LF&A MINUTES

LEGISLATIVE, FINANCE AND ADMINISTRATION COMMITTEE The Legislative, Finance, and Administration Committee meeting was held on January 11, 2010, at 5:30 p.m. with Chairman McGlumphy presiding. Members present were Mr. Salters (arrived at 5:34 p.m.), Mr. Leary, Mr. Shevock, and Dr. Jones. Members of Council present were Mr. Hogan, Mr. McGiffin, Mr. Ruane, Mrs. Russell (arrived at 6:35 p.m.) and Council President Williams (arrived at 6:00 p.m.). Mayor Carey was also present. AGENDA ADDITIONS/DELETIONS Mr. Leary requested the deletion of Item #2 - MAG Overview of Recommendations, to allow time for members to be provided the summaries of the meetings with employees. Mr. Leary moved for approval of the agenda, as amended, seconded by Mr. Shevock and unanimously carried. Review and Analysis Vacant Positions Report Mr. Anthony DePrima, City Manager, advised members that the vacant positions report is one (1) of three (3) similar reports that he monitors each month. He explained that these reports were created to measure the pulse in this difficult economic time and the report will change as positions are filled. Responding to Mr. McGlumphy, Mr. DePrima stated that the City is in the second year of a hiring freeze and, as with last year, there will be some positions that will be eliminated from the budget permanently. Overtime Report Mr. DePrima advised members this report is used to monitor overtime usage by department. He noted that the report was created to insure that employees are not making up lost income from furloughs with overtime and, to date, any overtime has been justified. In response to Mr. Ruane, Mr. DePrima stated that the increase in overtime in the Transmission and Distribution section of the Electric Department is from evening and weekend preparation for the Governor=s Avenue Project. Responding to Mr. McGlumphy, Mr. DePrima stated that the reports are compiled by department, not by person, and that the next report will include totals. Furlough Report Mr. DePrima advised members that employees are abiding by the furlough, which was adopted by City Council. Responding to Mr. McGlumphy, the purpose of this report is to make sure that employees are taking their furloughs. In response to Mr. McGlumphy, Mrs. Theresa Tieman, Senior City Administrator, explained that

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 2 there are no monies saved, as there were no monies budgeted, for furloughs. She noted that there was a "cost avoidance". Review and Recommendation - Filling of Critical Positions During their meeting of February 23, 2009, members recommended approval of the Hiring Freeze for Fiscal Year 2008-2009, but to allow the hiring of critical positions through the review and approval of the Legislative, Finance, and Administration Committee and City Council. It was suggested that there be a "standing" agenda item to consider the filling of critical positions and, if there are no positions to consider, the item could be removed. Police Officer Police Chief Jeffrey Horvath explained that, with the recent retirement of Captain Ray Sammons, a new vacancy was created. He reminded members that the Police Department=s authorized strength is currently 91 officers and that the vacant position would need to be filled in order for the City of Dover to remain compliant with the staffing provisions of the Community Oriented Policing Services (COPS) grant that was approved by Council on September 14, 2009. Filling this position would allow the Police Department to maintain 91 officers on duty and Chief Horvath explained its necessity in order for the City to continue to provide security and safety for the citizens of Dover. He mentioned that there will be a small savings, as the person he would like to hire is not a certified police officer and will have to go through the Policy Academy in March or June. Mr. Leary moved to recommend that staff be granted permission to recruit for the position of Police Officer, as requested by staff. The motion was seconded by Dr. Jones and unanimously carried. Proposed Ordinances Ordinance #2010-01 - Chapter 102 – Taxation, Article I - In General, Section 102-1 - Annual Valuation and Assessment Ms. Cheryl Russell, City Assessor, advised members that Ordinance #2010-01 is being brought back to revert the ordinance to its original intent and to strike out the amendments made by Mayor Carey, and approved by City Council, on December 14, 2009. The purpose of the amendment is to follow the recommendations resulting from a June 2008 audit performed by Mr. Frederick Chmura and Mr. William Ford of the International Association of Assessing Officers (IAAO). Ms. Russell explained that the recommendation was to prorate the values of properties as of the annual assessment date of January 1. Mr. Salters advised members that he does not believe it is fair to tax incomplete properties that are not making a profit due to the current economic conditions. Responding to Dr. Jones, Ms. Russell explained that there are two (2) properties that would be subject to taxation based on the percentage complete after 90 days without construction under the proposed ordinance changes.

