Anexo

CITY OF DOVER Fiscal Year 2004/05 Capital Investments Plan ¾ The CIP is a five-year plan for capital projects whose value is $10,000 or greater. Projects in the first year of the five-year CIP are included in the operating budget. The sections of the CIP are as follows: ¾ Project Development – all funds ¾ General Fund projects ¾ Electric Fund projects ¾ Water/Wastewater Fund projects ¾ Vehicle Replacements – all funds ¾ The Project Development category contains projects in the concept phase. This category serves as a "bookmark" until the project has been fully scoped with respect to need, cost, timeline, and priority.

CITY OF DOVER What Is New with the Fiscal Year 2004/05 CIP ¾ A Project Number has been or will be assigned to each project. This allows for better internal tracking. Equipment purchases will not receive a project number as they have in previous years. ¾ The financing section for projects has been re-formatted and now includes a “Prior to 2005” and “After 2009” columns. This change provides consistency in formatting among the Financing, Impact on Operating Budget, and Five-Year Cost Breakdown Schedule. ¾ There are 23 new projects in the five-year CIP, 16 of which are in Fiscal Year 2004/05. ¾ There are two dropped projects in the five-year CIP, one of which is in Fiscal Year 2004/05.

Status of Fiscal Year 2003/04 CIP Projects All 2003/04 vehicle purchases have been completed. Of the 50 CIP projects in the 2003/04 CIP, 17 are complete and 21 are on track. The status of the 12 remaining is as follows: C Hanson House Preservation Program – going out to bid this week; completion in fall 2004 C Police Heating/Ventilation/Air Conditioning Computer System Upgrade – proposal for rescheduling C U.S. 13 East Sanitary Sewer Interceptor – deferred to 2004/05 CIP C Puncheon Run Motor Control and Pump Replacement – design completed; project deferred to 2004/05 and 2005/06 C Walker Road Pump Station Upgrade – design completed; completion in fall 2004 C Water System Master Plan Update – project has been started; completion in summer 2004 C Division Street Water Main Upgrade – project has been started; completion in fall 2004 C 230 KV Tie with Conectiv – project has been started; completion in summer 2004 C Replace CAMA Tax Software – project will be completed in summer 2004 C North Dover Athletic Complex, Pool – dropped C Police Server Upgrade for CAD/RMS – dropped; pursuing a grant for 2004/05 C North State St./Rt. 13 Wire replacement -- dropped

CITY OF DOVER TOTAL CITY REVENUE SUMMARY 2005 CIP VERSUS 2004 CIP Prepared as of 05/10/04 Revenue Requirement Proposed Budget Fund 2004/05 2003/04 Difference General Fund $1,467,325 $1,173,497 $293,828 Community Transportation Fund 500,000 500,000 0 Transportation Enhancement Grant 0 216,000 (216,000) Water/Wastewater Fund 1,138,130 2,019,065 (880,935) Bond Financing 1,175,000 0 1,175,000 Electric Improvement and Extension Fund 2,064,476 10,696,244 (8,631,768) State Grant 247,000 280,000 (33,000) Other (Preservation DE, Calvary Baptist 0 2,005,000 (2,005,000) Church, Wilmington College, Duke) Parkland Fund 0 20,000 (20,000) Federal Grant 545,000 170,000 375,000 Impact Fee Reserve 75,000 175,000 (100,000) State Reimbursement 0 198,958 (198,958) Total Revenue Requirement for FY 2004/05 $7,211,931 $17,453,764 $10,241,833

CITY OF DOVER NEW PROJECTS INTRODUCED FOR FISCAL YEAR 2005 Prepared as of 05/10/04 PROJECT TOTAL PROJECT COST FOR FY 2005 General Fire Replacement of Utility Vehicle $37,000 Information Technology Information Technology Long Range Plan Implementation 185,000 Wireless Networking 18,925 Parks and Recreation Dover Park Enhancement (State Match) 60,000 Mayfair Park Playground 20,000 St. Jones River Multi-Use Trail and Bridge Replacement 117,000 Richardson Park Fence Replacement 15,000 $452,925 Water/Wastewater Inflow/Infiltration Removal $75,000 Cast Iron Main Replacement/Lining 50,000 $125,000

