CCW PACKET Revised

Council Committee of the Whole Agenda July 28, 2020 - 6:00 p.m. The agenda has been revised by adding a new item #2, Proposed Extension of Lodging Tax Deadline, to the Legislative, Finance and Administration Committee agenda. This meeting will be held remotely via WebEx. Public participation information is as follows: Phone: 1-408-418-9388 Link: https://cityofdoverde.webex.com/cityofdoverde/onstage/g.php?MTID=e9647a82c31de0c63d115a 32d1b97370d Event number: 129 558 6125 Event password: DOVER (if needed) If you are new to WebEx get the app now at https://www.webex.com/ to be ready when the meeting starts. Public comments are welcomed on any item and will be permitted at appropriate time. When possible, please notify the City Clerk (736-7008 or email at cityclerk@dover.de.us) should you wish to be recognized. Utility Committee Adoption of the Agenda 1. Annual Review and Approval of Governing Policy for Energy Commodity Risk Management (Staff recommendation: No Changes) 2. Adjournment of Utility Committee meeting Safety Advisory and Transportation Committee Adoption of the Agenda 1. Presentation - 15 Initiatives for Criminal Justice Reforms (Attorney General Kathy Jennings) 2. Presentation - Racial Equality and Social Justice Collaborative 3. Presentation - Dover Downs NASCAR Event - Plans for Staging with or without Fans 4. Update on Body Cameras 5. Adjournment of Safety Advisory and Transportation Committee meeting

Council Committee of the Whole Agenda - July 28, 2020 Page 2 Legislative, Finance, and Administration Committee Adoption of the Agenda 1. Discussion - New Property Value Notifications 2. Proposed Extension of Lodging Tax Deadline 3. Review and Approval of Federal COPS Grant 4. Proposed Ordinance #2020-10 - Chapter 34 - Elections (Staff recommendation: Adoption of Proposed Ordinance #2020-10) 5. Adjournment of Legislative, Finance, and Administration Committee meeting Adjournment of Council Committee of the Whole meeting S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\Committee-Agendas\2020\07-28-2020 CCW AGENDA Revised.wpd The agenda items as listed may not be considered in sequence. Pursuant to 29 Del.C. §1004(e)(2), this agenda is subject to change to include the addition or deletion of items, including executive sessions, which arise at the time of the meeting.

City of Dover, Delaware Governing Policy For Energy Commodity Risk Management Effective: TBDSeptember 9, 2019 Approved by: City of Dover Council (Last Revision September 9, 2019August 27, 2018)

TABLE OF CONTENTS PURPOSE OF THE RISK MANAGEMENT POLICY ..................................................................4 A. Introduction ....................................................................................................................4 B. Scope of Policy ................................................................................................................4 C. Objectives and Risk Philosophy ...................................................................................5 D. Policy Administration....................................................................................................5 MANAGEMENT AND CONTROLS .............................................................................................6 A. Utility Committee of The City Council .......................................................................6 B. Executive Risk Management Committee ....................................................................6 1. City Manager ................................................................................................................. 8 2. Director of the Utility .................................................................................................... 8 3. Controller........................................................................................................................ 8 4. TEA Client Services Manager ...................................................................................... 9 DISCUSSION OF RISKS ...............................................................................................................9 MARKETING AND TRADING PRACTICES ............................................................................11 A. Standards of Conduct ..................................................................................................11 B. Products, Activities and Limitations .........................................................................11 C. Contract Documentation and Confirmations...........................................................12 D. Training..........................................................................................................................12 E. New Product Protocol .................................................................................................12 RISK LIMITS AND RISK MEASUREMENTS ...........................................................................13 A. Limits..............................................................................................................................13 1. Delegation Authority .................................................................................................. 13 2. Volume Limits ............................................................................................................. 13 3. Locational Limits ......................................................................................................... 13 B. Stress Testing and Back Testing .................................................................................13 C. Instances of Exceeding Risk Limits............................................................................14 CREDIT POLICY ..........................................................................................................................14 A. Measuring Credit Risk .................................................................................................14 B. Analysis and Extension of Credit Limits ..................................................................14 C. Instances of Exceeding Credit Limits ........................................................................15 REPORTING .................................................................................................................................15 A. Risk Reporting ..............................................................................................................15 B. Credit Reporting ...........................................................................................................17 C. Hedge Effectiveness Reporting ..................................................................................17 2

INFORMATION TECHNOLOGY SYSTEMS ............................................................................17 POLICY DISTRIBUTION AND COUNSEL ...............................................................................18 A. Distribution Outside The City ....................................................................................18 B. Designated Counsel .....................................................................................................18 APPENDIX A – Approved Products .............................................................................................19 APPENDIX B – Approved Counterparties and Threshold Tables ................................................20 APPENDIX C – Business Risks ....................................................................................................25 APPENDIX D – Glossary ..............................................................................................................26 APPENDIX E – Swap Transaction Representative .......................................................................28 3

PURPOSE OF THE RISK MANAGEMENT POLICY A. Introduction The City of Dover (“City”) and its customers are routinely exposed to energy price risk, volume variability risk, basis risk and credit risk – herein referred to collectively as energy commodity risk - in the normal conduct of serving its electric load requirements. Volatility of energy commodity prices and volumetric uncertainty (either supply/generation or load obligations) impose a substantial and direct risk to the City’s financial and operating performance. By authority of its charter, the City has responsibility for overseeing the City’s electricity operations, including the management of its cost of serving Dover’s customers. By agreement dated July 2, 2019 and approved by the City (the “Energy Management Agreement”), the City has engaged The Energy Authority, Inc. (“TEA”) to assist the City with Asset Management and Strategic Planning Services, Risk Management Services, and Energy Management Services. This Policy for Energy Commodity Risk Management (“Policy”) is established the explicit understanding that the City has retained and delegated responsibilities to TEA to provide Risk Management Services. Additionally, the City has issued this Policy for dealing with the philosophy, framework and delegation of responsibilities necessary to govern activities related to Dover’s energy commodity risk management. As set forth herein, the City has established an organizational structure, delegated responsibility and established internal controls and procedures to ensure that all transactional and oversight activities are conducted in compliance with this Policy and in accordance with the City’s normal reporting, legal, financing and regulatory requirements relating to energy assets and transactions. B. Scope of Policy This Policy covers all transactions entered into the by the City of Dover designed to meet the City’s electric load requirement and the management of risk related to these transactions. In the event of conflict between this Policy and the EMA, the Policy shall control. This Policy is separate and distinct from enterprise risk management policies and procedures addressing the City’s safe operation of its generating stations and energy infrastructure, insurance requirements, permit compliance, employee matters regulatory compliance with laws and regulations of the State of Delaware and Federal 4

Agencies such as EPA, FERC, NERC and CFTC or other potential risks to the City beyond the purchase and sale of fuel and electric power and its ancillary products. C. Objectives and Risk Philosophy The objectives of the Policy are to identify energy commodity price and credit risk exposures and give the City a framework for the quantification and management of these exposures. The Policy will identify the reports needed to convey how the identified risk exposures can potentially impact the City’s overall cost of providing electricity service to its customers and report on the risk management of the transactions associated with City’s electric load requirements. Under the Policy, risk management activities will be conducted consistent with the City’s overall objective of appropriate risk mitigation. There are several objectives of the Policy which, when taken and executed together, serve to manage the City’s energy commodity price exposures. Specifically, the Policy: • Establishes framework for developing credit limits for counterparties and quantifies and manages the credit exposures related to potential counterparty abrogation • Quantifies the impact of the above exposures on City’s financial results • Manages the impact of the above exposures in line with the City’s identified level of risk tolerance • Provides clear delineation of responsibilities and authority, outline a separation of duties, and ensure reporting of risk is timely and accurate. • Ensures that the impact of any action affecting the City’s position is consistently quantified, monitored and authorized. The City’s risk management activities will be conducted consistent with its overall objective of appropriate risk mitigation and never for purposes of speculation. D. Policy Administration This Policy has been approved by the Executive Risk Management Committee and The Utility Committee of the Dover City Council. The Utility Committee must approve modifications to the Policy with the exception of the appendix information which can be modified with the approval of the Executive Risk Management Committee. 5

MANAGEMENT AND CONTROLS This Policy articulates the management and organization of the City and TEA to serve as a control framework outlining delegation of duties and responsibilities. A. Utility Committee of The City Council The Utility Committee of The City Council (The Committee) has a responsibility to provide approval of this Policy. With this approval, The Committee also assumes additional duties. They will understand the risks the City is and could be exposed to due to their energy commodity risk management activities. In this role, the Committee will have a responsibility to also understand the City’s policies and procedures, internal controls and systems which are used to help manage the City’s energy commodity risks. The Committee will approve any amendments to the Policy or limits within. The Executive Risk Management Committee will update the Committee periodically regarding the Policy and its functions. It will be the Committee’s responsibility to: • Discuss guidelines and strategic policies that govern the process by which the Energy Risk Management Committee assesses and manages risks • Review and approve any recommended changes to the risk policy at least annually • Approve new members and alternates of the Executive Risk Management Committee • Acknowledge the risk inherent in transactions covered under this Policy B. Executive Risk Management Committee An Executive Risk Management Committee (“ERMC”) has been formed to provide executive management oversight for the City’s energy commodity risk management activities. The ERMC is charged with the creation, amendment and administration of this Policy, including acquiring any approvals required by the Utility Committee, and will ensure that all energy commodity risk management activities of the City are performed consistent with this Policy. The ERMC will meet at least monthly to review compliance and conduct its business as described in this Policy. The ERMC shall be comprised of the following voting members: The City Manager, The Director of Utility, The City’s Controller and TEA’s Client Service Manager. The City’s ERMC will make decisions following the process outlined in this Policy. TEA’s Client Services Manager may include representatives from other areas within TEA in the monthly ERMC meetings who will attend in person or by conference call as non-voting advisors. Other City employees and TEA staff may also be asked to attend 6

meetings from time-to-time, as the ERMC deems necessary. The responsibilities of the ERMC shall include: • Establish scope and frequency for management reporting to the Utility Committee. • No less than annually, review the City’s Energy Commodity Policies and Procedures for correctness and completeness. • Review and approve any new risk report or change to an existing risk report provided by TEA to monitor risks outlined in this Policy. • Understand and approve any models, methodologies, and assumptions used for measuring risks such as volume risk, process risk, counterparty risk and commodity risk. • Monitor the City’s risks and ensure they are within the limits and are being managed according to what is indicated within the City’s Policy and associated procedures • Understand the City’s risk management objectives and risk tolerances. • Review and approve the risk management and trading strategy programs and associated risk. Each program should be reviewed to ensure alignment with Policy objectives and compliance with risk limits within this Policy. • Periodically review any risk management program approved in light of recent market changes, and ensure continued compliance with its established guidelines • Review and approve new products, markets, trading counterparties and credit limits • Review all violations and exceptions to this Policy and report such to the Committee. • Approve the individuals or companies that engage in the City’s commodity transactions and are subject to the limits within this Policy. • Ensure that the individuals or companies authorized to transact on behalf of the City as well as manage its risks, are appropriately trained and qualified. • Ensure independence and segregation of duties between front, middle and back office at TEA. • Recommend changes to this Policy to the City’s Utility Committee for approval and ensure the Utility Committee understands the City’s overall compliance with this Policy and associated procedures. • The ERMC will meet at least monthly to review risks identified and reported on by the Policy, this meeting shall be chaired by The City Manager. Minutes of each meeting of the ERMC shall be recorded and reflect any decisions and follow-up action items to be performed. These minutes will be reviewed and approved by the members of the ERMC in a timely manner. 7

Each member of the ERMC has a unique role as defined below: 1. City Manager The City Manager is independent of all commercial functions and carries the responsibility of establishment and maintenance of risk management for the City. The City Manager will be a voting member of the ERMC and act as a chair of the ERMC. Other responsibilities include: • Ensure this Policy is maintained. • Oversee reviews of the City’s energy commodity risks, limits, risk measurement methodologies and models, and programs and recommend changes to the ERMC. • Ensure potential transactions and their impacts on the City’s risks and limits defined within this Policy. • Develop and monitor the implementation of the Policy, and oversee other risk management processes and procedures established by this Policy or otherwise by the ERMC. • The City Manager shall name an Alternate to be approved by the Committee. 2. Director of the Utility The Director of the Utility has oversight for all trading, hedging, pricing, structuring, and market and operational risk management activities associated with the City. The Director of the Utility will be a voting member of the ERMC. Other responsibilities include: • Review the effectiveness of transaction processing systems and procedures relating to risk measurement. • Recommend operational risk and business risk assessment guidelines. • The Director of the Utility shall nominate an alternate to be approved by the Committee. 3. Controller The Controller is independent of all commercial functions and carries the oversight responsibilities associated with the City’s accounting practices. The Controller will be a voting member on the ERMC. Other responsibilities include: • Perform financial accounting including accounting for hedging and derivatives activities. • Comply with tax rules and make appropriate tax elections. • Record realized and unrealized gains and losses. 8

• Reconcile general ledger, cash transactions and margin accounts. • Implement tax-hedge accounting policies and other regulatory tax requirements. • Develop and maintain documentation outlining standard procedures for conducting business. • Invoice counterparties and resolve billing disputes. • Perform daily/weekly/monthly transaction checkout with counterparties. • Develop and maintain documentation outlining standard procedures for conducting business. • The Controller shall nominate an alternate to be approved by the Committee. 4. TEA Client Services Manager The TEA Client Service Manager roles and responsibilities are defined Exhibit B of the EMA between the City and TEA. The TEA Client Service Manager will be a voting member on the ERMC and act as chair of the ERMC in the absence of the City Manager. Other responsibilities include: • Monitor risk reports between ERMC meetings. • Report to the Committee and the ERMC on the City’s adherence to all limits and functions within this policy. • Engage the ERMC in discussions regarding events or developments that could expose the company to potential losses. • Recommend to the ERMC specific risk limits consistent with the City’s risk management objectives, risk tolerance, and risk management policy. • Coordinate and distribute independent market fundamental analysis. • Provide advisory support and recommendations as specified in Article 5 of the EMA. • Update RMC on training of TEA employees. • TEA shall nominate an alternate to be approved by the Committee. Alternates may vote, but only in the absence of the voting member for whom they serve. A person may serve for an alternate for more than one official, but they can only cast one vote. A quorum for a meeting shall be any combination of three voting members and alternates. A simple majority of votes is necessary to approve any action of the ERMC, but at least two voting members must approve the action. Members and alternates may attend by electronic means and count as present for the purpose of quorum and for a majority for a decision. DISCUSSION OF RISKS This Policy covers the management of all material energy market risks faced by the City. A comprehensive list of risks that are or could be relevant to City is shown in Appendix C of the 9

Policy. Among the most critical of these risks are commodity risk, counterparty risk, process risk, volume risk, and budget risk. These risks are measured by the limit structure and controls outlined in the Policy. Commodity risk represents the potential adverse impacts to the value of the City’s portfolio due to changes in the market. Commodity risk encompasses volatility risk, forward price risk, basis risk, correlation risk and liquidity risk. Counterparty risk represents the potential losses the City could incur due to delivery risk and receivable risk. Delivery risk stems from a supplier or trading counterparty that is unable or unwilling to perform on its commitments including but not limited to delivery or receipt of commodities. Receivable Risk includes the City’s risk associated with a counterparty’s timeliness of payment for services rendered. Process risk represents the risks associated with process problems including, but not limited to, inaccurate data capture, untimely trade execution or settlement problems. Controls over process risks are embedded in the organizational structure of TEA through the design processes and operating procedures. Volume Risk represents the potential for unforeseen changes from projections of excess or shortfall of capacity or energy from the actual needs. When variances are large coupled with large costs to transact and adverse moves in market prices this risk could be realized. In management of this risk, the City must be aware of the fact that unexpected variations in volume are often highly correlated with price movements. Budget Risk represents the potential to deviate outside of tolerable bounds of the City’s budget. Deviations from budget can be caused by forecast error or unforeseeable adverse changes in market prices. Regulatory Risk arises from participation in regulated markets. With the Independent System Operator (ISO) implementation of Federal Energy Regulatory Commission (FERC) Order 741, the City faces increasing regulatory risk when participating in wholesale energy markets. The TEA Compliance department works in conjunction with the TEA Risk Control department to help the City manage regulatory risk. Regulatory risk is managed by: • Annual Compliance Training for all employees participating in regulated markets; • Integration of the appropriate compliance culture within the Trading department through ongoing interaction between Compliance and Trading; • An independent monitoring and exposure measurement on transactions that could trigger an increase in regulatory risk. 10

MARKETING AND TRADING PRACTICES A. Standards of Conduct Individuals authorized to transact for the City shall not misrepresent, conceal or withhold information regarding energy commodity trading and risk management transactions to any person responsible for the accurate recording and/or reporting of such transactions; participate in any such transaction or similar activity for the benefit of any party other than the City; or hold or be a beneficiary of any financial interest in any entity with which the employee is engaged in trading or other business activity (other than ownership of an interest in a mutual fund managed by another party). Further, no employee authorized to place or execute such transactions may engage in trading power or energy commodities derivative instruments for his or her personal account. B. Products, Activities and Limitations Pursuant to achieving the City’s core objectives for the purpose of energy commodity risk management, the following limitations shall apply. • Permissible instruments will be restricted to the products and instruments specified in Appendix A – Approved Products of the Policy; o All physical forward transactions shall be governed by the Edison Electrical Institutive (EEI), North American Energy Standards Board (NAESB), or similar agreements with counterparties approved by the City. o The City reserves the right to enter into financial hedge transactions to effectuate Policy objectives, but does not authorize TEA to enter into financial hedge transactions on its behalf. Any such financial transactions that the City may enter into shall be governed by ISDA agreements with counterparties as approved by the City. • The maturity for each permissible instrument will be restricted to the maturity limits specified in the risk limits section of the Policy. • Transaction volumes for each risk management transaction will be restricted to the amounts specified in the Risk Limits section of the Policy. • Risk management transactions will be outlined in the City of Dover Hedge Program which will be approved by the ERMC. Risk management transactions may include the following: o Hedging the forward price of purchased power for delivery to the City as needed to meet its electric load requirements. o Hedging the forward price of natural gas and fuels as needed to generate power to meet the City’s electric load requirements. 11

o Unwinding of hedges to accommodate changes in expected load requirements, or for economic reasons subject to explicit constraints set by the ERMC. C. Contract Documentation and Confirmations No over-the-counter transaction may be executed until an EEI, NAESB, or similar agreement has been authorized by the City, approved by the ERMC and fully executed by the parties. Written confirmations will be required from counterparties, as defined in the Master Service Agreement between the City and counterparty, within one business day or such longer time as required by the contract in question for all risk management transactions. Contemporaneous with any commitments and prior to receipt of written confirmations, verbal commitments shall be memorialized internally as to instrument structure, quantity, relevant time horizon, price and any other relevant terms; such internal documentation shall be time stamped and correlated to the ultimate written confirmation to or from the counterparty. Both the internal documentation as well as the written confirmation from the counterparty shall be provided to TEA’s Risk Control Group immediately upon receipt for verification. In the event that there is a material failure to provide timely documentation or confirmations, then at the City Manager’s sole discretion, the offending individual’s authorization may be suspended. Similarly, if the failure to provide timely documentation or confirmations is due to the failure of counterparty, then at the discretion of the City Manager, a moratorium may be imposed on transactions with that counterparty. In such cases, the City Manager shall notify the ERMC of the issues leading to the suspension or moratorium shall. Nothing herein shall inhibit the City Manager from bringing control issues to the TEA’s Client Services Manager prior to a decision on materiality or the imposition of a suspension of trading privileges or counterparty moratorium. D. Training The ERMC will ensure that all City employees and/or TEA Staff that will execute transactions on behalf of the City will have appropriate training in the markets in which the transactions occur. E. New Product Protocol 12

