 59,229 592.29 1,184.58 CALVARY BAPTIST CHURCH 10,593 105.93 211.86 CAPITAL BAPTIST CHURCH 27,412 274.12 548.24 CAPITAL GRANGE NO 18 INC 9,200 92.00 184.00 CAPITAL SCHOOL DISTRICT 386,332 3,863.32 7,726.64 CAPITOL GREEN DAY CARE INC 5,830 58.30 116.60 CENDEL FOUNDATION 12,944 129.44 258.88 CENTRAL DEL HABITAT FOR HUMANITY INC 5,976 59.76 119.52 CHARTER SCHOOL INC 44,288 442.88 885.76 CHILDREN'S CHOICE PROPERTY TWO, A PA NON 5,376 53.76 107.52 CHRIST EPISCOPAL CHURCH 11,866 118.66 237.32 CHRISTIAN LIFE CENTER 3,234 32.34 64.68 CHURCH OF CHRIST INC 4,124 41.24 82.48 CHURCH OF THE HOLY CROSS 100,794 1,007.94 2,015.88 CHURCH OF THE LIVING GOD 5,090 50.90 101.80 COMM LEGAL AID SOCIETY INC 5,734 57.34 114.68 COMMUNITY HOLY TABERNACLE 3,008 30.08 60.16 CONGREGATION BETH SHALOM 7,686 76.86 153.72 CONGREGATION OF JEHOVAHS WITS 3,977 39.77 79.54 DE STATE UNIVERSITY FOUND INC 21,298 212.98 425.96 DEL CONF AFRICAN METH EPIS CHURCH 2,672 26.72 53.44 DELAWARE GUIDANCE SERVICES 10,248 102.48 204.96 DELAWARE HOUSING AUTHORITY 143,311 1,433.11 2,866.22 DELAWARE SOLID WASTE AUTHORITY 21,696 216.96 433.92 DELAWARE STATE UNIVERSITY 1,954,477 19,544.77 39,089.54 DIMA IX INC 6,164 61.64 123.28 DOVER ART LEAGUE 7,422 74.22 148.44 DOVER CENTURY CLUB 3,604 36.04 72.08 DOVER HOUSING AUTHORITY 305,659 3,056.59 6,113.18 DOVER INTERFAITH MISSION FOR HOUSING INC 7,657 76.57 153.14 DOVER SPECIAL SCHOOL DISTRICT 589,395 5,893.95 11,787.90 EDGEHILL COMMUNITY CHURCH 1,918 19.18 38.36 EJB INC 9,054 90.54 181.08 ELIZABETH MURPHY SCHOOL 49,968 499.68 999.36 ELKS LODGE BPOE 1903 17,700 177.00 354.00 FIRST BAPTIST CHURCH 34,340 343.40 686.80 FIRST PILGRAM BAPTIST CHURCH INC 3,288 32.88 65.76 FIRST SOUTHERN BAPTIST CHURCH OF DOVER 15,962 159.62 319.24 FIRST UNITED PENTECOSTAL CHRCH 26,817 268.17 536.34 GRACE PRESBYTERIAN CHURCH INC 43,842 438.42 876.84

Exterior Sq. Owner Ft. $.01 per sq ft $.02 per sq ft HOLY TRIN CHRCH OF LIV GOD INC 8,769 87.69 175.38 IGLESIA CHRISTIANA MARANTHA 11,940 119.40 238.80 JIREH CHRISTIAN CENTER INC 10,400 104.00 208.00 KENT COUNTY THEA GUILD FOUN 3,336 33.36 66.72 KENT SUSSEX COMMUNITY SERV INC 11,700 117.00 234.00 LIBERTY CHURCH INC 5,760 57.60 115.20 LOVE TEMPLE CHURCH OF GOD 4,696 46.96 93.92 LUTHER TOWERS IV 358,837 3,588.37 7,176.74 MASONIC HALL CORPORATION OF DOVER 9,124 91.24 182.48 MODERN MATURITY CENTER INC 82,172 821.72 1,643.44 MOM'S HOUSE INC OF DOVER 2,089 20.89 41.78 MOUNT ZION AME INC 2,762 27.62 55.24 NATIONAL COUNCIL ON AG LIFE & LABOR 6,514 65.14 130.28 NEW JERUSALEM BAPTIST CHURCH 5,962 59.62 119.24 PEOPLES CONGREGATION CHURCH 25,962 259.62 519.24 PEOPLE'S PLACE PROPERTIES INC 67,521 675.21 1,350.42 PERSIMMON PARK PLACE 1,054 10.54 21.08 PLANNED PARENTHOOD OF DE INC 2,964 29.64 59.28 PRESBYTERIAN CHURCH OF DOVER 22,044 220.44 440.88 PRESBYTERIAN HOMES INC 483,206 4,832.06 9,664.12 ROBBINS HOSE CO 36,640 366.40 732.80 SECOND BAPTIST CHURCH 10,800 108.00 216.00 SEVENTH DAY ADVENTIST CHURCH 12,082 120.82 241.64 SOLID ROCK SOUTHERN BAPTIST CHURCH INC 6,440 64.40 128.80 ST ANDREWS CHURCH 1,605 16.05 32.10 ST JOHNS EVANGELICAL CHURCH 8,204 82.04 164.08 ST JOHNS LUTHERAN CHURCH 15,431 154.31 308.62 THE MILFORD HOUSING DEV CORP 86,326 863.26 1,726.52 THE RECTOR WARDEN & VESTRYMAN 1,566 15.66 31.32 THE SALVATION ARMY 6,018 60.18 120.36 THE WELLNESS COMMUNITY-DEL INC 1,613 16.13 32.26 TRUSTEES OF THE PENINSULA 6,156 61.56 123.12 TRUSTEES OF WESLEY CHURCH 32,360 323.60 647.20 UNION AME CHURCH 2,808 28.08 56.16 UNION MISSIONARY BAPTIST CHURCH, INC 11,865 118.65 237.30 UNITED METHODIST CHURCH 5,402 54.02 108.04 UNITED STATES OF AMERICAN 16,028 160.28 320.56 UNIVERSITY OF DELAWARE 9,712 97.12 194.24 VETERANS OF WW II 6,032 60.32 120.64 VICTORY CHRISTIAN FELLOWSHIP 14,836 148.36 296.72 WASH DIST ADVISORY BOARD 1,656 16.56 33.12 WESLEY COLLEGE INC 562,334 5,623.34 11,246.68 WESLEY UNITED METHODIST CHURCH 3,540 35.40 70.80 WHATCOAT COMMUNITY DEV INC 79,134 791.34 1,582.68 WHATCOAT METHODIST CHURCH 23,905 239.05 478.10 WILMINGTON UNIVERSITY 107,514 1,075.14 2,150.28 YOUNG MENS CHRISTIAN ASSOC (YMCA) 47,250 472.50 945.00 72,103.83 144,207.66

ATTACHMENT #3 Council Committee of the Whole Meeting of 03/13/2018 Police Complaints 2016 - 2017 Bayhealth 649 Wesley College 85 Dover Housing Authority 84 Delaware Housing Authority 22 Delaware State University 22 Wilmington University 5 867 Fire Incidents 2016 2017 Total Bayhealth 8 5 13 Wesley College 29 19 48 Dover Housing Authority 5 7 12 Delaware Housing Authority 4 6 10 Delaware State University 128 127 255 Wilmington University 1 4 5 175 168 343