CITY OF DOVER NEW PROJECTS INTRODUCED FOR FISCAL YEAR 2005 Prepared as of 05/10/04 (continued) PROJECT TOTAL PROJECT COST FOR FY 2005 Electric Electric Administration Building UPS $23,000 Electric Department Relay Test Set 60,000 Printer/Plotter 19,576 Pole Inventory System 160,000 Outage Reporting System 35,000 PTW Power Supply System Analysis Software 23,000 Radio Read Meter Change Out 195,000 Heart Start ADS 27,000 $542,576 Vehicles Police - #244, 2005 Ford Crown Victoria $25,118 Police - #272, 2005 Ford Econoline Van 17,313 Electric T&D - #759, 2005 40' Bucket Truck 86,000 Electric T&D - #794, 2005 3/4-Ton 4x4 Pick-Up 20,000 $148,431

CITY OF DOVER PROJECTS DELETED OR DEFERRED BY BUDGET TEAM FOR FISCAL YEAR 2005 CIP Prepared as of 05/10/04 Category Project Amount Description Reason General Integrated Credit Card Processing $18,490 Deleted Will be completed by in-house staff. Westside Recreation Center 1,300,000 Deferred Deferred for further planning and to develop a financial strategy. Branch Library 1,140,000 Deferred Deferred for further planning and to develop a financial strategy. 5 East Reed Street Parking Lot Rehabilitation 45,000 Deleted Incorporated into the 2005 Street Program. Subtotal $2,503,490 Water Dupont Manor Commercial District Water System Expansion $25,000 Deferred Deferred due to resource limitations. Southwest Water Loop 200,000 Deferred Deferred due to resource limitations. Subtotal $225,000 Electric Mayfair to Mid City $650,000 Deferred Deferred due to resource limitations. Replacement of 69 KV Breakers 300,000 Deferred Deferred due to resource limitations. Kesslering Feeder 135,879 Deferred Deferred due to resource limitations. System Operations Automation 38,000 Deferred Deferred due to resource limitations. Subtotal $1,123,879

CITY OF DOVER PROJECTS DELETED OR DEFERRED BY BUDGET TEAM FOR FISCAL YEAR 2005 CIP Prepared as of 05/10/04 (continued) Category Project Amount Description Reason Vehicles Grounds - #555, Truck $16,000 Deferred Deferred due to condition of equipment. Grounds - #552, 1-Ton Truck 32,899 Deferred Deferred due to condition of equipment. Planning/Inspections - #3, Auto 16,000 Deferred Deferred due to condition of equipment. Sanitation - #445, Rear Loader 92,000 Deferred Deferred due to condition of equipment. Sanitation - #452, Rear Loader 110,000 Deferred Deferred after discussion with Department. Streets - #319, Case Backhoe 65,000 Deferred Deferred due to condition of equipment. Streets - #326, Dump Truck 75,000 Deferred Deferred due to condition of equipment. Wastewater - #692, Vacuum Truck 215,000 Deferred Deferred after discussion with Department. Meter Reading - #154, Truck 16,000 Deferred Deferred due to condition of equipment. Electric Eng. - #790, Truck 16,637 Deferred Deferred due to condition of equipment. Electric Eng. - #9, Truck 16,637 Deferred Deferred due to condition of equipment. Electric Eng. - #7, Auto 14,127 Deferred Deferred due to condition of equipment. Electric Eng. - #785, Truck 13,648 Deferred Deferred due to condition of equipment. Electric Eng. - #749, Truck 20,951 Deferred Deferred due to condition of equipment. Subtotal $719,899 Total $4,572,268 $63,490 was deleted; $4,508,778 was deferred.