As required to manage the City’s energy commodity risk the ERMC shall approve new products provided the requirements of the New Product Approval Procedure are met. RISK LIMITS AND RISK MEASUREMENTS A. Limits The limit structure is designed to quantify the types of risk in the City’s energy commodity portfolio. The City will manage and report on its energy commodity market risk using Delegation of Authority Limit, a Volume Limit and a Locational Limit. 1. Delegation Authority The Utility Committee delegates authority to the Dover ERMC to approve the acquisition of electric energy, capacity and/or transmission according to the following limits for expenditures or terms. The ERMC may not delegate these authorities to individuals authorized to commit Dover to financial obligations. Position Maturity Limit Term Limit Notional Value Limit Dover ERMC 5 years 5 years 20,000,000 TEA 1 month 1 month 1,000,000 This limit structure is not intended for use when transacting day-ahead and real time in the PJM market. 2. Volume Limits For no reason should a transaction be executed that exceeds the City’s electric load requirements. If there is an adjustment to the City’s electric load requirements and the existing transactions greater than 100% of the adjusted electric load requirements the ERMC will review and approve the offsetting strategy deployed in sufficient proportion to mitigate the encroachment. 3. Locational Limits Non-Commodity Transactions must support the requirement of one of the City’s generation units, native load or transaction locations. B. Stress Testing and Back Testing 13

The City’s positions shall be periodically stress tested and models shall be back tested. The processes around these tests are outlined in the Stress Testing and Back Testing Procedure. C. Instances of Exceeding Risk Limits Should the City or TEA enter into a transaction that causes the portfolio to exceed any above mentioned limits the Director of the Utility shall, in addition to notifying the ERMC, also notify the Chair of The Committee as soon as practicable and shall provide periodic reports to the Chair on the status the transactions for as long as the City is exceeding its limits. The ERMC will review and determine whether any liquidation or offsetting of transactions is warranted. The incident will be documented as a Policy Exception by the Director of the Utility. CREDIT POLICY Credit Risk is the risk due to the uncertainty in a counterparty’s ability to meet its contractual obligations. The primary objective of this credit policy is to mitigate, to the extent commercially reasonable, the credit risks associated with transactions covered in this Policy while still allowing the City to achieve its objectives. A. Measuring Credit Risk The status of credit risk will be measured and reported through reports provided by TEA. The current credit exposure will be reported at the agreement level via a Counterparty Credit Report provided by TEA. This information will be made available in real time to TEA trading personnel so that it can be checked prior to executing transactions for the City. Those responsible for risk oversight at the City and TEA will have access to this information no less frequently than once per day. The ERMC will monitor overall credit utilization and any credit exceptions at least monthly. When measuring the current credit risk, netting will be applied to the exposure if the City’s contract with a counterparty includes provisions for netting. B. Analysis and Extension of Credit Limits Physical and financial commodity transactions will be executed with counterparties approved by the ERMC with credit available to support the transactions. The creditworthiness of a counterparty will be determined by both qualitative and quantitative factors. Factors shall include, but not limited to: • A company’s debt credit ratings provided by the rating agencies. 14

• Financial data such as an analysis of the income statement, balance sheet, and cash flow, as well as liquidity and capital structure. • Subjective factors such as company’s fuel diversity, overall size, risk management policy and internal controls, geographic diversity, and market intelligence. A credit limit is the amount of unsecured credit granted to a counterparty. Unsecured credit exposure includes amounts owed by the counterparty, whether billed or not, and the mark-to-market differences in value of any collateral which the counterparty has provided the City. Any net exposure above the collateral threshold will require the posting of collateral by a counterparty. Further information on the City’s procedure for establishing credit is contained in the Counterparty & Credit Review Process. Collateral thresholds, term limitations and credit exposure limits will be subject to the maximums indicated in Appendix B, based upon the lower of the S&P and Moody’s credit ratings. At no time will the City incur a credit exposure with any counterparty greater than $60,000,000. C. Instances of Exceeding Credit Limits The City and TEA are restricted by the credit limits approved by the ERMC. The ERMC can suspend trading with a counterparty, if that counterparty’s credit limit has been reached or exceeded. The City or TEA traders shall not exceed the Counterparty Credit Limit by executing transactions with any counterparty without approval of the ERMC. The ERMC will determine when it’s appropriate to require additional collateral if a counterparty’s credit exposure exceeds its credit limit. Collateral includes standing letter of credit, cash, and prepayments. All credit exceptions will be documented and reported to the ERMC and the Committee as Policy Exceptions. REPORTING A. Risk Reporting Preparation of timely reports is critical to monitoring risk. TEA will furnish the required reports on a regular frequency for the City in a format acceptable to the ERMC. In addition, the ERMC and its designees will be provided access to the City’s risk reports as updated daily via TEA’s secure Web Portal. 15

Reports required on a monthly basis and for periodic meetings of the ERMC include the following: • Profit and Loss Report The Profit and Loss (P&L) Report shows the daily realization of transactions at either the transaction price or the market price as transaction roll from unrealized to realized. This report should show volumes, transaction prices and market prices of realized physical and financial power and fuel transactions. • Mark to Market Report The Mark to Market (“MTM”) Report conveys the potential transaction exposure, of all existing forward transactions executed, if the energy commodity portfolio was liquidated at the most recent market settlement prices. This report should show volumes, transaction prices and market prices of unrealized physical and financial power and fuel transactions. • Daily Activity Report The Activity Report presents a summary of the day’s trades executed in the bilateral energy market. • Cost of Service Report The City’s exposure to energy price risk shall be monitored and reported on a Cost-of- Service basis. All calculations are at the wholesale level. The Cost-of-Service recognizes all prior (expired) months within the Power Year on the basis of actual (incurred) costs, and recognizes all forward (pending) months within the Power Year on the basis of expected forward power and fuel prices and expected forward load-following risks. As defined below, the Cost-of-Service is an aggregation of Forward Energy Commodity Portfolio Cost, the Load Following Cost Expectation and the City’s Budget Target for Purchase Power Expense. o The Net Purchased Power Cost shows the net cost of all physical and financial transactions related to the City’s anticipated commodity requirements for power and fuel and is based on the price of all hedge transactions plus the forward market price of all unhedged transactions valued at current forward prices for energy commodities, customer-level cost per MWH of all physical and financial transactions related to Dover’s actual plus anticipated energy. o The expected fixed costs defined as load-serving entity (LSE) capacity costs, transmission costs and TEA management fees. o The Expected Load-Following Cost for a specified power year is defined as the expected cost (or revenue) associated with intra-month load variations due to weather or other events affecting demand. TEA has completed a historical analysis to measures the effective monthly average unit cost paid for Dover’s PJM Wholesale Load Responsibility (WLR) was calculated for each month since July 16

2013. From this analysis, TEA recommends using the post-Garrison results as a proxy for future estimates of the WLR and as an estimate of the Load Following Cost to be used for estimating the City’s Forward Cost-of-Service Report. The ERMC will update the Expected Load Following estimate while lack of necessary market information persists no less than annually. o For the historical payment analysis, an effective monthly average unit cost paid for Dover’s PJM Wholesale Load Responsibility (WLR) was calculated for each month since July 2013. This effective unit cost was constructed using Dover’s monthly PJM load payment (Dover Budget line item: PJM – Energy, Congestion & Losses), adding back the West Hub hedging credits, and dividing by the WLR. The values pre-Garrison-online and post- Garrison-online were compared with both straight and WLR-weighted averages. This effective LMP therefore includes the effects of intra-month load variations, contributions of both the DALMP and RTLMP, and the additional PJM charge types reflected in the monthly Dover Budget line item: PJM – Energy, Congestion & Losses. Pre-Garrison (July 2013 – May 2015) weighted average monthly load costs were $3.02, while the average post-Garrison cost (Jun 2015 – Apr 2018) has been $2.60. o o The Budget Target for Purchase Power Expense represents the City’s view of expected purchase power expense. B. Credit Reporting • Counterparty Credit Report The Counterparty Credit Report conveys the exposure to all counterparties with which the City has credit exposure resulting from its energy commodity risk management activities. • CFTC Reporting The City understands that transacting over the counter (OTC) swaps carries an additional Commodity Futures Trading Commission (CFTC) reporting function. Once required by the CFTC, the City will report on how the City generally meets its financial obligations associated with entering into non-cleared swaps in a manner acceptable to the CFTC. C. Hedge Effectiveness Reporting If the City’s transactions require a hedge effectiveness test, those testing results will be reported to the ERMC no later than one month after the end of the financial reporting period. The report will include a summary of testing methodology, assumptions of the testing and the outcome of results with a pass or fail by transaction. INFORMATION TECHNOLOGY SYSTEMS 17

Since information systems play a vital role in The City’s trading abilities, the City shall ensure that the information systems and technology used to store all transaction information is maintained and secure. The City’s transactions will be stored in TEA’s enterprise trading and risk management system. TEA uses the TriplePoint Commodity XL (CXL) system, integrated with Commodity XL for Credit Risk (Credit Risk). TEA has assigned a Database Administrator (DBA) that is charged with the database security and maintenance for the transaction database, CXL. The following safeguards for data security and backup will be installed: • Transaction data stored in the system of record will be replicated daily to ensure data redundancy; • The CXL database will be backed up at least daily after the close of business. POLICY DISTRIBUTION AND COUNSEL A. Distribution Outside The City The City’s Policy is restricted to the use of the City and TEA organizations. It shall not be distributed outside these organizations without the consent the ERMC. B. Designated Counsel Questions about the interpretation of any matters of this Policy should be referred to ERMC. The ERMC will provide clarification and explanation on any updates to this Policy. All legal matters stemming from this Policy will be referred to the City’s Legal Counsel. 18

APPENDIX A – Approved Products The following shall constitute a list of approved products to be utilized by TEA to manage the City’s energy commodity portfolio: • Physical Power • Physical Natural Gas • Physical Residual Fuel Oil (#2) • Capacity • Financial Power • Financial Options • PJM Demand Bids and Generation Offers • PJM InSchedules • PJM Transmission Products o Financial Transmission Rights o Annual Auction Revenue Rights • PJM Tier 2 Synchronized Reserves The above instruments can be executed by TEA on behalf of the City of Dover for the current and next two successive Power Years (July to June). 19

APPENDIX B – Approved Counterparties and Threshold Tables This Appendix establishes approved counterparties and their Collateral thresholds. Collateral thresholds, term limitations and credit exposure limits that are subject to the following maximums based upon the lower of the S&P and Moody’s credit ratings: Credit Thresholds from Dover Extended to the Counterparty Exelon Generation Company, LLC Threshold I S&P I Moody's $ 60,000,000 AAA Aaa $ 50,000,000 A- to AA+ A3 to Aa1 $ 40,000,000 BBB+ Baa1 $ 30,000,000 BBB Baa2 $ 20,000,000 BBB- Baa3 $ - Below BBB- Below Baa3 AEP Energy Partners, Inc. Threshold I S&P I Moody's $ 10,000,000 BBB- and Above Baa3 and Above $ - Below BBB- Below Baa3 BP Energy Company Threshold I S&P I Moody's $ 60,000,000 AA- to AAA Aa3 to Aaa $ 45,000,000 A+ A1 $ 30,000,000 A A2 $ 15,000,000 BBB to A- Baa2 to A3 $ - Below BBB Below Baa2 Calpine Energy Services, L.P. Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 15,000,000 AA- to AA+ Aa3 to Aa1 $ 10,000,000 A- to A+ A3 to A1 $ 5,000,000 BBB+ Baa1 $ 3,000,000 BBB- to BBB Baa3 to Baa2 $ - Below BBB- Below Baa3 20

EDF Trading North America, LLC Threshold I S&P I Moody's $ 18,000,000 Fixed Fixed PSEG Energy Resources & Trade, LLC Threshold I S&P I Moody's $ 20,000,000 BBB- and Above Baa3 and Above $ - Below BBB- Below Baa3 Sequent Energy Management, L.P. Threshold I S&P I Moody's $ 5,000,000 Fixed Fixed Conectiv Threshold I S&P I Moody's Unspecified * Above BBB+ Above Baa3 $ - Below BBB- Below Baa3 * Conectiv does not have a defined credit threshold, so for planning purposes, a $10,000,000 threshold is imposed as a conservative limit Macquarie Energy, LLC Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ Aa3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below Morgan Stanley Capital Group Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ Aa3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below 21

NextEra Energy Marketing, LLC Threshold I S&P I Moody's $ 30,000,000 AAA Aaa $ 25,000,000 AA- to AA+ Aa3 to Aa1 $ 20,000,000 A- to A+ A3 to A1 $ 15,000,000 BBB+ Baa1 $ 10,000,000 BBB Baa2 $ - BBB- or below Baa3 or below Deutsche Bank Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ Aa3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below Barclays Bank Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ Aa3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below Credit Thresholds from the Counterparty Extended to Dover AEP Energy Partners, Inc. Threshold I S&P I Moody's $ 10,000,000 BBB- and Above Baa3 and Above $ - Below BBB- Below Baa3 BP Energy Company Threshold I S&P I Moody's $ 30,000,000 AA to AAA Aa2 to Aaa $ 25,000,000 AA- Aa3 $ 20,000,000 A+ A1 $ 15,000,000 A A2 $ 5,000,000 BBB to A- Baa2 to A3 $ - Below BBB- Below Baa3 22

Calpine Energy Services, L.P. Threshold I S&P I Moody's $ 10,000,000 AA- to AAA Aa3 to Aaa $ 7,500,000 A- to A+ A3 to A1 $ 5,000,000 BBB+ Baa1 $ 3,000,000 BBB- to BBB Baa3 to Baa2 $ - Below BBB- Below Baa3 Exelon Generation Company, LLC Threshold I Fitch I Moody's $ 60,000,000 AAA Aaa $ 50,000,000 A- to AA+ A3 to Aa1 $ 40,000,000 BBB+ Baa1 $ 30,000,000 BBB Baa2 $ 20,000,000 BBB- Baa3 $ - Below BBB- Below Baa3 Conectiv Threshold I Fitch I Moody's Unspecified * Above BBB+ Above Baa3 $ - Below BBB- Below Baa3 *Conectiv does not have a defined credit threshold, so for planning purposes, a $10,000,000 threshold is imposed as a conservative limit PSEG Energy Resources & Trade, LLC Threshold I S&P I Moody's $ 12,000,000 * Fixed Fixed *Threshold is $12,000,000 as long as Dover maintains a Debt Service Coverage greater than 1.25% and Total Net Assets of at least $50,000,000 and Total Net Assets do not decline by more than 25% on a fiscal year end basis. Morgan Stanley Capital Group Threshold I S&P I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ Aa3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below 23

Macquarie Energy, LLC Threshold I Fitch I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ AA3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below NextEra Energy Marketing, LLC Threshold I Fitch I Moody's $ 23,000,000 AAA Aaa $ 18,000,000 AA- to AA+ AA3 to Aa1 $ 13,000,000 A- to A+ A3 to A1 $ 8,000,000 BBB+ Baa1 $ 3,000,000 BBB Baa2 $ - BBB- or below Baa3 or below EDF Trading North America, LLC Threshold I S&P I Moody's $ 18,000,000 Fixed Fixed Deutsche Bank Threshold I Fitch I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ AA3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below Barclays Bank Threshold I Fitch I Moody's $ 25,000,000 AAA Aaa $ 20,000,000 AA- to AA+ AA3 to Aa1 $ 15,000,000 A- to A+ A3 to A1 $ 10,000,000 BBB+ Baa1 $ 5,000,000 BBB Baa2 $ - BBB- or below Baa3 or below 24

APPENDIX C – Business Risks Business Risks Topology Commodity Counterparty Process Volume Budget Regulatory - Risk Risk Risk Risk Risk Risk Market Receivables Load Market Price Risk - Deadline CFTC Risk Uncertainty Uncertainty Risk Performance Reporting Load Volume Risk Supply Risk FERC Risk Risk Uncertainty M2M/Forward Generation Forecast RTO Curve Risk Uncertainty Error Liquidity Risk Basis Risk 25

APPENDIX D – Glossary Back Office – That part of a trading organization which handles transaction accounting, confirmations, management reporting, and working capital management. Bilateral Transaction - Any physical or financial transaction between two counterparties, neither of whom is an Exchange or market entity (e.g. MISO). Capacity – The real power output rating of a generator or system, typically in megawatts, measured on an instantaneous basis. Commodity - A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade. Financial Bilateral Transaction – A Bilateral Transaction that is non-physical and is defined by a Source Point, Sink Point, and Delivery Point that may be any CP Nodes as specified by the Midwest ISO. Financial Forward – An agreement regarding a position in a specified commodity, a specified price, and a specified future settlement date, that does not result in physical delivery of the commodity. Rather one party in the agreement makes a payment to the other party on the basis of the commodity price at the future date. Front Office – That part of a trading organization which solicits customer business, services existing customers, executes trades and ensures the physical delivery of commodities. Hedging Transaction - A transaction designed to reduce the exposure of a specific outstanding position or portfolio; “fully hedged” equates to complete elimination of the targeted risk and “partially hedged” implies a risk reduction of less than 100%. Mark-to-Market Value – A measure of the current value of unrealized positions; includes both Open Positions and Closed Positions. Middle Office – That part of a trading organization that measures and reports on market risks, develops risk management policies and monitors compliance with those policies, manages contract administration and credit, and keeps management and the Board informed on risk management issues. 26

Policy – Dover’s Governing Policy for Energy Commodity Risk, as amended and approved by The Utility Committee. Portfolio – A collection of transactions. Realized Gains/(Losses) – The amount earned (or lost) from a transaction, considered to be realized once the time for performance has lapsed (e.g. delivery of power in the case of physical transactions or expiration of an option in the case of financial transactions). Term – The total duration of a contract, defined as the number of days between the beginning flow date and ending flow date, inclusive. Unrealized Gains/ (Losses) – The amount expected to earn (lose) on a specific transaction(s); however, the time for performance has not lapsed. The total value of Unrealized Gains/ (Losses) is the Mark-to-Market value. 27

APPENDIX E – Swap Transaction Representative Purpose: To ensure that the City of Dover, a Special Entity under the Dodd-Frank Financial Reform Act, selects a qualified representative (“Representative”) to provide advice and guidance when entering into swap transactions with Swap Dealers or Major Swap Participants. Definitions: Special Entity: As defined in 7 U.S.C. 6s(h)(2)(C) and further interpreted in 17 C.F.R. 23.401(c). The City of Dover is a Special Entity as defined by 17 C.F.R. 23.401(c)(2). Swap Dealer: As defined in 7 U.S.C. 1a(49) and further interpreted in 17 C.F.R. 1.3(ggg) Major Swap Participant: As defined in 7 U.S.C. 1a(33) and further interpreted in 17 C.F.R. 1.3(hhh) Representative: As defined in this policy and 17 C.F.R. 23.450 Policy: Selection: The City of Dover shall endeavor to seek and employ an individual or entity that will voluntarily act as a Representative for all energy commodity swap transactions between XXXX and any Swap Dealer or Major Swap Participant. The Representative must meet the following qualifications identified in 17 C.F.R. 23.450(b): (i) Has sufficient knowledge to evaluate the transaction and risks; (ii) Is not subject to a statutory disqualification; (iii) Is independent of the swap dealer or major swap participant; (iv) Undertakes a duty to act in the best interests of the Special Entity it represents; (v) Makes appropriate and timely disclosures to the Special Entity; (vi) Evaluates, consistent with any guidelines provided by the Special Entity, fair pricing and the appropriateness of the swap; and (vii) In the case of a Special Entity as defined in § 23.401(c)(2) or (4), is subject to restrictions on certain political contributions imposed by the Commission, the Securities and Exchange Commission, or a self-regulatory organization subject to the jurisdiction of the Commission or the Securities and Exchange Commission; provided however, that this paragraph (b)(1)(vii) of this section shall not apply if the representative is an employee of the Special Entity. The Representative and the City of Dover shall enter into a legal agreement that binds the Representative to comply with items (i) through (vii) in this policy. At no longer than any 12-month interval, the City of Dover shall review the performance of the Representative to ensure compliance with items (i) through (vii) in this policy. 28

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE “ T H I S I S A M E R I C A’ S M O M E N T TO S E I Z E T H E O P P O RT U N I T Y F O R C H A N G E , A N D B U S I N E S S L E A D E R S C A N N O T S I T T H I S O N E O U T. ” - - R A N D A L L S T E P H E N S O N , C H A I R M A N & F O R M E R C E O , AT & T . -. ~ July 28, 2020 • ,•, I

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE MISSION • The goal of the Collaborative is to be a backbone of our community in building a more just future for all Delawareans. • Regardless of skin color or zip code. • Provide a strategy of a unified, powerful voice for meaningful changes in policy and practices that promote true racial equity and social justice in Delaware.

