Pwosè vèbal

SPECIAL COUNCIL MEETING BUDGET REVIEW A Special Council Meeting was held on May 17, 2011 at 4:00 p.m. with Council President Leary presiding. Council members present were Mr. Anderson (arrived at 4:30 p.m.) , Mrs. Russell, Dr. McGlumphy, Mr. Lynn, Mr. Bonar, Mrs. Williams, Mr. Hare, and Mr. Hutchison. Council staff members present were Mr. DePrima, Mrs. Mitchell, Mrs. Tieman, and Mrs. McDowell. Mayor Carey was also present. AGENDA ADDITIONS/DELETIONS Mr. Bonar moved for approval of the agenda, seconded by Mrs. Williams and unanimously carried. Council President Leary announced that a period would be set aside for public comments prior to each session. PUBLIC COMMENTS Mr. Michael Albert, Planner II, (522 Brandywine Drive, Bear), stated that he was speaking as an advocate for the employees who would potentially be laid off under some of the proposed budget plans for the next year. He felt that employees should explain their job duties and responsibilities and the amount of work that is required of each department. Noting that customer service and permit processing are priorities for the City, he advised members that these functions include two (2) of the positions that are potentially planned for a lay-off. Mr. Albert stated that during the past two (2) years, as the economy has waned, the Planning Department has taken on more responsibilities and an increased project load. He advised members that the department is currently responsible for a concern regarding a National Pollution and Discharge Elimination System (NPDES) Permit, which is an issue that was created as a result of a lack of proper staffing. He stated that if this concern is not adequately addressed within the next six (6) months, punitive Environmental Protection Agency (EPA) enforcement actions will result. Mr. Albert felt that other departments would also encounter similar issues involving staffing, availability, and service that not only affect staff, but also citizens under some of the reduced budget plans. 2011/2012 BUDGET OVERVIEW Council President Leary advised members that an introduction and presentation of the budget would be provided by Mr. Anthony DePrima, City Manager. Introduction and Presentation/Revenue Mr. DePrima provided a brief introduction and presentation of the 2011/2012 Draft Budget (Exhibit #1). He noted that staff has provided members with three (3) plans to balance the budget which were designed to give Council the maximum flexibility to choose components from various options to build a plan best suited for the citizens. He advised members that Balancing Plan A is a policy plan, explaining that the base budget presented by staff meets all City policies and includes capital projects, strategic projects and salary requests that he felt merit consideration by City Council. He stated that an additional $3,595,666 would be required in the base budget, indicating

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 2 that a combination of cuts and revenues could be utilized to obtain the $3.6M needed. Mr. DePrima reviewed details for Balancing Plans A, B, and C. (City Clerk’s Office Note: Exhibits #1, #2, and #3 referred to in the Balancing Plans include Pages 15-18 of the Draft Budget.) In response to Mrs. Russell, Mr. DePrima explained that when considering a rollback to 2002 staffing levels, it was determined that the City operated with almost the same programs and, although there were fewer people, roads, etc., the rationale was that the City did manage to operate. With reference to capital projects and strategic funds, he stated that staff eliminated those projects necessary in to balance the budget, explaining that only those projects that are absolutely necessary were maintained. Responding to Dr. McGlumphy, Mr. DePrima stated that the staffing rollback levels were conducted for General Fund departments only. Dr. McGlumphy suggested that staffing levels should be consistent for all Funds. He questioned why management has not been decreased at the same rate as staff. Referring to the Water, Wastewater, and Electric Fund staffing, Mr. DePrima advised members that a rollback is not proposed in these areas since the current staffing levels are lower than in 2002. He noted, in particular, that the Electric Fund currently has 19 fewer employees than in 2002 due to privatization, and that there would only be one (1) less employee for the Water Fund. Mr. Hare noted that Balancing Plan A includes a reduction of 12 police officers. Mr. DePrima explained that the Police Department was held to the same standard as other departments. He reiterated that the City operated without these positions in 2002 and the Department was able to accomplish its functions at that time. Mr. DePrima noted that, since 2002, Council has added new functions to the Police Department, such as the Quality of Life Team, Sex Offender Team, School Resource Officer Team, etc. Mr. Hare noted that, in January, members of City Council were advised of crime issues in the City and it was determined that the Police Department was a major component in addressing these issues. He relayed concern, noting that the City is not able to roll back population or crime rate to 2002 levels and questioned why staff would make such a recommendation. Responding, Mr. DePrima stated that Balancing Plan A simply reduced the number of employees to 2002 staff levels; however, understanding the importance Council placed on various programs, he stated that staff developed different options. He noted that Balancing Plan C eliminates only one (1) police officer and that there are other options for Council to consider. Mr. Hare recalled there were three (3) employees in the City Manager’s Office in 2002; however, he noted that there have been no cuts in this department. Responding, Mr. DePrima stated that two (2) employees were brought from the Administrative Services Department to the City Manager’s Office; therefore, there are no additional employees in the City Manager’s Office. Concurring with previous statements of Council, Mrs. Williams questioned why layoffs are not proposed across the board, including managerial and supervisory employees. She felt that staff should consider the staffing levels in 2001, noting that there were only three (3) employees in the City Manager’s Office at that time, which included the Mayor, and that Duke Energy was the manager of the Power Plant and those employees worked for Duke. She felt that the staffing numbers proposed are skewed and requested that staff present to Council the 2001 staffing levels and compare the savings with the 2002 staffing levels. Responding, Mr. DePrima stated that there

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 3 has been an assumption that he reviewed the 2001 staffing levels and assured members that this was not the case. In addition, he stated that the City Manager’s/Mayor’s Office had four (4) employees (Mayor, City Manager, and two (2) Administrative Assistants). In regard to the Power Plant employees, Mr. DePrima stated that in 2002 these employees worked for Duke Energy, and today they work for North American Energy Services (NAES); therefore, the Power Plant employees have not been included in the proposals. Mr. Anderson suggested that if 2002 staffing levels are being considered, then revenue levels should also be considered. He noted that the Electric Fund transfer was reduced from 8% to 6.5% because there was so much coming from transfer tax and that the additional monies were not necessary, which was a historic norm. He suggested that the City amend the policy back to the historic norm for the Electric Fund transfer to 7.99%, which would not affect the City’s bond rating, debt repayments, or other obligations. Responding, Mr. DePrima referred to Pages 12 and 13 of Exhibit #1 and noted that in 2002, 23.9% of General Fund Revenue was from the Electric Fund, compared to 17% today. Mr. Anderson questioned the amount represented by the 1.25% raises. Responding, Mr. DePrima stated that this expense amounts to $57,000. Responding to Mr. Hutchison, Mr. DePrima stated that the majority of overtime expenses are within the Police Department and that this matter could be discussed further with the Police Chief. He noted that there are some overtime expenses in the Electric, Sanitation, and Streets departments which are mostly due to emergency situations. Personnel and Salary Changes/ Salary Review Mr. DePrima reviewed Pages 167 through 170 of the Proposed Budget and explained the process involved for requesting new positions as well as upgrades/position changes/step increases. He noted that the list includes all requests and that not all requests were included in the draft Budget. He advised members that there is an error in the salary amounts provided, explaining that the amount listed for the Library Clerk - Full-Time is the amount depicted for the Library Clerk - Part-Time and vice versa. Responding to Mr. Hutchison, Mr. DePrima stated that the last market analysis was conducted in 2008 and that the City’s policy requires this analysis to be accomplished every three (3) years. Referring to the Community Development Director, Mr. Hare requested that staff provide market analysis information to justify the regrading of the position. Dr. McGlumphy requested that the Human Resources Department provide Council with salary comparisons with other municipalities within the State of Delaware and not include information from other states. Responding, Mr. DePrima requested clarification as to the level of the comparison, whether it should include all positions or management positions only. He also noted that the market analysis conducted in 2008 included jurisdictions in the State of Delaware. He explained that the problem is that there is only one (1) comparable municipality in the State, the City of Newark, since most other communities are either too small or too large.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 4 In response to Mr. Bonar, Mr. DePrima stated that a market analysis for all positions would be a massive undertaking for the Human Resources Department, which is currently reduced in staff and working on other responsibilities. He requested narrowing the scope and suggested that such an analysis be conducted on only non-bargaining employees and selected municipalities. There were no objections to Mrs. Williams’ suggestion that members be provided ample opportunity to review and discuss the budget and, if necessary, that additional sessions be scheduled. Mr. Bonar felt that it is very disadvantageous for newly elected members of Council to be requested to review and approve a budget within the first few weeks of office. He suggested that the budget process begin at an earlier date and, if necessary, change elections to allow newly elected members of Council an opportunity to have all information. Responding, Council President Leary suggested that this suggestion be considered by the Legislative, Finance, and Administrative Committee. Review of 2011/2012 Draft Budget - Selected General Fund Divisions Mr. DePrima reviewed a Presentation of the Selected General Fund Division Budgets for FY 2011/2012 - May 17, 2011 (Exhibit #2). The line item details for each of these budgets were included in the packet presented to members. Referring to the Mayor’s Budget, Mr. Bonar questioned the benefits of the trip to Germany. Responding, Mayor Carey stated that the City has been trying to develop an exchange student program, this is a main “drop off” point for U.S. troops, hospitals in the area provide service to U.S. troops, and that there are several U.S. troop transfers in and out of Germany. He explained the importance of maintaining economic development and a good working relationship with Germany to show appreciation. He also advised members that a previous visit by others provided knowledge regarding operation of power plants, solar panel fields, etc., and that these ideas are exchanged to help with economic development for the City of Dover. In response to Mrs. Williams, Mayor Carey explained that the Police Chief planned to purchase a new vehicle and preferred to utilize a used vehicle for the position; therefore, the Mayor’s new vehicle was purchased by the Police Department and the Police Department acquired the Mayor’s 2000 Ford Taurus. Dr. McGlumphy reminded members that a few months ago, several organizations came before City Council to explain the benefits of membership. He suggested that all organizations be required to make such presentations, with the exception of the national organization, in which he felt membership may not be necessary. Dr. McGlumphy requested that details for all 30-27 and 30-28 line items for each department be provided to members with an explanation for the need. Responding, Mrs. Tieman stated that the Budget details were supposed to be included in the material provided to members and assured members that this information would be distributed. There being no objections, Council President Leary declared a brief recess. Meeting recessed at 5:34 P.M. and reconvened at 5:51 P.M.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 5 Review of 2011/2012 Draft Budget - Selected General Fund Divisions (continued) Mr. DePrima continued the review of the 2011/2012 Draft Budget, beginning with the City Manager’s Office. Responding to Mr. Lynn’s questions regarding the legal expenses included in the City Manager’s Budget, Mr. DePrima stated that the majority of the expenses are for City Solicitor fees. With regard to bids for City Solicitor services, Mr. DePrima stated that, according to the Purchasing Contract Manager, this has been accomplished in the past. Mr. Hare requested that the details for line items 10-18 for each department be provided to members. Mrs. Tieman assured members that details for each line item for each department will be provided. At the request of Mr. Hare, Mr. DePrima stated that staff would provide members with a list of those employees that have City vehicles that they use and take home. Responding to Mr. Anderson, Mrs. Hawkins stated that there is a stipulation that requires the City to reimburse some retirees for the cost of their Medicare Part B Premiums, which is deducted from their social security payment. This benefit has been eliminated from the three (3) unions and for new hires; however, it remains for non-bargaining employees. She did not have information regarding the annual cost of providing this benefit. In response to Dr. McGlumphy, Mrs. Tieman indicated that, in addition to salaries, the salary line items (10-11) can include vacation sell-back, retirement, stand-by pay, etc. Responding to Mr. Lynn, Mrs. Traci McDowell, City Clerk, stated that much of the City Clerk’s Office work has time constraints, explaining that the law requires agendas to be posted within a certain period, minutes must be made available within a certain period, etc. She confirmed that it would be difficult for the City Clerk’s Office to continue the current work if there was any reduction in employees. She advised members that she asked her staff to provide her with a statement regarding the effect that losing an employee would have on the office. Mrs. McDowell read the following statement: • Packet and meeting schedules have a short turnaround time and, due to electronic documents, packets are getting more and more cumbersome. Extending most of these deadlines is not an option as they are fixed by law. • Meeting schedules result in reduced time to work on “routine” issues or long- term projects. Apart from meetings, the Clerk’s Office oversees a number of “routine” matters (which are rarely routine due to the large number of special circumstances and the complexity of the issues considered), such as elections, rezonings, alley abandonments, annexations, adoption of ordinances, recording of legal documents such as easements, etc. Each of these matters involves a lengthy, detailed, step-by-step process. Failure to develop, implement, and abide by these procedures can leave the City vulnerable to lawsuits and significant monetary losses.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 6 • The job duties of Clerk’s Office staff require a vast amount of specialized and detailed knowledge regarding the City’s Municipal Code; parliamentary procedures; election procedures, records retention; database management; technology related to recording software and variety of computer programs; implementation of the Freedom of Information Act; and a number of municipal procedures. Because staff play such a pivotal role between Council and the City staff/public, the implications of failure to understand this information are serious. It takes up to three years to acquire a solid base of knowledge to function well in the office. A great deal of on-the job training has been invested in the current employees, which makes them more valuable than their salaries indicate. • Consequences of being short-staffed are increased stress on staff, decrease in efficiency and quality of work, and possible employee turnover, which we cannot afford. Responsiveness to Council, staff, and the public would also be reduced. • We have had a steady increase in FOIA requests including over 40 requests in the current fiscal year. Some of these have been very complex, requiring coordination between departments, legal opinions, and detailed responses, as well as new State-imposed deadlines. • Postponement of Certification and Training which would improve employee effectiveness. Dr. McGlumphy suggested that these concerns could probably be relayed by all City departments. He cautioned members that if staff levels were returned to 2002, there should be an understanding that service would be affected. However, he also urged members to understand that the City’s expenses must be within their revenues. Referring to the Customer Service budget, Mr. Hare questioned the savings that would be realized by sending bills to Wilmington for distribution. Mr. DePrima reminded members that an analysis was conducted when this concept was proposed and stated that this information would be redistributed to City Council. With regard to questions raised by Mr. Hare concerning online credit card payments, Mr. DePrima assured members that he would provide members with the Committee Action Form that includes details regarding the savings provided to the City by having a third party handle these transactions. Mr. Anderson questioned the cost of mailing utility bills. Responding, Mrs. Tieman indicated that this research has not been conducted for several years and suggested that staff again review this matter.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 7 Mr. DePrima relayed appreciation to Mrs. Tieman and her team for discovering that meter reading equipment can be installed on trash trucks to collect data, thereby eliminating the need for an individual to perform this task. In response to Mr. Hare, Mrs. Tieman indicated that Page 206 of the Draft Budget is incorrect and that a corrected copy would be included in the final draft. In addition, Mr. DePrima invited members to visit the Customer Service Department to get a better understanding of its positions and their functions. Without objection, Council President Leary indicated that the Budget Review would continue tomorrow, May 18th, at 6:00 p.m. with the review of Item #5-G - Finance. Meeting recessed at 7:02 P.M. WEDNESDAY, MAY 18, 2011 - 6:00 P.M. - 9:00 P.M. The Special Council Meeting reconvened on Wednesday, May 18, 2011 at 6:00 p.m. with Council President Leary presiding. Council members present were Mrs. Russell, Dr. McGlumphy, Mr. Lynn, Mr. Bonar, Mrs. Williams, Mr. Hare, and Mr. Hutchison. Mr. Anderson was absent. Council staff members present were Mr. DePrima, Mrs. Mitchell, Mrs. Tieman, and Mrs. McDowell. Mayor Carey was also present. PUBLIC COMMENT PERIOD Mrs. Dawn Melson-Williams, City of Dover Principal Planner (120 Derbywood Circle), read the following statement into the record: “From its earliest history the City of Dover has been a planned community. From the initial directives of William Penn to layout the town in 1683 and platting of The Green to the early developments of the town as a residential and commercial center in Kent County to the extensive annexation and industrial expansions of the 1960s through the present day governmental, economic and cultural center, ‘planning’ initiatives have been at work. Planning may be considered a behind the scenes activity, but the results of these activities are quite visible on the landscape we see every day. The City of Dover Planning Office is involved in a range of activities that have long term impacts for the quality of life that our citizens and visitors enjoy in Dover. Just to give two examples of the “behind the scenes” work of planners are the work related to activities highlighted in news stories on the front pages of today’s newspapers: NASCAR Weekend at Dover International Speedway and the ground breaking for the new Dover High School project. Both facilities went through an application process with the Planning Commission requiring review and approval plans, report writing, inspections, etc. by planning staff. Other activities that you may not realize include Planners serving in the field as part of the City’s Command Post for incident management and vendor licensing during Race Week. For the school

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 8 project, Planning Staff has participated in and continues to participate in numerous meetings with the school district, design engineers and architects, etc. on what will be perhaps the largest public project of our careers for the construction of a 315,000 SF high school building and associated site facilities on over a 100 acres of land. To describe the Planning Staff, I would use the words of knowledgeable, professional, helpful, flexible, and dedicated to their responsibilities and the City. Our work, while it may not be as visible as the weekly collection of your trash or the daily supply of water and electric service that arrives at your house or business, we have an impact even with those somewhat ordinary (and expected services). We have to be knowledgeable of the 23 square miles of the City and the associated rules and regulations (what street do you live on – what is the zoning and what does that mean you or your neighbor can do or build. As planning professionals, the three planners and the Planning Director are all AICP certified (American Institute of Certified Planners – an achievement that’s the equivalent of licensure for our profession). We are helpful to customers calling or visiting City Hall for information on the rules for items like where you can build a fence to developers proposing construction of new residential units or commercial buildings within the City. We are flexible in our daily tasks as we field and tackle multiple duties and responsibilities for the Planning Commission, Historic District Commission and Board of Adjustment that we support in addition to special projects and tasks in a variety of areas like the Comprehensive Plan and NPDES permit (stormwater permit). We are dedicated to working with other City departments and work with outside agencies like the Dover Kent County MPO. We all readily take on the tasks delegated to us from the Planning Director even if it’s outside our typical planner job duties such as support to the committees of the Downtown Dover Partnership, GIS mapping updates and Census data. Please remember that while there are a total of four planners on staff, the administrative responsibilities of the Planning Director as a Department Head and an administrator of multiple divisions affects her availability for participating in the daily hands-on planning needs which then fall to the remaining three planners in conjunction with our one administrative assistant. Having been employed here in the Planning Office for just over nine years I have seen the impact of limited staffing. From requiring outside assistance to draft the 2003 Comprehensive Plan Update when there were only 2 planners on staff at the time to regularly having to work more than a 40 hour week and evening hours to meet prescribed regulatory deadlines or attend meetings. Even as the economic marketplace may have slowed development activities, our staff of four planners is still busy. For example in calendar year 2010 Planning Staff reviewed 800 Building Permit applications in conjunction with the Inspection Division for things such as fence, signs, renovation projects, and new buildings to ensure compliance with the Zoning Ordinance. We are out in the field completing Certificate of Occupancy Inspections for planning and zoning compliance and researching and drafting text amendments to the Zoning Ordinance. Hopefully, this statement has begun to show the importance of a fully staffed Planning Office. I can honestly say that every day