City of Dover 2004/05 Budget Presentation • Budget Cycle • Family of Funds • Budget Environment and Challenges • Carry Forward Goals • General Fund • Water/Wastewater Fund • Electric Fund • Pay-for-Performance

The Budget Cycle Strategic Mayor & Organization Annual Budget Council’s Plan Goals & 1 yr. Operating Implementation Priorities Objectives 1 yr. Capital Exp. Review Current year CIP Out years CIP 5-Year CIP Reviewed Reporting progress through monthly and annual reports

Dover Family of Funds ELECTRIC GENERAL WATER/WASTEWATER FUNDS FUNDS FUNDS OPERATING OPERATING OPERATING FUND FUND FUND Contingency Contingency Contingency For a "rainy day" emergency For a "rainy day" emergency For a "rainy day" emergency Improvement and Extension Capital Assets Reserve Improvement and Extension Financing of system expansion Replacement and expansion Financing of system expansion and improvement (i.e., infrastructure, buildings, etc.) and improvement Depreciation Reserve Capital Assets Reserve Replenishment of Replacement and expansion assets (i.e., infrastructure, buildings, etc.) Future Capacity Financing for system capacity expansion Insurance Stabilization Funding of the insurance deductibles Rate Stabilization Funding to offset cost of power cost adjustment

Budget Environment External • National economic environment shows signs of recovery, but not as favorable as in the mid to late 1990s • Less grants from Federal and State budgets • This economy means interest income is still low • Poor performance for pension plan results in increased pension contribution cost for the City • High cost of medical care creates upward pressure on health benefit (retirees and employees) • GASB rules will soon require funding of our post-retirement benefits. Estimated expense equals $1.9 million per year. We have funded $900,000.

Budget Environment (continued) Internal • Financial policy requires maintenance of carry forward balances, prohibits deficit spending • Continued vehicle lease payment ($345,378 annually) from Fiscal Year 2001/02 • Major water consumer reducing water consumption processes • Brown water issue • Increased costs to Kent County for wastewater treatment -- inflow infiltration -- corrected metering at Kent County Pump Station #3 • Increased purchase power costs per D/FD contract

Budget Challenges Pension FY 2004 Revised FY 2005 • General Pension Rate 14.60% 21.52% • Pension Costs City-wide $1,832,851 $2,448,910

Budget Challenges (continued) Healthcare Costs FY 2004 Revised FY 2005 • Increase City-wide 15.50% 13-15% • Healthcare Costs City-wide $2,055,927 $2,518,804

Budget Challenges (continued) 2004 Budget 2004 Rev. 2005 Proj. • Kent County Treatment Chg. $2.9 million $3.7 million $3.6 million • Purchase Power – DLD $38.6 million $37.4 million $40.5 million • Street Lights charged to Gen. Fund $0 $460,000 $460,000

This Budget Accomplishes... • No reduction in programs or services • No property tax increase • No increase in basic electric rates • No trash fee increase How Do We Accomplish This? • New revenue sources for the General Fund – Civil Traffic Penalties – Court of Chancery Fees • Budget Team cut budget requests by $720,225 • Adjust Purchase Power Cost Adjustment to electric rate • Allowable fund transfers eight percent of Electric and Water/ Wastewater Fund revenues • Eliminated the declining block rate structure for water - $110,000 • Increased the Wastewater rate by $.25 - $389,000

Fiscal Year - 2003/04 Carry Forward Carry forward meets requirement! Original Proposed Estimate • General Fund $ 1,654,816 $ 2,644,445 • Water/Wastewater Fund $ 1,609,194 $ 969,422 • Electric Fund $ 2,876,612 $ 3,971,444

General Fund Top Revenue Streams • Property Tax $7,396,454 • Electric Enterprise Fund Transfer $5,463,008 • Intrafund Service Receipts Electric $3,698,655 • Business Licenses and Permits $1,953,900 • Transfer Tax $1,400,000 • Intrafund Service Receipts Water/WW $ 998,487 • Trash Fees $ 950,000 Top Expense Departments • Police $9,663,425 • Sanitation $1,948,318 • Streets $1,199,936 • Administrative Services $1,024,773 • Facilities Management $ 993,020 • Information Technology $ 949,654 • Grounds Maintenance $ 938,038 • Library $ 931,406