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE WHY DOES THIS WORK MATTER? • Multi-generational and systemic racism, policies and practices • Disparities and inequities exist within education, wealth creation, law enforcement, etc. • Transformational change needed • At historical crossroads – locally and nationally

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE WHAT IS OUR FRAMEWORK? • Grassroots, statewide movement with local leadership and advocacy • Collaborative of diverse community stakeholders, including, youth voices • To amplify and advocate for community change and action around racial equity and social justice issues

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE WHAT IS OUR APPROACH/PATH FORWARD? • Foster courageous conversations • Increase engagement and influence • Mobilize disenfranchised communities • Develop collective messages • Map and align racial equity & social justice initiatives in DE • Develop public policies agenda • Launched racial equity and social justice fund

THE RACIAL EQUITY & SOCIAL JUSTICE COLLABORATIVE HOW DO YOU SEE YOURSELF IN THIS WORK?

COMMUNITY ORIENTED POLICING ORGANIZATIONAL TRANSFORMATION PROBLEM SOLVING SERVICES U.S. D.O.J. COPS GRANT AWARD AN OVERVIEW OF A FEDERAL COST -SHARING OPPORTUNITY TO EXPAND COMMUNITY POLICING IN THE CITY OF DOVER.

1. Goal: Increase Authorized Strength to 106 Officers in 2021 2. Vehicle: Cost sharing grant offered by the USDOJ COPS Office 3. Purpose: Add Five (5) Officers to Community Policing Unit 4. Vision: Double the amount of Community Programs/Services 5. Problem: Staffing Challenges 6. Problem: Maintenance of Core Programs/Services OUTLINE 7. Mandate: Increased Community Engagement 8. Cost Schedule 9. Strategy: Efficiency + Investment + Accountability = Value 10. Process: Agency Re-organization, Strategic Planning, Transparency 11. Result: More Safety, Crime Reduction & Service to At-Risk Populations 12. Next steps

GOAL: INCREASE THE AUTHORIZED STRENGTH FROM 101 TO 106 OFFICERS The 2019 City of Dover Comprehensive Plan envisions a “Bigger Better Dover.” In a related theme, the attractive idea of “Big Enough to Call a City but Small Enough to Call Home” is part of the introductory header. The Dover Police Department understands its role to play in bringing the comprehensive plan to life. The perception and reality of a safe and secure community will serve as a catalyst for economic growth as well as community prosperity. Our 2019 crime data informs us that this perception and reality is certainly threatened. Trend data in 2020 does not offer any indication of improvement.

AUTHORIZED STRENGTH BREAKDOWN – JULY 2020 101  Selection Gap is 1 to 7 months 9 = SENIOR STAFF MEMBERS (DIVISIONS/UNITS)  Police Academy is 6 months 1 = PUBLIC INFORMATION OFFICER 3 = PLANNING AND TRAINING  Onboard Training is 4 months 7 = DRUGS/VICE/ORGANIZED CRIME (TASK FORCE)  Total time is 11 to 17 months to 10 = CRIMINAL INVESTIGATORS replace a departing Officer 5 = SCHOOL RESOURCE OFFICERS 45 = PATROL OFFICERS (~11/PLATOON)  COVID rules now threaten our seats in the Sept. 2020 class 6 = STREET CRIMES UNIT (-1) 7 = MOTORCYCLE UNIT (-6)  COPS Grant Officers would not 6 = COMMUNITY POLICING (-3) begin Academy Training until 89 = WORKING OFFICERS EFFECTIVE 8-15-2020 March 2021 at the earliest +4 = OFFICERS CURRENTLY ONBOARDING  Grant acceptance window is 93 = WORKING OFFICERS BY THE END OF 2020 August 2020 8 = CURRENT VACANCIES (ATTRITION? / ACADEMY?)

POLICE OPERATIONAL OVERVIEW SPECIAL PATROL INVESTIGATIONS SERVICES Following Major Crime Special Operational Emergency Response Incidents Uniform Teams Interdicting Gangs, Community Calls for Service Drugs & Weapons Engagement

SPECIAL ENFORCEMENT/SERVICE OVERVIEW COMMUNITY ENFORCEMENT SERVICES POLICING School Resource Motorcycle/Traffic Police Cadets Officers Community Policing Parking Animal Welfare Officers

COMMUNITY POLICING TEAM COPS SCHOOL RESOURCE POLICE ATHLETIC LEAGUE COMMUNITY OFFICERS (5) PROGRAM DIRECTOR ENGAGEMENT (5) + 5

OUR STAFFING CHALLENGES 1. Officers are not obligated to provide notice at time of retirement. Attrition is hard to predict. 2. Pre-retirement resignations are occurring at a level never before seen. Some are related to professional standards accountability but others are for better opportunities. 3. As a prior slide illustrated, new vacancies will almost always remain unfilled for at least a full budget year; sometimes longer. 4. In-State lateral transfers often feature candidates with professional “baggage”. Out-of-State laterals face a difficult path to a Delaware COPT credential. High levels of frustration and many missed opportunities. 5. Functionally, a move to 106 Authorized Officers (all things considered), creates the potential for 101 Available Officers serving Dover. No departures for 18 months is the only way to get to full strength.

PATROL SERVICES C R I M I N AL I N V E S T I G AT I O N S SUPPORT SERVICES Maintaining Core Services Every subset of deployed officers were assigned their respective missions, over time, following a recognized need. In 2019, that investment held the community together through Training unprecedented crime numbers. The organization kept up with In-Progress the workload, and solved cases at the same consistent rate, Planning Emergency Reactive despite significant staffing shortages. Logistics Response Admin. Victimization would increase, and the perception of safety in Dover would decrease, if law enforcement operations were curtailed. Administration and Supervision maintain an acceptable Span of Control and Operational Support System as well as an effective Risk Management Program. Routine Considering the societal demand for expanded community Special engagement and improved relationships, as part of a larger Calls for Proactive Operations initiative, the Dover PD proposes to insert all 5 COPS funded Service Officers into Community Policing Special Operations.

COMMUNITY POLICING PROGRAMS AND INITIATIVES SCHOOL RESOURCE OFFICERS NEIGHBORHOOD SUPPORTING POLICE ATHLETIC LEAGUE ACTIVITIES OR EVENTS We have an Officer assigned to support safety Operation Gobble for meals at Thanksgiving and maintain relationships at the High School, both Middle Schools, and both Alternative Partnering with the Dover Elks and Bikeline to Learning Schools. They compliment the team of have a bicycle rodeo and safety course School District Constables and greatly reduce the Partnered with local veterinarian to have chips number of times it is necessary to call 911 or send made available for our 4 legged friends marked police units to the campuses. Partnering with Communities In Schools for back Our PAL program creates connectivity to the SRO to school supplies and “meet the teacher” program during school hours and to the younger children after school. In collaboration with other Our Spring Jam focused on Dover youth with interested persons and parents, young people NCALL and other community partners have an alternative to gangs and delinquency. Through personal development, the sense of “Trunk or Treat” on Legislative Mall with DDP belonging (that we all desire) is fulfilled.

COMMUNITY POLICING PROGRAMS AND INITIATIVES FUTURE POTENTIAL Programs for our elderly and/or physically disabled citizens that routinely check on their well-being. Crime Prevention Programs that feature a personal visit from an officer to go over safety and security issues at either a residential or commercial property in Dover. Expanded training and service to neighborhood watch groups throughout the city. (Problem-oriented policing) Personal Safety education and training for all age groups. Expanded programs and personal leadership development for our younger Dover population through existing PAL initiatives and additional concepts for athletes and non-athletes alike.

A LOOK TOWARDS THE FUTURE While serving all special Create a positive Double the number of or “at-risk” members of presence of Law engagement and the community, an Enforcement in the lives outreach activities in all emphasis on youth of young citizens from Dover neighborhoods programs will be the Kindergarten, through priority for resources College, and beyond

TIMELINE AND NUMBERS YEAR 1 YEAR 2 YEAR 3 Federal = 75% Federal = 40% Federal = 15% City = 25% City = 60% City = 85%

COST ROADMAP SUMMARY August 2020 March 2021 FY ‘22 FY ‘23 FY ‘24 •COPS Grant Officers •COPS Grant •Total City Expense is •Merely accept the Officers make it to •Total City Expense is begin the Police just under $350,000 just under $500,000 COPS Grant Award Academy Program the operational level by Q2 of FY ’22 •Majority burden •No cost incurred for •Federal cost sharing is •Only 2% of the City shifts from Federal to complete around Q3 the first three share of total program •Total City Expense City during this of FY ‘24 quarters of FY ‘21 cost would be needed is just under $172,000 budget year during the last quarter

DETAILED PROJECTIONS – INDIVIDUAL & GROUP Dov,e r P,oli,ce Depa.rtment COPS HIRING PROGRAM SUMMARY OF COSTS FY21-24 Po lioe O ffioer P.ayr,o II Oo.sts CITY OF DOVER FISCAL YEAR SCHEDULE Cost for five Officers: Hired to attend O5P Academy in March 2021 3122121 tf d' dd t 3121124 as of: 7l1S/20 27 .4:Y. 100:Y. 100:Y. 72 .6:Y. ~ FY21 •• FY22 FY23 FY24 Salary '" 51'011 ,ann ual 21/. X 2 13,890.00 56,680.00 61,260.00 66,120.00 19-8,15'0.00 69,45'0.00 264,400.0 0 3-06,300.00 330,600.0 0 990,75'0.00 PY'18 FOP Budget union conn act rates Be11 e·firts ---------------------------------------------------------------- ....... ············""''............................................................................................................... ______________ --------------------------------------------------------------------- ------------------ ----------------- .~~.if! .1~.iff~~~~.t!l'.I! ........... _.... .~)'.g).1 .. ~9-! :l'.I .~~ ...~ .~:::................:3-?. 0...J.!.. .............1./ t:9:~='°-1............ .J.,~ .1. .. ?..a: ............. .1.•~~:~=~ ··· .....~ l~,).~. ..... ),'.~~-°'·~ ....... .1- .~?,?.g.......!,.~g~.~~........1-,?~~,~.~. . .... .?.~c1-?.gx~ . ...... _. _...... _. 1 t•l~ l~~-r:~......................... ?.1'~.1~ ...1,~:~·~ ········- .............. ?..0..1.:. ..J ...................?.?.~:?.4:i.................. ?'.8-.8-.. ?.?.. .................!•-~:?.1........ ?, ~~·_1?.......1.'9.~?:'9:~·-·····~' ·1_?~.~~........4 ,~ 1,~~ ........ ,!~~._7_~........1.~,~ --~~................. . .~P.S:!1'.1! .~.~S:!J.~i.tY.................. .~)'.g).4 ... ~ .?I)_~ ..................... ~ 1.J ~ ........... :3-, ~ :.5.?.............~,?.'.9..8-..J.?. ............. }?:~::. ... .. . .. ).? ,?~?, ~g. . ..... ,.~~~.~~...... ).7-.~;g?.g......1?,~~!)..~~......?.M~?:?.g. . .....~.1.c4~,~.~. . ............... . Medica l lnsur,anoe 51'015 s-et amt'" 3.01/. 4 ,567.68 17 ,171.24 17 ,686.3-8 18 ,216.97 57 ,642.47 22,839.42 85,856.20 68, 31.90 91,084.85 268,212 .37 employee+ ................................................................................................................................................................................................................................................................................................................. spouse ....... . AJOOD 51'016 0 .03% ---------------------------------------------------------------- 4 .17 17.06 18.3-8 19 .64 ----------------- ........................................................................................................................................ 20.85 85.3-0 91.6-9 99.1 8 ------------------ 59.44 --------------------------------------------------------------------- 297.22 ----------------- -~l~~.1.n.~!J.~l'.l.n.~.~······-·-········-·~)'.g ).~ ... ~..1!.~ ...........................?.?.:4=1.1...................... ~.. !.'Q ................ .J.~... :.1.1 .................. .1..1.?.. .... Q.. ...... }~:?~ . ........1.1~·'.q'?..........~~,?'.g········- ~-°'•.1-J..........~ :'il_'.? .........1.c®4,?~ ................. . ~ :q~~~~~ 9.o. ~~.~i:i~l'.IJ[q~........ ?.1~.1 !. .. :~;).7 -~ ......... ........... 3~~!.: 0..1. ............. ?.,.5-:0:.9-.. ~Q .............3-,!!~:?.4............. .a: ....!.~..~Q ......1?, ~~·~ .. . ....4 ,?~?:'!l:~..... .1 !,.~ !-.~~...... ).~.?~,!.1......?~, .~~.E!•'.~ .. . .... ~1,).?it~?. . ............... . 1 1 -~~.l[~~.:i:~~~t J:.Q?. 1~ ~)'.g ).~ ....~.,~!)_~·········· ............!.!!.:~ ............ ?.,.1.l?.5-.. ?.~ .......... } ,~~Q:.5-?............. ?..!. 0.?... !.?...... ).1,,g.~ ,fg ...... ?, ~~1:!.~~······ )·~i~~,fg······1! , .1,~ .~~...... ).~,?.1.~,~g .......~ c1~:~.~ ................. . ) ••••••••••••• 1 R:etinement 5 1'020 16 .68% 2 316.85 9 487.58 10 218.17 11 028.82 33 10.51.41 11 584.25 47 437.90 5 1 090.64 55 144.ifr8 165 257.07 ir,ota Be 11 efits 9 ,9-80.13 39,223.72 41,385.00 43,73-8.22 134,327.07 49,9 00.64 196,118 .60 206 ,925.00 218,691.1 0 671,63:5.34 Tota Safary+ Be 11 efiits 23,870.13 96,103.72 102,645.00 109,85-8.22 332,477.07 11 9 ,35'0.64 480,518 .60 513,225.00 549,291.1 0 1,662,385.34 g .r:~~.t.'..~~.~!~~. ?.~.~~~~~~~..~¥.~~~~,1.r ,~~~ ·······-····· ...........1.~~ ··········-·'!~~ ............?!':'?..............~~............................ )~·~·····-·······~~~ ............ ?!~.............. ?.~ ................................... . f.~ .~~?).?.~?F.~...................................................1.~, ).~~..Q~......~),!?.~.q~····· }~c~?'.q,9_(! ····· )·M~~, 9.g.. J ~?,.0.Q.c!M..... ~~.~.Q~,9.L .. ~~~, ~Q.(! .q~·····1~.?~~,9.L ....~ ..~.c!·.q~.... J ?-;?,9.Q~_.P.~..... ?.7-i?.c!~.... % for 3.27 yrs -~.r:~~.t.f.~~.~!~ 9.. ?.~.r.~~.l'!t~.g;~..l:!Y. ~~.~~.I .Y.1~ .~~ • • • • • _ . . . . . . . • • • • • • • • • • • •?~ ............1!.~ ............ ~~~........... _~~. . .. ... .. .. .. .. .. ............ J~.............1!.~ ............•~~.............4?.~ .. .. ... .. .. .. .. ... . ................ . CityShare 4,690.13 34,323.72 69,0.95.00 99,368.22 207,477.07 23,450.64 171,618 .60 345,475.00 496,64·1:10 1,037,385.00 62. 0% % for 3.27yrs Tota s T .23,870.113 96, 03.12 1102,&15.00 109,,358.22 n2,4n.01 1 9,350.64 480,5118.60 5 3,225.00 549,291.10 T 1,662,l85.00 T · Budgeted amounts based on the current FOP contract FY21 pay scales (pay scales for Jul•Dec & Jan•Jun each year with 21/. increases on each scale) "FY21 hire date for police acdademy: 3122121 FY24 end date (3S months after start date):

Program fits into a larger picture First: DPD will continue the process of reorganization with an eye toward exposing blind spots, finding more ways to improve efficiency and adding value to the invested tax dollar by improving flexibility within and across units. Second: DPD will continue installing Community-Oriented policing as a department-wide philosophy. Every unit will have a proportional share of the effort assigned to them. Evaluations will be revised to reflect that Community Policing activities are weighted the same as traditional law enforcement duties. Third: Delivery of services will follow this model and the frontline supervisors will be expected to collaborate in support of expanded community engagement goals. Will tie in directly to the larger DPD Strategic Plan.

Expanded outreach capability First: Dover Police will continue to deliver the proven programs of the past with an eye toward an expanded schedule each year. Second: New programs will be added that create connections to all of Dover’s communities with a particular emphasis on young people. For example: Third: Partner with social services professionals, to engage at-risk citizens (addiction/behavioral health), both in 911 response situations and during follow up encounters to improve the overall quality of life in Dover.

The Delaware Congressional Delegation is proud to provide this letter of support for the Dover Police Department's application under the 2020 Community Oriented Policing Services (COPS) Hiring Program (CHP). The application being submitted seeks five new-hire police officers for Kent County's largest department. The officers will be deployed in an effort to further reduce gun violence within the city of Dover, the capitol of our nation ' s first state. We fully support the Dover Police Department' s vision to deploy the five new officers to work in concert with local groups and citizens within our capital city towards the common goal of reducing gun violence. Various shooting incidents, ranging from criminal mischief and reckless endangerment to assault and murder, have been occurring more frequently within the city since November, 2019. Of the 29 such incidents occurring since then, three have been classified as homicides with two of them involving juveniles. Currently, the department successfully employs the use of detailed crime analytics to monitor the shootings, and other criminal occurrences, throughout the city on a biweekly basis. This is part of a predictive policing model, producing actionable intelligence, where additional enforcement efforts are needed to reduce the violence. The Dover Police Department collaborates with other State and Federal law enforcement agencies; sharing information useful to the deterrence of the violent criminal activities. A special Task Force, staffed by these resources, was required to address their recent challenge. Collaboration extends to the Downtown Dover (business) Partnership, various inter-faith (clergy) groups, and other stakeholders concerned with the public safety of our citizens. However, a staffing shortage is limiting the visible police patrols needed to deter crime. Thomas R. Carper Christopher A. Coon Lisa Blunt Rochester United States Senator United State S nator M mber of Congress

Questions?

DEPARTMENT OF POLICE Thomas A. Johnson, Jr. 400 South Queen Street Chief of Police Dover, Delaware 19904 302-736-7 11 1 March 9, 2020 U.S. Department of Justice Office of Community Oriented Policing Services 145 N Street NE Washington, DC 20530 RE: 2020 COPS Hiring Program (CHP) Application To Whom It May Concern: The Dover Police Department (DPD) is a community-oriented law enforcement agency and holds the honor of being one of the top accredited police departments in the country as determined by the Commission on Accreditation for Law Enforcement Agencies (CALEA). The DPD, accredited since 2000, reached and has maintained CALEA's highest standards of excellence since 2008. It was my honor to become the Police Chief on February 13, 2020, and I am looking forward to working hard for both the agency and the city. During this past month, I have been spending a lot of time getting to know the community, its businesses, the organizations and citizens within it as well as becoming more acquainted with my own team inside the department. While attending various community events, and meeting concerned stakeholders, it became clear that citizens are concerned, and acutely aware, of the rising incidences of gun violence in and around Dover. As identified in our application, gun violence started to surge starting last fall and still continues today. During the November 2019 through February 2020 crisis window, there have been 29 shooting incidents within the City of Dover as compared to five each in the preceding two corresponding periods (Nov ' 18 • Feb ' 19 and Nov ' 17 • Feb ' 18). Of the 29 current incidents, 16 (55%), were determined as gang related. The department responded immediately, expending considerable overtime dollars, by increasing patrols and visible police presence in the affected areas as much as possible. The city was able to find some additionaJ overtime revenue and the DPD reprioritized other approved grant funding to supplement this presence. However, the hours needed on a permanent basis, to sustain the positive results, cannot be sustained through existing resources at the local level.