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 9 in the Planning Office is different and presents new challenges to address. Myself and the other members of the Planning Staff are dedicated to serving the citizens, elected and appointed officials, and all others whose paths in life may travel through Delaware’s capital city.” Mr. Kenneth Clendaniel, Building Maintenance Craftsperson II (3867 West Denney’s Road), advised members that he serves as the President of IUE/CWA Union for City of Dover, which represents 160 positions employed by the City and that there are currently 150 employees. During the 2009/2010 Budget Review, the City Manager approached all City unions requesting the consideration of furloughs. He stated that furloughs were instituted that year and the IUE/CWA developed 48 proposals for revenues and cost savings, which were reviewed by the Legislative, Finance, and Administration Committee and addressed by the City Manager. Mr. Clendaniel stated that only one (1) of the revenue/cost savings has been instituted, and no action has been taken on the other 47 proposals. In preparing for next year’s budget, he advised members that the City Manager met with all City unions once again and advised the members of the layoff proposal. He noted that Plan A proposes the layoff of 33 positions, equating to 38 employees, 13 of whom are members of the IUE/CWA. Although there are no Electric Department employees in the IUE/CWA, he stated that there are Water Department employees. Understanding that Electric and Water Departments generate money for the City, Mr. Clendanial explained that other departments, such as Central Services, Customer Services, and Public Services, save the City money. Although these departments are within the General Fund, he indicated that the services provided by these departments include Electric and Water Fund Departments. He indicated that the employees work for the City of Dover (one (1) entity) and not a specific department. Referring to recent newspaper articles, Mr. Clendaniel noted that, although the State of Delaware and Kent County are affected by the same economics as the City of Dover, they are capable of providing their employees pay raises. In 2002, he reminded members that Council was made aware that the City would be required to add funds for Other Post-Employment Benefits (OPEB). To his knowledge, Council budgeted $84,000 at that time and that since that time, no additional funds have been budgeted. Now there is a short-fall for the other post-employment benefits. He cautioned members to consider the effect layoffs would have on the City and suggested that Council consider transferring required funds from the Electric and/or Water Funds and accept Budget Plan B presented by the City Manager. Mr. William Neaton, City of Dover Economic Development Director (51 Sackarackin Avenue), advised members that for the past two (2) years, he has had the opportunity to work for the City of Dover. Prior to this, he was in the private sector for over 30 years. As addressed to employees during a recent “Employee Appreciation Day,” he stated that, without exception, the City of Dover has a group of professional, dedicated and hard working employees. He has had the opportunity to live in nine (9) states, various cities, and indicated that he chose Dover, Delaware as the location to live, work, and raise his family, which has been the best decision he has ever made. He stated that it is Council’s responsibility to assure that future generations have the opportunity to make this same “best” decision.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 10 Mrs. Tracy Harvey, City of Dover Community Development Manager (334 Mystic Lane, Magnolia), read the following statement into the record: “Recently questions have been raised regarding the salary of the Community Development Manager based on the amount of grant funding the city receives as an entitlement community. The federal reporting and program requirements to effectively manage this program are the same regardless if it is a $300,000 or a 3 million dollar grant. Since the initiation of the Neighborhood Stabilization Grant awarded to the City in 2009 for $1.5 million dollars to purchase foreclosed properties and remodel them to sell to income qualified homebuyers, the community development office has exceeded that goal by expending $1,527.000.00 including program income the city received through the sale of affordable properties. For each property sold, the community development office receives 10% for administrative cost. The City received a total of $33,418 in administrative cost from 2009 to present and there is still a balance of $56,576 in administrative cost available in the original allocation to be drawn down that will offset administrative cost for the CDBG program. For fiscal year 2010, there was no funding used from the general fund to supplement my salary. After March 13, 2013, all NSP housing proceeds will go directly to the CDBG grant fund increasing the grant allocation and program administration with no cost to the City to supplement my salary from the general fund.” Dr. McGlumphy thanked those who addressed members and requested that the City Clerk’s Office provide these statements to members in written form. He stated his belief that those who know what is “going on” in the City, are those employed by the City and their input provides Council the opportunity to better understand their decision. MISCELLANEOUS INFORMATION Based on the previous evening’s discussion, staff provided members with additional documents. Mrs. Tieman reviewed the additional documents, as follows: 1) Memorandum dated May 18, 2011 - Updated Draft Budget Pages (Exhibit #3); 2) Memorandum dated April 19, 2010 - Lockbox and Remote Deposit Services Analysis (Exhibit #4); 3) Line Items (30-27 Subscriptions and Dues, 30-28 Training and Conference, and 10-18 Educational Assistance) by Departments/Divisions (Exhibit #5); and 4) Overtime by Division (Exhibit #6). Review of 2011/2012 Draft Budget - Selected General Fund Divisions (continued) Mr. DePrima continued the review of the 2011/2012 Draft Budget, beginning with the Finance Department. At the request of Mrs. Williams, Mrs. Donna Mitchell, Controller/Treasurer, indicated that she would have to conduct research to determine if there are any redundant memberships. Concurring, Mr. Bonar questioned if there are individual memberships to the International Association of Chief of Police, Fire Association, planning associations, etc., and if there is a possibility of consolidating memberships to one (1) membership per office. As requested by Mr. Lynn, Mrs. Mitchell stated that she has prepared a statement that has been provided to members regarding the elimination of staff for the Finance Department (Exhibit #7).

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 11 Responding to Dr. McGlumphy, Mrs. Mitchell stated that staff has been implementing ADP for approximately six (6) months. She explained that there are three (3) modules (Payroll, HR, and Time and Attendance) that require conversion. She stated that all departments have been cooperative with the Finance Department and the City Manager has been very helpful in assuring that assistance is provided when necessary. Mrs. Mitchell noted that because the Department is small in size, the workload gets behind when employees are granted leave. She felt confident that the ADP system will be in full operation by July 31, 2011. Referring to the Human Resources Budget, Mrs. Kim Hawkins, Human Resources Director, advised members that personnel costs have increased due to an employee’s eligibility for retirement and the inclusion of “payout” for accumulated sick and vacation time. She echoed the comments made by fellow department heads regarding their concerns about the proposed reduction of staff. She stated that the Human Resources Budget is not exposed to a staff reduction due to a 25% reduction in 2009. She reminded members that the Human Resources Department has historically been staffed with three (3) employees. In 2006/2007, Mrs. Hawkins advised members that this department assumed full responsibility for risk management, including insurance claims and lawsuits for the City. She stated that, with a staff of three (3), as the Director, she has had to become more involved in the daily aspects of the department and has had less time to direct to her duties as the department head. She advised members that the Human Resources Department is responsible for recruitment, benefit administration, risk management, discipline, mentoring and advice for employees, labor negotiations, incident investigations, retirement, policies, DOT compliance, etc. Responding to Dr. McGlumphy, Mrs. Hawkins stated that, although she conducts an analysis to determine those employees who are eligible for retirement, employees are to notify their department head of their intention to retire for inclusion in the next year’s budget. In response to Mr. Bonar, Mrs. Hawkins indicated that the policy regarding notification of retirement is included in the Employee Handbook, and requires two (2) weeks notice for non-exempt personnel, and four (4) weeks for exempt personnel, with an additional stipulation requiring 45 days if the employee is seeking terminal leave. Mr. Bonar suggested that this policy be reviewed for possible amendment to require employees to provide additional time for notification of retirement. Mr. Hare questioned if the City could mandate retirement notification. Responding, Mrs. Hawkins stated that the policy is provided as a courtesy and that there is an understanding when situations with extenuating circumstances arise. Responding to Mr. Hare’s request for copies of all job descriptions, Mrs. Hawkins indicated that she is working with the City Clerk to provide this information. In response Mr. Hare regarding the hiring freeze established on February 23, 2009, Mr. DePrima explained that prior to the hiring freeze, Council was not involved with employee recruitment. Since the hiring freeze, staff created a critical requirement form and, if requirements are met, the requested position is submitted to the Legislative, Finance, and Administration Committee for their review and recommendation to City Council.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 12 At the request of Mr. Bonar, Mr. DePrima stated that staff would need to determine how many positions have been vacant for over one (1) year. He advised members that if a position has been vacant for more than one (1) year, staff purges it from the budget. Mr. Hare noted that in 2008 there were 377 employees and in 2011, there are 377.5 employees; therefore, he questioned what the freeze has accomplished. Responding to Mr. Hutchison, Mr. DePrima stated that Council was advised of the City’s financial situation during the Council Retreat earlier in the year when Council directed staff to prepare the budget in accordance with City policy (as it relates to transfers). Staff did not realize that $1M would be required for OPEB and the costs for the Pension unfunded liability. Mrs. Mitchell explained that, although staff has always been aware that the costs for OPEB are extreme, staff did not realize the percentage of payroll involved and the effect on the proposed budget. However, the Pension unfunded liability increased approximately half of $500,000, which was not known until the recent actuarial analysis was completed. Mr. Hutchison questioned how many employees had been hired since January 1, 2011. Responding, Mr. DePrima stated that there have been seven (7) employees hired, as follows: 1) a Ground Worker for the Electric T&D Division; 2) a Public Utilities Construction Manager; 3) a LAN Analyst for the IT Department; 4) an Administrative Assistant Position in the Police Department has been approved (although not filled and not expected to be filled until September 2011); and 5) four (4) additional Police Officers. Mr. Hutchison requested that staff provide the names, salaries, and total costs for the positions. Referring to the Information Technology Budget, Mr. Siegel noted that in 2002 the Department handled four (4) servers, 180 computers, and the same number of staff. In 2011, he stated that there are nine (9) servers at 5 East Reed Street, the IT Department now supports the Police and Fire Departments (two (2) servers) and the Power Plant (1 server), and a complete phone system. He stated that there are over 300 computers and that the workload and complexity of the work has increased exponentially since 2002, with the same number of IT staff. Although a decrease in staff is not proposed, he wanted members to be aware that the work has increased significantly for the Department. In response to Mr. Bonar regarding the Cisco VOIP System, Mr. Siegel stated that one (1) of the reasons funds are being requested for upgrade of the system at this time is because the software upgrade can be integrated with existing hardware, whereas the next generation of software will not work on existing hardware. The upgrade would allow the City to keep the hardware in operation for another year or two (2) before the City would need to consider replacement. As a result, it was staff’s opinion that this is the most opportune time. In addition, he advised members that some of the problems being experienced are the result of software integration between the phone system and the computers. The software does not work with Windows Vista or Windows 7. Mr. Siegel noted that the City must move forward and cannot continue to operate on an operating system dated 2005. In order for this to be accomplished, it is necessary to upgrade the software on the phone system at an estimated cost of $12,600, and perform “back” maintenance (a total $41,295 to upgrade all maintenance). Mr. Bonar requested that staff provide details regarding the costs for the software system as well as the maintenance costs.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 13 Responding to Dr. McGlumphy, Mr. Siegel stated that there were not enough funds included in the current budget to pay for the maintenance. He explained that prior to last year, maintenance was handled by Facilities Management; therefore, the IT Department staff did not have the required information to budget accordingly. When this was realized in mid-year, IT staff decided not to upgrade the maintenance by removing the $36,000 from the budget and put it in the proposed budget as a “catch up” at a total cost of $41,295. In reviewing the Tax Assessor’s Budget, Ms. Cheryl Russell, Tax Assessor, read the following statement into the record: “The Assessor's Office has only 3 full-time employees. The impact of losing one employee from our office would have a great negative impact on our already small department. This office maintains a very detailed property assessment system for approximately 12,000 parcels with an assessed value of approximately 4.4 billion dollars. The functions of this office also include but not limited to maintaining abatement programs; appeal hearings (informal and formal); maintaining values for annual billing and supplemental billing; Processing Deeds for stamping and Transfer Tax; and analyzing and reviewing building permits for valuation. Each employee serves a different function: The Assessor: Department Head/Supervisor All Administrative functions Field Work Defending City of Dover Assessments Generating values for new construction (building permits) Sales Ratio Studies Administrative Assistant: Administrative Function All correspondence in/out of the department Senior Citizen Exemptions Disability Exemptions Farm Land Audit Exemption Audits Income and Expense Mailing Deed Transfers Phones Transfer Tax Assessment Registers Appeal Minutes Copying and mailing of Appeal Information to Board Members

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 14 Residential Technician: Primarily Field Work Administrative Functions when needed (limited to phones/transfer tax/accepting applications) Daily Permit Activity (field work and data input) This office was fortunate to have an audit/study performed by the International Association of Assessing Officers in 2008. In this study, it was recommended that this office be staffed by 5 to 6 employees. During the presentation to Council, there is a power point slide titled "Future Direction of Assessor's Office” which states that "the Assessor's Office needs to be staffed adequately to be able to maintain current processes." This office is running smoothly in an off-revaluation year. All three employees do their job well and efficiently. Each employee helps out when and where needed; especially during vacation and sick days; which has allowed us to not have to request additional staff at this time. If we were to eliminate a position within the department: • Vacation and/or sick days would force an employee to either work a 9.5 hour day or close the office during a lunch hour. • If an employee is on vacation and the 2nd employee has an emergency it could also force the closure of the office for a period of time. • Working over-time to maintain the level of current processes and efficiency would be required.” In response to Mrs. Williams, Mrs. Russell stated that it took about one (1) year to complete the 4,000 building permits processed. She stated that a Residential Technician was hired at approximately $30,000 annually to assist with updating the building permits and assured members that this employee has been maintaining and keeping the data current. She confirmed that the Assessor’s Office is currently up to date. She indicated that there are approximately 60-75 building permits per month. Review of 2011/2012 Draft Budget - Selected General Fund Divisions Mr. DePrima reviewed a Presentation of the Selected General Fund Division Budgets for FY 2011/2012 - May 18, 2011 (Exhibit #8). The line item details for each of these budgets were included in the packet presented to members. With reference to the discussion regarding staffing levels, Mr. Zachery Carter, Director of Parks and Recreation, advised members that in 2002, there were six (6) full-time employees in the Parks and Recreation Department. Since that time, he stated that the City has greatly increased the programming, special events, activities, etc., being offered to the community. He reminded

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 15 members that three (3) years ago, the 20,000 sq. ft. John W. Pitts Center opened, which gave the department two (2) facilities to operate and man. Mr. Carter noted that approximately 60,000 patrons utilize the facility, which is made available seven (7) days per week. He stated that when the Center was opened, only four (4) additional part-time employees were hired, who manage the facility during the evening and weekend hours, which are the times of most frequent usage. Should these positions be eliminated, it would eliminate the ability to make the facility available during the evenings and weekends. Responding to Mrs. Williams, Mr. Carter stated that the Dover Park (White Oak) Facility continues to be utilized, indicating that during the past year there were 167 rentals of the facility. He advised members that there are occasions when there is only one (1) employee located at the Dover Park, as well as the Pitts Center (during weekday hours), which raises safety concerns. As discussed in the CIP, he stated that it would be more efficient for the City to provide one (1) recreational facility. In the future, it would be ideal to expand the multi-purpose room at the Pitts Center to accommodate the activities conducted at the Dover Park and include room for staffing at the Pitts Center which would allow the City to be more efficient. In response to Mr. Hutchison, Mr. Carter stated that he could not provide an accurate number of participants at the Recreation Centers at this time; however, in regard to leagues, there are now 57-60, compared to approximately 40 softball teams in 2002. In addition, he stated that there is a field hockey league which consists of 35-40 teams and an indoor field hockey league consisting of 35-40 teams, with 20 participants on each team. Since the Pitts Center has opened, Mr. Carter stated that attendance has increased 10% or more each year during the past three (3) years. Mr. Hutchison requested that staff provide details regarding the number of participants at each facility. Mr. Hare questioned how much revenue is generated from the facilities. Responding, Mr. Carter stated that during the past year, $149,000 in revenue was received. Although there currently are no charges for use of the open gym at the facilities for residents or non-residents, he stated that there is a large number of individuals using the open gym and that he has discussed the possibility of charging for this use with the City Manager. He confirmed that presently there are more non-residents utilizing the facility than residents (52% non-residents); however, this is changing and more and more residents are utilizing the facility each year. Mr. Lynn relayed concern that instituting fees would discourage usage and that the users would find less productive endeavors in which to engage. Responding, Mr. Carter felt that instituting fees would not affect the usage. Concurring with Mr. Lynn, Mrs. Russell relayed opposition to instituting fees for use of the gym. Mr. Carter advised members that the history of the department indicates that 97% of the programs offered are fee based. He suggested the possibility of charging a fee for the use of the gym for non- residents and no charge for residents. Responding to Mrs. Williams, Mr. Carter stated that there is no air conditioning in the gym and, although he was not concerned about the cost of installation of air conditioning, he relayed grave concerns regarding the operating costs.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 16 Mr. DePrima stated that, should a majority of Council wish to institute a fee for non-residents to use the open gym, staff would develop an estimate to include in the proposed budget. He advised members that the reasoning for not charging a fee was that there was so much opposition to doing so for City residents. He stated that it was a conscious decision not to charge Kent County residents since the County contributed $300,000 towards the building of the Pitts Center and there was a belief that Kent County would be building a gym in the near future. He stated that it was staff’s belief that there would be some reciprocity for gym usage between these two facilities. It was his feeling that enough time has passed for the City not to charge non-residents and showed a good faith effort; therefore, he indicated support for charging a nominal fee for gym usage for non-residents. There being no objections, Council President Leary declared a brief recess. Meeting Recessed at 7:53 P.M. and Reconvened at 7:54 P.M. Review of 2011/2012 Draft Budget - Selected General Fund Divisions (continued) Mr. DePrima continued the review of the 2011/2012 Draft Budget, beginning with the Library. Referring to the Library Budget, Ms. Margery Cyr, Library Director, read the following statement into the record: “1. Thank you for giving me the opportunity to speak with you tonight about the Library and its budget. 2. Proposed reduction in staffing: a. Of the 7 positions, 3 are currently vacant: i. 2 of them since 2009 1. 1 FT Library Clerk II Children's Department 2. 1 PT Library Clerk I Circulation Department ii. 1 of them very recent: PT Library Page iii. Please do not believe that these positions are not needed by the Library. They are badly needed. b. At full staffing, the reduction of 7 positions is a 24 % staff reduction. c. At current staff level with the 3 vacancies, the reduction of 4 positions represents an 18% staff reduction. 3.) Comparison of volume levels from 2002 to 2010: Comparison 2002 2010 Books Circ: 101,609 138,931 Audiovisual Circ: 12,578 15,572