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 3 Mr. Anthony DePrima, City Manager, advised members that in order for Ms. Russell to enforce the 90-day window, she would have to visit properties every day to witness that no construction is taking place. Mr. Philip McGinnis, McGinnis Commercial Real Estate Company, advised members that he is an appraiser and has been involved in property tax assessment appeals with the City of Dover for a number of years. Mr. McGinnis stated that while a building is under construction it generates no income; therefore, there is no value from an income standpoint, yet the land is still rightfully taxed. He felt that this ordinance would place a burden on the developer with an unfinished building and would be unfair to any taxpayer. He further noted that if a building is vacant for a period of time, the City Planning Department enforces the vacant building ordinance. Mr. Ruane stated that when a property is under construction it must be insured, so to indicate that a property under construction has no value is disingenuous. He further explained that although the City uses three approaches to assess properties (sales, cost, and market) it does not use any single one, and, although allowed, the approaches are not necessarily applied. He further indicated that to be fair and equitable, all properties should be assessed equally and justly, stating that waiting until the building is complete is not normal, accepted practice in the industry. In response to Council President Williams, Mr. McGinnis stated that the bank requires insurance during the construction phase in case there is a hazard, so that some repayment of the debt can take place. Mrs. Williams advised members that the function of the insurance is to protect the capital investment, which has nothing to do with the value of the property once the certificate of occupancy has been issued, and that these two issues are separate and should not be compared. Responding to Mrs. Williams, Mr. McGinnis stated that he knows of no other municipality or assessing group that taxes properties during construction. Mr. Tom Burns, Burns and Ellis REALTORS®, 490 N. DuPont Highway, stated that he is not familiar with the legislation passed by the State of Kansas, which was mentioned in the letter from Mr. Fred Chmura; however, he felt that the proposed ordinance was a disguised tax increase. He stated that the City had not presented a reason why additional funds were needed. He advised that he believes this ordinance will deter developers from building in the City of Dover and that the City should be more user-friendly to developers. He further noted that insurance on vacant buildings is nominal and that the bulk of insurance is for liability. Mr. Ruane stated that although insurance premiums may be low, if the building caught on fire the policy holder would expect enough funds to be able to rebuild the building to its level of completion before it burned. He further explained that the intent of the amendment is not to raise taxes but to conform with national standards. Currently, property under construction in the

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 4 City of Dover cannot be taxed until the Certificate of Occupancy is issued. He stated that the common practice in other states is to assess as of the status on the assessment date. He read into record a recommendation from the IAAO which states "Valuation of Property as of the Assessment Date: Clarify that all property is valued as of its ownership and current market value as of the January 1st assessment date. Currently property under construction cannot be placed on the tax rolls until a Certificate of Occupancy is issued. This is not common practice in the assessment profession in other states. The general practice is that all property is assessed as of its status on the assessment date. For example, if a building is under construction as of January 1st and is 50% complete on that date, then the assessor values the property as its 50% complete status and places this partial value on the annual assessment roll. Then the Certificate of Occupancy is issued, the assessor then reassesses the building and adds the additional increased assessment as a supplemental assessment on the next quarterly supplemental assessment date. Property receiving a change in zoning or specific use would also be adjusted based upon the assessment date". Mr. Scott Kidner, lobbyist for the Delaware Association of REALTORS®, expressed concern that there will be legal issues, as the owner of the property might not agree with the percentage of completion valued by the Assessor=s Office. He further requested that the real estate community be given notice when issues of importance such as this come before the Committee. Responding to Mr. McGlumphy, Mr. Kidner stated that if the City decides to approve this amendment, he would recommend that the City of Dover and the regulating community get together to address issues that may arise from this matter. Mr. Hogan stated that, as the policy is currently written, it is almost impossible for the Assessor=s Office to enforce. Dr. Jones stated that the City of Dover should encourage development and operate in a manner of goodwill. She felt that the Assessor=s Office and concerned others should work together to develop a workable plan. Ms. Jennifer Casey, Executive Vice President for the Homebuilders Association of Delaware and resident of the City of Dover, stated that this amendment will increase the cost of residential construction and will impact affordable housing. She further noted that the Economic Development Office brainstorms on how to bring businesses in and this ordinance amendment is unfair to long-term residents of this city when they are investing their money during difficult economic times. Ms. Casey stated that if the City of Dover is the only place in Delaware with this ordinance, investors and homebuyers will not come, which she felt would negate the small increase in the budget. Mr. Mike Harrington, Harrington ERA Realty, Inc., stated that everyone has worked very hard to promote the City of Dover. He believes that the City of Dover is sending a negative message to the community, which will single the city out. He expressed confidence that City Council will make the right decision.

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 5 Mr. Salters moved that the City Assessor=s Office, the City Manager=s Office and the Real Estate Community meet to attain a workable solution within 90 days. The motion was seconded by Mr. Leary. Dr. Jones stated that she would like to see research conducted so that factual information can be provided to the Committee. Mr. McGlumphy stated that he would like to see what is done in the State of Delaware, not other states, as the recommendations stated. He suggested a middle ground can be found during discussion. The motion that the City Assessor=s Office, the City Manager=s Office and the Real Estate Community meet to attain a workable solution within 90 days was unanimously carried. Ordinance #2010-02 - Adoption of 2009 ICC Codes (Building Codes) Dr. Jones moved to table Ordinance #2010-02 - Adoption of 2009 ICC Codes (Building Codes) to allow the development community time to review, seconded by Mr. Leary and unanimously carried. Health Benefits Committee Mr. Anthony DePrima, City Manager, advised members that in order to manage the OPEB liability and annual cost of health benefits, the City Administration is recommending the formation of a Health Benefits Committee, as appointed by City Council. He further advised that the Committee membership would consist of the following positions and that meetings would take place during normal City business hours: Council Members - two (2) appointed by City Council City Manager (Ex Officio) Human Resources Director Controller/Treasurer FOP – one (1) representative as appointed by the Union IBEW – one (1) representative as appointed by the Union IUE/CWA – one (1) representative as appointed by the Union Non-Bargaining – one (1) volunteer Mr. DePrima advised members that the goal of the Health Benefits Committee would be to research alternative health care plans, alternative vendors, health savings accounts, policy/procedure changes, or any other options to assist the City in reducing its health care liability and annual cost. In doing so, the Committee shall maintain quality health insurance that is affordable for the City employees, customers, and taxpayers. The Committee shall provide their recommendations to City Council by January 31, 2011. Mr. DePrima stated that the Committee would not discuss Medicare Part B, as Council will have made a ruling on this matter and it will be respected.