During the first weeks following my arrival, I have discovered there is a team of dedicated and passionate people working within my department. We are becoming a very young department at a time when the daily workload continues to increase. The average tenure of sworn Dover Police Officers is 10.1 years. But in the Patrol Section, where most of the contact with the community occurs, the average tenure is 8.4 years of service. By the summer, more than half of those 43 patrol officers will have less than 5 years on the job. Despite great training and mentoring, veteran officers know that experience is the best teacher. In addition to helping with the workload, a favorable grant decision would open up avenues of lateral transfer allowing experienced officers an opportunity to rapidly join the Dover policing family. My predecessors possessed long-term vision and adopted a five-year strategic plan in 20 18 that continues to be extremely useful. The plan includes four key goals: (l) continued reduction of violent crime, (2) focused effort on the opioid epidemic, (3) community policing enhancement and (4) emphasis on recruitment, retention and diversity. Violent crime in 2018 was associated with gangs, drug crimes and closely connected to the opioid epidemic. In addition to enforcement efforts, Dover Officers were trained in the use ofNARCAN and we partnered with state and federal agencies to sustain a NARCAN supply and provide drug intervention services. Community policing efforts were implemented department wide, to include all Units, so every Office r could become involved with this successful strategy and increase public awareness. Additional educational and athletic programs were implemented through the Police Athletic League (PAL) to create connections with the youth in our community. Getting police officers involved in positive and fun activities with our young people is a key in developing and maintaining future critical relationships. It also provides more opportunity for youth in "at-risk" situations to spend their time safely in a fun and positive environment rather than engage in criminal activities associated with gangs and other risky behaviors. As the Law Enforcement Executive for the Dover Police Department I am respectfully requesting the needed funding for five new pol ice officer positions. This grant will help ensure that existing strategies and programs can be sustained as they are still valid and useful. To be sure, we will continue to use analytics that produce credible evidence to determine additional ways to reduce gun violence in the community. The primary role of law enforcement is to address crime, contribute to a sense of security, and enhance the quality of life of all citizens. This is done better through a holistic approach, working with community partners, but the impact of a uniformed officer cannot be replaced by a secondary resource. Thank you for your kind consideration to this application. Sincerely, ~ Page 2 of 2

<!Congre~~ of tbe mlniteb ~tate~ March 10, 2020 wmtasf)ington, 11)(( 20515 Mr. Phil E. Keith, Director Office of Community Oriented Policing Services U.S. Department of Justice 145 N Street NE Washington, DC 20530 Dear Director Keith, The Delaware Congressional Delegation is proud to provide this letter of support for the Dover Police Department's application under the 2020 Community Oriented Policing Services (COPS) Hiring Program (CHP). The application being submitted seeks five new-hire police officers for Kent County's largest department. The officers will be deployed in an effort to further reduce gun violence within the city of Dover, the capitol of our nation's first state. We fully support the Dover Police Department' s vision to deploy the five new officers to work in concert with local groups and citizens within ow- capital city towards the common goal of reducing gun violence. Various shooting incidents, ranging from criminal mischief and reckless endangerment to assault and murder, have been occurring more frequently within the city since November, 201 9. Of the 29 such incidents occurring since then, three have been classified as homicides with two of them involving juveniles. Currently, the department successfully employs the use of detailed crime analytics to monitor the shootings, and other criminal occurrences, throughout the city on a biweekly basis. This is part of a predictive policing model, producing actionable intelligence, where additional enforcement efforts are needed to reduce the violence. The Dover Police Department collaborates with other State and Federal law enforcement agencies; sharing infomrntion useful to the deterrence of the violent criminal activities. A special Task Force, staffed by these resources, was required to address their recent challenge. Collaboration extends to the Downtown Dover (business) Partnership, various inter-faith (clergy) groups, and other stakeholders concerned with the public safety of our citizens. However, a staffing shortage is limiting the visible po lice patrols needed to deter crime. We appreciate your consideration of this application. Please contact us once a decision is rendered. Should you have any questions, we can be reached through our staff members: Larry Windley in Senator Carper's office at (302) 674-3308; Kate Rohrer in Senator Coons' office at (302) 736-5601; and Tyrone Jones in Congresswoman Blunt Rochester's office at (302) 830- 2330. Thomas R. Carper Christopher A. Coons Lisa Blunt Rochester United States Senator United States Senator Member of Congress

 3')3ULQW9LHZ &2362IILFH$ZDUG$SSOLFDWLRQ '( 'RYHU3ROLFH'HSDUWPHQW @) ~!!!~ U.S. Department of Justice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¶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³==´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³+RZWR$SSO\´VHFWLRQRIWKH&2362IILFH$SSOLFDWLRQ*XLGH <RXU6$05HJLVWUDWLRQLVVHWWRH[SLUHRQ  3OHDVHHQWHUGDWHLQ00''<<<<IRUPDW 1RWH,I\RXU6$0UHJLVWUDWLRQLVVHWWRH[SLUHSULRUWR6HSWHPEHUSOHDVHUHQHZ\RXU6$05HJLVWUDWLRQSULRUWRFRPSOHWLQJWKLVDSSOLFDWLRQ&RQWDFW WKH6$06HUYLFH'HVNDWRUYLHZXSGDWH\RXUUHJLVWUDWLRQLQIRUPDWLRQDWKWWSVZZZVDPJRY (&RJQL]DQW)HGHUDO$JHQF\ (QYLURQPHQWDO 3URWHFWLRQ $JHQF\ V KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ 6HOHFWWKHOHJDODSSOLFDQW¶V&RJQL]DQW)HGHUDO$JHQF\$&RJQL]DQW)HGHUDO$JHQF\JHQHUDOO\LVWKHIHGHUDODJHQF\IURPZKLFK\RXUMXULVGLFWLRQUHFHLYHV WKHPRVWIHGHUDOIXQGLQJ<RXU&RJQL]DQW)HGHUDO$JHQF\DOVRPD\KDYHEHHQSUHYLRXVO\GHVLJQDWHGE\WKH2IILFHRI0DQDJHPHQWDQG%XGJHW$SSOLFDQWV WKDWKDYHQHYHUUHFHLYHGIHGHUDOIXQGLQJVKRXOGVHOHFW³'HSDUWPHQWRI-XVWLFH´DVWKH&RJQL]DQW)HGHUDO$JHQF\ ))LVFDO<HDU )URP  WR  3OHDVHHQWHUGDWHLQ00''<<<<IRUPDW *86'LVWULFW$WWRUQH\4XHVWLRQ D,QGLFDWH\RXU86$WWRUQH\¶V2IILFH'LVWULFWE\VHOHFWLQJ\RXUVWDWHDQGWKHQVHOHFWLQJ86$WWRUQH\¶V2IILFH'LVWULFWLQE 'HODZDUH E,QGLFDWH\RXU86$WWRUQH\¶V2IILFH'LVWULFWE\VHOHFWLQJIURPWKHGURSGRZQ 'HODZDUH V +/DZ(QIRUFHPHQW$JHQF\6ZRUQ)RUFH,QIRUPDWLRQ (QWHUWKH)LVFDO<HDU%XGJHWHG6ZRUQ)RUFH6WUHQJWKIRUWKHFXUUHQWILVFDO\HDUEHORZ7KHEXGJHWHGQXPEHURIVZRUQRIILFHUSRVLWLRQVLVWKHQXPEHURI VZRUQSRVLWLRQVIXQGHGLQ\RXUDJHQF\¶VEXGJHWLQFOXGLQJIXQGHGEXWIUR]HQSRVLWLRQVDVZHOODVVWDWH%XUHDXRI,QGLDQ$IIDLUVRUORFDOO\IXQGHG YDFDQFLHV'RQRWLQFOXGHXQIXQGHGYDFDQFLHVRUXQSDLGUHVHUYHRIILFHUV D1XPEHURIRIILFHUVIXQGHGLQDJHQF\¶VFXUUHQWILVFDO\HDUEXGJHW )XOO7LPH  3DUW7LPH  ,&LYLOLDQ6WDIILQJ (QWHUWKHQXPEHURIFLYLOLDQSRVLWLRQVIXQGHGLQDJHQF\¶VFXUUHQWILVFDO\HDUEXGJHW D1XPEHURIFLYLOLDQSRVLWLRQVIXQGHGLQDJHQF\¶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

 3')3ULQW9LHZ I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I 6XPPDU\RI&XUUHQW$FWLYH1RQ&2362IILFH$ZDUGVWKDW6XSSRUWWKH6DPHRU6LPLODU$FWLYLWLHVRU6HUYLFHVDVEHLQJ3URSRVHGLQWKH&236 2IILFH$SSOLFDWLRQ )HGHUDO$ZDUGLQJ $SSOLFDWLRQ 3URJUDP1DPH 3URMHFW 7RWDO ,WHPV 'HVFULEH+RZ7KLV3URMHFW'LIIHUV $JHQF\RU6WDWH 1XPEHU LI /HQJWK 5HTXHVWHG 5HTXHVWHG )URP7KH$SSOLFDWLRQ)RU&236 $JHQF\IRU6XE NQRZQ $PRXQW 2IILFH)XQGLQJ DUGHG DZDUGHG)HGHUDO I )XQGLQJ I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

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¶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¶VFXUUHQWHQWU\ OHYHOVDODULHVDQGIULQJHEHQHILWVIRUIXOOWLPHVZRUQRIILFHUV ,I\RXUDJHQF\UHTXHVWVRIILFHUVWREHGHSOR\HGDVVFKRROUHVRXUFHRIILFHUV 652 $//2)7+(2)),&(5326,7,2165(48(67('%(/2:0867%( 86('72'(3/2<)8//7,0(VFKRROUHVRXUFHRIILFHUV'RQRWUHTXHVWPRUHRIILFHUSRVLWLRQVWKDQ\RXUDJHQF\FDQH[SHFWWRGHSOR\LQWKLVFDSDFLW\$ ³VFKRROUHVRXUFHRIILFHU´LVDFDUHHUODZHQIRUFHPHQWRIILFHUZLWKVZRUQDXWKRULW\ZKRLVHQJDJHGLQFRPPXQLW\SROLFLQJDFWLYLWLHVDQGLVDVVLJQHGE\WKH HPSOR\LQJDJHQF\WRZRUNLQFROODERUDWLRQZLWKVFKRROV,IDZDUGHGDQDZDUGIRU652SRVLWLRQ V SOHDVHQRWHWKDWWKH&2362IILFHUHTXLUHVWKDWWKH RIILFHU V GHSOR\HGLQWRWKH652SRVLWLRQ V VSHQGDPLQLPXPRISHUFHQWRIWKHLUWLPHLQDQGDURXQGSULPDU\DQGVHFRQGDU\VFKRROVZRUNLQJRQVFKRRO DQG\RXWKUHODWHGDFWLYLWLHV7KHSODFHPHQWRIODZHQIRUFHPHQWRIILFHUVLQVFKRROFDUULHVDULVNRIFRQWULEXWLQJWRD³VFKRROWRSULVRQSLSHOLQH´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¶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¶UROHVRQVDIHW\LQIRUPDWLRQVKDULQJ VXSHUYLVLRQUHVSRQVLELOLW\DQGFKDLQRIFRPPDQGIRUWKH652DQGVLJQDWXUHV,IDZDUGHGDUHFLSLHQWPXVWVXEPLWDQ028WRWKH&2362IILFHZLWKLQ GD\VIURPWKHGDWHVKRZQRQWKHDZDUGFRQJUDWXODWRU\OHWWHU,PSOHPHQWDWLRQRIWKH&236+LULQJ3URJUDPDZDUGZLWKRXWVXEPLVVLRQDQGDFFHSWDQFHRIWKH UHTXLUHG028PD\UHVXOWLQH[SHQGLWXUHVQRWEHLQJUHLPEXUVHGE\WKH&2362IILFHDQGRUDZDUGGHREOLJDWLRQ ,QDGGLWLRQLQ6HFWLRQ%\RXPXVWVHOHFW³6FKRRO%DVHG3ROLFLQJWKURXJK6FKRRO5HVRXUFH2IILFHUV´XQGHU³6FKRRO%DVHG3ROLFLQJ´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¶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¶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¶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¶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j) 1R 3DUW 7KHIROORZLQJTXHVWLRQVZLOOKHOS&RQJUHVVDQGWKH86'HSDUWPHQWRI-XVWLFHLGHQWLI\SRWHQWLDOJDSVLQWUDLQLQJ 2QDYHUDJHKRZPDQ\KRXUVRI,16(59,&( QRQUHFUXLW WUDLQLQJ HJ)72FRQWLQXLQJSURIHVVLRQDOHGXFDWLRQUROOFDOOVWDQGDUG DUHUHTXLUHGDQQXDOO\ IRUHDFKRI\RXUDJHQF\¶VRIILFHUVGHSXWLHVLQWKHIROORZLQJFDWHJRULHV LIQRQHSOHDVHLQGLFDWHKRXUV " 8VHRIIRUFH KRXUV  KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