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 17 Total Circ: 307,533 375,632 Interlibrary Loan: Loaned to other libraries for their customers' use: 34,422 Borrowed from other libraries for Dover for our customers' use: 34,033 Total ILL : 68,455 Visitors: 181,412 390,612 Computer Use: 18,629 55,397 Programming: unknown Child's: 214 programs/7,958 attend Teen: 42 programs / 467 attend Adult: 146 programs / 1,473 attend 4. The Library is currently open 68 hours each week. There are significant and devastating consequences to public service of staffing reduction at these levels. Probable consequences are: a. Closing Sundays, one evening/week, and holidays which the Library remains open while the City of closed. b. Reduction of enrichment and information programming at all levels: Children's, adults, teens. c. Potential need to regularly close the children's department in order to maintain adequate staffing levels to ensure safety and security in the building. d. Potential loss of revenue from State Aid for meeting standards of Anchor Library. e. Potential loss of revenue from Kent County Reciprocal Borrowing reimbursement. f. Seriously compromised quality of customer service. g. Seriously compromised staff morale. 5. Kent County Reciprocal Borrowing Reimbursement Agreement: a. Agreement put in place in 1994 between the libraries in Kent County and the Kent County Levy Court. Provides per item reimbursement for each library item which is checked out to Kent County residents who are not residents of a municipality when that item is borrowed from one of the municipal libraries. b. The current reimbursement rate is $2.65 per item checked out.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 18 c. The annual amount reimbursed to the municipal libraries is dependent on the number of qualifying circulations. To the City of Dover, this is typically between $400,000 and $450,000 of income to the City per year.” Mr. Lynn stated his understanding regarding the needs of the library as they relate to providing services to some of the more vulnerable portions of the community, such as children and seniors. He felt that libraries have a demonstrable effect in improving literacy rates among children. He noted that Budget Plan A is predicated on staff reductions and questioned which programs would be eliminated for children if there was a staff reduction at the Library. Responding, Ms. Cyr stated that there would be a reduced number of pre-school story times, after-school activities, and weekend activities. She noted that the Library has worked very hard during the past two (2) years to develop a program that meets the needs of a very diverse audience of teenagers in Dover. She reminded members that teenagers can only use the Library during after school hours and weekends. If the Library faces closure, not only would the Library not be able to provide activities for them but the Library facility itself would be unavailable for their use. In regard to seniors, Ms. Cyr stated that seniors currently participate in the computer training programs offered by the Library and use the facility for reading newspapers and magazines as well as borrowing books; therefore, a lack of access to the Library would definitely impact the seniors as well. In response to Mr. Hare, Ms. Cyr stated that an additional $400,000 is necessary in order to obtain full funding for the new library. In regard to the $4M bonds for the Library, Mr. DePrima explained that he and Mrs. Mitchell presented a proposal to Council to float a $4M bond, which would not only assume some of the debt for the new Library but also address other capital expenses for the City, mostly street funds. He noted that the idea is to take some of the Library Reserve money to pay off the debt service for the larger bond issue until 2017, when the City would have no debt, and then the City would pick up debt service after 2017. He stated that this concept has been included in Budget Plan C. Mr. DePrima noted that the $400,000 is in addition to the bridge loan and the Green Energy Fund loan. At the request of Mr. DePrima, Mrs. Mitchell further explained that the idea of issuing a bond was to cover the Green Energy loan, in the amount of $1.5M, which must be financed, and would be paid with monies received from the Green Energy Fund which are included on customers’ electric bills. An amount of $1.2M was included for the sale of the existing Library, which would not be sold until after the funds are needed, as well as an additional $2M. She explained that this would “free up” $2M in the Library Reserve to pay for other capital projects, and the Library and Street Program would be bonded. The City would maintain the same level of debt service after 2017 and the current debt service increase would be paid by the Library Reserve funds. Mr. Hare questioned how much money the new Library will cost residents, explaining his feeling that the citizens are not aware of the true numbers involved with the new Library. Responding, Mr. DePrima stated that the City has been very transparent regarding the funding for the new Library and that he would provide members with the funding plan information.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 19 Responding to Mrs. Williams, Mrs. Mitchell stated that the concept of bonding the projects was developed due to the projects being multi-generational uses. She explained that, rather than placing the burden of the cost for a 20-year facility on current rate payers, the bonding would allow for future generations to help pay for it through debt service payments each year. Understanding this concept, Mrs. Williams questioned how much money would be available for a bond if a catastrophic event occurred, or if a situation arose that created a very expensive need for the City. Responding, Mrs. Mitchell stated that, according to the City Charter, the City can bond up to $7M annually and that there is a cap of 1% of the assessed value, which would equate to approximately $23M that the City could not exceed. Currently, she stated, the City’s debt service is under $3M for the General Fund. Noting that bonding is an important component for the budget, Mr. DePrima suggested that staff provide members with the original bonding presentation to promote a better understanding. In response to Mr. Leary, Ms. Cyr stated that the Library continues to utilize two (2) retired workers who are provided by a program offered by the Modern Maturity Center, which is funded by Federal Grant Funding to provide part-time work for older, retired workers. She stated that recently this funding has been reduced and the hours have been cut back to 16 hours per week for each worker. Responding to Mrs. Russell, Ms. Cyr stated that the Library did have an intern, a Library School Student, who provided assistance in the Children’s Department. Referring to Page 13 of the Draft Budget, Dr. McGlumphy requested clarification with regard to the new positions approved for the Library. Responding, Ms. Cyr noted a typographical error in the third sentence of the fourth bullet and that the one (1) full-time Librarian II position should be a Library Clerk II, and the one (1) part-time Librarian I position should be a Library Clerk II. At the request of Mr. DePrima, Ms. Cyr explained that a Librarian is a professional who has received a Masters of Library Studies Degree and provides assistance to customers in terms of assisting readers, answering advisory questions, and planning and implementing programs for the public. She stated that a Library Clerk requires a high school diploma and provides direct customer service, mostly checking in/out material and answering directional questions. At the request of Mrs. Williams, Ms. Cyr stated that a Library Page is responsible for putting books and materials back on shelves and keeping them organized. Referring to the Public Services Department, Mr. Scott Koenig, Public Services Manager/Director of Public Works, reviewed the wide range of services provided by the Public Services Department. He stated that these services are provided in an effort to support the City’s mission, vision, and critical success factors. He noted the changes that have occurred in the City during the last 10 years. He reminded members that the City went through a very large period of annexation and growth in commercial stock in buildings and residential development. He noted that, although such growth has slowed down recently, it continues in the City and all these additions have an impact to the Public Service Department. In addition, Mr. Koenig noted that the department has been faced with an increased amount of regulations, such as those associated with stormwater, sanitation, street sweeping, environmental cleanups, etc. He stated that there are 58 budgeted positions within the

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 20 department and each is critical to the success of the department. Mr. Koenig relayed his utmost satisfaction with the work done by each of these employees; however, he noted that the department is faced with a number of back-ups and requests and is sometimes criticized with respect to customer service and responsiveness. He explained that the economy has changed substantially during the past 10 years, and with the addition of email, PDAs, computer access, etc., requests are received 24 hours per day, seven (7) days per week. He stated that there is an expectation of very timely, quick, and detailed response. Mr. Koenig advised members that this level of responsiveness takes a toll, explaining that the amount of information provided to members of Council and the information expected by customers requires planning, interaction, and manpower to accomplish. He noted that there are five (5) positions scheduled for elimination in the Draft Budget. Mr. Koenig advised members that if these positions are eliminated, the other employees will be required to pick up the workload. It was his opinion that there is a fairly stressed out workforce across the City and that there will be a toll for any additional responsibilities. Although he understood the fiscal constraints, he explained it was his responsibility to advocate for the Public Services Department. Responding to Mrs. Williams, Mr. Koenig reminded members that in 2004, there was a proposal which indicated an estimated $1.5M each year for street maintenance. Considering the prices of asphalt and concrete today, it would cost $2M each year for street maintenance with a 20-year removal and renewal schedule. Staff submits a $1.5M budget request, which includes approximately $800,000 to $1M of Community Transportation Funds and the balance through the General Fund. He stated that the General Fund monies have been reduced in recent years to approximately $350,000 and the City’s ability to obtain Community Transportation Funds related to street improvements has fluctuated annually from nearly $1M to only $250,000 to $300,000; therefore, the funding source for the street program is volatile. He confirmed that in order for the City to be proactive rather than reactive, the City would need $2M per year. If streets continue to be delayed, he anticipated that there would be a 20% increase in costs in the future. In response to Mr. Bonar, Mr. Koenig stated that the last major cash infusion to the water and sewer system was for the bond issue related to the Water Treatment Plant and McKee Run Pump Station. There were funds included in the 2005/2006 Budget for the Pump Station #7 Upgrade. Mr. Bonar stressed the importance of the City being proactive with regard to water, sewer, streets, and other utilities; otherwise, he felt that the City will realize significant problems in the future. He noted that it is the responsibility of members of Council to take appropriate action in this regard. Dr. McGlumphy recalled that Mrs. Sharon Duca, Water/Wastewater Manager, would provide an annual report on utility projects and suggested that members be provided an update. Referring to the Economic Development Office budget, Mr. Hare questioned expenses included for account #30-91, Economic Development, in the amount of $26,000. Responding, Mr. Koenig stated that the $26,000 budgeted represents the annual payments made to the Kent County Tourism Office in the amount of $15,000 and Kent County Economic Development Partnership in the amount of $11,000. Responding to Mr. Hare regarding the Life Safety Budget, Mr. Koenig stated that the $205,360 included in account #30-31, Contractual Services, is to provide two (2) shifts of ambulance services to the City of Dover. In regard to the Emergency Management Coordinator position, Mr. DePrima

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 21 stated that the position became vacant upon the retirement of Mr. Wayne Hutchison (December 2010) and that it is planned for the position to remain vacant at this time. He stated his intention to present ideas to members of Council regarding this position in the near future. Without objection, Council President Leary indicated that the Budget Review would continue tomorrow, May 19th, at 6:00 p.m. with the review of item #1-B(b-3) - Inspections and Permitting. Meeting recessed at 9:05 P.M. THURSDAY, MAY 19, 2011 - 6:00 P.M. - 9:00 P.M. The Special Council Meeting reconvened on Thursday, May 19, 2011 at 6:00 p.m. with Council President Leary presiding. Council members present were Mr. Anderson (arrived at 6:05 p.m.) , Mrs. Russell, Dr. McGlumphy, Mr. Lynn, Mr. Bonar, Mrs. Williams, Mr. Hare, and Mr. Hutchison. Council staff members present were Mr. DePrima, Mrs. Mitchell, Mrs. Tieman, and Mrs. McDowell. Mayor Carey was also present. A moment of silence was held in memory of Mr. Dick Ennis, former Levy Court Commissioner, who passed away this morning. PUBLIC COMMENT PERIOD Mrs. Ann Marie Townshend, Director of Planning and Community Development (52 Washington Street), read the following statement into the record: “Good evening. For the record, my name is Ann Marie Townshend and I reside at 52 Washington Street in Dover. You know me as a city employee, but as everyone else does, I wear multiple hats. In addition to working for the City of Dover, I am a resident. Being a City of Dover resident has been at multiple points in my life a conscious decision my husband and I have made. We first moved to Dover in 1997, when we were young professionals working for the State of Delaware. In 1999, we bought our first house in Dover, where we started our family. We specifically chose Dover as our home where we would start our family because of the quality of life and quality of services that the City has to offer. By 2005, we were at a decision point, as we had outgrown our small house once our two small children began to grow. Being Baltimore natives, we discussed whether we should look for jobs closer to our original home and move back, or whether we should stay in Dover. We made a strong conscious decision at that time to continue our careers and our lives in Dover. This was now home for us. Our instructions to our realtor in our house search, we want to look only at properties within the City limits. We had come to enjoy the quality of our environment and the quality of City services. We didn't want to be anywhere else. Shortly after we made this decision, I enthusiastically applied for the Planning Director position with the City. How exciting to be able to serve and be a part of preserving the quality of life of the City I now call home! My past five years with the

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 22 City have been wonderful. It is still a great place for my family, and I am proud that I can help to keep it this way. Many of your employees have similar stories. Many of us are employees and residents. We pay the same taxes and fees as the rest of your constituents, while at the same time seeing the stress on the workforce as we try to do more with less. This is a delicate balancing act. We applaud your attention to detail to ensure that the City remains accountable to those who pay the taxes and fees. We are glad that you, along with the City administration, have worked hard to keep our taxes and fees affordable, while still providing an amazing level of service. We understand and appreciate the tough decisions you have to make, and we support you in your struggle to make these decisions. As a manager, I worry for the future of my employees, who come in every day and give their best. Many of them wonder what this budget will mean for them and their families. Clearly, we need to make cuts, but I ask you to keep in mind something that Michael Albert said the other night, these aren't just numbers and positions, they are people and services. As I have said to some of you in conversation, I do not envy the task in front of you, but I am here to provide whatever support I can as you make these tough decisions.” Mrs. Jody Stein, Administrative Assistant, City Clerk’s Office (522 Woodsedge Road ), read the following statement into the record: “I appreciated Dr. McGlumphy’s remarks last night encouraging Council members to strongly consider the viewpoints of employees. I agree that there might be a tendency to hyperfocus on the numbers on the pages before you and lose sight of the fact that those numbers represent the stories of many people. I would like to share a little of my story with you. In addition to being a City employee, I am also a resident of Dover. My children were born and raised in the City, and over the years my family and I have taken full advantage of the wonderful recreational programs offered by the City and have benefitted from its many services, such as utilities, police protection, the volunteer fire service, street maintenance, snow removal, and the “behind-the-scenes” efforts of the planning and inspections department, all of which are provided at a very reasonable cost. My appreciation for City government reached a whole new level after I came to work for the City three years ago and got to meet some of the people who were responsible for providing these services. I learned a great deal about the hard work and dedication that goes into making sure these benefits are available to residents. I am very proud to be part of the intelligent, innovative, and hardworking team of people who put their hearts and souls into serving our residents and making Dover such a great place to live. Now our government finds itself in the challenging position of trying to maintain vital City services, keep costs low for residents, and treat staff fairly - during a time when economic realities threaten each of these goals. Obviously the only solution

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 23 to the budget shortfall is compromise. I believe that residents and staff all realize that. It is self-evident that the City cannot continue to provide the same services with less money. As a City resident, I have appreciated that Council has battled to keep utility and tax rates low over the years. Yet I believe that we receive excellent services for a more than fair rate. This was brought home to me recently when my son moved to Nashville. I was astounded to learn that his recycling is picked up once per month and brush pickup is scheduled for residents three times per year. This was a stark contrast to Dover, where we take for granted that our leaves are vacuumed at the curb and returned to us as free mulch. I believe this service is worth much more than the $12.40 monthly fee stated in the proposed budget, and there may be other services that should be reexamined as well. I have read many letters to the editor from residents chastising the City for considering rate increases during the current economic downturn. Yet City services must be self-supporting at a minimum, and if some services can be managed so cost-effectively that they produce income, perhaps some of these funds can be directed toward areas of financial shortfall, and perhaps some jobs can be saved. As a City employee, I understand that sacrifices may be required during these difficult times; however, it is important that these sacrifices are shared fairly. Employees who work side by side should be paid equitably, whether they are union or non-union, and whether they are paid from general fund, the electric fund, or the water fund. To mandate otherwise is an affront to the hard work of the individual employee and a threat to the morale of the staff as a whole. In addition, those employees who occupy positions that have been undervalued for many years should not be asked to continue to sacrifice more than those who are in positions that are being paid at market value. (I may get in trouble for this tomorrow, but I think you should understand that this is a veiled reference to employees such as the City Clerk. I believe that the value of this position far surpasses the figures that you find in the budget before you. If you have any questions about the value of a City Clerk to municipal government in general, Mayor George Wright from the League of Local Governments can inform you. If you would like to know more about the value of the City Clerk to the City of Dover, I suggest you speak to people like Nick Rodriguez, Donna Mitchell, Scott Koenig, or Ann Marie Townshend, who interact with this office on a regular basis.) I am personally very conscious of the consequences of the economic downturn. Two years ago my husband lost his job due to a buyout and corporate downsizing. In spite of diligently searching for work and going through job retraining, he remains unemployed today. We were fortunate because our mortgage was paid and I retained health benefits through my employment with the City. Many of his co-workers lost their income and their health care without warning, and some of these individuals suffer from serious health conditions. I dread the prospect of any of my fellow City of Dover workers being placed a similar situation.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 24 I do not envy members of Council the very challenging task that now confronts you. You must make very difficult decisions, and regardless of which approach is adopted, the decisions made will impose hardships on both residents and staff. I ask that you do your very best to protect employees by doing all that you can to avoid layoffs and ensure that budget reductions are imposed equitably, not just on the general fund, so that the negative impact may be dispersed.” Officer Dave Spicer, City of Dover Police Department (400 S. Queen Street), stated that he serves as the President of the Fraternal Order of Police Lodge 15 and read the following statement into the record: “Good evening members of council my name is David Spicer and I am the President of the Fraternal Order of Police Lodge #15. I would like to take a few minutes of your time to comment on this years budget for the City of Dover Police Department. I understand Members of Council have been given three options by our City Manager to balance this years budget. If I understand one proposal is to cut 33 employee positions 12 of which are police officers. The mere fact of putting this proposal into black and white is disturbing. Ladies and gentlemen I probably don't have to tell you that gun play and gun violence has never been higher in this City. We cannot get through a single week without shots being fired at someone or someone being injured by a gun. Cutting 12 police officers would be a huge mistake. The rise of gangs and gang violence is astronomical. Most of you have been educated to how many gangs are in our area and the number of crimes they are responsible for. If we do not continue to seek out these gangs these criminals will only get worse and continue to terrorize our City. Members of Council I know these economic times are tough. I asked each of you do you have options. Do you have the ability to transfer funds from one area to another without hardship? I ask all of you will you be able to sleep at night peacefully knowing you balanced this years budget and laid off 12 police officers who choose this City for employment and to raise a family. The City Manager has brought to our attention that the City is suffering from a 3.7 million dollar short fall. Before any consideration or thoughts of layoffs of any employees I would suggest that ongoing capitol projects be delayed and freeing up a portion of these funds to balance this budget. These projects should only continue when the City is in a better financial position. Previous Members of Council recognized that manpower was already stretched very thin and they made the decision to fill empty positions to bring the departments personnel back to full strength. Eliminating 12 officers would be detrimental to the safety and well being of the citizens of Dover.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 25 I am confident you will make the right decision. Thank you for your time.” Ms. Kay Sass, Public Information Officer, City Manager’s Office (4453 Kenton Road Dover ), read the following statement into the record: “What came to mind when I first heard the possibility of 33 jobs being cut? First, it does not affect just 33 people, most of the 33 people are no different than you and I. We are parents; we are spouses, some of whose spouses are being laid off by other organizations like mine. When I heard the request the other night from Councilman Hare to gather job descriptions of the employees I thought to myself- how many peoples job duties match their job description, I know mine does not. As public affairs what do I do? I handle all media requests, submissions, clarifications and releases - Press conferences to advertisements and everything in between; For any and all departments and all offices. I deal with the franchise agreements with Comcast and Verizon, constituent issues, writing speeches for the Mayor, the State of the City Address, Mayors Annual Reception, Mayor's Prayer Breakfast, and handling public outreach for all events City wide. I represent the city at other events and functions-it is not just showing up it is hauling all of the equipment and setting everything up - alone. I write, edit, assemble and have copy ready a city wide newsletter that goes out quarterly without assistance. I oversee the customer relation management program that the constituents use to request services, get answers to frequently asked questions or to file a concern. I follow up making sure that the issues are being handled in not only a timely fashion but one that is acceptable to the people in our community- I report it monthly to the city manager to keep him abreast of concerns. We have groups that reserve City Hall for field trips-it has been a joy to be able to teach not just the youth but also adults in our community on our form of government, amazed that so many people that live here did not realize the council manager form of government. I assisted Scott Koenig, working diligently, on grant writing and we brought in $101,000 in recycling grants. I also secured sponsorship for the last 2 years for Concerts on The Green with WSFS in the amount of $12,000 - working with Sam's Club I have received funds each year to provide annually 100 elderly and disabled individuals with fans in our community making life a little better for them.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 26 This past year the City has taken on redoing the entire City of Dover website which we hope will be going live next week. I am not an IT person but I do know the importance for making things easy for our community to access and the importance of transparency in our government. This was another responsibility that was given to when an IT position was let go, again with no additional compensation. Myself, and Andy Siegel have spent hours upon hours redesigning and training city staff on the new website. I have been one of the advisors for Youth Advisory Council since its origination. Participated in the Public Library Campaign. Annually I train every City employee in customer service because it is important that people feel that they are being heard and being treated in a fair and respectful way. I have the Verizon channel that we post public service announcements to as well as show the City Council meetings. When one of our employees in public utilities retired, I inherited the public education and outreach on electrical safety in the area schools and various locations in the community. This was just added on as yet another additional responsibility with no increase in pay given. I was fortunate enough when I started doing it that Wayne Hutchison was available and aided me in hauling the equipment but as you know Wayne Hutchison retired in December bringing on additional responsibilities for me. Since I worked with Wayne regularly on writing some of the Emergency Procedures for the City as well as setting up and working the call center during the winter months it was natural for me to inherit additional responsibilities with Emergency Management. Since Wayne's retirement I continued with the classes that are offered through FEMA to be well versed and trained in Emergency Management. I completed- on my own time- since January 92 hours of online class time and the entire Professional Development series receiving my certification in the mail about 2 weeks ago. As well as all of the training for Emergency Management through DEMA, FEMA and the Department of Homeland Security I have also taken all of the classes for Advanced Public Information Officer with the final one being a week in Anniston Alabama a year ago in March the EM classes are: Emergency Program Manager- An Orientation to the Position Fundamentals of Emergency Management Emergency Planning Emergency Management Decision Making and Problem Solving Developing and Managing Volunteers in a Crisis participation in an Emergency Management Operations Center Workshop