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 6 Mr. DePrima indicated that the Health Benefits Committee may, at times, need to hire consultants to explain or cost out various options and, in this event, the Committee will be responsible for developing RFP=s, selecting vendors, and submitting to Council the approval of recommended vendors, as promulgated by the Purchasing Policy. He further explained that all costs will be paid from the OPEB Trust Fund. In response to Mr. Salters, Mr. DePrima stated that the January 31, 2011, date was given to allow considerable research to take place. He further advised that the meetings would take place once or twice a month and would be scheduled during normal business hours to eliminate the need for overtime. Mr. Ruane stated that he believes excluding any health benefit from discussion is a mistake. Mr. Salters moved to recommend approval of the formation of a Health Benefits Committee and appointment of two (2) Council members to serve on the Committee, with the understanding that meetings will be conducted during City business hours. The motion was seconded by Mr. Shevock. Mr. McGlumphy advised members that he believes that sometimes decisions are made that are not beneficial in the long-run but can be corrected when revisited. The motion to recommend approval of the formation of a Health Benefits Committee and appointment of two council members to serve on the Committee, with the understanding that meetings will be conducted during City business hours, was unanimously carried. Proposed Ordinance #2010-03 - FY 2009 Budget Balances and Projected Carry Forward Balances Mrs. Donna Mitchell, Controller/Treasurer, advised members that the draft budget ordinance Amendment #1 is to incorporate into the FY10 budget the final budget balances and project budget balances carried forward from FY09. Mrs. Mitchell stated that the General Fund changes incorporate the loss of $775,200 in Municipal Street Aid funds, which was offset by the adjustment to the beginning budget balance of $812,127. The Municipal Street Aid Fund has been adjusted, as well, for the $775,200. FY09 encumbrances have been included for the Police Department and Human Resources Department. Mrs. Mitchell noted that the Water and Wastewater Fund had a negative beginning budget balance adjustment in aggregate, which was all attributed to Kent County sewer treatment fees exceeding the City=s revenues for treatment fees ($497,667). Mrs. Mitchell advised members that the Electric Revenue Fund had a positive beginning budget balance adjustment of $3.1 million and that she and the City Manager will discuss the possibility of eliminating the budgeted $3 million transfer-in from the Rate Stabilization Reserve in the

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 7 mid-year review in order to maintain the current reserve balance to address any needs in the FY11 Budget. She stated that the balance as of June 30, 2009 is $4.7 million. Mrs. Mitchell further explained that the policy minimum is 3% of budgeted purchased power cost and the maximum is 10% ($2.5 million to $8.3 million). Mrs. Mitchell stated that, for the first time in several years, the Worker=s Compensation Fund had a negative adjustment to the beginning budget balance of $126,345 since expenses exceeded contributions in FY09. However, she indicated that the fund still remains in a good financial position with a budget balance of $1.4 million. Mrs. Mitchell advised that other changes are the elimination of the budget for the Other Post Employment Benefits Fund as this is now a trust, as adopted by Council in May 2009, and no longer a governmental fund. In addition, she stated that a $50,000 adjustment was made to the Community Transportation Fund for the transfer-in as a correction to the budget, and the CDBG Fund budget was added. Responding to Mr. Ruane, Mrs. Mitchell confirmed that the revenue projections to keep the budget balanced have not changed in any significant manner. She further advised that the City Manager would bring forward any necessary budget adjustments at the mid-year review. In response to Mr. McGlumphy, Mrs. Mitchell explained that the carry forward balance is $812,127, and the $775,220 is the loss of the Municipal Street Aid, with the net amount of $36,927 going toward the ending budget balance. Responding to Mr. Ruane, Mrs. Mitchell confirmed that the $775,220 will be used to fund the Municipal Street Aid Program and that any other adjustments would be made during the mid-year review during the first meeting in March. Mr. Leary moved to recommend adoption of Proposed Ordinance #2010-03, FY 2009 Budget Balances and Projected Carry Forward Balances (Attachment #1), seconded by Mr. Salters and unanimously carried. Mr. Leary moved for adjournment, seconded by Mr. Shevock and unanimously carried. Meeting Adjourned at 6:50 P.M. Respectfully submitted, William P. McGlumphy Chairman WPM/rr/tm magB40B.wpd Attachments Attachment #1 - Proposed Ordinance #2010-03 - FY 2009 Budget Balances and Projected Carry Forward Balances

LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 11, 2010 PAGE 8

ATTACHMENT #1 LF&A Committee Meeting of 1/11/2010 CITY OF DOVER PROPOSED ORDINANCE #2010-03 1 BE IT ORDAINED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN COUNCIL MET: 2 The amounts hereinafter named in various City funds are changed from the currently approved 3 revenues/receipts and appropriations to the revised revenues/receipts and revised appropriations for use 4 by the various departments of the Municipal Government for: 5 2009 - 2010 BUDGET ORDINANCES 6 GENERAL FUND 7 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 8 Info Only Revised 9 2009/10 2009/10 10 CASH RECEIPTS ESTIMATES BUDGET BUDGET 11 PRIOR YEAR BALANCE 2,816,763 3,628,890 12 FINES AND POLICE REVENUE 620,000 620,000 13 911 FEE 45,000 45,000 14 INVESTMENT INCOME 253,000 253,000 15 LIBRARY REVENUES 66,508 66,508 16 KENT COUNTY BOOK REIMBURSEMENT 460,000 460,000 17 BUSINESS LICENSES 1,430,000 1,430,000 18 PERMITS AND OTHER LICENSES 904,000 904,000 19 MISCELLANEOUS CHARGES 54,250 54,250 20 POLICE EXTRA DUTY 300,000 300,000 21 PROPERTY TAXES 10,185,246 10,185,246 22 BID REVENUE 52,692 52,692 23 RECREATION REVENUE 141,500 141,500 24 FRANCHISE FEE 486,000 486,000 25 TRASH FEES 1,260,000 1,260,000 26 DSWA TRASH FEE REBATE 160,000 160,000 27 RENT REVENUE - GARRISON FARM 41,535 41,535 28 COURT OF CHANCERY FEES 745,000 745,000 29 INTRAFUND SERVICE RECEIPTS W/WW 991,830 991,830 30 INTRAFUND SERVICE RECEIPTS ELECTRIC 3,483,884 3,483,884 31 GRANTS: 32 POLICE RELATED 40,000 40,000 33 POLICE PENSION GRANTS 620,000 620,000 34 CAPITAL SCHOOL DISTRICT REVENUE 74,000 74,000 35 TRANSFERS FROM: 36 TRANSFER TAX 1,400,000 1,400,000 37 MUNICIPAL STREET AID 775,200 - 38 CIVIL TRAFFIC PENALTIES 700,000 700,000 39 WATER/WASTEWATER 548,020 548,020 40 ELECTRIC 6,758,100 6,758,100 41 TOTALS 35,412,528 35,449,455

42 2009 - 2010 BUDGET ORDINANCES 43 GENERAL FUND - CONTINUED 44 Info Only Revised 45 EXPENDITURE SUMMARY 2009/10 2009/10 46 BUDGET BUDGET 47 DEPARTMENT EXPENSES: 48 CITY CLERK 290,580 290,580 49 COUNCIL 112,684 112,684 50 TAX ASSESSOR 572,526 572,526 51 FIRE 750,445 750,445 52 GROUNDS MAINTENANCE 1,119,611 1,119,611 53 LIBRARY 1,148,716 1,148,716 54 RECREATION 757,467 757,467 55 LIFE SAFETY 422,029 422,029 56 CODE INFORCEMENT 378,092 378,092 57 PLANNING 409,335 409,335 58 INSPECTIONS 517,316 517,316 59 ECONOMIC DEVELOPMENT 243,854 243,854 60 POLICE 11,739,470 11,769,685 61 POLICE EXTRA DUTY 449,516 449,516 62 STREETS 857,422 857,422 63 SANITATION 2,200,285 2,200,285 64 CITY MANAGER 553,130 553,130 65 INFORMATION TECHNOLOGY 883,075 883,075 66 FINANCE 781,791 781,791 67 PUBLIC SERVICES - ADMINISTRATION 355,159 355,159 68 FACILITIES MANAGEMENT 1,042,498 1,042,498 69 CENTRAL SERVICES 778,095 778,095 70 FLEET MAINTENANCE 699,676 699,676 71 CUSTOMER SERVICES 893,054 893,054 72 HUMAN RESOURCES 451,960 455,960 73 MAYOR 69,899 69,899 74 OTHER EXPENDITURES: 75 DEBT SERVICE 328,410 328,410 76 INSURANCE 600,000 600,000 77 RETIREES HEALTH CARE 1,014,820 1,014,820 78 UNCOLLECTIBLES - TRASH AND OTHER 10,000 10,000 79 STREET LIGHTS 985,000 985,000 80 TRANSFER TO CAPITAL PROJECT FUND 344,802 344,802 81 TRANSFER TO PENSION TRUST 620,000 620,000 82 TRANSFER TO CDBG FUND 11,000 11,000 83 CURRENT YEAR BALANCE 3,020,811 3,023,523 84 TOTALS 35,412,528 35,449,455

85 2009 - 2010 BUDGET ORDINANCES 86 GENERAL CONTINGENCY FUND 87 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 88 Info Only Revised 89 2009/10 2009/10 90 CASH RECEIPTS ESTIMATES BUDGET BUDGET 91 BEGINNING BALANCE 645,254 744,871 92 TOTALS 645,254 744,871 93 EXPENDITURE ESTIMATES 94 CARRY FORWARD TO NEXT YEAR 645,254 744,871 95 TOTALS 645,254 744,871 96 2009 - 2010 BUDGET ORDINANCES 97 GOVERNMENTAL CAPITAL PROJECTS FUND 98 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 99 Info Only Revised 100 2009/10 2009/10 101 CASH RECEIPTS ESTIMATES BUDGET BUDGET 102 BEGINNING BALANCE 375,408 462,693 103 STATE GRANTS 4,000,000 4,180,234 104 INTEREST EARNINGS 2,700 2,700 105 BOND PROCEEDS 1,912,433 1,912,433 106 TRANSFER FROM GENERAL FUND 344,802 344,802 107 TRANSFER FROM LIBRARY RESERVE 3,000,000 3,180,235 108 TOTALS 9,635,343 10,083,097 109 EXPENDITURE SUMMARY 110 FIRE 292,210 292,210 111 LIBRARY 8,912,433 9,272,902 112 RECREATION - 70,000 113 POLICE 73,700 94,706 114 STREETS 350,000 350,000 115 INFORMATION TECHNOLOGY 7,000 7,000 116 CURRENT YEAR BALANCE - (3,721) 117 TOTALS 9,635,343 10,083,097