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¶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¶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n 1RQHRIWKHDERYH  :KLFKRIWKHIROORZLQJGR\RXFRXQWPHDVXUHWRDQQXDOO\DVVHVV\RXUDJHQF\¶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l $JHQF\QHZVOHWWHU KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ n 1HLJKERUKRRGQHZVOHWWHUV $JHQF\ZHEVLWH 6RFLDOQHWZRUNLQJ %ORJV7ZLWWHUIHHGV)DFHERRNSDJHVHWF &LWL]HQDOHUWV\VWHP WHOHSKRQHHPDLOWH[WHWF &LWL]HQDOHUWV\VWHPWKDWLVJHRJUDSKLFDOO\WDUJHWHGEDVHGRQXSGDWHGKRWVSRWV 3XEOLFDFFHVVWHOHYLVLRQUDGLR &RPPXQLW\RUJDQL]DWLRQERDUGPHPEHUVKLS 3XEOLFIRUXPVZLWKFKLHIVKHULIIFRPPDQGVWDII 3RVWHUVELOOERDUGVIO\HUV [l 1RQHRIWKHDERYH  7KURXJKZKLFKRIWKHIROORZLQJZD\VGRHV\RXUDJHQF\IRUPDOO\LQYROYHFRPPXQLW\PHPEHUVLQLQIOXHQFLQJDJHQF\SUDFWLFHVDQGRSHUDWLRQV"3OHDVH FKHFNDOOWKDWDSSO\ &LWL]HQSROLFHDFDGHPLHV • 9ROXQWHHUDFWLYLWLHV $X[LOLDU\SROLFHSURJUDPV [l &LYLOLDQUHYLHZERDUGV LHGLVFLSOLQDU\UHYLHZERDUGV &LWL]HQDGYLVRU\JURXSV LHLQIRUPDODGYLVRU\IXQFWLRQ [) ,QYROYHPHQWLQKLULQJGHFLVLRQV LQWHUYLHZSDQHOVVHOHFWLRQERDUGVHWF u ,QYROYHPHQWLQFRQWULEXWLQJWRDQQXDOOLQHRIILFHUSHUIRUPDQFHUHYLHZV ( l 5HSUHVHQWDWLRQRQSURPRWLRQDOERDUGV [l 3DUWLFLSDWLRQLQDFFRXQWDELOLW\DQGSHUIRUPDQFHUHSRUWLQJDQGWUDFNLQJPHHWLQJV [l 3DUWLFLSDWLRQLQFRPSODLQWUHVROXWLRQSURFHVV IRUPDOPHGLDWLRQGLVFLSOLQDU\ERDUGVHWF •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¶VFDSDFLW\WRLPSOHPHQWFRPPXQLW\SROLFLQJVWUDWHJLHVDQG DSSURDFKHV  8VLQJWKHIROORZLQJOLVWVHOHFWDSUREOHPIRFXVDUHDWKDWZLOOEHDGGUHVVHGE\WKHRIILFHUVUHTXHVWHGLQWKLVDSSOLFDWLRQ3OHDVHFKRRVHWKHRSWLRQWKDWEHVW ILWV\RXUSUREOHP<RXPD\VHOHFWRQHSUREOHPIRFXVDUHDWRDGGUHVVWKURXJKWKLVDZDUGIXQGLQJ :KHQLGHQWLI\LQJDSUREOHPLWLVLPSRUWDQWWRWKLQNDERXWWKHQDWXUHRIVLPLODULQFLGHQWVWKDWWDNHQWRJHWKHUFRPSULVHWKHSUREOHPDQGDFFRUGLQJO\GHVFULEH LWLQSUHFLVHVSHFLILFWHUPV HJ³EXUJODU\RIUHWDLOHVWDEOLVKPHQWV´UDWKHUWKDQMXVW³EXUJODU\´ ,QGRLQJWKLVLWFDQEHKHOSIXOWRFRQVLGHUDOODVSHFWVRIWKH SUREOHPLQFOXGLQJWKHOLNHO\RIIHQGHUVWKHVXLWDEOHWDUJHWVYLFWLPVDQGKRZWKHVHFRPHWRJHWKHULQWLPHDQGVSDFH 6FKRRO%DVHG3ROLFLQJ [l &KLOG6H[XDO3UHGDWRUVDQG,QWHUQHW6DIHW\ &KLOGUHQ([SRVHGWR9LROHQFH <RXWK&ULPHDQG'HOLQTXHQF\ 6FKRRO%DVHG3ROLFLQJ 6FKRRO%DVHG3ROLFLQJWKURXJK6FKRRO5HVRXUFH2IILFHUV %\VHOHFWLQJWKLVIRFXVDUHD\RXUDJHQF\LVFRPPLWWLQJWKDWLIDZDUGHGDOORIILFHUSRVLWLRQVUHTXHVWHGLQWKLVDSSOLFDWLRQ RUDQHTXLYDOHQWQXPEHURI UHGHSOR\HGYHWHUDQRIILFHUV ZLOOEHXVHGWRGHSOR\VFKRROUHVRXUFHRIILFHUVDQGDGGUHVVSUREOHPVLQDQGDURXQGSULPDU\DQGVHFRQGDU\VFKRROV 3OHDVHVSHFLI\WKHDUHDVWKHVFKRROUHVRXUFHRIILFHU V ZRXOGDGGUHVV FKHFNDOOWKDWDSSO\  [l $GGUHVVFULPHSUREOHPVJDQJVDQGGUXJDFWLYLWLHVDIIHFWLQJRURFFXUULQJLQRUDURXQGDQHOHPHQWDU\RUVHFRQGDU\VFKRRO [l 'HYHORSRUH[SDQGFULPHSUHYHQWLRQHIIRUWVIRUVWXGHQWV (GXFDWH\RXWKLQFULPHSUHYHQWLRQDQGVDIHW\ • 'HYHORSRUH[SDQGFRPPXQLW\MXVWLFHLQLWLDWLYHVIRUVWXGHQWV u n 7UDLQVWXGHQWVLQFRQIOLFWUHVROXWLRQUHVWRUDWLYHMXVWLFHDQGFULPHDZDUHQHVV [l $VVLVWLQWKHLGHQWLILFDWLRQRISK\VLFDOFKDQJHVLQWKHHQYLURQPHQWWKDWPD\UHGXFHFULPHLQRUDURXQGWKHVFKRRO [) $VVLVWLQGHYHORSLQJVFKRROSROLF\WKDWDGGUHVVHVFULPHDQGWRUHFRPPHQGSURFHGXUDOFKDQJHVWRHQKDQFHVFKRROVDIHW\ • 2WKHU$UHD 3OHDVH6SHFLI\2WKHU$UHD 2WKHU6FKRRO%DVHG3ROLFLQJ SOHDVHVSHFLI\ 2SLRLG(GXFDWLRQ3UHYHQWLRQDQG,QWHUYHQWLRQ n (GXFDWLRQ3UHYHQWLRQDQG,QWHUYHQWLRQ KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ +RPHODQG %RUGHU6HFXULW\3UREOHPV 7 3DUWQHULQJZLWK)HGHUDO/DZ(QIRUFHPHQWWR&RPEDW,OOHJDO,PPLJUDWLRQ HJLQIRUPDWLRQVKDULQJ J SDUWQHUVKLSVWDVNIRUFHVDQGKRQRULQJ GHWDLQHUV u 3URWHFWLQJ&ULWLFDO,QIUDVWUXFWXUH3UREOHPV [l ,QIRUPDWLRQRU,QWHOOLJHQFH3UREOHPV [l 2WKHU+RPHODQG6HFXULW\3UREOHP SOHDVHVSHFLI\ 1RQ9LROHQW&ULPH3UREOHPVDQG4XDOLW\RI/LIH3ROLFLQJ :-1 %XUJODU\ n )UDXG n /DUFHQ\7KHIW 1RQ0RWRU9HKLFOH (J 0RWRU9HKLFOH7KHIW7KHIWIURP0RWRU9HKLFOH (J 9DQGDOLVP [J 6RFLDO'LVRUGHU [l 4XDOLW\RI/LIH3UREOHP 3URVWLWXWLRQ u 0LVGHPHDQRU&ULPHV [J 'LVRUGHUO\$FWLYLW\ n 7UDIILFDQG3HGHVWULDQ6DIHW\ n 2WKHU1RQ9LROHQW&ULPH3UREOHP SOHDVHVSHFLI\ %XLOGLQJ7UXVWDQG5HVSHFW u %XLOGLQJ7UXVWDQG5HVSHFW 9LROHQW&ULPH3UREOHPV 7 $VVDXOW n +RPLFLGH (J 5DSH (J 5REEHU\ [J 'RPHVWLF9LROHQFH [l +XPDQ7UDIILFNLQJ *XQ9LROHQFH ,I6HOHFWHG3OHDVHVSHFLI\\RXUJXQYLROHQFHSUREOHPIRUH[DPSOHJXQYLROHQFHE\MXYHQLOHJDQJPHPEHUVGUXJUHODWHGJXQYLROHQFHHWF ,QFUHDVHGJXQYLROHQFHDVVRFLDWHGZLWKMXYHQLOHJDQJPHPEHUVDQGLOOHJDOGUXJDFWLYLWLHV 3OHDVHDOVRLQFOXGHWKHQXPEHURIDJJUDYDWHGDVVDXOWVZLWKDILUHDUPLQ\RXUMXULVGLFWLRQGXULQJWKHODVWFDOHQGDU\HDU  &ULPLQDO*DQJV 'UXJ0DQXIDFWXULQJ'UXJ'HDOLQJ'UXJ7UDIILFNLQJ u 2WKHU9LROHQW&ULPH3UREOHP SOHDVHVSHFLI\ D %ULHIO\GHVFULEHWKHSUREOHPIRFXVDUHDWKDW\RXZLOODGGUHVVZLWKWKHVHDZDUGIXQGVDQG\RXUDSSURDFKWRWKHSUREOHP>FKDUDFWHUVRUOHVV@ KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ Š‡‹–›‘ˆ‘˜‡”‹•‡š’‡”‹‡ ‹‰ƒƒŽƒ”‹‰‹ ”‡ƒ•‡‹—„‡”‘ˆ‰—”‡Žƒ–‡†˜‹‘Ž‡– ”‹‡•‘˜‡”–Š‡Žƒ•– •‡˜‡”ƒŽ‘–Š•ƒ†ƒ›‘ˆ–Š‡™‡”‡ ‘‹––‡†„›Œ—˜‡‹Ž‡‰ƒ‰‡„‡”•Ŝ‹ ‡‘˜‡„‡”ɩɥɨɰř–Š‡’‘Ž‹ ‡ †‡’ƒ”–‡–”‡•’‘†‡†–‘ɩɮ•‡’ƒ”ƒ–‡˜‹ –‹•™Š‘™‡”‡ƒ••ƒ—Ž–‡†ř‹Œ—”‡†‘”‹ŽŽ‡†™‹–Šƒ‰—Ŝƒ›‘ˆ–Š‡ ˜‹ –‹•ƒ††‡ˆ‡†ƒ–•‹˜‘Ž˜‡†‹–Š‡•‡‰—˜‹‘Ž‡ ‡ ƒ•‡•ř™‡”‡†‹”‡ –Ž›–‹‡†–‘•‘‡–›’‡‘ˆ‰ƒ‰ ƒˆˆ‹Ž‹ƒ–‹‘Ŝ –Š‡ˆ‹”•––™‘‘–Š•‘ˆɩɥɩɥř•Š‘‘–‹‰‹ ‹†‡–• ‘–‹—‡†–‘”‹•‡ƒ•–Š‡’‘Ž‹ ‡†‡’ƒ”–‡– ”‡•’‘†‡†–‘–Š‹”–‡‡‹ ‹†‡–•™Š‹ Š‹ Ž—†‡†–Š”‡‡Š‘‹ ‹†‡•ƒ†ɮƒ††‹–‹‘ƒŽ˜‹ –‹•™Š‘™‡”‡•Š‘–„›ƒ ‰—Ŝ‹‡ſɭɰʩƀ‘ˆ–Š‡•‡‹ ‹†‡–•™‡”‡‰ƒ‰”‡Žƒ–‡†ŜŠ‡‰”‘™‹‰‹ ‹†‡ ‡•‘ˆ‰—˜‹‘Ž‡ ‡•‹‰‹ˆ‹ ƒ–Ž› ‹’ƒ –•–Š‡ƒ„‹Ž‹–›‘ˆ‘—””‡•‹†‡–•ř˜‹•‹–‘”•řƒ†Ž‘ ƒŽ„—•‹‡••‘™‡”•–‘ˆ‡‡Ž•ƒˆ‡™‹–Š‹–Š‡ ‘—‹–›Ŝ  ˆƒ™ƒ”†‡†ř–Š‡ˆ—†•™‹ŽŽ’”‘˜‹†‡–Š‡Ž‡˜‡”ƒ‰‡‡‡†‡†ˆ‘”–Š‡‹–›‘ˆ‘˜‡”–‘ƒ’’”‘˜‡–Š‡Š‹”‹‰‘ˆˆ‹˜‡ ƒ††‹–‹‘ƒŽ’‘Ž‹ ‡‘ˆˆ‹ ‡”•™Š‘ƒ”‡†‡•’‡”ƒ–‡Ž›‡‡†‡†ŜŠ‡ƒ‹ˆ‘ —•™‹ŽŽ„‡–‘ ‘„ƒ–‰—”‡Žƒ–‡† ”‹‡• ƒ†Œ—˜‡‹Ž‡‰ƒ‰˜‹‘Ž‡ ‡„›„—‹Ž†‹‰—’ƒ’‘Ž‹ ‡’”‡•‡ ‡‹ƒˆˆ‡ –‡†ƒ”‡ƒ•‘ˆ–Š‡ ‹–›–‘ˆ‘•–‡” ‘‘’‡”ƒ–‹‘™‹–Š–Š‡”‡•‹†‡–•‹–Š‘•‡ƒ”‡ƒ•ŜŠ‡ƒ††‹–‹‘ƒŽƒ’‘™‡”™‹ŽŽ‡š’ƒ†–Š‡ƒ–”‘Ž‹˜‹•‹‘ƒ† ‘—‹–›‘Ž‹ ‹‰‹–ƒ†”‡†— ‹‰˜‹‘Ž‡– ”‹‡™‹ŽŽ„‡ƒ ‘ŽŽƒ„‘”ƒ–‹˜‡‰‘ƒŽˆ‘”„‘–Š–Š‡’‘Ž‹ ‡ †‡’ƒ”–‡–ƒ†–Š‡ ‘—‹–›‹™Š‹ Š‹–•‡”˜‡•Ŝ ƒ††‹–‹‘ř–Š‡†‡’ƒ”–‡–Ũ•–”ƒ–‡‰‹ Žƒ•–”‘‰Ž› •—’’‘”–•ˆ‘•–‡”‹‰ ‘—‹–›’‘Ž‹ ‹‰‡ˆˆ‘”–•„›ƒŽŽ‘’‡”ƒ–‹‘ƒŽ—‹–•–‘‹ ”‡ƒ•‡’—„Ž‹ ƒ™ƒ”‡‡••ƒ† ‘—‹–›‹˜‘Ž˜‡‡–ŜŠ‡†‡’ƒ”–‡–Š‘’‡•–Šƒ––Š‹•’‘•‹–‹˜‡’‘Ž‹ ‡ ‘–ƒ –™‹ŽŽƒŽ•‘Š‡Ž’‘ˆˆ‹ ‡”•”‡ƒ Š Œ—˜‡‹Ž‡•ƒ–ƒ‡ƒ”Ž‹‡”ƒ‰‡ƒ†Š‡Ž’–Š‡‡†— ƒ–‡–Š‡•‡›‘—‰’‡‘’Ž‡ƒ†‰—‹†‡–Š‡‹ƒ’‘•‹–‹˜‡†‹”‡ –‹‘Ŝ ƒ˜‹‰‘ˆˆ‹ ‡”• Ž‘•‡Ž› ‘‡ –‡†–‘ƒŽŽ”‡•‹†‡–•ř’”‘’‡”–›ƒƒ‰‡”•ř„—•‹‡••‘™‡”•řƒ†˜ƒ”‹‘—• •–ƒ‡Š‘Ž†‡”•‹–Š‡ ‘—‹–›™‹ŽŽ‘Ž›ˆ‘•–‡” ‘‘’‡”ƒ–‹‘ř–”—•–řƒ†–”ƒ•’ƒ”‡ ›Ŝ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~ 7KHPHGLD [l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¶VFDSDFLW\WRLPSOHPHQWFRPPXQLW\SROLFLQJDSSURDFKHV  ,IDZDUGHGIXQGVZLOO\RXUDJHQF\LQLWLDWHRUHQKDQFHDQ\RIWKHIROORZLQJLQWHUQDOFKDQJHVWRSHUVRQQHOPDQDJHPHQW" 6HOHFWQRPRUHWKDQLQWHUQDO FKDQJHVWRSHUVRQQHOPDQDJHPHQWWKDWZLOOEHDGGUHVVHGZLWKWKHVHDZDUGIXQGV D )OH[LELOLW\LQRIILFHUVKLIWDVVLJQPHQWVWRIDFLOLWDWHDGGUHVVLQJVSHFLILFSUREOHPV r.i $VVLJQPHQWRIRIILFHUVWRVSHFLILFQHLJKERUKRRGVRUDUHDVIRUORQJHUSHULRGVRIWLPHWRHQKDQFHFXVWRPHUVHUYLFHDQGIDFLOLWDWHPRUHFRQWDFWEHWZHHQ SROLFHDQGFLWL]HQV 3OHDVHSURYLGHDQDUUDWLYHIRUHDFKLQWHUQDOFKDQJHWRSHUVRQQHOPDQDJHPHQWLGHQWLILHG FKDUDFWHUVRUOHVV •’”‡• ”‹„‡†‹‘—”–”ƒ–‡‰‹ Žƒř–Š‡‘˜‡”‘Ž‹ ‡‡’ƒ”–‡–’Žƒ•–‘Šƒ˜‡ƒŽŽ’‘Ž‹ ‡‘ˆˆ‹ ‡”•‡‰ƒ‰‡†‹ ‘—‹–›’‘Ž‹ ‹‰ƒ –‹˜‹–‹‡•–‘‹ ”‡ƒ•‡’—„Ž‹ ƒ™ƒ”‡‡••ƒ† ‘—‹–›‹˜‘Ž˜‡‡–ŜŠ‡ƒ††‹–‹‘ƒŽ ƒ’‘™‡”’”‘˜‹†‡†„›–Š‹•‰”ƒ–™‹ŽŽ‡ƒ„Ž‡–Š‡†‡’ƒ”–‡––‘Šƒ˜‡‘ˆˆ‹ ‡”•‡‰ƒ‰‡†‹•’‡ ‹ˆ‹ ‡‹‰Š„‘”Š‘‘†• ‹–Š‡ ‘—‹–›ˆ‘”Ž‘‰‡”’‡”‹‘†•‘ˆ–‹‡–‘†‡˜‡Ž‘’”‡Žƒ–‹‘•Š‹’•ř–”—•–ƒ†–”ƒ•’ƒ”‡ ›™‹–Š‘—” ‘—‹–›’ƒ”–‡”•Ŝ‘—‹–›‘Ž‹ ‹‰‹–‘ˆˆ‹ ‡”•Šƒ˜‡ƒŽ™ƒ›•„‡‡ƒ••‹‰‡†–‘•’‡ ‹ˆ‹ ‡‹‰Š„‘”Š‘‘†•–‘ „—‹Ž†”‡Žƒ–‹‘•Š‹’•ƒ†–”—•–‹–Š‘•‡ƒ”‡ƒ•Ŝ ‘™‡˜‡”ř–Š‡ƒ††‹–‹‘ƒŽ‡‰ƒ‰‡‡–‘ˆ’ƒ–”‘Ž‘ˆˆ‹ ‡”•‹–Š‡ •ƒ‡™ƒ›™‹ŽŽŠ‡Ž’–‘’”‘˜‹†‡‘”‡’”‡•‡ ‡‹ƒŽŽ–Š‡ƒ”‡ƒ•‘ˆ–Š‡ ‹–›‡˜‡”›†ƒ›ƒ•–Š‹•‹•™Šƒ–‹•‡‡†‡†Ŝ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