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 27 Was it required for me to take these classes since the position is not officially mine? No! But in good faith I have a hard time winging it when people's lives are in danger or our community is devastated so I took it upon myself to reach out for the training and to accomplish the professional development series so I am aware of the requirements by law in an emergency situation making sure that we as a City follow the procedures in place by the federal government that if a disaster does take place, I am properly trained to make sure that we follow their procedures and guidelines so we would qualify for reimbursement and not lose out on that too. Each day when I walk through the door I dedicate 110% that 110% does not stop when 5 pm rolls around. If it is 2 am and there is an issue in Dover I have gotten out of bed, dressed and on the road in minutes. I have done this for years, not driving a City vehicle, not getting City gas, not submitting my mileage. In a time of any disaster I concentrate on what do we as a City need to do to make this right? I handle press releases and inquiries as the PIO for the Fire Marshals' office I set up shelter when we had 126 people affected by the largest fire Dover had seen in years. Why? Not because it was part of my job description but because I believe in the City of Dover. I believe in the people I work with I believe in the people that live here. I believe to be part of a community that you have to be willing to step up when the going gets tough. I believe that as a City Council you will make the right decision giving our residents the services that they have been given, are accustomed to and we excel at. Do I envy you as a Council? Absolutely not. You are positioned in a no win situation and this is a very tough position I only pray that all things are considered for all of us. Thank you for your time.” Dr. McGlumphy reiterated his appreciation for those who addressed members and again, requested that the City Clerk’s Office provide these statements to members in written form. He requested that if any other staff wishes to submit comments to members of Council for consideration, that they provide them to the City Clerk’s Office for distribution. MISCELLANEOUS INFORMATION Based on the previous evening’s discussion, staff provided members with additional documents. Mrs. Tieman reviewed the additional documents provided to members, as follows: 1) City Manager’s Legal Expenses (Exhibit #9); 2) Memorandum dated May 19, 2011 - Take Home Vehicles (Exhibit #10); and 4) City of Dover Water Quality Applicable Expenditures (Updated “Duca” Report) (Exhibit #11). Mr. Lynn referred to an excerpt from the Regular Council Meeting of March 29, 2004 provided to him and noted that the City Solicitor and Deputy City Solicitor positions had not been bid since 2004. Confirming, Mr. DePrima stated that during the previous budget session on May 18th, when the Purchasing Manager indicated four (4), he interpreted that as being four (4) years ago; however, he felt that he must have been referring to Fiscal Year 2004. As noted in the minutes, he advised members that although an RFP was prepared, at that time, Council made a motion that the “Request For Proposals for Legal Fees be null and void and that any further RFPs for any appointed City positions must have the full approval of Council.”

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 28 Review of 2011/2012 Draft Budget - Selected General Fund Divisions (continued) Mr. DePrima continued the review of the 2011/2012 Draft Budget, beginning with Inspections and Permitting. Referring to account #30-33, Demolitions, of the Inspections and Permitting Budget, Mrs. Tieman explained that the budget for Demolitions, along with Grass Cuttings, has been removed from the Code Enforcement Divisional Budget and included as a direct expense to the General Fund. This was done in an attempt to alleviate budget overrides; however, after meeting with the Controller/Treasurer, it was staff’s feeling that these expenses should be in the Divisional Budget. Therefore, there is no increase in the Draft Budget for these expenses, only a change in how they are listed. Mr. DePrima also advised members that staff has developed a procedure to avoid budget overrides. In addition, he noted that demolition expenses will be put on the tax duplicate and will become due the following year. If the tax bill, including the demolition expense, is not paid, the property can go to Sheriff’s Sale. Prior to this, he explained that the demolition expenses were placed as a lien on the property. Although no Code amendment is required to accomplish this for demolition expenses, Mr. DePrima stated that staff is preparing an ordinance amendment that would allow for grass cutting expenses to be handled in the same manner. Dr. McGlumphy requested that staff provide members with the amount budgeted this year for terminal leave, by position. Responding to Mr. Hare regarding the possibility of providing uniform, larger trash containers for yard waste similar to those provided in the County, Mr. DePrima stated that this option was considered by staff and that there is a large expense involved. He noted that although the County paid the initial expense, they are billing the costs to their customers. He advised members that when the City began the recycling program, customers complained about large containers. It was staff’s feeling that, rather than providing customers with a third large green container (noting that they currently have a recycling container and a black container), they could use a smaller, 35-gallon container. Elaborating, Mr. Koenig stated that the City’s residential and commercial customers are utilizing approximately 11,000 black containers, there are just under 8,000 recycling containers, and the average cost of the green containers for yard waste is approximately $50 each, which would cost the City approximately $450,000 (9,000 x $50) just to provide the containers. In addition, he stated that utilizing the green containers would require truck modifications to install “paddle flippers” due to the weight of the containers and contents. In addition, Mr. Koenig noted that the City’s composition of housing is much different than that of the County in that there are several townhouse and duplex developments, as well as other small space developments and explained that space is an issue in these areas with the current containers. In response to Mrs. Williams, Mr. Koenig stated that, in conjunction with the yard waste program, the City added one (1) month of springtime leaf collection. It was his belief that the leaf collection season will expand to begin in early March through April. He expressed concern that residents are still placing their leaves in bags for regular trash collection and that the City has been notified by the landfill that the leaves must be out of the regular trash collection system. Therefore, he assured members that staff will be working on this program for improvements.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 29 In response to questions of Mr. Anderson, Mr. DePrima explained the vehicle replacement program as it relates to either maintaining a vehicle and possible refurbishing or budgeting for its replacement. He stated that, in an average year, staff budgets $300,000 to $350,000 for the replacement of one (1) to two (2) sanitation trucks. Noting that the City utilizes the State of Delaware contracts for the purchase of vehicles, Mr. Hare questioned if staff also considers other businesses for such purchases. Responding, Mr. Koenig stated that the City does not always purchase through the State of Delaware contracts, explaining that bids are always solicited for sanitation trucks and that there are occasions when it is necessary for the City to purchase outside of the State of Delaware contract due to timing issues or when a particular make/model is desired. Responding to Mrs. Russell, Mr. DePrima confirmed that the Streets Division is currently operating at the same strength as in the year 2002. With regard to the need for radios, pagers, and cell phones questioned by Mrs. Williams, Mr. DePrima assured members that staff is conducting research to determine those employees who have such devices and reviewing the necessity of the equipment to be provided by the City. In reviewing the Planning and Community Enhancement Services Budget, Mrs. Ann Marie Townshsnd, Director of Planning and Community Development, provided members with a statement prepared by the Planning Office Staff (Exhibit #12). In addition, she noted that one of the City Planners serves as the contact person for the U.S. Census, which affects the entire City in terms of grant applications. She advised members that there is a very strong demographic component in the Planning Office which could result in legal ramifications. She noted that another responsibility is serving as the gatekeeper for development projects, explaining that there are many agencies involved in the development and review process that are not under the umbrella of the City; however, the City coordinates their comments. She advised members that there has been a lot of time spent on serving as the intermediary between the development community and State regulatory agencies. As previously mentioned regarding the National Pollution Discharge Elimination System (NPDES), Mrs. Townshend stated that, in 2003, the City of Dover was required, under the Clean Water Act, to obtain a permit from the Department of Natural Resources and Environmental Control (DNREC) under NPDES for the Municipal Separate Storm Sewer System (MS4), which is the conveyance system that collects stormwater from the streets and into stormwater ponds or directly to surface waters. The City is under a mandate from the Federal Government and has been under permit since 2003. Since the City has not been able to adequately staff the permit, the City has been in violation of the permit. Last year, she requested that this responsibility transfer from Public Works to the Planning Office, feeling that many of the tasks associated with the permit were planning related and within the skill set of the planners. She felt that the Planning Office could bring the City into compliance and remain so. Although she stated that the City is currently not in compliance, she assured members that great strides have been made in this regard. If staffing levels were returned to 2002, she was confident that the City would fall out of compliance.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 30 In reviewing the subscription and membership dues, Mrs. Townshend stated that $2,925 has been budgeted, which includes American Planning Association and American Institute of Certified Planner memberships for all four (4) Planners. In order to maintain accreditation, she advised members that all Planners must be members of both organizations and the memberships cannot be combined. In addition, she noted that there is a subscription for the Planning Advisory Service, which is a membership within the American Planning Association that provides national research on specific issues (such as research on regulating Solar and Wind in residential areas), at a cost of approximately $750, and she felt that the City greatly benefits from this service. She advised members that the other subscriptions include publications such as Planning and Environmental Law, which is a journal and costs approximately $500. Although this journal keeps staff up-to-date on issues and planning laws, she suggested that they can obtain this knowledge elsewhere. Responding to Mr. Bonar regarding the NPDES Permit, Mrs. Townshend stated that one (1) violation has been resolved, and that DNREC is going to issue another notice of violation which will include a list of the actions necessary to close out the permit that was not listed in the previous notice of violation. In accordance with a recent meeting with DNREC, the notice will include the failure to comply with timeline and will allow the City, through the end of 2011, to complete the list of actions necessary. Failure to comply with the timeline, will result in administrative penalties (fines) from DNREC. She stated that these fines will be in the tens of thousands of dollars and upwards to $100,000. If DNREC fails to enforce the City, then the EPA will become involved and conduct the enforcement. She stated that, although funds will be required, the specifics are not known at this time. Mr. Bonar stated that, once again, another government agency with unfunded mandates is putting the City in the position of costing money. Referring to the Conference and Training account, Mrs. Townshend noted that monies have been budgeted for attendance at the Regional Conference, explaining that in order to maintain Professional Certifications, Planners are required to earn 32 credit hours of professional development in every two (2) year period. There being no objections, Council President Leary declared a brief recess. Meeting recessed at 7:31 P.M. and reconvened at 7:45 P.M. Review of 2011/2012 Draft Budget - Selected General Fund Divisions (continued) Mr. DePrima continued the review of the 2011/2012 Draft Budget, beginning with Code Enforcement. With reference to the Code Enforcement Division, Mrs. Townshend read the following statement into the record: “Much of the work of the City's Code Enforcement Staff goes unnoticed. If the grass is cut on a vacant property before it reaches a level of community nuisance and complaint, if a rental property corrects code violations that may reduce the appearance of the neighborhood and the safety of tenants, if trash receptacles are brought back to proper location on the property, you might not notice this. If these things are not addressed, you would definitely see the difference.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 31 In addition to issuing violation notices, our Code Enforcement staff frequently works with property owners on how they can achieve compliance. They attend community and homeowners association meetings to be proactive in addressing complaints in communities. They have been known to "clean up" a nuisance rather than simply issue a notice. They work closely with our police department, customer service department, and public works department to address areas of common interest. A recent example of this was the response to complaints and gang activity on Barrister Place. The Departments worked together to address property code violations, trash, and criminal activity. The Code Enforcement staff has also assisted with the reduction of inflow and infiltration into the sanitary sewer system by notifying property owners that roof drain and sump pump connections to the sanitary sewer system must be eliminated. Violation notices have been sent out, and many of these connections have been removed, thereby reducing costs for sewer treatment. In January 2010, a code enforcement officer retired, bringing our staffing level from 5 employees down to 4 employees. These employees include one supervisor and three field inspectors. Each of these field inspectors is responsible for approximately one-third of the land area of the City, which geographically is very large. Also during this time, the number of foreclosures and vacant residential properties has skyrocketed, leaving staff to track down contacts at banks and management companies, monitor properties, and hire contractors to cut grass. Additionally, other property owners, including landlords, have deferred maintenance on their properties due to the economic downturn, again, leading to code violations that threaten the quality of our neighborhoods. The reduction recommended for the Code Enforcement staff is a part-time temporary position that has helped to fill the gap since the retirement in 2010. While this may seem insignificant, this loss leaves us in a more complaint driven mode, and inhibits our ability to be proactive in enforcement. Additionally, with proposed cuts in the Planning Office and Inspections and Permitting Division, some of the responsibilities of these offices, including certificate of occupancy inspections, gas tests, and framing inspections, will likely fall to the Code Enforcement staff. Can we survive? The answer is yes, we can. But it needs to be clear that proposed cuts will reduce the ability of the division to be proactive and lengthen the amount of time to respond to complaints and resolve violations.” Responding to Mr. Hutchison, Mrs. Townshend stated that there are hundreds of properties (200-300) that are not in compliance with the Dover Code. Most cases are resolved within 30 days; however, she stated that those properties that remain non-compliant beyond that point take a substantial amount of time for staff, the department manager, and the City Solicitor. Referring to the Community Development Budget, Mrs. Williams questioned the number of homes that have been “turned over” to home ownership in conjunction with the Neighborhood Stabilization Program. Responding, Mrs. Harvey stated that four (4) properties have been sold; one (1) is a lease purchase and one (1) is a rental for Connections, for persons with disabilities. There are two (2) additional properties that remain available; however, she stated that there are sales pending.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 32 Mrs. Townshend reminded members that when the City approved the Neighborhood Stabilization Program, it was stipulated that the City did not want to own properties. As a result, she stated that the City has granted monies to the partners; therefore, homes that have not yet been purchased are owned by the Diamond Community Land Trust, which is required to maintain the properties, etc. In response to Mrs. Williams regarding penalties for the Stimulus Act, Mrs. Harvey stated that the City will not be subject to such penalties since the City has already expended the funds. If the properties are not sold, she felt that the Land Trust will consider a lease/purchase for the properties. Responding to Mrs. Russell, Mrs. Townshend stated that the authorization for the part-time employee for the Community Development Division was exceeded; therefore, the City is no longer employing the part-time employee, nor has the position been included for next year. She advised members that in 2010, there was a significantly higher administrative burden due to the multiple “pots” of monies and at this time, many of the burdens have been satisfied. With reference to the specification writings (bids) for the rehabilitation program, she suggested that it be contracted as in previous years. Mrs. Russell relayed concern with a single individual bearing all responsibility for this office. Clarifying, Mrs. Mitchell reminded members that Council authorized the expenditure of $10,000 for the part-time employee and that the expenses totaled $15,000, $5,000 over and above the amount authorized by Council. As a result, she advised Mrs. Townshend that no additional expenses could be occurred at this time and suggested that she submit an additional request to Council, if necessary. In response to Mrs. Russell, Mrs. Townshend requested that any further discussion regarding this matter take place during an Executive Session of Council. Referring to the Fire Department’s Budget, Fire Chief Jack Fortney stated that Plan A proposes the elimination of a Fire Dispatcher. He stated that currently there are five (5) full-time Dispatchers, four (4) of whom are assigned to Station #1 (downtown) and one (1) assigned to Station #2 (Dover-Kenton Road). The Dispatcher at Station #2 was established in 2003 to cover Station #1 shifts as needed (vacations, sick leave, etc.) as well as maintain the building. This individual is also assigned with assisting GPS information pertaining to locating Fire Department Connections, Knox Boxes, and Fire Hydrants. He advised members that all Dispatchers are EFD Certified, which is now a requirement for the City of Dover. He noted that the additional Dispatcher has reduced overtime issues and has reduced part-time employees from seven (7) to one (1). Chief Fortney stated that overtime paid in 2009/2010 was $50,658 and to date is $11,315, which is well below previous years. The part-time expenses for 2009/2010 were $11,593 and to date, $1,880. In regard to the annual contribution, in the amount of $281,252, from the City of Dover, Fire Chief Fortney noted that two (2) of the three (3) plans would reduce the budget for the Fire Department in the amount of $5,000. Although the previous year’s budget indicated a $600 surplus for the Department, he stated that there were two (2) invoices held to be paid in the current fiscal year. Although he was not requesting additional funds for the Fire Department, he requested that no additional monies be taken from the Fire Department’s budget.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 33 In response to Mr. Bonar, Mrs. Rebecca Rollison, Fire Chief Assistant, assured members that she would provide information regarding the two (2) invoices mentioned by Fire Chief Fortney. For clarification, Mr. DePrima noted that Plan A includes an “across the board” reduction, which is the $5,000 mentioned by Fire Chief Fortney. Mr. Bonar advised members that Volunteer Fire Departments throughout the State have realized significant reductions in the amount of funding received from insurance and grant-in-aid. The Volunteer Firefighters Association is attempting to have some of this funding restored and is developing a new methodology for verifying the insurance pay-outs. He noted that if Dover’s Fire Department was operated as a “paid fire department, it would cost taxpayers an additional $13M to $14M and relayed his appreciation that the City of Dover has a volunteer service to fill that void. Responding to Mr. Anderson, Fire Chief Fortney stated that the monies budgeted in the telephone line item for upgraded fire pagers (included in line item #30-21 in the amount of $40,640) could be removed from the Fire Department’s budget. The New World System Software, included in line item #30-67, in the amount of $40,000, would provide the Fire Department a more integrated database with the Dover Police Department as well as the Kent Center, and would allow communication computer to computer, to vehicles, etc. At the request of Mrs. Williams, Mrs. Rollison indicated that she would determine if blueprints of buildings would be available with the New World System Software and/or if it would be a separate module, and the costs. Fire Chief Fortney explained the importance of having the same type of equipment and the request for the Holmatro rescue equipment, noting that the Holmatro is a one-point “hookup,” and provides more PSI. As suggested by Mr. DePrima, Mrs. Mitchell explained that Council authorized the purchase of a new Quantum Ladder Truck for the Fire Department with expected delivery in July 2011. The plan for financing the truck provides for the first payment to occur in the next fiscal year and a seven (7) year loan period. Mr. DePrima reviewed a Presentation of the Selected General Fund Division Budgets (Police Department) and Water/Wastewater Fund for FY 2011/2012 - May 19, 2011 (Exhibit #13). Chief James Hosfelt, Dover Police Department, read a prepared statement as follows: “Good evening, on behalf of the employees of the Dover Police Department I wanted to thank you for the opportunity to speak to our budgetary needs and concerns. Let me begin by getting right to the core issue - and speak to the possibility of "laying off" employees. Since 2002 the police department has not increased its civilian workforce. It is my belief that technology has allowed us to provide professional and efficient services without increasing this side of the workforce. On