118 2009 - 2010 BUDGET ORDINANCES 119 GENERAL CAPITAL ASSET REPLACEMENT RESERVE 120 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 121 Info Only Revised 122 2009/10 2009/10 123 CASH RECEIPTS ESTIMATES BUDGET BUDGET 124 BEGINNING BALANCE 235,074 327,369 125 INTEREST EARNINGS 7,000 7,000 126 TOTALS 242,074 334,369 127 EXPENDITURE ESTIMATES 128 CARRY FORWARD TO NEXT YEAR 242,074 334,369 129 TOTALS 242,074 334,369 130 2009 - 2010 BUDGET ORDINANCES 131 WATER/WASTEWATER FUND 132 REVENUES AND EXPENSES FOR 2009 - 2010 133 Info Only Revised 134 2009/10 2009/10 135 REVENUE ESTIMATES BUDGET BUDGET 136 PRIOR YEAR BALANCE - WATER 662,079 659,584 137 PRIOR YEAR BALANCE - WASTEWATER 307,112 327,614 138 PRIOR YEAR BALANCE - KCSA 100,194 (397,473) 139 WATER FEES 4,499,000 4,499,000 140 WASTEWATER FEES 3,045,560 3,045,560 141 WASTEWATER ADJUSTMENT FEES 3,435,390 3,435,390 142 WATER TANK SPACE LEASING 293,669 293,669 143 SEWER IMPACT FEES 475,000 475,000 144 WATER IMPACT FEES 280,000 280,000 145 INTEREST EARNINGS - WATER 35,370 35,370 146 INTEREST EARNINGS - WASTEWATER 43,230 43,230 147 MISCELLANEOUS SERVICE FEE 71,000 71,000 148 TOTALS 13,247,604 12,767,944

149 2009 - 2010 BUDGET ORDINANCES 150 WATER/WASTEWATER FUND - CONTINUED 151 Info Only Revised 152 EXPENSE SUMMARY 2009/10 2009/10 153 BUDGET BUDGET 154 DIRECT EXPENSES: 155 ENGINEERING & INSPECTION 697,783 697,783 156 WATER CONSTRUCTION 410,338 410,338 157 WATER DEPARTMENT 458,333 458,333 158 WATER TREATMENT PLANT 1,517,663 1,517,663 159 WASTEWATER DEPARTMENT 988,455 988,455 160 METER READING 72,533 72,533 161 KENT COUNTY TREATMENT CHARGE 3,435,430 3,435,430 162 DIRECT EXPENDITURE SUBTOTALS 7,580,535 7,580,535 163 OTHER EXPENSES: 164 DEBT SERVICE - WATER 468,013 468,013 165 DEBT SERVICE - WASTEWATER 364,938 364,938 166 RETIREES HEALTH CARE 134,680 134,680 167 INTRAFUND SERVICE FEES 1,262,456 1,262,456 168 TRANSFER TO: 169 GENERAL FUND FROM WATER 231,459 231,459 170 GENERAL FUND FROM WASTEWATER 316,561 316,561 171 WATER IMP AND EXT 500,000 500,000 172 WASTEWATER IMP AND EXT 200,000 200,000 173 SEWER IMPACT FEE RESERVE 110,062 110,062 174 CURRENT YEAR BALANCE WATER 1,136,086 1,133,591 175 CURRENT YEAR BALANCE WASTEWATER 842,660 863,162 176 CURRENT YEAR BALANCE KCSA 100,154 (397,513) 177 OTHER EXPENSES SUBTOTALS 3,588,169 3,588,169 178 TOTALS 13,247,604 12,767,944

179 2009 - 2010 BUDGET ORDINANCES 180 WATER/WASTEWATER CONTINGENCY RESERVE 181 SOURCES AND USES OF FUNDS 2009 - 2010 182 Info Only Revised 183 2009/10 2009/10 184 SOURCE OF FUNDS BUDGET BUDGET 185 PRIOR YEAR BALANCE - WATER 118,292 118,780 186 PRIOR YEAR BALANCE - WASTEWATER 132,279 132,821 187 INTEREST EARNINGS 8,770 8,770 188 TOTALS 259,341 260,371 189 USE OF FUNDS 190 CURRENT YEAR BALANCE - WATER 122,431 122,919 191 CURRENT YEAR BALANCE - WASTEWATER 136,910 137,452 192 TOTALS 259,341 260,371 193 2009 - 2010 BUDGET ORDINANCES 194 WATER/WASTEWATER IMPROVEMENT & EXTENSION FUND 195 REVENUES AND EXPENSES FOR 2009 - 2010 196 Info Only Revised 197 2009/10 2009/10 198 REVENUE ESTIMATES BUDGET BUDGET 199 PRIOR YEAR BALANCE - WATER 431,400 1,631,844 200 PRIOR YEAR BALANCE - WASTEWATER 219,375 625,152 201 TRANS FR WATER OPERATING FUND 500,000 500,000 202 TRANS FR WASTEWATER OPERATING FUND 200,000 200,000 203 TRANS FR WASTEWATER IMPACT FEE RESERVE 518,230 518,230 204 WATER - STATE REVOLVING LOAN PROCEEDS 2,404,017 2,404,017 205 WASTEWATER - STATE REVOLVING LOAN PROCEEDS 5,942,481 5,942,481 206 FEDERAL/STATE GRANTS - 45,248 207 TOTALS 10,215,503 11,866,972 208 EXPENSE SUMMARY 209 WATER 2,987,317 3,753,430 210 WASTEWATER 6,539,110 6,912,942 211 WATER CONSTRUCTION 39,000 39,000 212 CURRENT YEAR BALANCE - WATER 309,100 753,431 213 CURRENT YEAR BALANCE - WASTEWATER 340,976 408,169 214 TOTALS 10,215,503 11,866,972