 3')3ULQW9LHZ Š‡‘˜‡”‘Ž‹ ‡‡’ƒ”–‡– ”‹‡ƒƒŽ›•–‹†‡–‹ˆ‹‡•ƒ†‘‹–‘”• ”‹‡–”‡†•ř ”‹‡ƒ’Š‘–•’‘–•ř ƒƒŽ›•‡•ř’”‡†‹ –• ”‹‹ƒŽƒ –‹˜‹–›—•‹‰–Š‡†ƒ–ƒˆ”‘˜ƒ”‹‘—••–ƒ–‡ƒ†ˆ‡†‡”ƒŽ•›•–‡•Ŝ ƒ††‹–‹‘ř –Š‡†‡’ƒ”–‡–ƒŽ•‘—•‡•‹–‡ŽŽ‹‰‡ ‡”‡ ‡‹˜‡†ˆ”‘ ‹–‹œ‡•Ũ ‘’Žƒ‹–•ƒ†‘–Š‡”•–ƒ–‡ƒ†ˆ‡†‡”ƒŽŽƒ™ ‡ˆ‘” ‡‡–ƒ‰‡ ‹‡•–‘‹†‡–‹ˆ›Ž‘ ƒŽ†”—‰†‡ƒŽ‡”•ƒ†–Š‡‡‹‰Š„‘”Š‘‘†•Ŝƒ„‹™‡‡Ž›„ƒ•‹•ř–Š‡ †‡’ƒ”–‡– ”‹‡ƒƒŽ›•–řˆ‹”•–Ž‹‡•—’‡”˜‹•‘”•ƒ† ‘ƒ†•–ƒˆˆ‡‡–™‹–Š†‡’ƒ”–‡–Ž‡ƒ†‡”•Š‹’–‘ •–”ƒ–‡‰‹œ‡ƒ††‡–‡”‹‡†‡’Ž‘›‡–ƒ’’”‘ƒ Š‡•ˆ‘”’‘Ž‹ ‡”‡•‘—” ‡•Ŝ ƒ††‹–‹‘ř–Š‡†‡’ƒ”–‡–™‹ŽŽ ‘–‹—‡–‘’ƒ”–‡”™‹–Š‘–Š‡”Ž‘ ƒŽ ‘—‹–›ř•–ƒ–‡řƒ†ˆ‡†‡”ƒŽƒ‰‡ ‹‡•–‘†‡–‡”‹‡ƒ’’”‘ƒ Š‡•ƒ† •‘Ž—–‹‘•ˆ‘”•— ‡••ˆ—ŽŽ›’”‘•‡ —–‡ƒ†”‡‘˜‡˜‹‘Ž‡–‘ˆˆ‡†‡”•ˆ”‘–Š‡ ‘—‹–‹‡•™‡•‡”˜‡Ŝ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l 1RQHRIWKHDERYH  7RZKDWH[WHQWDUHWKHUHUHODWHGJRYHUQPHQWDODQGRUFRPPXQLW\LQLWLDWLYHVWKDWFRPSOHPHQW\RXUDJHQF\¶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Š‡ ŠƒŽŽ‡‰‡•ˆƒ ‹‰Žƒ™‡ˆ‘” ‡‡–ƒ†•‘ ‹‡–›–‘†ƒ›ƒ”‡‡‘”‘—•Ś‰—˜‹‘Ž‡ ‡ř‰ƒ‰•ř–Š‡‘’‹‘‹† ”‹•‹•ř ƒ†’‡”•‘ƒŽ•‡ —”‹–›ˆƒ –‘”•ŚƒŽŽ ‘–”‹„—–‡–‘‹ ”‡ƒ•‹‰˜‹‘Ž‡– ”‹‡–”‡†•™‹–Š‹‘—” ‘—‹–›Ŝ•ƒ ”‡•—Ž–ř–Š‡‘˜‡”‘Ž‹ ‡‡’ƒ”–‡–ƒ††”‡••‡†–Š‡•‡ ‘ ‡”•™‹–Š‹ ”‡ƒ•‡†‘˜‡”–‹‡’ƒ–”‘Ž•‹ƒˆˆ‡ –‡† ƒ”‡ƒ•–Š”‘—‰Š‘—––Š‡ ‹–›–Šƒ–™‡”‡‹†‡–‹ˆ‹‡†–Š”‘—‰Š–Š‡—•‡‘ˆ ”‹‡ƒƒŽ›•‹•ŜŠ‡„—›Ş‹„›’‘Ž‹ ‡ ’‡”•‘‡Žƒ•™‡ŽŽƒ•‡„‡”•‘ˆ–Š‡ ‘—‹–›řŠƒ•„‡‡‘—–•–ƒ†‹‰ƒ†•— ‡••‹†‡ ”‡ƒ•‹‰˜‹‘Ž‡– ”‹‡• ‡ƒ•—”‡†Ŝ ‘™‡˜‡”řƒ††‹–‹‘ƒŽ’‡”•‘‡Ž”‡•‘—” ‡•ƒ”‡”‡“—‹”‡†–‘ ‘–‹—‡–Š‡•‡‡ˆˆ‘”–•‘ƒ‘”‡’‡”ƒ‡– „ƒ•‹•Ŝ  Ž–Š‘—‰Š–Š‡ ‹–›•—’’‘”–•–Š‡‘˜‡”–‹‡‡ˆˆ‘”–•ƒ†‡–‘†ƒ–‡řˆ—†‹‰ˆ‘”–Š‡ˆ‹˜‡ƒ††‹–‹‘ƒŽ’‘Ž‹ ‡‘ˆˆ‹ ‡”• ”‡“—‡•–‡†‹–Š‡ ɩɨ„—†‰‡–•–ƒ”–‹‰‹ —Ž›ɩɥɩɥř‹•‘– —””‡–Ž›ƒ˜ƒ‹Žƒ„Ž‡Ŝ‹–›–ƒš‡•‘”ˆ‡‡•‹ ”‡ƒ•‡• ƒ”‡‘– —””‡–Ž›•—’’‘”–‡†ř„—––Š‡•‡‰”ƒ–ˆ—†•™‹ŽŽ•‡ —”‡–Š‡Ž‡˜‡”ƒ‰‡‡‡†‡†ˆ‘”–Š‡’‘•‹–‹‘•–‘ „‡ˆ—†‡†Ŝ %6HUYLFH3RSXODWLRQ (QWHUWKHWRWDOSRSXODWLRQRIWKHJRYHUQPHQWHQWLW\DSSO\LQJIRUWKLVDZDUGXVLQJWKHODWHVWFHQVXVHVWLPDWHDYDLODEOHLQWKH$PHULFDQ)DFW)LQGHUDW KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ KWWS)DFW)LQGHUFHQVXVJRY  &KHFNKHUHLIWKHSRSXODWLRQRIWKHHQWLW\DSSO\LQJIRUWKLVDZDUGLVQRWUHSUHVHQWHGE\86&HQVXVILJXUHV HJFROOHJHVVSHFLDODJHQFLHVVFKRRO SROLFHGHSDUWPHQWVHWF  :KDWLVWKHDFWXDOSRSXODWLRQ\RXUGHSDUWPHQWVHUYHVDVWKHSULPDU\ODZHQIRUFHPHQWHQWLW\" 7KLVPD\RUPD\QRWEHWKHVDPHDVWKHSRSXODWLRQVSHFLILHGDERYH)RUH[DPSOHDVHUYLFHSRSXODWLRQPD\EHWKHFHQVXVSRSXODWLRQPLQXVLQFRUSRUDWHG WRZQVDQGFLWLHVWKDWKDYHWKHLURZQSROLFHGHSDUWPHQWZLWKLQ\RXUJHRJUDSKLFERXQGDULHVRUHVWLPDWHVRIULGHUVKLS HJWUDQVLWSROLFH RUYLVLWRUV HJSDUN SROLFH $QDJHQF\ZLWKSULPDU\ODZHQIRUFHPHQWDXWKRULW\LVGHILQHGDVKDYLQJILUVWUHVSRQGHUUHVSRQVLELOLW\WRFDOOVIRUVHUYLFHIRUDOOW\SHVRIFULPLQDO LQFLGHQWVZLWKLQLWVMXULVGLFWLRQ D,IDSSOLFDEOHSOHDVHH[SODLQZK\WKHVHUYLFHSRSXODWLRQGLIIHUVIURPWKHFHQVXVSRSXODWLRQ &)LVFDO+HDOWK (QWHU\RXUODZHQIRUFHPHQWDJHQF\¶VWRWDORSHUDWLQJEXGJHWIRUWKHFXUUHQW$1'SUHYLRXVWZRILVFDO\HDUV3OHDVHQRWH$OOILJXUHVPXVWEHURXQGHGWRWKH QHDUHVWZKROHGROODU &855(17),6&$/<($5    35(9,286),6&$/<($5    35(9,286),6&$/<($5    7KH86&HQVXV%XUHDX$PHULFDQ&RPPXQLW\6XUYH\ $&6 SURYLGHVPXOWL\HDUSRYHUW\UDWHHVWLPDWHVIRUFRPPXQLWLHV3OHDVHJRWRWKH86 &HQVXV%XUHDX¶V$PHULFDQ)DFW)LQGHU KWWS)DFW)LQGHUFHQVXVJRY WRGHWHUPLQHWKHSHUFHQWDJHRILQGLYLGXDOVLQSRYHUW\LQ\RXUMXULVGLFWLRQ )RUMXULVGLFWLRQVQRWLQFOXGHGLQWKHFHQVXV HJVFKRROVXQLYHUVLWLHVWUDQVLWSDUNV SOHDVHFKHFNWKHER[IRU³1RW$SSOLFDEOH3OHDVHVHHWKHSURJUDP $SSOLFDWLRQ*XLGHIRUDGGLWLRQDOLQIRUPDWLRQDQGKHOSLQXVLQJWKH$PHULFDQ)DFW)LQGHU3OHDVHQRWH$OOILJXUHVPXVWEHURXQGHGWRWKHQHDUHVWZKROH SHUFHQW D3HUFHQWDJHRILQGLYLGXDOVLQSRYHUW\  D 1RW$SSOLFDEOH 7KH%XUHDXRI/DERU6WDWLVWLFV¶/RFDO$UHD8QHPSOR\PHQW6WDWLVWLFV /$86 SURJUDPSURYLGHVPRQWKO\HVWLPDWHVRIXQHPSOR\PHQWIRU FRPPXQLWLHV3OHDVHJRWRWKH%XUHDXRI/DERU6WDWLVWLFV¶/$86ZHEVLWH KWWSZZZEOVJRYODXGDWDKWP WRILQGGHWDLOHGLQVWUXFWLRQVIRU ORRNLQJXS\RXUORFDODUHD VXQHPSOR\PHQWUDWH,WPD\EHQHFHVVDU\WRVHOHFWWKHQHDUHVWEHVWPDWFKWR\RXUMXULVGLFWLRQ IRUH[DPSOHDFLW\RIIHZHU WKDQSHRSOHPD\UHSRUWWKHLUFRXQW\OHYHOUDWH 3OHDVHVHHWKHSURJUDPDSSOLFDWLRQJXLGHIRUDGGLWLRQDOLQIRUPDWLRQDQGKHOSLQXVLQJWKH/$86GDWD )RUMXULVGLFWLRQVQRWLQFOXGHGLQWKHFHQVXV HJVFKRROVXQLYHUVLWLHVWUDQVLWSDUNV SOHDVHFKHFNWKHER[IRU³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u 0\DJHQF\FDQQRWUHSRUWFULPHGDWDIRU ( l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¶VODZHQIRUFHPHQWEXGJHWZLWK VWDWHDQGRUORFDOIXQGVDWWKHHQGRIDZDUGIXQGLQJRYHUDQGDERYHWKHQXPEHURIORFDOO\IXQGHGVZRUQRIILFHUSRVLWLRQVWKDWZRXOGKDYHH[LVWHGLQWKH DEVHQFHRIWKHDZDUG7KHVHDGGLWLRQDOSRVLWLRQ V PXVWEHUHWDLQHGXVLQJVWDWHORFDORURWKHUQRQIHGHUDOIXQGLQJRQO\<RXPD\QRWXVHIXQGVDZDUGHGE\ RWKHUIHGHUDODZDUGVWRFRYHUWKHFRVWVRIUHWHQWLRQ$WWKHWLPHRIDZDUGDSSOLFDWLRQDSSOLFDQWVPXVWDIILUPWKDWWKH\SODQWRUHWDLQWKHSRVLWLRQVDQGLGHQWLI\ WKHSODQQHGVRXUFH V RIUHWHQWLRQIXQGLQJ:HXQGHUVWDQGWKDW\RXUDJHQF\¶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• 3ULYDWHVRXUFHVGRQDWLRQV n 1RQIHGHUDODVVHWIRUIHLWXUHIXQGV VXEMHFWWRDSSURYDOIURPWKHVWDWHRUORFDORYHUVLJKWDJHQF\ n )XQGUDLVLQJHIIRUWV [) 6WDWHORFDORURWKHUQRQIHGHUDODZDUGIXQGLQJ u 2WKHU ,IRWKHUSOHDVHSURYLGHDEULHIGHVFULSWLRQRIWKHVRXUFH V RIIXQGLQJQRWWRH[FHHGFKDUDFWHUV 6(&7,212)),&,$/3$571(5 6 &217$&7,1)250$7,21 $QRIILFLDO³SDUWQHU´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¶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¶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¶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u ([HPSW  L )L[HG5DWH  +HDOWK,QVXUDQFH )DPLO\&RYHUDJH       /LIH,QVXUDQFH       9DFDWLRQ 1XPEHURI+RXUV$QQXDOO\  , - - - - - - , '--~ _ _ - ___.~ '--~- ___.~       6LFN 1XPEHURI+RXUV$QQXDOO\        /HDYH 5HWLUHPHQW       :RUNHU V&RPSHQVDWLRQ u ([HPSW       8QHPSOR\PHQW ([HPSW       ,QVXUDQFH 2WKHU 6KLIW 'LIIHUHQWLDO 3D\PHQWV V       2WKHU $FFLGHQWDO 'HDWK DQG 'LVDELOLW\ V       2WKHU 3ROLFH 7UXVW V        %HQHILWV6XE7RWDO3HU<HDU 3RVLWLRQ   I I &7RWDO6DODU\%HQHILWV3HU<HDU 3RVLWLRQ   I I '7RWDO6DODU\DQG%HQHILWVIRU<HDUV DQG 3RVLWLRQ   ;  RI3RVLWLRQV ~1-~1  6$/$5<'(7$,/6 3DUW6ZRUQ2IILFHU6DODU\,QIRUPDWLRQ ,I\RXUDJHQF\ VVHFRQGRUWKLUG\HDUFRVWVIRUVDODULHVDQGRUIULQJHEHQHILWVLQFUHDVHDIWHUWKHILUVW\HDUFKHFNWKHUHDVRQV V ZK\LQWKHVSDFHEHORZ,I WKHVHFRVWVGRQRWLQFUHDVHSOHDVHVHOHFW³1RW$SSOLFDEOH´ &RVWRI/LYLQJ$GMXVWPHQW &2/$ 6WHS5DLVHV n &KDQJHLQ%HQHILW&RVWV [ 1RW$SSOLFDEOH 3DUW)HGHUDO/RFDO6KDUH&RVWV IRU+LULQJ$ZDUGV $VSDUWRIWKHORFDOPDWFKLQJUHTXLUHPHQWIRUWKH&236+LULQJ3URJUDPUHFLSLHQWVPXVWDVVXPHDSURJUHVVLYHO\ODUJHUVKDUHRIWKHFRVWRIWKHDZDUG ZLWKORFDOIXQGVRYHUWKHWKUHH\HDUDZDUGSHULRG7KLVPHDQVWKDW\RXUORFDOPDWFKPXVWLQFUHDVHHDFK\HDUZKLOHWKHIHGHUDOVKDUHPXVWGHFUHDVH  7RWDO6DODU\DQG%HQHILWVIRU\HDU  DOOSRVLWLRQV   7RWDO)HGHUDO6KDUH KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ  7RWDO)HGHUDO3HUFHQWDJH  7RWDOORFDOVKDUHUHTXLUHG  7RWDO/RFDO3HUFHQWDJH 3OHDVHSURMHFWLQWKHFKDUWEHORZKRZ\RXUDJHQF\SODQVWRDVVXPHDSURJUHVVLYHO\ODUJHUVKDUHRIWKHDZDUGFRVWVGXULQJHDFK\HDURIWKHSURJUDP7KH FKDUWLVRQO\DSURMHFWLRQRI\RXUSODQVZKLOH\RXUDJHQF\PD\GHYLDWHIURPWKHVHVSHFLILFSURMHFWLRQVGXULQJWKHDZDUGSHULRGLWPXVWVWLOOHQVXUHWKDWWKH IHGHUDOVKDUHGHFUHDVHVDQGWKHORFDOVKDUHLQFUHDVHV)RUPRUHGHWDLOVRQORFDOPDWFKLQJUHTXLUHPHQWVIRUWKLVSURJUDPSOHDVHUHIHUWR KWWSVFRSVXVGRMJRYJUDQWV 3OHDVHXVHWKH5HFDOFXODWHEXWWRQEHORZDIWHUDQ\FKDQJHVWRWKHEHQHILWWDEOHDERYHEHIRUHPRYLQJIRUZDUG  3HUFHQWRIWKH³7RWDO/RFDO6KDUH5HTXLUHG´\RXUDJHQF\SODQVWRDVVXPHLQ<HDU  3HUFHQWRIWKH³7RWDO/RFDO6KDUH5HTXLUHG´\RXUDJHQF\SODQVWRDVVXPHLQ<HDU  3HUFHQWRIWKH³7RWDO/RFDO6KDUH5HTXLUHG´\RXUDJHQF\SODQVWRDVVXPHLQ<HDU  3HUFHQW7RWDO  )HGHUDO6KDUH<HDU  )HGHUDO6KDUH<HDU  )HGHUDO6KDUH<HDU  )HGHUDO7RWDO  /RFDO6KDUH<HDU  /RFDO6KDUH<HDU  /RFDO6KDUH<HDU  /RFDO7RWDO  5HFDOFXODWH 6%8'*(76800$5< ,QVWUXFWLRQV3OHDVHUHYLHZWKHFDWHJRU\WRWDOVDQGWKHWRWDOSURMHFWFRVWVEHORZ,IWKHFDWHJRU\WRWDOVDQGSURMHFWDPRXQWVVKRZQDUHFRUUHFWSOHDVH FRQWLQXHZLWKWKHVXEPLVVLRQRI\RXUDSSOLFDWLRQ6KRXOG\RXQHHGWRPDNHUHYLVLRQVWRDEXGJHWFDWHJRU\SOHDVHUHWXUQWRWKH%XGJHW'HWDLO:RUNVKHHW 6HFWLRQ %XGJHW&DWHJRU\ &DWHJRU\7RWDO $6ZRUQ2IILFHUV  %&LYLOLDQDQG1RQ6ZRUQ3HUVRQQHO  &(TXLSPHQWDQG7HFKQRORJ\  '6XSSOLHV  (7UDYHO7UDLQLQJDQG&RQIHUHQFHV  )&RQWUDFWVDQG&RQVXOWDQWV  *2WKHU&RVWV  +,QGLUHFW&RVWV  7RWDO3URMHFW$PRXQW  7RWDO)HGHUDO6KDUH$PRXQW   7RWDO3URMHFW$PRXQW;)HGHUDO6KDUH3HUFHQWDJH$OORZDEOH 7RWDO/RFDO6KDUH$PRXQW ,IDSSOLFDEOH    7RWDO3URMHFW$PRXQW7RWDO)HGHUDO6KDUH$PRXQW ,I\RXUDSSOLFDWLRQLVIXQGHGEXWIRUDUHGXFHGQXPEHURIRIILFHUSRVLWLRQVWKHSHUFHQWDJHRIWKHORFDOVKDUHSURYLGHGDERYHZLOOEHDSSOLHGWRWKHWRWDO SURMHFWFRVWRIWKHDZDUGHGRIILFHUV :DLYHURI/RFDO0DWFK 7KH&2362IILFHPD\ZDLYHVRPHRUDOORIDUHFLSLHQW VORFDOPDWFKUHTXLUHPHQWEDVHGRQVHYHUHILVFDOGLVWUHVV'XULQJWKHDSSOLFDWLRQUHYLHZSURFHVV \RXUDJHQF\ VZDLYHUUHTXHVWZLOOEHHYDOXDWHGEDVHGRQWKHDYDLODELOLW\RIIXQGLQJDGHPRQVWUDWLRQRIVHYHUHILVFDOGLVWUHVVDVUHIOHFWHGWKURXJKWKHILVFDO KHDOWKGDWDLQVHFWLRQRIWKLVDSSOLFDWLRQDQGDFRPSDULVRQRI\RXUILVFDOKHDOWKGDWDZLWKWKDWRIWKHRYHUDOODSSOLFDQWSRRO 4$UH\RXUHTXHVWLQJDZDLYHURIWKHORFDOPDWFKEDVHGRQVHYHUHILVFDOGLVWUHVV" 1R V &RQWDFW,QIRUPDWLRQIRU%XGJHW4XHVWLRQV 3OHDVHSURYLGHFRQWDFWLQIRUPDWLRQRIWKHILQDQFLDORIILFLDOWKDWWKH&2362IILFHPD\FRQWDFWZLWKTXHVWLRQVUHODWHGWR\RXUEXGJHWVXEPLVVLRQ )LUVW1DPH 5RELQ KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

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†G  VHFWLRQRIWKH5HKDELOLWDWLRQ$FWRI 86&† VHFWLRQRIWKH(GXFDWLRQ$PHQGPHQWVRI 86&† DQGVHFWLRQRI WKH$JH'LVFULPLQDWLRQ$FWRI 86&†  EWKH$SSOLFDQWXQGHUVWDQGVWKDWWKHDSSOLFDEOHVWDWXWHVSHUWDLQLQJWRQRQGLVFULPLQDWLRQPD\LQFOXGHVHFWLRQ  F RI7LWOH,RIWKH2PQLEXV&ULPH&RQWURO DQG6DIH6WUHHWV$FWRI 86&† F VHFWLRQ H RIWKH9LFWLPVRI&ULPH$FWRI 86&† H VHFWLRQ$ E RIWKH -XYHQLOH-XVWLFHDQG'HOLQTXHQF\3UHYHQWLRQ$FWRI 86&† E DQGWKDWWKHJUDQWFRQGLWLRQVHWRXWDWVHFWLRQ E  RIWKH9LROHQFH $JDLQVW:RPHQ$FW 86&† E  ZKLFKZLOODSSO\WRDOODZDUGVPDGHE\WKH2IILFHRQ9LROHQFH$JDLQVW:RPHQDOVRPD\DSSO\WRDQDZDUG PDGHRWKHUZLVH FWKH$SSOLFDQWXQGHUVWDQGVWKDWLWPXVWUHTXLUHDQ\VXEUHFLSLHQWWRFRPSO\ZLWKDOOVXFKDSSOLFDEOHVWDWXWHV DQGDVVRFLDWHGUHJXODWLRQV DQG GRQEHKDOIRIWKH$SSOLFDQW,PDNHWKHVSHFLILFDVVXUDQFHVVHWRXWLQ&)5††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† WKH$UFKHRORJLFDODQG+LVWRULFDO 3UHVHUYDWLRQ$FWRI 86&†† DQGWKH1DWLRQDO(QYLURQPHQWDO3ROLF\$FWRI 86&†† DQG&)53DUWV  1(3$ DQG IORRGSODLQVDQGZHWODQGV   ,DVVXUHWKDWWKH$SSOLFDQWZLOOJLYHWKH'HSDUWPHQWDQGWKH*RYHUQPHQW$FFRXQWDELOLW\2IILFHWKURXJKDQ\DXWKRUL]HGUHSUHVHQWDWLYHDFFHVVWRDQG RSSRUWXQLW\WRH[DPLQHDOOSDSHURUHOHFWURQLFUHFRUGVUHODWHGWRWKHDZDUG LIDQ\ PDGHE\WKH'HSDUWPHQWEDVHGRQWKHDSSOLFDWLRQ  ,DVVXUHWKDWLIWKH$SSOLFDQWLVDJRYHUQPHQWDOHQWLW\ZLWKUHVSHFWWRWKHDZDUG LIDQ\ PDGHE\WKH'HSDUWPHQWEDVHGRQWKHDSSOLFDWLRQ DLWZLOOFRPSO\ZLWKWKHUHTXLUHPHQWVRIWKH8QLIRUP5HORFDWLRQ$VVLVWDQFHDQG5HDO3URSHUW\$FTXLVLWLRQV$FWRI 86&†† ZKLFK JRYHUQWKHWUHDWPHQWRISHUVRQVGLVSODFHGDVDUHVXOWRIIHGHUDODQGIHGHUDOO\DVVLVWHGSURJUDPVDQG ELWZLOOFRPSO\ZLWKUHTXLUHPHQWVRI86&††DQGZKLFKOLPLWFHUWDLQSROLWLFDODFWLYLWLHVRI6WDWHRUORFDOJRYHUQPHQWHPSOR\HHV ZKRVHSULQFLSDOHPSOR\PHQWLVLQFRQQHFWLRQZLWKDQDFWLYLW\ILQDQFHGLQZKROHRULQSDUWE\IHGHUDODVVLVWDQFH  ,IWKH$SSOLFDQWDSSOLHVIRUDQGUHFHLYHVDQDZDUGIURPWKH2IILFHRI&RPPXQLW\2ULHQWHG3ROLFLQJ6HUYLFHV &2362IILFH ,DVVXUHWKDWDVUHTXLUHGE\ 86&† F  LWZLOOWRWKHH[WHQWSUDFWLFDEOHDQGFRQVLVWHQWZLWKDSSOLFDEOHODZ²LQFOXGLQJEXWQRWOLPLWHGWRWKH,QGLDQ6HOI'HWHUPLQDWLRQDQG (GXFDWLRQ$VVLVWDQFH$FW²VHHNUHFUXLWDQGKLUHTXDOLILHGPHPEHUVRIUDFLDODQGHWKQLFPLQRULW\JURXSVDQGTXDOLILHGZRPHQLQRUGHUWRIXUWKHUHIIHFWLYH ODZHQIRUFHPHQWE\LQFUHDVLQJWKHLUUDQNVZLWKLQWKHVZRUQSRVLWLRQVDVSURYLGHGXQGHU86&† F    ,IWKH$SSOLFDQWDSSOLHVIRUDQGUHFHLYHVD'2-DZDUGXQGHUWKH67236FKRRO9LROHQFH$FWSURJUDP,DVVXUHDVUHTXLUHGE\86&† D   WKDWLWZLOOPDLQWDLQDQGUHSRUWVXFKGDWDUHFRUGVDQGLQIRUPDWLRQ SURJUDPPDWLFDQGILQDQFLDO DV'2-PD\UHDVRQDEO\UHTXLUH ,DFNQRZOHGJHWKDWDPDWHULDOO\IDOVHILFWLWLRXVRUIUDXGXOHQWVWDWHPHQW RUFRQFHDOPHQWRURPLVVLRQRIDPDWHULDOIDFW LQWKLVFHUWLILFDWLRQRULQWKH DSSOLFDWLRQWKDWLWVXSSRUWVPD\EHWKHVXEMHFWRIFULPLQDOSURVHFXWLRQ LQFOXGLQJXQGHU86&††DQGRUDQGRU86&††  DQGDOVRPD\VXEMHFWPHDQGWKH$SSOLFDQWWRFLYLOSHQDOWLHVDQGDGPLQLVWUDWLYHUHPHGLHVIRUIDOVHFODLPVRURWKHUZLVH LQFOXGLQJXQGHU86&†† DQG ,DOVRDFNQRZOHGJHWKDWWKH'HSDUWPHQW¶VDZDUGVLQFOXGLQJFHUWLILFDWLRQVSURYLGHGLQFRQQHFWLRQZLWKVXFKDZDUGVDUHVXEMHFWWR UHYLHZE\WKH'HSDUWPHQWLQFOXGLQJE\LWV2IILFHRIWKH,QVSHFWRU*HQHUDO 6LJQDWXUHRI/DZ(QIRUFHPHQW([HFXWLYH$JHQF\([HFXWLYH )RU\RXUHOHFWURQLFVLJQDWXUHSOHDVHW\SHLQ\RXUQDPH 7KRPDV-RKQVRQ 7KRPDV-RKQVRQ KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