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 34 the other hand, the number of police officers has increased by twelve. This was done so we could support initiatives such as the Quality of Life Task Force, the Sex Offender Section, School Resource Officers, and increase staffing in the Patrol and Criminal Investigations Units. If given the mandate to reduce my law enforcement workforce by twelve officers, those Units affected will be the Community Policing Section (4) and the Quality of Life Section (4), along with the four officers currently attending the police academy. I simply cannot afford to take any officers away from the Patrol Unit, Criminal Investigations Unit or certain sections within the Special Enforcement Unit, such as the Motorcycle and Sex Offender Sections. These Units are the backbone of any law enforcement agency. This philosophy is consistent with the information I provided to Council in February during joint committee meetings. As a reminder, the cost of one of the officers in the police academy is being paid through a COPS grant for the next 30 months. At this time there is no other federal funding available that we are eligible to receive for things of this nature. In regards to Capital Projects, we understand the need to remove the Police Station Parking Lot from the project list and although repairs are needed we can make do for another year. In reviewing the options laid out by Mr. DePrima regarding Police Vehicles we have discussed both at great length. As a result, I would ask Council to consider paring down these options to the replacement of only three vehicles (Criminal Unit) at a cost of $65,000. I am confident that with only three replacement vehicles and my current inventory we will be able to continue appropriate police response. In years past, we have applied for and received federal funding to purchase police vehicles, but at this time there are no federal monies available to support this type of request. Currently we have five 2011 Ford Crown Vics which we are holding to help us get through the upcoming fiscal year. The only Strategic Project we have budgeted for is our triennial CALEA Inspection and Conference at a cost of $9,500.00. The Commission on Accreditation for Law Enforcement Agencies ensures that we maintain compliance with 464 national standards. These standards are part of a nationally recognized risk management system for running a Law Enforcement Agency and the benefits of Accreditation significantly out weight the cost. Because of CALEA, my officers are better trained and equipped and they have a much clearer understanding of their duties and responsibilities to the population we serve. Although I cannot provide an exact figure, I do know that our current insurance carrier for the City takes into account that we are a nationally accredited police agency. For over a decade we have been Nationally Accredited and to throw away a program that we have already invested so much into, with both time and money, to save $9,500.00 just doesn't make sense to me.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 35 Under Plan C of the budget proposals, at the bottom of the page, it lists reducing the Police Terminal Leave Budget by $100,000.00. In the upcoming fiscal year 17 Dover Police Officers are eligible to retire. If all retire and lump sum payouts are requested, the cost to the city will be over $1,000,000.00. Do I think this is probable — no, but it should be a concern. My employees are very concerned with next year's planned negotiations and the emphasis these negotiations will place on healthcare. I think it would be a safe assumption to say that before any possible changes to retirement benefits several employees may retire. In closing, and for the benefit of our new Council members I would like to highlight that the police department has applied for, received and managed in excess of a million dollars in grants to support our law enforcement operations over the last few years. The money from these federal and state grants have helped to offset the cost of salaries, equipment and training which normally would have been the burden of the City. We consider ourselves good stewards of the cities money and my staff continuously works towards finding other funding options to support our crime fighting efforts and community support programs. I apologize if my comments were too long, but I believed it necessary to speak on those issues affecting the police department which are outlined in the budget proposals. Thank you for your time and attention.” In response to Mr. Lynn, Police Chief Hosfelt stated that utilizing the Bartel Formula, which is used for Workload Assessment, the current Police force is down 45 officers, consisting of 32 officers for the Patrol Unit, seven (7) officers for the Detective Section, and six (6) officers for the Drugs, Vice, and Organized Crime (DVOC) Section. The addition of 45 officers would provide officers 50% of their time unobligated, in accordance with the Bartel Formula. He confirmed that the Bartel Formula was created by the FBI and in the opinion of experts, the City of Dover Police Department is currently understaffed, without taking into consideration any decrease proposed in the draft Budget. With regards to the safety of citizens, Police Chief Hosfelt stated that a reduction in police presence would likely result in a decrease of service provided to the citizens and response times to calls for service would increase. With reductions in staff, he advised members that Special Units would be the first to be impacted. He noted that the “backbone” to any law enforcement agency is their patrol unit and explained the necessity of the Detective Section if a situation requires further investigation. Mrs. Williams felt that the recent increase in authorized strength for the Police Department was to re-establish Community Policing to assist with Gang Warfare. Understanding that it would be impossible for the City to provide 45 additional officers, it was her opinion that there should be no elimination of police officers and that the intent of the previous Council to provide four (4) additional officers should be honored. Referring to the Mayor’s Budget, Mrs. Williams recalled that the Police Department was providing a vehicle to the Mayor. She questioned why the Police Department would be “donating” a vehicle and then requesting that Council provide them with new vehicles. Responding, Police Chief Hosfelt

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 36 stated his opinion that a new Crown Victoria is not necessary for Parking Enforcement or for the Evidence Technician, explaining that the new cars are desired for the Police Department’s Patrol Operations. Therefore, it was a “better fit” for the Evidence Technician to use the Mayor’s car rather than a new Crown Victoria in his everyday activities. Mr. Hutchison relayed concern regarding the overtime budgeted ($500,000) for the Police Department. He requested that the Police Chief review this matter and develop a proposal for a possible reduction. Responding, Chief Hosfelt assured members that overtime is constantly scrutinized and that his staff has some preliminary thoughts, such as a civilian court liaison officer. Although such a suggestion could not be utilized this year, he felt that this would be a possibility for future years and would provide significant cost savings in overtime. Without objection, Council President Leary indicated that the Budget Review would continue on Tuesday, May 24th, at 6:00 p.m. with the review of Item #2 - Water/Wastewater Fund as listed for the May 19th Session. Meeting recessed at 9:06 P.M. TUESDAY, MAY 24, 2011 - 6:00 P.M. - 9:00 P.M. The Special Council Meeting reconvened on Tuesday, May 24, 2011 at 6:00 p.m. with Council President Leary presiding. Council members present were Mr. Anderson, Mrs. Russell, Dr. McGlumphy, Mr. Lynn, Mr. Bonar, Mrs. Williams, Mr. Hare, and Mr. Hutchison. Council staff members present were Mrs. Mitchell, Mrs. Tieman, and Mrs. McDowell. Mayor Carey was also present. PUBLIC COMMENT PERIOD Ms. Kathy Divver, Customer Service Manager (104 Kings Court, Harrington), read the following statement into the record: “I have been a City of Dover employee for almost 21 years. My current position is Customer Service Manager. Over the years, I have noticed that throughout the City, employees display a great sense of pride, commitment and a sense of value. I understand Council has difficult choices to make this budget year. The impact of your decision may dramatically affect loyal dedicated employees, their families and the citizens of Dover. It is important for Council to understand the role that each department plays in the day to day operations of the city. Mrs. Tieman has provided a detailed description of all functions handled by the Customer Service Department. We keep Mrs. Tieman updated daily and appreciate her support.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 37 The Customer Service Department is critical to the vitality, stability and continued growth of the City. We establish utility services for customers, read electric and water meters and prepare bills for services offered by the City of Dover. Every effort is made to maintain our outstanding receivables at an acceptable level. We manage the property tax billing and collection process. Our cashiers process City of Dover payments at the Reed St office and through electronic transmission. All existing staff work together to provide an excellent level of service. Any reduction in staff would impede continued growth and adversely affect the quality of customer service. Words cannot express the gratitude that I have for the entire Customer Service staff. This is a dedicated group of individuals that accept and move forward with the changes in technology and staffing. Individuals that come to work pull together and work as one team. There was reference made at one budget hearing regarding the number of supervisors on staff in customer service. We are comprised of specialized smaller divisions that each plays a critical role. Customer Service feels the impact of a troubled economy. We hear and understand the hardships our customers face and try our best to meet their needs, while staying with established policy guidelines. Often, throughout the day the customer service representatives will refer customers to the customer service supervisor to make complicated and difficult decisions. She will take time and personally review the account and present all available options. She supports continued customer service training and keeping the staff up to date with policy changes. The Account Clerk III cashier position properly accounts for cash processes, prepares bank deposits, and ensures the work for the day is handled in an efficient manner. This too requires attention to detail and meeting internal control requirements. Meter Reading is the core of the billing process. It all starts here. The supervisor in this department manages to keep meter reading on schedule, ensure work order are completed on time, networks tasks between departments, and works with customers in the field. Account Clerk III- Billing department generates accurate and timely bills to customers. The billing supervisor performs billing audits, manages large commercial accounts, developed the idea for the new utility bill, continues advancing the billing department towards new technology and gaining knowledge of renewable energy. Billing requires constant monitoring and an articulate watchful eye.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 38 I am responsible for managing all areas of the customer service department. In addition to analyzing and preparing monthly reports, handling critical customer issues, participate in projects that involve customer service department, making sure the lines of communication are open between staff in customer service. Thank you for your time.” Mrs. Teresa Tieman, Senior City Administrator (17 Howe Drive), read the following statement into the record: “Good Evening, My name is Teresa Tieman. I reside at 17 Howe Drive, Dover, Delaware. I have been employed by the COD for 23 years. My current position is Senior City Administrator for Budget, Program Development and Customer Services. The other evening when the Customer Services and Meter Reading budgets were reviewed, I did not really have the opportunity to discuss what Customer Services and Meter reading actually do. I would like to take the opportunity now. I am very proud of Customer Services and Meter Reading divisions. They have been working smarter to provide you and the Citizens with excellent service. There have been a lot of comparisons to FY 2002. In customer service we still do most of the same things we did in 2002. We still: Read water and electric meters, Prepare electric, water and trash bills, Take payments, Manage inquires, Maintain internal accounting controls on billing and collection activities. Open and close accounts, Maintain an equalized payment plan, Bill all the City’s miscellaneous bills and handle those inquires (this may be a pole repair for auto accident, or curb repair. And, we handle the City’s general information number with a live person, so that no one talks to an automated system. To give you some perspective: Today we prepare approximately 300,000 bills annually, which is an 11% increase over 2002. We also handle 20,000 work orders annually which are 7 percent more than 2002 levels. CS handles 3,700 calls per month - calls can range from 2 minutes to 25 minutes. This does not include the general information number or the number of citizen who come through the door. Walk-in customers are 4,700 per month or 235 per day. Every two minutes someone walks through the door. In addition to the things we did in 2002, since 2004 CS handles tax billing, inquiries and collections. The collection process alone requires a good deal of time since it has to comply with legal requirements. Lately we have invested a great deal of time in trying to make payment arrangements with citizens so they don’t go to munitions sale.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 39 The process of billing and handling the customer’s accounts has increased in complexity. There are new privacy laws and regulations. We have had to comply with new regulations as we perform our responsibilities, most recently the FACTAct/identity theft protection has come into play. The City’s clean hands ordinance means we must work closely with Inspections/Fire Marshall’s offices. While the quantity and complexity of work has increased, today, staffing has been reduced by 3 people or 15%. We are staffed with 14 customer service employees and 3 meter readers. We are able to accomplish this through technology. A new phone system, mobile data collection of meter reading and lockbox and remote deposits are a few examples. Along with technology, sometimes come additional work requirements. In 2002, we received payments through the mail and in person. Now, in addition to getting payments through the mail and in person we get them from the lockbox, ACH transfers, remote 3rd party credit card processors, and bank drafting. Each of these needs to be reconciled on a daily basis. This is increasing workload. It was mentioned last week that we were able to decrease staff because of technology. You need to know that we not only decreased staff, we increased productivity, accuracy, and customer service because of technology. It was also mentioned that we had a lot of supervisors for the number of staff. Those supervisors are working supervisors. We have been organized this way for many years. It may seem like a lot, but it works effectively. All supervisors are crossed trained to back up other supervisors. Originally, I was thinking of describing a typical day for the supervisors, but I do not believe a typical day would do them justice. Corrine Mosher is the CS Supervisor works daily dealing with customers in hardship. Daily she assists in the Cashier area, processes bankruptcies, updates the website, and maintains medical customer information, reviews disconnection lists, works interdepartmentally with Inspections, Fire Marshall, and Water service men. Keeps staff updated on procedures, new developments. Provides CS training, Denise Roberson, the account clerk III in billing was instrumental in the development of the new bill. She also backs up the meter reading supervisor. Denise is part of a two person team that prepares bills for our 23,200 customers on a monthly basis. She handles the document retention for the department, trains customer service staff regarding billing topics, updates billing information on the

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 40 website, monitors commercial and primary customer accounts monthly, prepares requests for rate information throughout the year, backs up customer service manager in handling customer issues. She is the go to person. Sherry Dixon is the Account Clerk III for the Cashier area. Currently, she and one other cashier process the payments that come in through walk-in customers and drop boxes. This can be over 10,000 transactions per month. Sherry processes deposits and since we have remote deposit now, follows a destruction schedule for the remote deposit checks. Sherry coordinates, cash handling, posts cash to the receipt system, administers COD parking and boat permits, backs up the CS supervisor. She maintains the safe. Sherry is responsible for the accurate receipt and accounting of over $132.4 million annually- our billings. Her days are always busy. Nancy Swaggard is the Meter Reading supervisor. As the Field Rep III, she is responsible for the accurate reading of 39,000 plus meter readings. She also coordinates the reading schedule, on-call schedule, disconnect schedule and uploads and downloads meter readings to and from the billing system. She works closely with the billing staff to coordinate reading/billing schedules and work orders. If your bush is blocking a meter, you may have received a letter from Nancy. If one of the meter readers is out for any reason, Nancy covers their duties that day. She coordinates work orders with the water/wastewater divisions and electric. In 2004, Kathy Divver became the Customer Service Manager. She is my right hand. She oversees the management of customer services and meter reading. Most recently Kathy has worked daily to implement a new bill design and the lock box. These projects were both implemented simultaneously. Both implementations went smoothly and that is really saying something. The bill was designed and implemented in house without additional contracting costs. In addition to projects like this, she handles the most difficult customer issues, works with Finance on reconciling accounts receivable issues, bills and collects property taxes. Kathy is a trouble shooter, with all the new technology and mandates that affect customer service and meter reading this is no easy task. Kathy and I speak every day. Since 2004, I have also focused on special projects and the budget. Special projects include: A city wide VOIP system, Meter reading mobile collection system, City-wide revenue manual, Water Impact fee research and implementation, current revenue $357,000, Management audit of Planning and Inspections, and Tax Office Lock Box implementation, Utility Bill Re-design, Implementation of the City Wide Privacy Committee, Re-organization of Meter Reading. Budgeting for the City now includes, strategic planning and is nearly year round. It is more complex because of changes in policies, mandates and the Great Recession.”