215 2009 - 2010 BUDGET ORDINANCES 216 WATER/WASTEWATER CAPITAL ASSET RESERVE ACCOUNT 217 SOURCES AND USES OF FUNDS FOR 2009 - 2010 218 Info Only Revised 219 2009/10 2009/10 220 SOURCE OF FUNDS BUDGET BUDGET 221 BEGINNING BALANCE WATER 178,452 205,611 222 BEGINNING BALANCE WASTEWATER 84,403 64,560 223 INTEREST EARNINGS - WATER 6,246 6,246 224 INTEREST EARNINGS - WASTEWATER 2,954 2,954 225 TOTALS 272,055 279,371 226 USE OF FUNDS 227 CARRY FORWARD TO NEXT YEAR WATER 184,698 211,857 228 CARRY FORWARD TO NEXT YEAR WASTEWATER 87,357 67,514 229 TOTALS 272,055 279,371 230 2009 - 2010 BUDGET ORDINANCES 231 ELECTRIC REVENUE FUND 232 REVENUES AND EXPENSES FOR 2009 - 2010 233 Info Only Revised 234 2009/10 2009/10 235 REVENUE ESTIMATES BUDGET BUDGET 236 PRIOR YEAR BALANCE 8,219,350 11,415,737 237 DIRECT SALES TO CUSTOMER 99,533,042 99,533,042 238 UTILITY TAX 1,781,500 1,781,500 239 GREEN ENERGY 137,600 137,600 240 MISCELLANEOUS REVENUE 1,051,184 1,051,184 241 RENT REVENUE 186,816 186,816 242 EMISSION CREDIT SALES 274,000 274,000 243 INTRAFUND SERVICE RECEIPTS W/WW FUND 270,626 270,626 244 INTEREST EARNINGS 158,500 158,500 245 TOTALS 111,612,618 114,809,005

246 2009-2010 BUDGET ORDINANCES 247 ELECTRIC REVENUE FUND - CONTINUED 248 Info Only Revised 249 EXPENSE SUMMARY 2009/10 2009/10 250 BUDGET BUDGET 251 DIRECT EXPENSES: 252 POWER SUPPLY 55,619,481 55,619,481 253 POWER SUPPLY MANAGEMENT 3,000,000 3,000,000 254 PJM CHARGES - LOAD 13,943,413 13,943,413 255 CAPACITY CHARGES 13,469,528 13,469,528 256 RATE STABILIZATION CREDIT (3,000,000) (3,000,000) 257 SUBTOTAL POWER SUPPLY 83,032,422 83,032,422 258 PLANT OPERATIONS 5,798,710 5,848,710 259 GENERATIONS FUELS 1,275,251 1,275,251 260 PJM CREDITS (1,701,066) (1,701,066) 261 CAPACITY CREDITS (12,133,285) (12,133,285) 262 GENERATION SUBTOTAL (6,760,390) (6,710,390) 263 POWER SUPPLY & GENERATION SUBTOTAL 76,272,032 76,322,032 264 TRANSITION COSTS 265 TRANSMISSION/DISTRIBUTION 3,318,622 3,318,622 266 ELECTRICAL ENGINEERING 1,500,012 1,500,012 267 ADMINISTRATION 640,535 640,535 268 METER READING 289,103 289,103 269 SYSTEMS OPERATIONS 624,520 624,520 270 UTILITY TAX 1,781,500 1,781,500 271 DIRECT EXPENSE SUBTOTALS 84,426,324 84,476,324 272 OTHER EXPENSES: 273 ALLOW FOR UNCOLLECTIBLES 135,000 135,000 274 RETIREES HEALTH CARE 567,430 567,430 275 GREEN ENERGY PAYMENT TO DEMEC 137,600 137,600 276 INTRAFUND SERVICE FEES 3,483,884 3,483,884 277 INTEREST ON DEPOSITS 54,500 54,500 278 INVENTORY WRITE OFFS 175,000 175,000 279 POWER SUPPLY STUDY 497,250 497,250 280 DEBT SERVICE 3,956,600 3,956,600 281 TRANSFER TO: 282 IMPROVEMENT & EXTENSION 2,500,000 2,500,000 283 GENERAL FUND 6,758,100 6,758,100 284 CONTINGENCY RESERVE 83,500 83,500 285 CURRENT YEAR BALANCE 8,837,430 11,983,817 286 TOTALS 111,612,618 114,809,005