2004/05 Top Five CIP Projects Name Dollars Fund 1. Street and Alley $850,000 General Fund, Community Program Transportation Fund 2. Police Radio System $375,000 Federal Grant Upgrade 3. Annual Contributions to $253,000 General Fund Robbins Hose Co. 4. Police Server Upgrade $200,000 General Fund, for CAD/RMS Federal Grant 5. Information Technology $185,000 General Fund Long Range Plan Implementation

General Fund Trend Data Property Taxes 8 ,0 0 0 ,0 0 0 7,50 0 ,0 0 0 7,0 0 0 ,0 0 0 6 ,50 0 ,0 0 0 6 ,0 0 0 ,0 0 0 5,50 0 ,0 0 0 5,0 0 0 ,0 0 0 4 ,50 0 ,0 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

General Fund Trend Data Electric Fund Appropriation 6 ,0 0 0 ,0 0 0 5,50 0 ,0 0 0 5,0 0 0 ,0 0 0 4 ,50 0 ,0 0 0 4 ,0 0 0 ,0 0 0 3 ,50 0 ,0 0 0 3 ,0 0 0 ,0 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

General Fund Trend Data Licenses and Permits 2 ,2 50 ,0 0 0 2 ,0 0 0 ,0 0 0 1,750 ,0 0 0 1,50 0 ,0 0 0 1,2 50 ,0 0 0 1,0 0 0 ,0 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

General Fund Trend Data Percentage of Licenses to General Fund 11.0 0 % 10 .0 0 % 9 .0 0 % 8 .0 0 % 7.0 0 % 6 .0 0 % 5.0 0 % 4 .0 0 % 3 .0 0 % 2 .0 0 % 1.0 0 % 0 .0 0 % 1 9 93 1 9 94 1 99 5 1 99 6 19 9 7 1 9 98 1 99 9 2 00 0 20 0 1 20 0 2 2 00 3 20 04 20 0 5

General Fund Trend Data Municipal Street Aid 9 0 0 ,0 0 0 8 0 0 ,0 0 0 70 0 ,0 0 0 6 0 0 ,0 0 0 50 0 ,0 0 0 4 0 0 ,0 0 0 3 0 0 ,0 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

General Fund Trend Data Transfer Tax 2 ,50 0 ,0 0 0 2 ,3 0 0 ,0 0 0 2 ,10 0 ,0 0 0 1,9 0 0 ,0 0 0 1,70 0 ,0 0 0 1,50 0 ,0 0 0 1,3 0 0 ,0 0 0 1,10 0 ,0 0 0 9 0 0 ,0 0 0 70 0 ,0 0 0 50 0 ,0 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

General Fund Trend Data Sanitation Fees 1,3 0 0 ,0 0 0 1,10 0 ,0 0 0 9 0 0 ,0 0 0 70 0 ,0 0 0 50 0 ,0 0 0 3 0 0 ,0 0 0 10 0 ,0 0 0 2 00 0 2 00 1 2 00 2 20 03 2 00 4 20 0 5

Fiscal Year 2004/05 - General Fund Revenue $30,211,628 Expense $27,606,772 Balance Carry Forward: $ 2,604,856 – 10.91% (Goal - 8%) Revenue Includes • $2,644,445 – Prior year balance • $7,396,454 – Property tax • $ 480,000 – Court of Chancery Fees • $ 800,000 – Civil Traffic Penalties • $ 848,016 – Appropriation - Water/Wastewater Fund • $5,463,008 – Appropriation - Electric Fund • $ 998,487 – Water Intrafund Service Fees • $3,698,655 – Electric Intrafund Service Fees

Fiscal Year 2004/05 - General Fund (continued) Expenses • Includes Street Lights expense - $460,000 • Transfers $600,000 to Post Retirement Benefits Reserve • Three new positions – Assistant Finance Director – Mechanic I – GIS Coordinator • Three percent increase for FOP bargaining unit • $174,191 budgeted for zero-to-five percent increase for non- bargaining employees • No increase for IUE – contract has not been settled • Excludes $369,949 in requests from General Fund departments