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 41 Council President Leary noted the receipt of a letter from Mr. Anthony DePrima, City Manager, and read into the record, as follows: “Dear Councilman Leary, Understanding that the current City Council, with many new members, wants to take the City in a new direction, and that I am in a place in my nearly 20 year career where I can feel really proud of the direction the City has taken, I wish to retire from service. I am exercising all of the retirement benefits accrued to me, and specifically request the terminal leave option as set forth in Article XI Section 5 Sick Leave-Sick Leave for Retirement Credit of the City Handbook. My last day of active duty will be June 8, 2011. I leave the City in a place where we have improved the overall quality of life in Dover, yet our taxes were recently reported as being one of the lowest in Delaware. Surveys show that Dover’s water, sewer, and electric rates are some of the lowest in Delaware. Dover’s financial standing is strong, despite the doomsayers’ who want to paint our City as being in crisis. I am proud of any small part I have played in numerous projects in Dover; including the 1996 Comprehensive Plan, the John Pitts Center, 230kv TIE station, methodical rebuilding of the electric distribution and transmission system, launching solutions to the sewer inflow and infiltration, and solutions to the brown water problem. I proudly look out my window to the Library construction, and know that just a few miles east the Dover Sun Park is well under construction. I am proud of many of the other improvement for which I have had some part: unifying our budget, CIP and strategic planning processes; developing a performance evaluation system that matters, unifying our electric, water, and wastewater into one department, and bringing e-government services to Dover. I am most honored to have worked with many great employees who for the most part go under recognized; I hope Council is truly listening to what they have to say during the budget hearings. After discussing it with Council President Leary we agreed, that I will not participate in the remaining budget hearings. Instead, I will focus the rest of my time on tying up loose business for a smoother transition. I have been a public servant nearly my entire adult life and will continue to serve the public in whatever way the good Lord decides for me. I have been blessed that he gave me nearly twenty years working for Dover, Delaware and wish everyone the best. Sincerely, Anthony DePrima”

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 42 Council President Leary announced that one of the City’s Water/Wastewater employees, Mr. Brian Turner, Civil Engineer, would be soon be deployed to Afghanistan and read the following statement into the record: “Brian is in the 1049th Transportation Company of the Delaware Army National Guard. His unit has been activated for ultimate deployment to Afghanistan. From May 25th to May 27th Brian will be at his Armory in Seaford, Delaware. From May 28th to July 8th he will be training in Fort Bliss, Texas. From Texas he will be heading to Afghanistan, where they will be conducting convoy operations and training the Afghan military. We look forward to Brian’s return in June 2012.” Mr. Leary wished Mr. Turner Godspeed and safety, and thanked him for his service to our country. Referring to Exhibit #13, Mrs. Tieman continued the review of the 2011/2012 Draft Budget, Water/Wastewater Fund for FY 2011/2012 - May 19, 2011, beginning with Water/Wastewater Engineering. Responding to Mr. Anderson, Mr. Ron Lunt, Public Utilities Director, reminded members that the City recently began implementation of the Inflow and Infiltration (I&I) Projects and that completion of the projects will take many, many years and cost multi-millions of dollars. He doubted that these projects could be accomplished in 15-20 years, even if the funding was not taken into consideration. He stated that staff would need to determine an estimate in time and money if it was the City’s desire to accelerate these projects. Mr. Lunt stated that the City is far away from solving the I&I problems, explaining that the projects include 160+ miles of sewer lines, some older than 100 years. The City has begun a relining program and are still in investigation stage in some areas. He stated that approximately 1½ miles have been included in this year’s projects at a cost of $1.8M. In response to Mr. Hare, Mrs. Tieman assured members that updated organizational charts would be provided to members. Considering the funding required for the Water/Wastewater Fund, Mr. Anderson questioned how staff can justify the transfer of approximately 4% to the General Fund. Responding, Mr. Lunt stated that the transfer amount is a decision made by members of Council on an annual basis. Noting the damage that can be caused by trees, Mr. Bonar questioned if staff has given consideration of replacing this type of landscaping with a type that is less invasive. Responding, Mrs. Duca stated that this has recently been discussed with the Public Services Manager and the Grounds Superintendent to develop a recommendation for replacing street trees, taking into account the location of the sewer lateral. Mrs. Tieman reviewed a Presentation of the Electric Fund Division Budgets for FY 2011/2012 - May 24, 2011 (Exhibit #14). In response to Mrs. Williams, Mr. Lunt stated that the importance of the City maintaining distribution is a multi-faceted question; however, local control would be a primary concern. He explained that the T&D Division provides more than just delivering energy and advised members of the recent upgrades to the system.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 43 Mr. Hare relayed concerns regarding the City’s inability to fund OPEB in the previous three (3) years and questioned the City’s ability to provide salary increases for employees during these “tough” economic times. Responding, Mrs. Tieman noted that in FY2009 salaries were increased; however, employee furloughs were implemented. Although OPEB was not budgeted in those previous years, she stated that the City has funded this in the Draft Budget. For clarification, Mrs. Mitchell stated that the Government Accounting Standards Board (GASB) does not require the City to fund OPEB; however, it must be shown as an expense. If it is not funded, the City will not have the funds necessary to pay benefits to retirees, which is why OPEB should be funded. She assured members that this year, in order to be compliant with accounting standards, the City has funded OPEB. In addition, she explained that OPEB expense appears on the City’s balance sheet as a liability since the City showed it as an expense but did not actually fund it; therefore, it is reflected as a liability on the balance sheet. In regards to the salary increases and furloughs, Mrs. Williams reminded members that technically employees were provided salary increases; however, since the furloughs were instituted, there was no net increase in employee’s salaries. Responding to Mr. Hare, Mr. Lunt explained the benefits for the Power Plant operations to be contracted, which was a decision made by Council several years ago. Elaborating, Mrs. Tieman indicated that the power supply and capacity costs total $63.9M and the City bills almost $100M, noting that there are operating expenses for the City from this profit and that some is transferred to the General Fund. Mr. Hare noted that there are 29 employees at the Power Plant and questioned how much the City makes from the contract. Responding, Mr. Lunt stated that the City received $12M last year, will receive $7.2M this year, and next year will receive $13M-$14M, which reflects the payment the City receives in capacity, and that the City’s expenses are deducted. Mr. Lunt explained that capacity payments are funds received from PJM (City sells and bids directly to PJM). To “be available” is what is called a capacity payment. If the City runs and sells energy into the PJM Network, the City will also receive a margin payment, which is for cost of fuel and operations subtracted from the payment received for the energy. This current year, the City received approximately $2.5M in margin payment. He noted that, of the $12M capacity payment and $2.5M net margin on operation ($14.5M total), the City’s expenses were approximately $7M and that in the future, the capacity payments will decrease. Mr. Bonar suggested that members who wish to have a better understanding visit Valley Forge, the site of an educational program. Mr. Lunt stated that, as a part of The Energy Authority Agreement, on-site training can be provided if desired by members to provide an understanding of operations and rates. He also suggested that a 2030 Meeting could be beneficial to learn about options being considered for the future. In response to Mr. Hare, Mrs. Mitchell referred to Page 42 of the Draft Budget, where the credits for power supply and generation are reflected, which indicates a $1.9M net for generation.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 44 At the request of Mr. Hare, Mrs. Mitchell assured members that staff would conduct research to determine whether the City would profit by contracting the Power Plant Operations. There was much discussion regarding the benefits of the City maintaining the Power Plant, and it was requested that staff provide details for the past five (5) years to assist in making this determination. Mr. Lunt advised members that the City’s Power Plant is a very challenging plant to operate due to its age. Mr. Anderson suggested that staff contact the department handling Green Management since he has noticed that they are planting trees under power lines rather than across the street where there are no power lines. There being no objections, Council President Leary declared a brief recess. Meeting Recessed at 7:44 P.M. and Reconvened at 7:45 P.M. Review of 2011/2012 Draft Budget - Fund Summaries Mrs. Tieman reviewed the Fund Summaries included in the 2011/2012 Draft Budget, as follows: Electric Fund, beginning on Page 41; Water/Wastewater Fund, beginning on Page 33; and the General Fund, beginning on Page 22. Responding to Dr. McGlumphy, Mrs. Mitchell stated that all transfers are policy compliant. In response to Mr. Hare, Mrs. Tieman stated that staff would determine what .01¢ in electric rates provides the City in revenue. At the request of Dr. McGlumphy, Mrs. Tieman stated that the operation expenses for the General Fund are approximately $37.6M, the Water/Wastewater Fund approximately $13.3M, and Electric Fund approximately $91.9M, noting that the fund balances should not be included in the totals. Council President Leary suggested that members recess until after the holiday (June 6, 2011 at 6:00 p.m.) to provide staff the opportunity to fulfill requests for information and that members relay their suggestions for the next meeting through the City Clerk’s Office. There being no objections, Council President Leary indicated that the Budget Review would continue on Monday, June 6th, at 6:00 p.m. Meeting recessed at 8:53 P.M. MONDAY, JUNE 6, 2011 - 6:00 P.M. - 9:00 P.M. The Special Council Meeting reconvened on Monday, June 6, 2011 at 6:00 p.m. with Council President Leary presiding. Council members present were Mr. Anderson, Mrs. Russell, Dr. McGlumphy, Mr. Lynn, Mr. Bonar, Mrs. Williams, Mr. Hare, and Mr. Hutchison. Council staff members present were Mrs. Mitchell, Mrs. Tieman, and Mrs. McDowell. Mayor Carey was also present.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 45 PUBLIC COMMENT PERIOD Mr. Edward Carl, Wilmington, stated that he understood that Council is faced with serious problems in trying to develop equitable solutions to a budget crisis. Due to limitations and the current economic crisis, he suggested that Council act “outside of the box.” Mr. Carl felt that there is no solution other than cutting vital services. He stated that there is a need for a change in national policy and in order for this to happen, there should be intervention in Washington, DC. He submitted an emergency “Glass-Steagall” Resolution for Council’s consideration (Exhibit #15). Mr. Gregory Moore, Becker Morgan Group (309 S. Governors Avenue), addressed members on behalf of the Downtown Dover Partnership (DDP), stating he was serving as their Acting President. He advised members of the successes of the DDP and his hopes that they can maintain the momentum during the next budget year. He advised members that Dr. William Johnston, President of Wesley College, was unable to attend this meeting and at his request, read the following statement into the record: “Dear Members of the City Council, It is a privilege for me to serve on the Downtown Dover Partnership in the 3 years that I have lived in Dover. It is a vital organization and I have seen the positive impact it brings to our downtown area. Personally I am also pleased to have Wesley College support our downtown and partner in any way possible. As the Council deliberates over the budget this coming year, please know the significant impact that the Partnership and the employees are having in our downtown and I encourage you to do everything possible to support the funding of these continued efforts. Dover has many wonderful assets and the downtown is and will remain an asset in the future with the good workof the City and organizations such as the Downtown Dover Partnership. Thank you for your support and all that you do for our City and community.” Council President Leary noted the receipt of correspondence from Braylene Marvel (Exhibit #16) and the Central Delaware Chamber of Commerce (Exhibit #17). Mr. Dave Truax, (35 Upland Avenue), addressed members as the City’s Fire Marshal and an employee. He explained the importance of the training provided for Fire Marshals and noted that, although there may be an initial cost to the City to provide the required training, savings will be realized due to the Fire Marshal’s ability to handle a crime scene rather than paying for a police officer. He also suggested that members of Council continue to include employees in the budget process. Mr. Gerald Street, 39 Hazel Road, echoed the comments of Mr. Moore in regards to the DDP. He noted that, although the DDP currently owns six (6) properties, the Old Acme Property has a $1.3M loan, which is interest only and to be paid in approximately 1½ to 2 years. The DDP is in the process of developing the property, which requires many volunteers and the assistance of City staff. Without the assistance of City staff, he relayed concern that the property will not be developed and the loan would convert to an interest bearing loan. Ms. Cindy Small, Director of Tourism for Greater Dover and Kent County, advised members that

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 46 she serves on the Board of Directors for the DDP. She explained the importance of the tourism industry, which represents $1.5B of annual economic impact to the State of Delaware. She expressed the desire for the City of Dover to receive its portion of the $1.5B. In working with the DDP, she stated that there has been momentum in the development of the downtown area and over time, the City will reap the rewards. It was her hope that the Council will continue to support the efforts of the DDP. AGENDA ADDITIONS/DELETIONS Mr. Bonar moved for approval of the agenda as presented, seconded by Mr. Hutchison and unanimously carried. MISCELLANEOUS INFORMATION Based on the previous discussion and requests, staff provided members with additional documents, as follows: 1) Requested Retirement Pay by Position (Exhibit #18); 2) Subscriptions & Dues – Redundant or Duplicate Memberships (Exhibit #19); 3) Abandoned Buildings Not In Compliance (Exhibit #20); 4) Employees Eligible to Retire - May 24, 2011 (Exhibit #21); 5) Open Positions - May 24, 2011 (Exhibit #22); 6) Funding Sources Dover Public Library Building Project Update: June 6, 2011 (Exhibit #23); 7) Letter from Ms. Margie Cyr, Library Director, Additions to Library Budget Presentation (Exhibit #24); 8) Recreation Program Comparison (Exhibit #25); 9) Rate Reduction Request (Exhibit #26); and 10) Analysis of Library Reserve Account (Exhibit #27). 2011/2012 Budget - Updated Staff Proposal Mrs. Mitchell advised members that based on previous sessions as well as direction by some members of Council, staff developed amendments to the Draft Budget. She reviewed a Presentation of the City of Dover Fiscal Year 2011/2012 Proposed Budget As Amended - June 6, 2011 (Exhibit #28). Referring to Section 11 of the Revenue Policy as it relates to Electric Utility Transfer, Mrs. Mitchell provided members with a proposed amendment that would provide an increase in the percentage from 6.5% to 8% (see page 4 of Exhibit #18). She stated that staff has researched Fitch’s rating and other community comparables. She explained her concurrence with the 8%, based on this being the amount that Fitch states provides moderate support (5%-8% range). In addition, she stated that her concurrence is based on the fact that the City of Dover has a large number of tax-exempt properties, the ability to maintain historical financial trends and debt covenants in the electric utility, the ability to provide full funding for the OPEB Pension annual contribution, the ability to provide citizens with a 5.9% PCA credit on electric rates, and there is no additional debt service projected for the electric utility over the next five (5) years. Responding to concerns relayed by Mrs. Williams, Mrs. Mitchell stated that the City is currently working on a five (5) year forecast and the purpose of making this a policy change is to prevent the City from changing it each year, which is “frowned upon” by the rating agencies. She assured members that the electric utility can manage an 8% transfer without any repercussions.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 47 Mr. Bonar expressed his opposition to balancing the General Fund budget by utilizing funds from the electric rate payers. He stated that the City’s property taxes have been artificially kept low because of the use of the Electric Fund monies. He reminded members that property taxes are tax deductible and that electric bills are not. Although he understood the benefits of such a transfer, he felt that members should review how the City develops revenues for the long term. Responding, Mrs. Mitchell explained that there is a balance to be considered and that members of Council should take into consideration that the rate payers are also tax payers. She also noted that not all of the City’s population itemizes deductions for taxes; therefore, it must be Council’s decision to balance all factors and make a determination. Council President Leary reminded members that the initial purpose of the electric utility was to address the high percentage of non-taxable properties in the City and to utilize the “profits” to subsidize other activities. Dr. McGlumphy thanked Mrs. Mitchell and Mrs. Tieman for the amended proposed Budget and requested that all City employees join Council in becoming a part of the solution and not the problem. At this point, he suggested that members of Council approve the amended proposed Budget as presented. There being no objections, Council President Leary declared a brief recess. Meeting Recessed at 6:58 P.M. and Reconvened at 7:16 P.M. Mr. Bonar moved for the addition of Item #3 - Appointment of Interim City Manager, seconded by Mrs. Williams and unanimously carried. Appointment of Interim City Manager Mr. Bonar announced that the appointment of an interim City Manager was discussed in executive session. Mr. Bonar moved to appoint Mr. Scott Koenig as Interim City Manager effective June 8, 2011, seconded by Mrs. Williams and unanimously carried. Discussion - 2011/2012 Budget (continued) Responding to Mr. Hare, Council President Leary reiterated that the amended Draft Budget has been provided as a means to get through the next fiscal year and that additional reviews and recommendations for future budgets will be forthcoming. Dr. McGlumphy suggested that, as discussions continue, members take a “solid” look at Pay-for- Performance and streamlining departments as well as current policies, noting that there will be a thorough discussion regarding personnel and salaries. In addition, Mr. Bonar suggested that members review revenue enhancements that are sustainable, with the least effect on property owners, residents, and the business community.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 48 If City employees take the opportunity to address the Legislative, Finance, and Administration Committee, Mrs. Williams suggested that if there is a need, the Chair establish a sub-committee or task force and that staff be appointed to serve on such to assure their participation. Mr. Hutchison suggested that the City establish policies pertaining to salary scales to be based on the “Delaware market.” Mrs. Russell requested that there be no retribution to employees who address members of Council to relay concerns or recommendations. Mr. Bonar suggested the consideration of establishing a “Suggestion Reward” Program to reward employees who provide suggestions that save City funds. Mrs. Williams stated that employees should not just provide money saving ideas but also relay any ideas related to systemic changes. In response to Mr. Anderson, Mrs. Mitchell stated that there are no salary increases included in the Amended Budget other than for those employees who are in either the IUE or IBEW Union (by contract). Responding to Mr. Lynn, Mrs. Mitchell stated that the City will realize a savings of $52,000 by eliminating the position requested for the Dover Library. She explained that when the new Library opens in FY2013, the position would be put back and included at that time. She assured members that the Library Director was advised of the change. For further clarification, Ms. Cyr stated concurrence with the delay in the position, stipulating that it will be on a short-term basis. Mr. Lynn questioned if the Amended Budget includes funding for the training previously mentioned by the Fire Marshal. Responding, Mrs. Mitchell explained that the total amount budgeted for Training/Conferences was cut in half. She assured members that if the resources are not available, staff can utilize the budget amendment procedure to move monies around in their budget. Council President Leary noted that, in accordance with the City’s Charter, the Budget Ordinances will be presented for a First Reading on June 13, 2011 and a Final Reading and Adoption will be scheduled for June 27, 2011. In response to Mr. Anderson, Council President Leary confirmed that amendments to the Budget Ordinances would be permitted when presented for the First and Final Readings. Dr. McGlumphy moved for acceptance of the Amended 2011/2012 Budget, as presented, with the understanding that there are line items included that can be moved by individual departments to satisfy the necessary requirements as outlined, and also that, over the next few meetings, the Legislative, Finance, and Administration Committee will discuss additional information and situations that may indicate cause for a reduction in force. The motion was seconded by Mrs. Williams and unanimously carried.

SPECIAL COUNCIL MEETING (BUDGET REVIEW) MAY 17, 2011 PAGE 49 Council President Leary thanked everyone for their participation in this year’s budget process. By unanimous consent, the Meeting Adjourned at 7:41 P.M. TRACI A. McDOWELL CITY CLERK All orders, ordinances, and resolutions adopted by City Council during their Special Meeting of May 17, 2011, are hereby approved. CARLETON E. CAREY, SR. MAYOR TM/jg S:\AGENDAS & MINUTES\Council-Minutes\2011\05-17-2011 Budget Hearings.wpd Exhibits Attached to Original Minutes and File Copy Exhibit #1 - Introduction and Presentation of the 2011/2012 Draft Budget Exhibit #2 - Presentation of the Selected General Fund Division Budgets for FY 2011/2012 - May 17, 2011 Exhibit #3 - Memorandum dated May 18, 2011 - Updated Draft Budget Pages Exhibit #4 - Memorandum dated April 19, 2010 - Lockbox and Remote Deposit Services Analysis Exhibit #5 - Line Items (30-27, 30-28, and 10-18) by Departments/Divisions Exhibit #6 - Overtime by Division Exhibit #7 - Statement Prepared by Finance Department--Eliminating Accounting I Position Exhibit #8 - Presentation of the Selected General Fund Division Budgets for FY 2011/2012 - May 18, 2011 Exhibit #9 - City Manager’s Legal Expenses Exhibit #10 - Memorandum Dated May 19, 2011 - Take Home Vehicles Exhibit #11 - Updated “Duca” Report Exhibit #12 - Planning Office Statement Exhibit #13 - Presentation of the Selected General Fund Division Budgets and Water/Wastewater Fund Division Budgets for FY 2011/2012 - May 19, 2011 Exhibit #14 - Presentation of the Electric Fund Division Budgets for FY 2011/2012 - May 24, 2011 Exhibit #15 - Proposed Emergency "Glass-Steagall" Resolution - submitted by Edward Carl Exhibit #16 - Correspondence from Braylene Marvel Exhibit #17 - Correspondence from the Central Delaware Chamber of Commerce Exhibit #18 - Requested Retirement Pay by Position Exhibit #19 - Subscriptions & Dues – Redundant or Duplicate Memberships Exhibit #20 - Abandoned Building Not In Compliance Exhibit #21 - Employees Eligible to Retire - May 24, 2011 Exhibit #22 - Open Positions - May 24, 2011 Exhibit #23 - Funding Sources Dover Public Library Building Project Update: June 6, 2011 Exhibit #24 - Letter from Ms. Margie Cyr, Library Director, Additions to Library Budget Presentation Exhibit #25 - Recreation Program Comparison Exhibit #26 - Rate Reduction Request Exhibit #27 - Analysis of Library Reserve Account Exhibit #28 - Presentation of the City of Dover Fiscal Year 2011/2012 Proposed Budget As Amended - June 6, 2011