287 2009 - 2010 BUDGET ORDINANCES 288 ELECTRIC UTILITY IMPROVEMENT AND EXTENSION FUND 289 REVENUES AND EXPENSES FOR 2009 - 2010 290 Info Only Revised 291 2009/10 2009/10 292 REVENUE ESTIMATES BUDGET BUDGET 293 PRIOR YEAR BALANCE 1,461,547 2,625,760 294 PRIOR YEAR BALANCE BOND PROCEEDS 1,378,257 4,240,034 295 INTEREST EARNINGS 33,700 33,700 296 STATE REIMBURSEMENT FOR GOVS AVE - 710,318 297 STATE GRANTS - 105,723 298 FEDERAL GRANTS - 135,152 299 BOND ISSUE 2008 1,958,107 - 300 TRANSFER FROM ELECTRIC 2,500,000 2,500,000 301 TOTALS 7,331,611 10,350,687 302 EXPENSE SUMMARY 303 ELECTRIC GENERATION 1,254,000 1,875,290 304 TRANSMISSION AND DISTRIBUTION 1,127,147 1,127,147 305 ELECTRICAL ENGINEERING 3,525,536 5,642,167 306 ELECTRICAL ADMINISTRATION - 105,723 307 CURRENT YEAR BALANCE 1,424,928 1,600,360 308 CURRENT YEAR BALANCE -BOND - - 309 TOTALS 7,331,611 10,350,687 310 2009 - 2010 BUDGET ORDINANCES 311 ELECTRIC CONTINGENCY RESERVE ACCOUNT 312 SOURCES AND USES OF FUNDS FOR 2009 - 2010 313 Info Only Revised 314 2009/10 2009/10 315 SOURCE OF FUNDS BUDGET BUDGET 316 BEGINNING BALANCE 927,869 928,654 317 INTEREST EARNINGS 27,700 27,700 318 TRANSFER FROM ELECTRIC REVENUE FUND 83,500 83,500 319 TOTALS 1,039,069 1,039,854 320 USE OF FUNDS 321 CARRY FORWARD TO NEXT YEAR 1,039,069 1,039,854 322 TOTALS 1,039,069 1,039,854

323 2009 - 2010 BUDGET ORDINANCES 324 ELECTRIC DEPRECIATION RESERVE ACCOUNT 325 SOURCES AND USES OF FUNDS FOR 2009 - 2010 326 Info Only Revised 327 2009/10 2009/10 328 SOURCE OF FUNDS BUDGET BUDGET 329 PRIOR YEAR BALANCE 7,701,763 7,789,990 330 INTEREST EARNINGS 290,000 290,000 331 TOTALS 7,991,763 8,079,990 332 USE OF FUNDS 333 CURRENT YEAR BALANCE 7,991,763 8,079,990 334 TOTALS 7,991,763 8,079,990 335 2009 - 2010 BUDGET ORDINANCES 336 FUTURE CAPACITY RESERVE ACCOUNT 337 SOURCES AND USES OF FUNDS FOR 2009 - 2010 338 Info Only Revised 339 2009/10 2009/10 340 SOURCE OF FUNDS BUDGET BUDGET 341 PRIOR YEAR BALANCE 8,640,651 8,763,863 342 INTEREST EARNINGS 260,000 260,000 343 TOTALS 8,900,651 9,023,863 344 USE OF FUNDS 345 CURRENT YEAR BALANCE 8,900,651 9,023,863 346 TOTALS 8,900,651 9,023,863

347 2009 - 2010 BUDGET ORDINANCES 348 INSURANCE STABILIZATION RESERVE ACCOUNT 349 SOURCES AND USES OF FUNDS FOR 2009 - 2010 350 Info Only Revised 351 2009/10 2009/10 352 SOURCE OF FUNDS BUDGET BUDGET 353 PRIOR YEAR BALANCE 383,502 385,103 354 INTEREST EARNINGS 11,500 11,500 355 TOTALS 395,002 396,603 356 USE OF FUNDS 357 CURRENT YEAR BALANCE 395,002 396,603 358 TOTALS 395,002 396,603 359 2009 - 2010 BUDGET ORDINANCES 360 ELECTRIC RATE STABILIZATION RESERVE ACCOUNT 361 SOURCES AND USES OF FUNDS FOR 2009 - 2010 362 Info Only Revised 363 2009/10 2009/10 364 SOURCE OF FUNDS BUDGET BUDGET 365 PRIOR YEAR BALANCE 4,642,013 4,652,527 366 INTEREST EARNINGS 76,600 76,600 367 TOTALS 4,718,613 4,729,127 368 BUDGET SUMMARY 369 TRANSFER TO ELECTRIC FUND 3,000,000 3,000,000 370 CURRENT YEAR BALANCE 1,718,613 1,729,127 371 TOTALS 4,718,613 4,729,127

372 2009 - 2010 BUDGET ORDINANCES 373 MUNICIPAL STREET AID FUND 374 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 375 Info Only Revised 376 2009/10 2009/10 377 CASH RECEIPTS ESTIMATES BUDGET BUDGET 378 BEGINNING BALANCE 107 428 379 STATE GRANT 775,000 - 380 INTEREST EARNED 200 - 381 TOTALS 775,307 428 382 EXPENDITURE ESTIMATES 383 TRANSFER TO GENERAL FUND 775,200 - 384 CURRENT YEAR BALANCE 107 428 385 TOTALS 775,307 428 386 2009 - 2010 BUDGET ORDINANCES 387 WORKER'S COMPENSATION FUND 388 REVENUES AND EXPENSES FOR 2009 - 2010 389 Info Only Revised 390 2009/10 2009/10 391 REVENUE ESTIMATES BUDGET BUDGET 392 PRIOR YEAR BALANCE 1,404,956 1,278,611 393 INTEREST INCOME 46,300 46,300 394 PREMIUM FROM CITY 753,822 753,822 395 TOTALS 2,205,078 2,078,733 396 EXPENSE ESTIMATES 397 PROGRAM EXPENSES - CLAIMS 450,000 450,000 398 INSURANCE 93,400 93,400 399 BANK FEES 1,300 1,300 400 STATE OF DEL - SELF INSURANCE TAX 50,000 50,000 401 CONTRACTUAL SERVICES 37,000 37,000 402 CURRENT YEAR BALANCE 1,573,378 1,447,033 403 TOTALS 2,205,078 2,078,733