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³'HSDUWPHQW´ GHWHUPLQHVWRDZDUGWKHFRYHUHGWUDQVDFWLRQJUDQWRUFRRSHUDWLYH DJUHHPHQW /REE\LQJ $VUHTXLUHGE\86&†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¶VUHTXHVWIRU)HGHUDOIXQGVLVLQH[FHVVRIDQGDQ\IXQGVRWKHUWKDQ)HGHUDODSSURSULDWHGIXQGVKDYHEHHQSDLGRUZLOOEHSDLG WRDQ\SHUVRQIRULQIOXHQFLQJRUDWWHPSWLQJWRLQIOXHQFHDQRIILFHURUHPSOR\HHRIDQ\DJHQF\DPHPEHURI&RQJUHVVDQRIILFHURUHPSOR\HHRI&RQJUHVVRU DQHPSOR\HHRIDPHPEHURI&RQJUHVVLQFRQQHFWLRQZLWKWKLV)HGHUDOJUDQWRUFRRSHUDWLYHDJUHHPHQWWKH$SSOLFDQWVKDOOFRPSOHWHDQGVXEPLW6WDQGDUG )RUP///³'LVFORVXUHRI/REE\LQJ$FWLYLWLHV´LQDFFRUGDQFHZLWKLWV DQGDQ\'2-DZDUGLQJDJHQF\¶V LQVWUXFWLRQVDQG F 7KH$SSOLFDQWVKDOOUHTXLUHWKDWWKHODQJXDJHRIWKLVFHUWLILFDWLRQEHLQFOXGHGLQWKHDZDUGGRFXPHQWVIRUDOOVXEJUDQWVDQGSURFXUHPHQWFRQWUDFWV DQG WKHLUVXEFRQWUDFWV IXQGHGZLWK)HGHUDODZDUGIXQGVDQGVKDOOHQVXUHWKDWDQ\FHUWLILFDWLRQVRUOREE\LQJGLVFORVXUHVUHTXLUHGRIUHFLSLHQWVRIVXFKVXEJUDQWV DQGSURFXUHPHQWFRQWUDFWV RUWKHLUVXEFRQWUDFWRUV DUHPDGHDQGILOHGLQDFFRUGDQFHZLWK86&† '(%$50(176863(16,21$1'27+(55(63216,%,/,7<0$77(56 $3XUVXDQWWR'HSDUWPHQWUHJXODWLRQVRQQRQSURFXUHPHQWGHEDUPHQWDQGVXVSHQVLRQLPSOHPHQWHGDW&)53DUWDQGWRRWKHUUHODWHG UHTXLUHPHQWVWKH$SSOLFDQWFHUWLILHVZLWKUHVSHFWWRSURVSHFWLYHSDUWLFLSDQWVLQDSULPDU\WLHU³FRYHUHGWUDQVDFWLRQ´DVGHILQHGDW&)5† D WKDW QHLWKHULWQRUDQ\RILWVSULQFLSDOV²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¶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††DQG  $7KH$SSOLFDQWFHUWLILHVDQGDVVXUHVWKDWLWZLOORUZLOOFRQWLQXHWRSURYLGHDGUXJIUHHZRUNSODFHE\² D 3XEOLVKLQJDVWDWHPHQWQRWLI\LQJHPSOR\HHVWKDWWKHXQODZIXOPDQXIDFWXUHGLVWULEXWLRQGLVSHQVLQJSRVVHVVLRQRUXVHRIDFRQWUROOHGVXEVWDQFHLV SURKLELWHGLQLWVZRUNSODFHDQGVSHFLI\LQJWKHDFWLRQVWKDWZLOOEHWDNHQDJDLQVWHPSOR\HHVIRUYLRODWLRQRIVXFKSURKLELWLRQ E (VWDEOLVKLQJDQRQJRLQJGUXJIUHHDZDUHQHVVSURJUDPWRLQIRUPHPSOR\HHVDERXW²  7KHGDQJHUVRIGUXJDEXVHLQWKHZRUNSODFH  7KH$SSOLFDQW¶VSROLF\RIPDLQWDLQLQJDGUXJIUHHZRUNSODFH  $Q\DYDLODEOHGUXJFRXQVHOLQJUHKDELOLWDWLRQDQGHPSOR\HHDVVLVWDQFHSURJUDPVDQG KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

 3')3ULQW9LHZ  7KHSHQDOWLHVWKDWPD\EHLPSRVHGXSRQHPSOR\HHVIRUGUXJDEXVHYLRODWLRQVRFFXUULQJLQWKHZRUNSODFH F 0DNLQJLWDUHTXLUHPHQWWKDWHDFKHPSOR\HHWREHHQJDJHGLQWKHSHUIRUPDQFHRIWKHDZDUGEHJLYHQDFRS\RIWKHVWDWHPHQWUHTXLUHGE\SDUDJUDSK D  G 1RWLI\LQJWKHHPSOR\HHLQWKHVWDWHPHQWUHTXLUHGE\SDUDJUDSK D WKDWDVDFRQGLWLRQRIHPSOR\PHQWXQGHUWKHDZDUGWKHHPSOR\HHZLOO²  $ELGHE\WKHWHUPVRIWKHVWDWHPHQWDQG  1RWLI\WKHHPSOR\HULQZULWLQJRIWKHHPSOR\HH¶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† F  LIWKLVDSSOLFDWLRQLVIRUD&236DZDUGWKH $SSOLFDQWFHUWLILHVWKDWWKHUHKDVEHHQDSSURSULDWHFRRUGLQDWLRQZLWKDOODJHQFLHVWKDWPD\EHDIIHFWHGE\LWVDZDUG$IIHFWHGDJHQFLHVPD\LQFOXGHDPRQJ RWKHUV2IILFHVRIWKH8QLWHG6WDWHV$WWRUQH\V6WDWHORFDORUWULEDOSURVHFXWRUVRUFRUUHFWLRQDODJHQFLHV ,DFNQRZOHGJHWKDWDPDWHULDOO\IDOVHILFWLWLRXVRUIUDXGXOHQWVWDWHPHQW RUFRQFHDOPHQWRURPLVVLRQRIDPDWHULDOIDFW LQWKLVFHUWLILFDWLRQRULQWKH DSSOLFDWLRQWKDWLWVXSSRUWVPD\EHWKHVXEMHFWRIFULPLQDOSURVHFXWLRQ LQFOXGLQJXQGHU86&††DQGRUDQGRU86&††  DQGDOVRPD\VXEMHFWPHDQGWKH$SSOLFDQWWRFLYLOSHQDOWLHVDQGDGPLQLVWUDWLYHUHPHGLHVIRUIDOVHFODLPVRURWKHUZLVH LQFOXGLQJXQGHU86&†† DQG ,DOVRDFNQRZOHGJHWKDWWKH'HSDUWPHQW¶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†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† 1RW$SSOLFDEOH 6(&7,21&&(57,),&$7,212) * 3$571(56+,3$1'&(57,),&$7,212) ,//(*$/,00,*5$7,21&223(5$7,21 6WDWHDQGORFDOODZHQIRUFHPHQWDJHQF\DSSOLFDQWVKDYHWKHRSSRUWXQLW\WRUHFHLYHDGGLWLRQDOSRLQWVEDVHGRQWKHLUFRRSHUDWLRQZLWKIHGHUDO LPPLJUDWLRQRIILFLDOVWRDGGUHVVLOOHJDOLPPLJUDWLRQ $6WDWHRUORFDOODZHQIRUFHPHQWDJHQF\DSSOLFDQWVPD\UHFHLYHDGGLWLRQDOSRLQWVLIWKHDJHQF\KDVD J SDUWQHUVKLSGHILQHGIRUWKLVSXUSRVHDVD SDUWQHUVKLSZLWKWKH86'HSDUWPHQWRI+RPHODQG6HFXULW\ ³'+6´ XQGHU86&†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¶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¶VPDQXDO$VVXUDQFHV&HUWLILFDWLRQVDQGDOORWKHUDSSOLFDEOH SURJUDPUHJXODWLRQVODZVRUGHUVDQGFLUFXODUV KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

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¶V DSSOLFDWLRQIURPIXQGLQJFRQVLGHUDWLRQSOHDVHFDOOWKH&2362IILFH5HVSRQVH&HQWHUDW KWWSVSRUWDOFRSVXVGRMJRY6063ULQW9LHZDVS["DSS  SURJ1DPH &+3 SULQW7\SH DOO FXUUHQW3DJH  

OMB Number: 1103-0098 Expiration Date: 05/31/2020 COPS Application Attachment to SF-424 Section 1: COPS PROGRAM REQUEST Federal assistance is being requested under the following COPS program: Select the COPS grant program for which you are requesting federal assistance. A separate application must be completed for each COPS program for which you are applying. Please ensure that you read, understand, and agree to comply with the applicable grant terms and conditions as outlined in the COPS Application Guide before finalizing your selection. ONLY ONE PROGRAM OPTION MAY BE CHECKED ~ COPS Hiring Program • Law Enforcement Mental Health and Wellness Act • Community Policing Development • Preparing for Active Shooter Situations • Anti-Heroin COPS School Violence Prevention Program • Tribal Grant Resources Program-Technical Assistance • COPS Anti-Methamphetamine Task Force • Community Policing Development Microgrants • Program Applicant ORI Number: DE00101 Re-enter Applicant ORI Number: DE00101 The ORI number is assigned by the FBI and is your agency's unique identifier. The COPS Office uses the first seven characters of this number. The first two letters are your state abbreviation, the next three numbers are your county's code, and the next two numbers identify your jurisdiction within your county. If you do not currently have an ORI number, the COPS Office will assign one to your agency for the purpose of tracking your grant.ORI numbers assigned to agencies by the COPS Office may end in “ZZ.” Tracking Number:GRANT13034051 Funding Opportunity Number:COPS-CHP-APPLICATION-2020 Received Date:Mar 02, 2020 12:39:17 PM EST

MAP OF THE CITY OF DOVER, DELAWARE ("'6) (330) 001) DE 1S (100, 1111:,) -- (10ft;(H\i) I I OE10 , DE i 0£1$ \ 1·

0MB Number: 4040-0004 Expiration Date: 1213112002 Application for Federal Assistance SF-424 • 1. Type of Submission: • 2. Type of Application: • If Revision, selecl appropriate tetter(s) D Preapplication ~New I I ~ Application D Continuation • Other (Specify) D Changed/Corrected Application D Revision I I • 3 . Date Received: 4. Applicant Identifier: !Completed by Grants gov upon submission II I Sa. Federal Entity Identifier: 5b. Federal Award Identifier: IDF'lfll QI II I State Use Only: 6. Date Received by State: I II 7. State Application Identifier: I I 8. APPLICANT INFORMATION: • a. Legal Name: lei t y O r Dc•v, r I • b. Employer/Taxpayer Identification Number (EIN/TIN): • c. Organizational DUNS: ,, is1 600oc 92 I l1 /7r 931jr,1 JI I d. Address: • Street1 : lrit y H l - 15 L ·Yi:iirma E- ~za I Street2: I • City: [' •ver I County/Parish: I • State: DE : Delaware I Province: I • Country: 11:;;..: IT~ ' [ .:;~,; ~c!'.; I ' Zip I Postal Code: 119901 - 71.'7 I e. Organizational Unit: Department Name: Division Name: IP• . i :, Dep3 r t.m•~ n t II l f. Name and contact information of person to be contacted on matters involving this application: Prefix: I • First Name: !Robin I Middle Name: I'M". I • Last Name: IA-ik ~ ns I Suffix: I I Trtle: Ir lice R""" .Jrce~ M1nager I Organizational Affiliation: lr~Lce. Depa r trnE n t I • Telephone Number: l3c - /j6-4446 I Fax Number: i<c ,_ 1J6- 11s I • Email: Ir ,c, • _j j._ n @, tar-e . d~ . l.i;.; I

Application for Federal Assistance SF-424 • 9. Type of Applicant 1: Select Applicant Type: le= City r T,wnship Governmen~ I Type of Applicant 2: Select Applicant Type: I Type of Applicant 3: Select Applica nt Type: I • Other (specify): I • 10. Name o f Fed e ral A gency: r ommunity 0ri1>r1t"d P0l 1cir1<.1 S<>rvices I 11 . Catalog of Federal Domestic Assistance Number: 111:., . 710 I CFDA Title: Pi,b 1 ic Sa fPty Partnership snd C' •mrnunity p l icing Grants • 12. Funding Opportunity Number: 1~0P$- CHP- APPl!CAT!ON- ? ~c I ·rrtJe: !'OPS- CH F- m LICAT I ON - 2 02' I 13. Compet ition Identification Number: I Title: 14. A reas Affec ted by Project (Ci ties, Counties, States, etc.): l,-1ap of the r ~ t y ,f DcvPr , DE . pdt II -,dd Attachme ,, II Delete Attachment 11 View Attachme nt I • 15. Descripti ve Title of Applicant's Project: l'ew-Hi<e P<' l l -,. 0tficers I Attach supporting documents as specified 1n agency mstruclions. I Add Attachments 11 I I& 11 I · IV 1 ts I 1

Application for Federal Assistance SF-424 16. Congressional Dist ricts Of: ·a.Applicant ioE:-a 11 I • b. Program/Project lnE-a11 I Attach an additional list of Program/Project Congressional Districts if needed. I I I Add Attachment II c:· A!!achm~~ II ovn\ttac hrner.t I 17. Proposed Project: ·a. Start Date: lio;r J J) r, I " b. End Date: IC/Q 30/20 ~ I 18. Estimated Funding($): ·a. Federal I ., 0 I • b Applicant I '31fl , fit- ·I • c. State I 0. ,1 • d. Local I u. ,,ul • e. Other CJ . nul I ·t. Program Income I ll . Cll I • g. TOTAL I 1, •14 3, 70( . 751 • 19. Is Application Subject to Review By State Under Executive Order 12372 Process? [:gj a. This application was made available to the State under the Executive Order 12372 Process for review on I 03/10/2020 I- D b. Program is subject to E.0 . 12372 but has not been selected by the State for review. D c. Program is not covered by E.0. 12372. • 20. Is the Applicant Delinquent On Any Federal Debt? (If "Yes," provide explanation in attachment.) OYes [:gj No If "Yes", provide explanation and attach I I I Add Attat t--n ,,, .,_ 11 . ::hment 11 ,... tt, chmt I 21. *By signing this application, I certify (1) to the statements contained in the list of certifications** and (2) that the statements herein are true, complete and accurate to the best of my knowledge. I also provide the required assurances** and agree to comply with any resulting terms if I accept an award. I am aware that any false, fictitious, or fraudulent statements or claims may subject me to criminal, civil, or administrative penalties. (U.S. Code, Title 218, Section 1001) [:gj •• I AGREE •• The list of certifications and assurances, or an internet site where you may obtain this list, is contained in the announcement or agency specific instructions. Authori:i:ed Representative: Prefix: lrhief I • First Name: IThr-,ma" I Middle Name: I I • Last Name: !Johnson l Suffix: I I • Titte: j~t.' f ' t P li -~ I • Telephone Number: I, - ' l o - -,] l I Fax Number: !1n,_-3.., _7157 I • Email: l•r r,-3 - . i ,t ns ,n,a,-; . statP . j,. . •1s I • Signature of Authorized Rep<esentative: !completed by GrantS.gov upon submission I • Date Signed: IComple!ed by GrantS.gov upon subm1ss10n I

; 1-800-518-4726 GRANTS.GOV• WORKSPACE FORM SUPPORT@GRANTS GOV This Workspace form is one of the forms you need to complete prior to submitting your Application Package. This form can be completed in its entirety oflline using Adobe Reader. You can save your form by clicking the "Save" button and see any errors by clicking the "Check For Errors· button. In-progress and completed forms can be uploaded at any time to Grants.gov using the Workspace feature. When you open a form, required fields are highlighted in yellow with a red border. Optional fields and completed fields are displayed in white. If you enter invalid or Incomplete Information in a field, you will receive an error message. Additional instructions and FAQs about the Application Package can be found in the Grants.gov Applicants tab. OPPORTUNITY & PACKAGE DETAILS: Opportunity Number: ':OPS - ~HP- APPLICAT ION- 2020 Opportunity Title: :OPS - CHP- APPLfCATION - 2020 Opportunity Package ID: PKG00.Z5i;J21-1 CFDA Number· 16 . 7 10 CFDA Description: Public s.,fety Pdrtnersh1~ ~nd Community Policing Grc0nts Competition ID: Competition Title: Opening Date: 0 1/09/2020 Closing Date: ()1/11 / ~020 Agency: Cornm•1nl • y Orl~nte,J Po l i c ino Services Contact Information: COPS Oftice Response Center Phone : ~~1 . 421 . G770 APPLICANT & WORKSPACE DETAILS: Workspace ID: 1-lS )1142"-,4 1 Application Filing Name: City f Dover Pnlice Dep ,rtmer,t DUNS: 07"10936640000 Organization: DOVER, CITY OF (INC} Form Name: Application tor Federa 1 Assistance (SF- 424} Form Version: 2.1 Requirement: M,ndato ry Download Date/Time: Mac 1 , . ,n 03 : 29 : 3. PM EDT Form State: No Errors FORM ACTIONS :

City of Dover Legislative, Finance & Administrative Committee Meeting Police Department – Budget Request July 28, 2020