EXHIBIT #1 2011 Budget Review Special Council Meeting of 05/17/2011 CITY OF DOVER Fiscal Year 2011-2012 Draft Budget Presentation EXHIBIT #1 May 17, 2011 2011 Budget Review Special Council Meeting of 05/17/2011

Dover Family of Funds ELECTRIC FUNDS GENERAL FUNDS WATER/WASTEWATER FUNDS OPERATING FUND OPERATING FUND OPERATING FUND Contingency Contingency Contingency For a “rainy day” emergency For a “rainy day” emergency For a “rainy day” emergency Electric I & E Fund Governmental Capital Water/Wastewater Financing of system expansion & improvement Projects Fund I & E Fund Replacement and expansion Financing of system expansion (i.e., infrastructure, buildings, etc.) & improvement Depreciation Reserve Replenishment of assets Capital Assets Reserve Replacement and expansion Future Capacity (i.e., infrastructure, buildings, etc.) Financing for system capacity expansion Insurance Stabilization Funding of the insurance deductibles Rate Stabilization Funding to offset cost of power cost adjustment 2

GENERAL FUND 3

Fiscal Year 2011-2012 Revenue $32,695,548 Expense 37,601,233 Balance Carry Forward: $ -990,022 (requires additional $3,595,666 to meet requirement) REVENUE INCLUDES: Prior Year Balance $3,305,663 Property Tax 11,133,367 Business Licenses 1,523,675 Permits & Other Licenses 934,000 Trash Fees 2,050,000 Court of Chancery Fees 690,000 Appropriation –Water/Wastewater Fund 424,508 Appropriation-Electric Fund 6,338,000 Water Intrafund Service Fees 1,042,049 Electric Intrafund Service Fees 3,556,264 4

Budget Options Balancing Plan “A” Balancing Plan “B” Balancing Plan “C” Balances the budget by Balances the budget by Balances the budget by - Reducing staff by 33 positions. Rolling - Maintaining the Electric Transfer at current - Eliminating 13 positions back to Fiscal 2002 levels. levels of $8.85 million or 9% of gross (see Exhibit A) (see Exhibit A) revenue (same as 2010-2011) - Eliminating 20 capital projects - Increasing Tax Revenue by 11.3% or $0.04 - Eliminating 13 capital projects (see Exhibit B) per $100 of assessed value (see Exhibit B) - Eliminating 9 new strategic programs - Increasing Rental Permits by 15% by - Eliminating 5 new strategic (see Exhibit C) increasing fees programs (see Exhibit C) - Reducing Materials, Supplies & - Increasing Trash Revenue by $100,000, - Reducing Non-Bargaining raises Administrative Expenses $69,500 or increasing fee from $11.70 to to 1.25% 0.2 % across the board. $12.40 per 90 gallon container. - Increasing the Electric Transfer to - Eliminating Non-Bargaining Raises $8.1 million or 8.3% of gross revenue - Electric Transfer of$6.33 million or 6.5% - Increasing Rental Licenses by as per the policy. 10% - Increasing Trash Revenue by $100,000, increasing fee from $11.70 to $12.40 per 90 gallon container. These options are designed to give City Council - Funds Street & Library Program maximum flexibility to choose components from through Bonds various options to build a balancing plan best - Reducing Police Terminal Leave suited for the citizen’s of Dover. Budget by $100,000 5

Total General Fund Revenues $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $- 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2,012 2012 A 2012 B 2012 C Total Revenues Tax Increase Sanitation Fee Electric Transfer Rental Inspection Fees 6

General Fund Expenses – Base Budget Fiscal Year 2011-2012 − 2 % increase for IUE bargaining unit − FOP contract negotiations are currently ongoing − Allocated $112,900 for Non-Bargaining pay increases (1.5% plus 1% for performance) − 1.5 new positions Library Clerk II and PT Library Clerk I - $50,802 − Administrative Assistant Succession Planning for Police - $45,950 − Healthcare increase of 0% − Workers Comp fees removed for one time skip − OPEB costs of 6.6% of salary or $1.1 million − Unfunded Pension Liability - $2.88 million 7

General Fund Expenses – Base Budget Fiscal Year 2011-2012 − Vehicular and equipment replacements - $966,300 − Police vehicles - $221,200 − Trash trucks (2) - $368,600 − Streets dump truck - $131,055 − Street Sweeper - $170,000 − Street and Concrete Program - $410,000 8

General Fund Expenses 40,000,000 35,000,000 30,000,000 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 9

General Fund Top Revenue Streams Property Tax $11,133,367 Electric Enterprise Fund Transfer 6,338,000 Intrafund Service Receipts Electric 3,556,264 Trash Fees 2,050,000 Business Licenses and Permits 2,457,700 Intrafund Service Receipts Water/Wastewater 1,042,049 Civil Traffic Penalties 1,000,000 Transfer Tax 900,000 10

Examples of Proposed Tax Increase (Balancing Plan B Only) Proposed Tax Bill Increased Current Tax Property Assessment (Increasing 11.3% Difference Cost per Bill or 4 cents) Month Central Dover (Forest Street) $146,100 $493.53 $551.97 $58.44 $4.87 Foxhall West Home $311,300 $1,051.57 $1,176.09 $124.52 $10.38 Village of Westover Townhomes $147,900 $499.61 $558.77 $59.16 $4.93 Mayfair/Crossgates Homes $192,400 $649.93 $726.89 $76.96 $6.41 West Dover (Forrest Ave) $152,100 $513.79 $574.63 $60.84 $5.07 Downtown Home $224,300 $757.69 $847.41 $89.72 $7.48 Woodbrook Home $204,100 $689.45 $771.09 $81.64 $6.80 Typical Home $161,600 $545.88 $610.52 $64.64 $5.39 11

Percentage of Utility to General Fund 30.00% 25.00% 23.9% 23.1% 21.5% 21.2% 20.3% 20.3% 19.1% 18.5% 18.6% 20.00% 17.6% 17.7% 17.6% 16.7% 15.00% 13.5% 10.00% 5.00% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 12

Electric Fund Transfer to General Fund as % of Electric 10.00% 9.6% 9.5% 9.1% 8.8% 9.00% 8.3% 8.3% 8.1% 8.00% 7.4% 6.9% 6.9% 7.00% 6.7% 6.5% 6.5% 6.00% 5.3% 5.00% 4.00% 3.00% 2.00% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 13

Water/Wastewater Fund Transfer to General Fund as % of Water/Wastewater 12.00% 10.0% 10.00% 8.2% 7.8% 8.00% 6.00% 5.0% 4.5% 4.4% 4.5% 4.6% 4.5% 4.00% 2.6% 2.6% 2.6% 2.6% 2.00% 0.0% 0.00% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 14

Trash Fee vs. Sanitation Expense $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base Sanitation Expense Trash Fee 15

Transfer Tax 4,000,000 3,750,000 3,500,000 3,250,000 3,000,000 2,750,000 2,500,000 2,250,000 2,000,000 1,750,000 1,500,000 1,250,000 1,000,000 750,000 500,000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 16

General Fund Fiscal Year 2011-2012 Base Budget Top Expenses by Department Police $ 13,185,890 Sanitation 2,360,400 Library 1,237,200 Grounds 1,034,000 Facilities Management 971,200 Customer Services 940,700 Finance 883,000 Recreation 807,300 Streets 792,600 Fleet Maintenance 716,100 17

Fiscal Year 2011-2012 Strategic Budget Options Balancing Plan A - Policy Balancing Plan B - Waives Balancing Plan C - Compliant, No Increase Transfer & Reserve Policies, Budget Items Proposed Budget Somewhere in Revenue, Reduction Increases Revenues, No between A & B in Spending Reduction in Spending in Dollars $ in Dollars $ in Dollars $ in Dollars $ IAS Maintenance Agreement set up & hosting fee Tax Assessor 7,300 7,300 7,300 7,300 for publishing property card on web. Purchased upgraded pagers. Misc station & alarm Fire 81,400 Removed 81,400 Removed room repairs. New World Software Global Connect Emergency Notication ($9,000); Life Safety 13,000 Removed 13,000 13,000 Police Training Academy (1 staff member - $4,000) Code Enforcement Air Card for one additional staff member. 480 Removed 480 Removed Planning Stormwater Compliance Implementation. 18,500 18,500 18,500 18,500 CALEA Award Conference ($4,500); Triennial Police 9,500 Removed 9,500 Removed reacreditation Inspector travel expenses ($5,000) City Manager Union Contract Negotiations 100,000 Removed 100,000 Removed Information Technology Upgrades to existing Cisco VoIP phone system 13,200 13,200 13,200 13,200 Public Services Admin Radio replacements (24 mobile, 6 portable) 42,276 42,276 42,276 42,273 Facilities Management Energy Savings Procurement Contract - Audit 7,800 7,800 7,800 7,800 Central Services Pitney Bose Folder, Insert Lease 15,336 15,336 15,336 15,336 Human Resources Recruitment 2,000 Removed 2,000 Removed Mayor Trip to Ramstein, Germany 2,900 Removed 2,900 Removed TOTALS 313,692 78,612 313,692 117,409 DIFFERENCE 235,080 196,283 18

Fiscal Year 2011-2012 CIP Budget Options Balancing Plan A - Policy Balancing Plan B - Waives Balancing Plan C - Compliant, No Increase in Transfer & Reserve Policies, Department Budget Item Proposed Budget Somewhere Revenue, Reduction in Increases Revenues, No between A & B Spending Reduction in Spending in Dollars $ in Dollars $ in Dollars $ Fire Annual Contribution 216,820 216,820 216,820 216,820 Holmatro Equipment 56,234 Project Removed 56,234 Project Removed Grounds 1995 Ford Crew Cab Dump Truck (#552) 44,720 Vehicle Removed 44,720 Vehicle Removed Recreation Park & Playground Improvement Program 30,000 Project Removed 30,000 Project Removed Splash Pad at Schutte Park 20,000 Project Removed 20,000 Project Removed Dover Park Roof Replacement 30,000 Project Removed 30,000 30,000 Police 8 Crown Vics & 3 Fusions 221,234 Vehicles Removed 221,234 111,234 Vehicle Replacement Supplemental Funds 20,000 Project Removed 20,000 20,000 Repair Police Station Parking Lot 25,300 Project Removed 25,300 Project Removed 19

Fiscal Year 2011-2012 CIP Budget Options – continued Balancing Plan A - Policy Balancing Plan B - Waives Balancing Plan C - Compliant, No Increase in Transfer & Reserve Policies, Department Budget Item Proposed Budget Somewhere Revenue, Reduction in Increases Revenues, No between A & B Spending Reduction in Spending in Dollars $ in Dollars $ in Dollars $ Streets Concrete Construction & Replacement 60,000 Project Removed 60,000 30,000 Salt Storage Building at Schutte Park 50,000 Project Removed 50,000 Project Removed Street & Alley Program 175,000 Project Removed 175,000 200,000 Brine Manufacturing System 27,825 Project Removed 27,825 Project Removed Dump Truck Refurbishment 30,000 Vehicle Removed 30,000 30,000 Dump Truck w/Snow Plow (#328) 128,000 Vehicle Removed 128,000 Project Removed Street Sweeper (#357) 170,027 170,027 170,027 170,027 Graco Line Lazoer IV Model #390 5,385 Project Removed 5,385 Project Removed Sanitation Automated Trash Truck (#442) 232,084 Vehicle Removed 232,084 Vehicle Removed Bulk Trash Truck (#447) 136,500 Vehicle Removed 136,500 136,500 IT Computer Hardware Replacement 73,000 Project Removed 73,000 Project Removed Public Services - Admin GIS Infrastructure & Mobile Solutions 18,000 Project Removed 18,000 Project Removed Central Services Purchase Used Forklift 30,670 Vehicle Removed 30,670 Vehicle Removed Mayor Downtown Security Cameras 33,000 Project Removed 33,000 Project Removed TOTALS $ 1,833,799 $ 386,847 $ 1,833,799 $ 944,581 DIFFERENCE $ 1,446,952 $ 889,218 20

WATER/WASTEWATER FUND 21

Fiscal Year 2011-2012 Revenue $13,911,300 Expense 13,318,606 Water Carry Forward: $2,673,527 Fund balance requirement met Wastewater Carry Forward: $ 1,800,097 Fund balance requirement met KCSA Carry Forward: ($1,515,084) Fund balance requirement not met Revenue Includes No Rate Increases 22

Water/Wastewater Fund Water Revenue $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 23

Water/Wastewater Fund Wastewater Revenue $4,000,000 $3,000,000 $2,000,000 $1,000,000 $- 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 A 2012 B 2012 C Base Base Base 24

Water/Wastewater Fund Top Operating Revenue Sources Water Fees $4,603,400 Wastewater Adjustment Fees 3,090,900 Wastewater Fees 3,756,700 Water Impact Fees 1,386,900 Sewer Impact Fees 323,000 Water Tank Space Leasing 307,600 Top Operating Expenses Kent County Treatment Charge $4,235,400 Water Treatment Plant 1,555,250 Intrafund Service Fees 1,278,100 Wastewater Department 982,500 Engineering & Inspections 634,350 Water Department 455,850 25

Water/Wastewater Fund Top Capital Investments Projects Name Amount Fund Inflow/Infiltration $1.0 million Debt Financing Water Quality Improvements $500,000 Debt Financing Lepore Road Pump Station Replacement $350,000 Debt Financing 26

ELECTRIC FUND 27

Fiscal Year 2011-2012 Revenue $105,224,955 Expense 91,788,137 Balance Carry Forward: $ 13,436,818 (meets 8% requirement) Revenue Includes − Direct Sales to Customers $95.7 million − Miscellaneous Service revenue of $1.6 million. 28

Fiscal Year 2011-2012 Electric Fund Expenses − Power supply costs projected to decrease 12.9% 2009-10 2010-11 2010-11 2011-12 %CHANGE ACTUAL BUDGET REVISED BUDGET 2011-12 EXPENSES: POWER SUPPLY $ 55,619,481 $ 48,059,699 $ 47,634,363 $ 42,047,430 -11.7% POWER SUPPLY MANAGEMENT 3,000,000 2,280,000 2,321,562 1,170,000 -49.6% PJM CHARGES - LOAD 7,247,049 11,850,876 13,363,432 15,043,396 12.6% CAPACITY CHARGES 13,516,203 11,618,223 12,302,392 8,506,512 -30.9% CONTRACTUAL SERVICES - - - 115,000 0.0% RATE STABILIZATION CREDIT - - - (1,000,000) SUB-TOTAL POWER SUPPLY 79,382,733 73,808,798 75,621,749 65,882,338 -12.9% − Power plant costs expected to decrease 2.1%. − Transfer $3.5 million to the Electric Capital Projects Fund. − Transfers $1.5 million to fully fund OPEB. 29

Electric Fund Top Revenue Sources Direct Sales to Customers $95,675,500 Utility Tax 1,966,100 Miscellaneous Revenue 919,000 Top Expenses Purchase Power $65,882,338 Transfer to General Fund 6,338,000 Powerplant 6,024,822 Debt Service 4,058,700 Transfer to Capital 3,556,264 Intrafund Service Fees 3,500,000 30

Electric Fund Top Capital Investments Projects Name Amount Fund Distribution System Upgrades $500,000 Electric Fund Unit 3 Boiler Air Heater $440,000 Electric Fund Unit 3 Turbine Inspection $348,000 Electric Fund Distribution Feeder Replacement $277,510 Electric Bond 31

32

EXHIBIT #2 2011 Budget Review Special Council Meeting of 05/17/2011 DRAFT BUDGET REVIEW Fiscal Year 2011-2012 EXHIBIT #2 May 17, 2011 – Budget Review Hearing 2011 Budget Review Special Council Meeting of 05/17/2011

What You Need to Know • Departments were requested to hold budgets at original fiscal 2011 budget levels for materials and supply expenditures (20 Series) and administrative expenditures (30 series) with the following exceptions: • Computer Hardware Replacement • Items deemed strategic or necessary • Percentage up or down is based on original fiscal 2011 budget. • There is no increase to Health Care and Workers Compensation expense has been removed from the budget for one year. • OPEB is budgeted as a percentage of Salary – General Fund equals 6.6% of salary – Water Fund equals 5.3% of salary – Electric Fund equals 5.1% of salary 2

Mayor page 176 Personnel Costs 56,513 2%
Materials & Supplies 2,900 395% Administrative Expenditures 31,516 5% Overall Operating Expenses 90,929 3% Capital Outlay 33,000 0% Highlights: 20-38 Computer Hardware Purchase - $2,600. 30-28 Training Conference increased $6,950 and is offset by reductions in advertisement, and contractual services. 40-25 Other Equipment Purchase - $33,000 surveillance cameras for selected Downtown Areas (strategic). 3

City Council page 177 Personnel Costs 90,755 8% Materials & Supplies 13,780 10
Administrative Expenditures 30,189 4%
Overall Operating Expenses 134,724 3% Highlights: Temporary Help increased. Materials and Supplies decreased 10% due to decreases in office supplies and computer hardware. Administrative Expenditures decreased due to a reduction in subscriptions and dues. 4

City Manager page 187 Personnel Costs 489,428 12% Materials & Supplies 26,395 13% Administrative Expenditures 99,658 13% Overall Operating Expenses 573,295 4% Highlights: Personnel Costs are up due salary, healthcare, educational assistance, pension costs and OPEB. Materials and supplies increased due to computer hardware replacements. Administrative Expenditures increased due to legal expenses for contract negotiations. 5

Facilities Management page 194 Personnel Costs 820,296 2%
Materials & Supplies 29,420 2% Administrative Expenditures 121,464 5%
Overall Operating Expenses 971,180 2%
Highlights: Personnel Costs decreased due to salary and benefit reduction of one person transferred to Central Services last year. Workers compensation is also decreased. Materials and Supplies are about the same as last year. There were increases to uniforms and maintenance supplies which were partially offset by safety materials and small tool decreases. Administrative Expenditures are decreased, phone maintenance was moved to Information Technology. Electricity was increased to reflect historical need. 6

Central Services page 195 Personnel Costs 385,136 9% Materials & Supplies 22,380 2% Administrative Expenditures 300,813 2% Overall Operating Expenses 708,329 6% Capital Outlay 30,670 - Highlights: Salary is increased for transferred staff from Facilities Maintenance and OPEB. Materials and Supplies increased due computer hardware purchase. Administrative expenditures are budgeted to increase for the purchase of a new envelope stuffer. Capital Outlay replaces an aged forklift with a used enhanced forklift. 7

Fleet Maintenance page 196 Personnel Costs 391,368 4% Materials & Supplies 320,985 16%
Administrative Expenditures 3,706 21%
Overall Operating Expenses 716,059 6%
Highlights: Personnel Costs are up due to raises and OPEB. Materials and Supplies decreased due to budgeted expense for maintenance of an aging vehicle fleet set at a realistic level. Administrative Expenses decreased due to reductions in environmental expenses and training. 8

City Clerk page 201 Personnel Costs 265,383 9% Materials & Supplies 14,785 103% Administrative Expenditures 32,456 9%
Overall Operating Expenses 312,624 9% Highlights: Materials and supplies increased due to computer hardware expense. Administrative expenditures decreased due to a reduction in contractual services and office equipment maintenance. 9