404 2009 - 2010 BUDGET ORDINANCES 405 OTHER POST EMPLOYMENT BENEFITS FUND (Closed with annual audit) 406 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 407 In May 2009 Council adopted a OPEB Trust - all assets were transferred to the Trust 408 Info Only Revised 409 2009/10 2009/10 410 CASH RECEIPTS ESTIMATES BUDGET BUDGET 411 PRIOR YEAR BALANCE 4,752,552 - 412 INTEREST INCOME 135,000 - 413 TOTALS 4,887,552 - 414 EXPENDITURE ESTIMATES 415 CURRENT YEAR BALANCE 4,887,552 - 416 TOTALS 4,887,552 - 417 2009 - 2010 BUDGET ORDINANCES 418 COMMUNITY TRANSPORTATION IMPROVEMENT FUND 419 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 420 Info Only Revised 421 2009/10 2009/10 422 CASH RECEIPTS ESTIMATES BUDGET BUDGET 423 PRIOR YEAR BALANCE 108,812 270,803 424 GRANTS REVENUE - STATE LEGISLATORS 1,000,000 1,000,000 425 TRANSFER FROM GOVT CAP PROJECTS FUND 350,000 300,000 426 INTEREST INCOME 2,800 2,800 427 TOTALS 1,461,612 1,573,603 428 EXPENDITURE ESTIMATES 429 PROGRAM EXPENSES 1,350,000 1,472,690 430 CURRENT YEAR BALANCE 111,612 100,913 431 TOTALS 1,461,612 1,573,603

432 2009 - 2010 BUDGET ORDINANCES 433 PARKLAND/RECREATION RESERVE ACCOUNT 434 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 435 Info Only Revised 436 2009/10 2009/10 437 SOURCE OF FUNDS BUDGET BUDGET 438 PRIOR YEAR BALANCE 192,735 218,245 439 TOTALS 192,735 218,245 440 USES OF FUNDS 441 CURRENT YEAR BALANCE 192,735 218,245 442 TOTALS 192,735 218,245 443 2009 - 2010 BUDGET ORDINANCES 444 LIBRARY RESERVE ACCOUNT 445 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 446 Info Only Revised 447 2009/10 2009/10 448 SOURCE OF FUNDS BUDGET BUDGET 449 PRIOR YEAR BALANCE 3,309,400 3,554,078 450 INTEREST INCOME 117,000 117,000 451 TOTALS 3,426,400 3,671,078 452 USE OF FUNDS 453 TRANSFER TO CAPITAL PROJECT FUND 3,000,000 3,180,235 454 CURRENT YEAR BALANCE 426,400 490,843 455 TOTALS 3,426,400 3,671,078

456 2009 - 2010 BUDGET ORDINANCES 457 LIBRARY GRANTS 458 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 459 Info Only Revised 460 2009/10 2009/10 461 RECEIPT ESTIMATES BUDGET BUDGET 462 PRIOR YEAR BALANCE 133 16,336 463 STATE GRANT 247,801 247,801 464 TOTALS 247,934 264,137 465 EXPENDITURE ESTIMATES 466 STATE GRANTS: 467 PROGRAM EXPENSES & SUPPLIES 41,935 41,935 468 BOOKS 107,216 107,216 469 AUDIO VISUAL SUPPLIES 55,000 55,000 470 TRAINING/CONF/FOOD/TRAVEL 5,000 5,000 471 CONTRACTUAL SERVICES 18,650 18,650 472 COMPUTUER HARDWARE 20,000 20,000 473 SUBTOTAL STATE GRANTS 247,801 247,801 474 FEDERAL GRANTS: 475 CURRENT YEAR BALANCE 133 16,336 476 TOTALS 247,934 264,137

477 2009 - 2010 BUDGET ORDINANCES 478 COMMUNITY DEVELOPMENT BLOCK GRANT FUND 479 CASH RECEIPTS AND EXPENDITURES FOR 2009 - 2010 480 Info Only Revised 481 2009/10 2009/10 482 RECEIPT ESTIMATES BUDGET BUDGET 483 PRIOR YEAR BALANCE - 104,742 484 GENERAL FUND APPROPRIATION 11,000 11,000 485 FEDERAL GRANT 269,548 269,548 486 TOTALS 280,548 385,290 487 EXPENDITURE SUMMARY 488 COMMUNITY DEVELOPMENT DIVISION 56,109 56,109 489 CLOSING COST/DOWN PAYMENT PROGRAM 30,000 37,157 490 DOVER INTERFAITH MINISTRY 60,000 491 COMMUNITY REHAB ASSISTANCE 60,000 97,535 492 FAIR HOUSING COUNSELING 50 493 FIRST STATE RESOURCE CONSERVATION 35,000 35,000 494 GEM PROPERTIES 217 - 219 W REED ST 6,956 6,956 495 MURPHY SCHOOL 50,483 50,483 496 DOWNTOWN DOVER PARTNERSHIP 42,000 42,000 CURRENT YEAR BALANCE - - 497 TOTALS 280,548 385,290