Budget Adjustments as of May 19, 2004 Fiscal Department Year Description Department Ele/Obj Description Increase Decrease Overall 2004 110-1500-525 20-26 Program Expenses/Supplies 0 (7,350) 0 2004 Police 110-1700-541 40-28 Computer Hardware - HVAC 0 (18,500) 0 2004 Facilities 110-2500-552 40-31 City Hall Roof Repairs Construction - 0 (71,000) 0 Management deferred 2004 Central 110-2700-571 40-31 Central Services Roof Repairs 0 (45,000) 0 Services Construction - deferred 2004 Subtotal 0 (141,850) (141,850) 2005 Library 110-1500-523 20-32 Cameras 0 (9,999) 0 2005 Police 110-1700-543 10-99 Salary and Benefits 18,017 0 0 2005 Assessor 110-1300-513 30-31 Contractual Services 0 (63,750) 0 2005 Assessor 110-1300-513 30-44 Agency Billing/Temporary Help 12,000 0 0 2005 Facilities 110-2500-552 40-31 City Hall Roof Repairs Construction - 46,500 0 0 Management rebudgeted 2005 Central 110-2700-571 40-31 Central Svcs Roof Repairs Construction - 84,300 0 0 Services rebudgeted 2005 Subtotal 160,817 (73,749) 87,068 Total 160,817 (215,599) (54,782)

Water/Wastewater Fund Top Revenue Sources • Water Fees $3,962,500 • Wastewater Fees $2,931,810 • Wastewater Adjustment Fees $2,788,875 • Impact Fees $ 665,000 • Water Tank Space Leasing $ 240,102 Top Expenses • Kent County Treatment Charge $3,600,000 • Intrafund Service Fees $ 998,487 • Wastewater Debt Service $ 872,552 • Water Department $ 865,572 • Water Debt Service $ 748,259 • Wastewater Department $ 727,539 • Water Treatment Plant $ 611,556

2004/05 Top Four CIP Projects Name Dollars Fund 1. U.S. 13 East Sanitary $875,000 Bond Financing Sewer Interceptor 2. Puncheon Run Motor $500,000 Water/Wastewater Fund Control and Pump Replacement 3. Division Street Water $300,000 Bond Financing Main Upgrade 4. Walker Road Pump $158,000 Water/Wastewater Fund Station Upgrade

Fiscal Year 2004/05 - Water/Wastewater Fund • Revenue $11,911,339 • Expense $10,275,428 • Balance Carry Forward: $ 1,635,911 – 14.95% (Goal - 10%) Revenue Includes • Elimination of the declining block rate structure for water - $110,000 • Increase of the Wastewater rate by $.25 - $389,000 Expenses • Begins tentative implementation of Ten Point Plan to remedy brown water • Begins five-year phase-out of Kent County wastewater deficit • Transfers $100,000 to Post Retirement Medical Benefits Reserve • Carry Forward meets requirement • $848,016 to General Fund (transfer increase of $17,016) • $11,715 in budget cuts

Electric Fund Top Revenue Sources • Direct Sales to Customers $55,633,802 • Purchase Power Adjustment $ 4,934,544 • Utility Tax $ 1,182,367 • Miscellaneous Revenue $ 496,000 • Rent Revenue $ 170,885 • Interest Earnings $ 120,000 Top Expenses • Purchase Power $40,555,237 • Transfer to General Fund $ 5,463,008 • Intrafund Service Fees $ 3,698,655 • Transmission and Distribution $ 2,963,771 • Debt Service $ 2,623,372 • Transfer to Future Capacity $ 2,000,000 • Electric Engineering $ 1,710,053