CITY OF DOVER1 DE-GENERAL & CAPITAL FUNDS I N DEX SCENARI O OPTI ONS I NPUT SHEET 1 . - - - - - I- N_S_T -R _ U_ CT I _ O N _S _ _ __ , S C E N A R I O CAT E G O R I E S 2021 2022 2023 2024 2025 2026 ~ > .ENTER CATEGORY NAME SELECT OJ>T I ON ..J, > ! CAT E GORY 1- COJ>S GRANT BACK T O T O P t t t SO U RCES: A . COP S Gra n t R ece i p t s. 350 , 600 1 98, 600 75, 800 2 74, 400 ,, IJSES: P ercs.o n n e l - 5 O f fi ce res. ( S e p t e mb er 20 2 0 ) 448, 9 00 485, 2 00 5 0 9 , 7 00 5 45, 400 583, 6 00 6 2 4 , 5 00 2 , 7 48, 400 S O U R C ES: B.. COP S Gra n t IJSES: T rn i n i n g, Unif orm s., a n d Suppli es S9, '9 00 2 , 5 00 2 , 5 00 6 , 800 2 , 5 00 2 , 5 00 1 6 , 800 S O U RCES: I C . COPS Gra n t IJS ES: V e h i cl es 115 , 600 1 27, 2 00 2 4 2 ,800 D T O T A L S O U RCES: 350 , 600 1 98, 600 7 5 , 800 2 7 4 , 400 TOTA L U S ES: 5 08, 800 603, 3 0 0 5 1 2, 2 0 0 552 , 2 00 S,86, 100 7 5 4, 2 00 3 , 008, 000 t % F E D E RAL S O U RCES 68.'9 % 3 2 .9 % 14.8% 0 .0% 0 .0% 0 .0% > ENTER CATEGORY NAME > ! CAT EGORY 2 - Body Worn Camera s SELECT O J>T I ON ..J, BACK T O T O P SOU RCES: A . O PT IO N ,, IJSES: Body W orn Ca m erns - 7 0 ( A ll i n Cost) 140, 000 6 9 , 2 00 59,, 2 00 69, 2!00 6 9 , 20 0 69, 2 00 D r T OTAL S O U R C ES: T O T A L U SES: t 1 40, 000 69, 2 0 0 5 ,9 ,, 2 00 69, 2!00 69, 2 0 0 346,000 > ENTER CATEGORY NAME > ! CATEGORY 3 - Camera Station Monitor & I ncidents Report Clerk I SELECT OJ>T I ON ..J, BACK T O T O P ~ t t SOU RCES: A . O PT IO N ,, IJSES: P ercs.onn e l - 1 C i v ili a n 4 6 , 5 00 4 7 , 600 48, 9 00 5 0 , 2!00 5 1, 6 00 52, 9 00 D T O T A L SOU RCES: T O T A L U SES: 4 6 , 5 00 48, 9 00 50, 2!00 5 1 , 600 5 2 , 9 00 25 1 , 2 00 D TOTA L SO U R C ES: 3 5 0 , 600 198, 600 75,800 2 74, 400 T OTA L U SES: 695, 300 720 ,100 6 3 0, 300 671, 600 7 0 6 , '9 00 8 76, 3 00 3 , 6 0 5 , 2 00 CALCULATIONS I N ET IM PACT O N A NNUA L BU D GET ( 3 44, 7 0 0 ) ( 5 2 1,5 0 0 ) ( 554 , 5 0 0 ) ( 671, 600) (706, 9 00) ( 8 76, 3 0 0 ) ( 3 , 330,800) ~. t $ .0 1 T AX PROPERTY T A X IN CREASE A nnu a l C h a n g e in Ta x R a t e $0.010 $0.010 $0.015 $0.005 $0.016 $0.001 $0.019 $0.003 $0. 020 $0. 001 $0.025 $0.005

CITY OF DOVER1 DE-GENERAL & CAPITAL FUNDS I N DEX SCENARI O OPTI ONS IN PUT SHEET 1 . - - - - - I- N_S_T -R _ U_ CT I _ O N _S _ _ __ , S C E N A R I O CAT E G O R I E S 2021 2022 2023 2024 2025 2026 ~ > .ENTER CATEGORY NAME SELECT OJ>TI ON ..J, > ! C A T EGORY 1- C OJ>S GRANT BACK T O T O P t t t SOU RCES: A . COPS Grnnt R ece i p t s. 95, 900 308,'900 167, 800 52, 400 S29, 100 ,, IJSES: P ercs.onne l - 5 O f fice res. (M a.-ch 2021) 119, 400 480, 600 513, 300 549•, 300 587,800 629,000 2 , 760,000 SOU RCES: B.. COPS G.-a nt IJSES: Trn in i ng, Unif oi-ms., and Suppli es 59, '9 00 2 , 500 2 , 500 6 , 800 2 , 500 2 , 500 16, &00 SOU RCES: I C . COPS Grn nt IJSES: V e h i cl es I 115, 600 1 27, 200 242, 800 D TOTA L SOU RCES: 95, 900 308, 900 167, 800 52, 400 529, 100 t TOTA L U SES: > ENTER CATEGORY NAME > % FEDERAL SOURCES ! C ATEGORY 2 - Body Wo rcn C amern,s 1 179, 300 53 .5% 598, 700 51. 6 % S1S, &0 0 32.S% 556,100 9.4% 590, 300 0 .0% 75-8, 700 0 .0% 3 , 0 1 9 , 600 SELECT OJ>TI ON ..J, BACK T O T O P SOU RCES: A. O P T I O N ,, IJSES: Bo d y Wo.-n Camerns- 7 0 ( A ll i n Cost) 140, 000 69, 200 69•, 200 69, 2!00 69,200 69, 200 D r TOTAL SOU RCES: TOTA L U SES: t 140, 000 69, 200 6 '9 •, 200 69, 2!00 69, 200 346, 000 > ENTER CATEGORY NAME > ! CATEGORY 3 - Camern Station Monito.- & Incidents Report C le rck I SELECT OJ>TI ON ..J, BACK T O T O P ~ t t SOU RCES: A . OPTI O N ,, IJSES: P ercs.onne l - 1 C i v ili an 46, 500 4 7 , 600 48, 900 50, 2!00 5 1, 600 52, 900 D TOTA L SOU RCES: TOTAL U SES: 46, 500 48, 900 50, 2!00 5 1 , 600 52, 9 00 251, 200 D TOTA L SOURCES: 9S,'900 308,'900 167, 800 52,400 529, 100 TOTAL U SES: 365, 800 715, 500 633,'9 00 675, 500 7 11,100 &80,&00 3 , 616, &00 CALCULATIONS I N ET I MPACT O N A NNUA L BU DGET ( 269, 900) ( 406 , •600) (466,100) ( 623, 100) (711,lDO) ( 880,&00) ( 3 , 087, 700) ~. t $.01 TAX PROPERTY TAX IN CREASE A nnu a l Cha n ge in Ta x Rate $0.008 $0.008 $0.012 $0.004 $0.013 $0.002 $0.018 $0.004 $0. 020 $0. 003 $0.025 $0.005

CITY OF DOVER, DE - GENERAL & CAPITAL FUNDS SENSITIVITY ANALYSIS ~~ ,;;;,;;:;};,~ UNO < CLICK ON CELL SELECT STARTING FISCAL YEAR> o L~_,_9_ _ _ __.E_. . .! SELECT ENDING FISCAL YEAR> IL2_0 2_G_ _ _ ~F_,..~! CONVERT DOLLARS TO > 1 , TH O USA N DS r. . 1 ... REVENUES AND EXPENDITURES BASELIN E BAS ELIN E ... $60, 000 $50, 000 > OPTION CATEGORY > ..I, $40, 000 IS z ICATEGORY 1 - COPS GRANT- March 2021 """':::> 0 $30, 000 i= "' $20, 000 I CATEGORY 2 - Body Worn Camerasl 0 $10,000 CATEGORY 3 - Camera Stat ion $0 2019 2020 2021 2022 2023 2024 2025 2026 Mon itor & Inc idents Re ort Clerk VARIANCE (865) (1,998) (1,842) (3, 978) (4,402) (4, 898) (5, 369) (5,895) VAR BASE 44,521 47, 062 46, 861 49,427 50,331 51,382 52,452 53 , 681 ICATEGORY4 • - - BASELINE REV 4 3 , 65 6 45, 064 44, 923 45, 140 45, 761 46,43 1 47 ,083 47 , 786 - - REVENUES 43, 656 45, 064 45, 019 45,449 4 5,929 46,484 47 ,083 47 , 786 - - BASELINE EXP 44, 521 47, 062 46, 496 48, 711 49, 697 50 , 706 51, 741 5 2 , 801 I CATEGORY 5 • - - EXPENDITURES 44, 521 47 ,062 46,861 49,427 50, 331 51, 382 52,45 2 53,681 UNRESERVED FUND BALANCE I CATEGORY 6 • $5, 000 10, 000 I CATEGORY 7 • "' C $0 -$5, 000 ---- ----- - - 5, 000 z <( -$10, 000 "' :::> 0 -$15, 000 (5,000) I CATEGORY 8 • ::c I- ..,,_ -$20, 000 (10, 000) -$25, 000 (15, 000) I CATEGORY 9 • -$30, 000 2019 2020 2021 2022 2023 2024 2025 2026 (20, 000) - NEGATIVE (300) (4, 278) (8,680) (13, 578) (18, 947) (24, 842) I CATEGORY 10 • - POSITIVE 3, 540 1, 542 - - FB BASE 6, 837 4,839 3, 266 (305) (4, 240) (8, 515) (1.3,173) (18,188) Copyright 2004-2020, Government Finan ce Research Group UC - www. MuniCast.com

CITY OF DOVER, DE - GENERAL & CAPITAL FUNDS FINANCIAL SUMMARY, BY ACCO~11 0-GENERAL FUND I • I 7070R 7071R 7077F ,onF 7074F 70,~F 707nF FUND BALANCE-BEGINNING 6,837,000 4,838,600 3,266,400 (304,800) (4,240,200) (8,515,300) (13,173,200) REVENUES AND SOURCES 01-PROPERTY TAXES 14,S96,700 14,885,800 15,183,SOO 15,487,200 15,796,900 16,112,800 16,43S,100 02-FRANCHISE FEES 645,000 645,000 645,000 645,000 645,000 645,000 645,000 03-LICENSES ANO PERMITS 3,194,000 2,916,000 2,945,200 2,974,700 3,004,400 3,034,400 3,064,700 OS-GRANTS RECEIVED S43,SOO 623,SOO 223,100 223,100 223,100 223,100 223,100 06-COURT OF CHANCERY FEES 1,47S,000 1,440,000 1,S12,000 1,S87,600 1,667,000 1,7S0,400 1,837,900 07-SANITATION FEES ANO REBATES 3,076,600 3,090,600 3,106,100 3,121,600 3,137,200 3,152,900 3,168,700 08-LIBRARY REVENUE - GENERAL 384,800 368,400 372,100 37S,800 379,600 383,400 387,200 09-FINES 1,097,SOO 1,167,800 1,179,SOO 1,191,300 1,203,200 1,215,200 1,227,400 10-INVESTMENT INCOME {LOSS) 120,000 140,000 140,700 141,400 142,100 142,800 143,SOO 11-M ISCELLANEOUS SERV ICES 312,SOO 270,000 27S,400 280,900 286,SOO 292,200 298,000 13- INOIRECT SERV ICES BILLING S,749,900 S,S92,700 S,760,SOO S,904,SOO 6,081,600 6,233,600 6,420,600 20-TRANSFERS IN-ELECTRIC FUND {480) 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 21-TRANSFERS IN-ERLSP {212) S32,900 445,000 449,SOO 449,SOO 454,000 454,000 458,SOO 22-TRANSFERS IN-MUN ICIPAL STREET All 665,300 7S0,000 700,000 700,000 700,000 700,000 700,000 23-TRANSFERS IN-OTHER 145,000 lSS,000 156,600 158,100 159,700 161,300 162,900 24-TRANSFERS IN-REALTY TRANSFER TAX 1,S25,000 1,433,SOO 1,490,800 1,S20,600 1,SSl,000 1,S82,000 1,613,600 25-TRANSFERS IN-WATER/WW FUND {41 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 TOTAL REVENUES ANO SOURCES 45,063,700 44,923,300 45,140,000 45,761,300 46,431,300 47,083,100 47,786,200 EXPENDITURES AND USES 01-SALAR IES ANO WAGES 19,SS0,600 20,404,SOO 20,812,600 21,332,900 21,866,200 22,412,900 22,973,200 02-FICA 1,S14,700 1,S66,SOO 1,S97,800 1,637,700 1,678,600 1,720,600 1,763,600 03-HEALTH INSURANCE 3,641,300 3,63S,300 3,744,400 3,856,700 3,972,400 4 ,091,600 4 ,214,300 04-0THER-BENEFITS 936,600 943,100 9S2,SOO 962,000 971,600 981,300 991,100 OS-RETIREE HEALTHCARE 1,894 ,900 2,045,400 2,106,800 2,170,000 2,23S,100 2,302,200 2,371,300 07-PENSION 3,732,700 3,94 9,100 4 ,028,100 4,128,800 4 ,232,000 4 ,337,800 4 ,446,200 08-0 PEB 977,700 837,100 853,800 87S,100 897,000 919,400 942,400 09-MATERIALS & SUPPLIES 1,749,840 1,S36,400 1,SSl,800 1,S67,300 1,S83,000 1,S98,800 1,614,800 10-AOM IN EXPENDITURES 6,254,660 6,212,700 6,30S,900 6,400,SOO 6,4 96,SOO 6,S93,900 6,692,800 11-0THER EXPENSES 1,982,400 2,010,100 2,010,100 2,010,100 2,010,100 2,010,100 2,010,100 12-STREET LIGHT 815,000 815,000 823,200 831,400 839,700 848,100 856,600 13-0THER-CHARGES 250,000 14-TRANSFER-TO-OEBT S00,000 462,200 SS3,700 SS3,700 SS3,700 SS3,700 SS3,700 15-TRANSFER-TO-CIP 3,261,600 2,078,100 3,370,SOO 3,370,SOO 3,370,SOO 3,370,SOO 3,370,SOO TOTAL REVENUES ANO SOURCES 47,062,000 46,495,500 48,711,200 49,696,700 50,706,400 51,740,900 52,800,600 SURPLUS/(OEFICIT) (1,998,300) (1,572,200) (3,571,200) (3,935,400) (4,275,100) (4,657,800) 15,014,400) %REVENUE -4% -3% -8% -9% -9% -10% -10% FUND BALANCE-ENDING 4,838,600 3,266,400 (304,800) (4,240,200) (8,515,300) (13,173,200) (18,187,600) % OF REVENUES ANO SOURCES 10.7% 7.3% -0 .7% -9.3% -18.3% -28.0% -38.1% Additional Funds Needed (1,233,500) 327,500 3,916,000 7,901,100 12,229,800 16,939,800 22,010,500

CITY OF DOVER PROPOSED ORDINANCE #2020-10 1 BE IT ORDAINED BY THE MAYOR AND COUNCIL OF THE CITY OF DOVER, IN 2 COUNCIL MET: 3 That Chapter 34 - Elections, Article II - Voter Registration, Section 34-31. - Requirements of the 4 Dover Code be amended by inserting the text indicated in bold, blue, and deleting the text indicated 5 in red strikeout as follows: 6 ARTICLE II. - VOTER REGISTRATION 7 Sec. 34-31. - Requirements. 8 No person shall vote, or be allowed to vote, in any municipal election unless such person is properly 9 registered to vote for state elections in accordance with title 15 of the Delaware Code (15 Del. C. 10 § 1101 et seq.), and as otherwise qualified to vote as required in section 8 of the city Charter. 11 Sec. 34-32. - Registration deadlines. 12 (a) Regular elections. In accordance with 15 Del. C. § 2036, The the city clerk shall 13 close the registration records at the close of the business day on the last working day 14 of March of each year before the fourth Saturday prior to the date of the annual 15 regular election, and only those voters properly registered as of that time shall be 16 entitled to vote at the following annual regular election., and the 17 (b) Special elections. In accordance with 15 Del. C. § 2037, the city clerk shall close 18 the registration records 10 days prior to the date of a special election, and only 19 those voters properly registered as of that time shall be entitled to vote at the 20 following special election. 21 The registration records of the city shall remain closed until the first working day in May the day 22 after the regular or special election. 23 Sec. 34-32 34-33. - Custodian of registration records. 24 The city clerk shall be the custodian of the permanent registration records. The removal of 25 registration records from city hall shall be done only with the express consent of the city clerk. 26 (Code 1981, § 2-27; Ord. of 1-9-1989) 27 Secs. 34-3334-34—34-60. - Reserved. 28 (Code 1981, § 2-26; Ord. of 1-9-1989; Ord. of 11-26-1990, § 2) 29 BE IT FURTHER ORDAINED: 30 That Chapter 34 - Elections, Article III - Absentee Voting of the Dover Code be amended by 31 inserting the text indicated in bold, blue, and deleting the text indicated in red strikeout as follows:

Ordinance #2020-10 - Chapter 34 - Elections Page 2 32 ARTICLE III. - ABSENTEE VOTING 33 Sec. 34-61. - Purpose. 34 35 The intention of this article is to provide qualified voters of the city who are unable to appear at the 36 polling place of their district to cast their ballot on the day of an election with the ability to cast an 37 absentee ballot. 38 (Code 1981, § 2-41; Ord. of 2-11-1985; Ord. No. 2017-15 , 11-27-2017) 39 State Law reference— Similar provisions, 15 Del. C. § 5501. 40 Sec. 34-62. - Persons eligible to vote by absentee ballot. 41 Any qualified elector, duly registered, of this city may cast their vote by absentee ballot in any 42 regular municipal election or special municipal election if the elector is unable to appear at the 43 polling place of their election district due to reasons set forth in 15 Del. C. § 5502—Persons eligible 44 to vote by absentee ballot. 45 (Code 1981, § 2-42; Ord. of 2-11-1985; Ord. No. 2017-15 , 11-27-2017) 46 State Law reference— 15 Del. C. § 5502. 47 Sec. 34-63. - Request for ballot; statements required of persons applying for absentee ballots. 48 49 Any voter who is qualified under 15 Del. C. § 5502—Persons eligible to vote by absentee ballot, and 50 who desires to receive an absentee ballot may request one by filing a statement with the city clerk's 51 office, subscribed and sworn to by the voter, no later than 12:00 noon the day before the election. 52 (Code 1981, § 2-44; Ord. of 2-11-1985; Ord. of 11-26-1990, § 3; Ord. No. 2017-15 , 11-27-2017) 53 Sec. 34-64. - Distribution of ballots, envelopes and instructions. 54 Upon receipt of a statement from a voter, the city clerk's office, not more than 60, nor less than four 55 days prior to the regular or special election and within three days after the absentee ballots, envelopes 56 and instructions for completing and returning an absentee ballot become available, shall mail to the 57 voter, postage prepaid, an official ballot, enclosed in an official envelope, along with a voucher 58 envelope marked "voucher envelope," a copy of the instructions for completing and returning an 59 absentee ballot and a mailing envelope marked "mailing envelope." Nothing contained in this section 60 shall prevent the issuance of an absentee ballot to those lawfully entitled thereto prior to 12:00 noon 61 on the day prior to any regular or special election when the request is made less than four days prior 62 to the regular or special election. 63 (Code 1981, § 2-45; Ord. of 2-11-1985; Ord. of 11-26-1990; Ord. No. 2017-15 , 11-27-2017) 64 Editor's note— Ord. No. 2017-15 , adopted November 27, 2017, repealed § 34-64 and renumbered 65 § 34-65 as § 34-64. Former § 34-64 pertained to requests for ballots and derived from the Code of 66 1981; Ord. of 2-11-1985; and Ord. of 11-26-1990.

Ordinance #2020-10 - Chapter 34 - Elections Page 3 67 State Law reference— Similar provisions, 15 Del. C. § 5504. 68 ADOPTED: * 69 S:\ORDINANCES\2020\DRAFT\ORDINANCE #2020-10 - CH 34 - ELECTIONS\ORDINANCE #2020-10 - CH 34 - ELECTIONS, ART II - VOTER REGISTRATION.wpd 70 SYNOPSIS 71 The amendment aligns the voter registration deadlines with the Delaware Code. 72 73 (SPONSORS: LINDELL AND MCDOWELL) 74 Actions History 75 07/28/2020 - Introduction - Council Committee of the Whole/Legislative, Finance, and Administration Committee