2004/05 Top Five CIP Projects Name Dollars Fund 1. New Developments/ $510,000 Improvement and Upgrades Extension Fund 2. 69 KV - Vansant to $300,000 Improvement and Mayfair Extension Fund 3. Whiteoak 69 KV $273,900 Improvement and Rebuild Extension Fund 4. 4 KV to 12 KV $214,000 Improvement and Upgrade Extension Fund 5. Distribution $200,000 Improvement and Upgrades Extension Fund

Fiscal Year 2004/05 - Electric Fund • Revenue $66,509,042 • Expense $62,664,076 • Balance Carry Forward: $ 3,844,966 - 6.14% (Goal - 5%) Revenue Includes • $3.82/750 kWh increased power cost adjustment • Represents the power cost increase in Duke agreement – Represents a $45.84 annual increase for 750 kWh/month user – Dover remains competitively priced within the market Expenses • Transfers $200,000 to Post Retirement Medical Benefits Reserve • Includes $761,344 increase in appropriation to General Fund, $460,000 of which is for Street Lights expense • Includes two and one half percent increase for IBEW bargaining unit per contract • Adds new position of Engineering Fieldman • Budgets overlapping salary for new Electric Director • Excludes $338,561 in salary/operating expense requested for Electric

City of Dover City Assessor Memo To: Mayor and Council From: Jerome Cooper, City Assessor CC: City Manager, Finance Director Date: May 18, 2004 Re: Budget revision for 2004-05 for Contractor Services Listed below are the revised figures for the consultant services and administrative help that will be required during the reassessment for the 2004-05 Tax Year. If you have any questions, please contact me. COST HOURS Consultants Fee $150.00 400 60,000.00 Part-Time Employee (administrative) $15.00 800 12,000.00 Assessment of 50 largest Commercial Properties $325.00 50 16,250.00 TOTAL $88,250.00 1

City of Dover Pay-for-Performance WHAT IS PAY FOR PERFORMANCE (P.F.P.)? Pay-for-Performance is a system for awarding pay increases to Non-Bargaining employees based on: z Employee performance in reaching goals and objectives and their performance in Core Competencies z Employees position in the Pay Plan (Example: below market, at market, above market) z Salary increases based on Market Studies

Pay-for-Performance (continued) Human Resources Director Recommendation z Analysis of the Market Survey recommends: z 3.5 percent Average Market increase for the FY 05 and z 1.0 percent Equity Adjustment because of a lower-than-market increase in FY 04 (Here is why)

Pay-for-Performance (continued) Market Analysis for Projected Increases Fiscal Year 2004 Fiscal Year 2005 City of Dover, Non-Bargaining 2.0 percent increase 4.5 percent increase (proposed) Kent County 4.0 percent increase 4.0 percent increase State of Delaware $500-$600 bonus 3.0 percent increase (equates to 3-5 percent) City of Newark 3.5 percent increase 3.5 percent increase Ocean City, MD 2.5-6.5 percent (2.5 2.5-6.5 percent (2.5 percent COLA + up to 4.0 percent COLA + up to 4.0 percent increase Step) percent increase Step) FOP 3.0 percent increase 3.0 percent increase IBEW 3.0 percent increase 3.0 percent increase Daily Labor Report - BNA 3.4 percent increase 3.4 percent increase

Pay-for-Performance (continued) Market Analysis Also Proposes Increase in Labor Grade Ranges by 3.2 percent z Note: z This is not added on top of the P.F.P. increase. z It establishes the job ranges for new employment. z It determines whether current employees are ranked below market, at market, or above market.

Pay-for-Performance (continued) The 4.5 percent market increase is applied to the employee “At Market” who scored “Good.” OVERALL SCORE ADJUSTMENT Employee Employee Employee Employee Below At Above Above From To Market (1) Market (1) Market (1) Maximum Unsatisfactory 10 15 0 0 0 0 Needs 16 25 0 0 0 0 Improvement Good 26 35 4.75% 4.50% 4.25% 4.00% Commendable 36 45 5.00% 4.75% 4.50% 4.00% Outstanding 46 50 5.50% 5.00% 4.75% 4.00% P.F.P Salary Calculation Worksheet – Adopted by City Council on _______________