Customer Services page 207 Personnel Costs 794,879 1% Materials & Supplies 47,050 11%
Administrative Expenditures 98,780 205% Overall Operating Expenses 940,709 8% Highlights: Personnel costs reflect a reduction in force of one staff. This reduction is due to the use of a lock box for processing mail payments. Additional costs are budgeted for lock box services in 30-31 for $65,980. Materials and supplies decreased due to reductions associated with the new bill format. Bill paper stock is no longer preprinted which costs less and there is less stock used. 10

Meter Reading page 208 Personnel Costs 191,377 1%
Materials & Supplies 11,033 7% Administrative Expenditures 19,796 0% Overall Operating Expenses 222,206 0% Capital Outlay 20,000 - Highlights: A promotion is budgeted for Meter Reader I to a Meter Reader II. Since the reduction in force last year, the supervisor has determined that both employees need to be versed in all aspects of the division. Increases in the computer hardware are responsible for the increase in Materials and Supplies. Capital Outlay purchases two additional mobile data collectors to be used in trash trucks for meter reading. A test pilot was completed in Fiscal 2011. This will enable the City to capture between 50-75% of readings. 11

Finance page 212 Personnel Costs 681,317 7% Materials & Supplies 13,200 4%
Administrative Expenditures 188,475 5% Overall Operating Expenses 882,992 7% Highlights: Personnel costs increased due to increases in salary and OPEB. Materials and supplies are down due to decreases in office supplies and printing & duplicating. Administrative expenses increased due to increased cost of office equipment repairs for the addition of ADP time clocks. 12

Human Resources page 223 Personnel Costs 299,400 19% Materials & Supplies 57,763 2% Administrative Expenditures 39,257 23%
Overall Operating Expenses 396,420 10% Highlights: Personnel costs are increased due to salary expense and OPEB Materials and Supplies are increased due to medical supplies and physicals related to DOT physicals. Administrative expenses are down due to reduced consulting fees related to last years labor negotiations and unemployment. 13

Information Technology page 230 Personnel Costs 387,243 20%
Materials & Supplies 98,537 5% Administrative Expenditures 240,623 43% Overall Operating Expenses 726,403 3%
Capital Outlay 73,000 508% Highlights: Personnel Costs for this division are reduced as there is one vacancy in the department. Materials and supplies are increased for computer hardware replacement as per the Lifecycle Replacement Program. Administrative Expenditures are increased for contractual services and office equipment repairs and maintenance. These increases are related to phone system maintenance and upgrades. Capital expense is increased to replace servers - $73,000. 14

Tax Assessor page 251 Personnel Costs 184,356 - Materials & Supplies 5,348 33% Administrative Expenditures 44,440 390% Overall Operating Expenses 234,144 19% Highlights: Materials and Supplies are increased for computer hardware expense. Administrative Expenses are increased for two strategic expenses: increased assessment software expenses ($3,500) and a hosting fee for publishing property record cards on the internet ($3,800). Administrative Expenses are also increased for legal expenses associated with tax appeals. 15

EXHIBIT #3 2011 Budget Review Special Council Meeting of 05/17/2011 Memorandum Office of the City Manager PO Box 475 Dover, DE 19903 Phone: (302) 736-7164 FAX: (302) 736-7002 Email: ttieman@dover.de.us To: Mayor and City Council From: Teresa Tieman, Sr. City Administrator cc: City Clerk’s Office Date: May 18, 2011 Subject: Updated Draft Budget Pages Attached please find the following updated organizational charts:  City Council (with new Council members)  City Clerk  Customer Services  Information Technology  Parks, Recreation & Library  Police  Tax Assessor  Planning  Code Enforcement  Life Safety  Inspections & Permitting  Grounds  Streets  Sanitation Each page is numbered, so it can be placed in the appropriate section of your Draft Budget binder. If you have any questions, please feel free to give me a call. Thank you. /hf Attachments

General City of Dover CITY COUNCIL ORGANIZATIONAL CHART FISCAL YEAR 2012 CITIZENS OF DOVER MAYOR AND COUNCIL AT-LARGE/COUNCIL PRESIDENT THOMAS J. LEARY 1ST DISTRICT 2ND DISTRICT COUNCILMAN COUNCILMAN WILLIAM F. HARE JAMES L. HUTCHISON COUNCILMAN COUNCILWOMAN WILLIAM P. MCGLUMPHY BEVERLY C. WILLIAMS 3RD DISTRICT 4TH DISTRICT COUNCILMAN COUNCILMAN DAVID L. BONAR DAVID L. ANDERSON COUNCILMAN COUNCILWOMAN SEAN M. LYNN SOPHIA R. RUSSELL 180 Fiscal 2012 Draft Operating Budget

General City of Dover CITY CLERK ORGANIZATION CHART FISCAL YEAR 2012 CITY COUNCIL CITY CLERK City Clerk/Assistant Treasurer* 1 Assistant City Clerk Administrative Assistant Assistant Treasurer* 2 1 * Appointed by Council 200 Fiscal 2012 Draft Operating Budget

General City of Dover CUSTOMER SERVICES ORGANIZATION CHART FISCAL YEAR 2012 CITY MANAGER Senior City Administrator CUSTOMER SERVICES Customer Services Manager 1 Office Assistant 1 BILLING CUSTOMER SERVICES/ COLLECTIONS Account Clerk III Customer Services Supervisor 1 1 Billing Clerk Account Clerk II 1 6 Account Clerk I 1 CASHIERS METER READING Account Clerk III Field Service Representative III 1 1 Account Clerk I Field Service Representative II 1 2 206 Fiscal 2012 Draft Operating Budget

General City of Dover INFORMATION TECHNOLOGY ORGANIZATION CHART FISCAL YEAR 2012 Fiscal 2012 Draft Operating Budget 229

General City of Dover PARKS, RECREATION AND LIBRARY ORGANIZATION CHART FISCAL YEAR 2012 Fiscal 2012 Draft Operating Budget 239

General City of Dover POLICE ORGANIZATION CHART FISCAL YEAR 2012 89 Officers 4 Officers in Training 29 Civilians 118 Total Employees Fiscal 2012 Draft Operating Budget 245

General City of Dover 2. Oblique Software. The project includes purchasing software that allows the viewing of images and enhanced tools for data collection from oblique aerial photos. Oblique photography is an aerial photograph that is taken at an angle. This objective is part of the administration program and advances the critical success factors of Employee Satisfaction and Effective Organizational Communication. Measure: Purchase/installation of software is scheduled to be completed by June 2012. TAX ASSESSOR ORGANIZATION CHART FISCAL YEAR 2012 250 Fiscal 2012 Draft Operating Budget

General City of Dover PLANNING ORGANIZATIONAL CHART FISCAL YEAR 2012 Fiscal 2012 Draft Operating Budget 257

General City of Dover 2. Implement the problem rental dwelling procedure. This objective is a part of several departmental programs and advances the critical success factors of Citywide Safety, Customer Satisfaction and Effective Community Communication. Measures: a. Continue tracking the number of properties that have their rental licenses suspended and report them in the City Planner’s monthly report. b. Evaluate and potentially propose code amendments to penalize landlords who fail to maintain rental dwellings to a minimum code level. 3. Develop procedures to improve the maintenance and vacant registration of foreclosed and vacant residential properties. This objective is a part of several departmental programs and advances the critical success factors of Citywide Safety, Customer Satisfaction and Effective Community Communication. Vacant and foreclosed properties continue to detract from residential neighborhoods across the City. Under this objective, staff would continue to improve implementation of the vacant building ordinance and possibly develop proposed code amendments to ensure that vacant and foreclosed properties are maintained and tracked. Measure: Develop policies to improve the implementation of the vacant building ordinance as they relate to vacant and foreclosed homes. Identify gaps in current code and develop amendments to close these gaps. CODE ENFORCEMENT ORGANIZATIONAL CHART FISCAL YEAR 2012 Fiscal 2012 Draft Operating Budget 261

Public Services City of Dover FISCAL YEAR 2010‐2011 STRATEGIC ACCOMPLISHMENTS 1. Complete revisions to the City’s Snow Emergency Plan. This objective is shared among all the divisions of Public Services and advances the critical success factors of Citywide Safety, Customer Satisfaction and Effective Community Communication. Measures: a. Develop a specific section for deep snow operations. b. Incorporate lessons learned from recent debriefings of City staff with respect to these events. c. Present revisions to City Council by December 1, 2010. 2. Develop “full scale” exercise scenario for the failure of the Silver Lake Dam. This objective is shared among all the divisions of Public Services and advances the critical success factors of Citywide Safety, Customer Satisfaction and Effective Community Communication. *The Strategic Objectives for Life Safety will be presented in the 2011‐2012 Final Budget. LIFE SAFETY ORGANIZATION CHART FISCAL YEAR 2012 Fiscal 2012 Draft Operating Budget 271

Public Services City of Dover 2. Track the number of building inspections, re‐inspections, and second re‐inspections performed in relation to the number of required inspections. 2009‐2010 Actual 2010‐2011 Projected 2011‐2012 Projected Results 7,000 – first inspections Information was not submitted in ≥7,000 – first inspections 780 – re‐inspections a timely fashion to be included in ≥780 – re‐inspections 100 – second re‐inspections this publication. ≥100 – second re‐inspections Note: Required inspections = First Inspections. All permit totals are driven by construction activity. FISCAL YEAR 2010‐2011 STRATEGIC ACCOMPLISHMENTS 1. Schedule no less than four training sessions during the fiscal year regarding the new 2009 IBC codes recently adopted by the City of Dover. This objective is a part of the Licensing and Permitting Administration program, and advances the critical success factors of Employee Satisfaction and Effective Organization Communication. Measure: Ensure that the necessary staff attends, and that all training sessions are held by June 30, 2011. *The Strategic Objectives for Inspections & Permitting will be presented in the 2011‐2012 Final Budget. INSPECTIONS AND PERMITTING ORGANIZATION CHART FISCAL YEAR 2012 274 Fiscal 2012 Draft Operating Budget

Public Services City of Dover GROUNDS ORGANIZATION CHART FISCAL YEAR 2012 282 Fiscal 2012 Draft Operating Budget

Public Services City of Dover *The Strategic Objectives for the Streets division will be presented in the 2011‐2012 Final Budget. STREETS ORGANIZATION CHART FISCAL YEAR 2012 286 Fiscal 2012 Draft Operating Budget

Public Services City of Dover SANITATION ORGANIZATION CHART FISCAL YEAR 2011 CITY MANAGER PUBLIC SERVICES Public Services Manager 1 PUBLIC WORKS OPERATIONS Operations Manager 1 SANITATION Public Works Supervisor I 1 Motor Equipment Operator III 4 Motor Equipment Operator II 3 Motor Equipment Operator I 5 Fiscal 2012 Draft Operating Budget 291

EXHIBIT #4 2011 Budget Review Special Council Meeting of 05/17/2011

Finance Department Fiscal Year 2011 Budget Supplemental Information May 3, 2010

2

FY11 Proposed Changes  Personnel & Benefits – Increase $56,466  Addition of Accountant II (City Manager agreed to Alternative of Outsourcing)  To provide Assistance to Assistant Finance Director in management and oversight of Payroll, Accounts Payable, and Internal Control Risk Assessments  Two Position/Grade Changes requested  Accountant I to Accountant II – originally planned job progression; Expansion of functions from bank reconciliations, project tracking & reporting, and petty cash auditing to full Fund accounting and reporting.  Account Clerk II to Account Clerk III – job progression; Expansion of functions from clerical accounts payable processing to functions which require greater analytical skills and the ability to make independent decisions. When requested, prepares analysis for Director and Assistant Director. (Not approved by CM in final budget)  Unscheduled Overtime  Vacations, sick leave, and other leaves of absences create a need for overtime. In the past, we have used comp time to control the budget, however it is becoming a problem with comp time use creating a need for more comp time. Each employee struggles with having the hours necessary to back up other members of staff.  Materials, Supplies & Administrative Expenses – Increase $4,533  Equipment for Accountant II - $1,700 (Strategic) (Removed from final budget)  Desktop Computer  Telephone  Other  Contract Increases $2,983 – Audit & Actuary Services  Transfer $2,000 to Printing and Duplicating from Office Equip. Repairs & Maintenance  Subscriptions & Dues $480 for increased State licensing fees, plus Assistant Directors CPA licensing; offset by $510 reduction in Office Equipment Repairs & Maintenance  Overall – Budget increase $60,999 or 7.8%  Base Budget – Decrease of 2.0% as compared to FY10 Budget  Strategic – Increase of 9.8% as compared to FY10 Budget  Alternative for payroll outsourcing to contract provider is being provided to the City Manager  Cash receipts lockbox and remote deposit cost/benefit analysis has been provided to the City Manager 3

Accounts Payable (Upgrade not approved in final budget) Evolution of Responsibilities  Hired as an Account Clerk II – performed data entry procedures for processing payments to City of Dover vendors  Accounts Payable Office was originally staffed with 1.5 employees  Increased projects and fixed asset purchases created a need to assign one employee the full- time responsibility for accounting and maintaining the fixed asset records, reports and system  Internal Control Procedures have evolved with new auditing standards  Maintains list of authorized signatures for various purchase levels  Insures original invoices are submitted with requisitions or purchase orders  Insures packing slips/bills of lading are submitted and signed off by receiving employee  Internal Control Risk Assessment changes – Insure Policy Compliance related to disbursements  Purchasing Policy  NAES Purchasing Policy  Travel Policy  Cell Phone Policy, etc…  FY08 – Daily cash receipts  To address continued increase in fixed assets and capital projects  Daily deposit reconciliation  Trouble shooting problems with Finance & Customer Service staff  Process improvements  Training customer service personnel on finance procedures and forms in regards to cash receipts 4

Alternative proposal to outsource payroll (Analysis provided to City Manager – Approved in final budget – Contractual Services $65,000)  Pros  Web based system; Better technology and user friendly access than our current system;  Provides employee’s with self-service functionality and on-line access to wage and benefit information  Provides City portal to post newsletters, bulletins and benefit changes  Potential to reduce long-term wage & benefit costs of additional headcount  Supervisors can more effectively manage employee schedules and overtime  Would require use of time clocks (cost of equipment included in the analysis)  City-wide efficiency gains on time and attendance, leave slips, etc…  Goal to have paperless payroll (all documentation electronic)  Any turnover in the payroll office would not be as disruptive to the Department  Would reduce workload on I/T staff and programming request  Ability to easily calculate “what if” pay increases for budgeting and union negotiations  Ability to use selected vendor’s integrated PFP function and data base for wage comparisons  Ability to do self-evaluations and have individuals and managers monitoring performance goals on-line  Department Heads have reviewed demo and response has been favorable  Cons  Cultural change  No wire for time clocks at two locations – Facility Maintenance & Construction Crew sites; Manual process until such time as communication lines can be installed;  Current pricing and analysis based on discussions and meetings with ADP. Solicitation of formal RFP may increase or decrease current estimates  Job application process can be done on-line, however this vendor’s form does not include work history  An alternative would be to require an attachment of the City application, a resume or a document with any additional information you would want. Or maintain the current applicant tracking module in the H.T.E. system. 5

Lockbox & Remote Deposit Services (Analysis provided to the City Manager)  Advantages  Staff can focus on customer calls and walk in services.  Supervisors whom assist with mail on heavy volume days will gain this time lost.  Mail processing would not be interrupted by employee absences.  The staff would not be overwhelmed with processing a huge volume of mail after a long Holiday weekend, such as the Monday after Thanksgiving. The same would hold true for the month of July with the property tax payments.  Mail processing and the cash will be electronically transferred to City bank accounts when offices are closed for emergencies and Holidays in which the banks open.  Since they process mail on Sundays, the City will receive credit to their account on Monday for the Friday and Saturday mail.  Customers who pay on line will have their City account credited the same day as the customers financial institution sends an electronic file to the lockbox.  Disadvantages  All future bank agreements would require the continuation of these services, if not (a) we may have a requirement for additional staff and (b) we would have to purchase the check scanning equipment.  We would not be in control of our mailed-in payment processing.  We would need to process any mailed-in payments to the City’s P.O. Box and not to the lockbox through our remote deposit system in order to prevent any delay in customer credit.  Transition  Does include some start up cost.  The return envelope address would not be Dover, Delaware and may create some initial confusion.  During the initial changeover, a greater amount of exceptions would have to be manually managed by the Customer Service staff.  Not included in cost is the write off of whatever stock is remaining of the City’s current return envelopes as they would need to be replaced with envelopes with the lockbox address. Our current inventory is 130 boxes valued at $1,312. They are usually ordered twice a year. 6

Finance Department Changes – Past 5 years  Addition of paying all vendors and contractors on $6 million power plant budget  The transfer to other Departments the City leases, copier support, and phone contracts has provided some relief and enabled the Accounts Payable Clerk to pick up the daily cash receipts reconciliation.  The franchise agreements were transferred to the new Public Relations Coordinator in the City Manager’s Office.  Staff training due to turnover; i.e. Since 2005 we have had 5 different employee’s in the payroll office; Has caused backlog in account reconciliations and other items needed for the audit;  Increased complexity in payroll with collective bargaining agreements and benefits by employee group;  Debt issues in FY10 & FY11; All accounting for bond proceeds and project tracking during project completion phase (up to 3 years); Several more debt financings in 5 year CIP;  Greater number of utility projects being completed; Monitor expenses for capital versus operating that are charged to projects; Breakout capital projects by asset classification to record asset;  Increased maintenance of fixed asset systems and physical tagging of assets;  Increased informational and project reporting for City Council;  Addition of accounting, reporting and participation for City Committees and organizations;  Implementation of Financial Forecasting for Utility Funds and rate setting; General Fund to follow;  Research and implementation of process improvements; i.e. electronic fund transfers from customers and to vendors; reducing number of paper checks issued and received;  Implementation of new auditing and accounting standards; i.e. Other Post Employment Benefits and Trust Fund establishment; Internal Controls; Derivatives; Fund Balance; 7

EXHIBIT #5 2011 Budget Review Special Council Meeting of 05/17/2011 EXHIBIT #5 2011 Budget Review Special Council Meeting of 05/17/2011

EXHIBIT #6 2011 Budget Review Special Council Meeting of 05/17/2011 Overtime by Division Fiscal 2012 Budget Account Fiscal 2012 Fund/Dept Description ACCT Description Budget City Clerk 110‐1100‐511.10‐12 OVERTIME ‐ Tax Assessor 110‐1300‐513.10‐12 OVERTIME ‐ Fire 110‐1400‐514.10‐12 OVERTIME 43,498 Grounds 110‐1500‐522.10‐12 OVERTIME 17,000 Library 110‐1500‐523.10‐12 OVERTIME 4,000 Parks & Recreation 110‐1500‐525.10‐12 OVERTIME ‐ Life Safety 110‐1600‐531.10‐12 OVERTIME 10,000 Code Enforcement 110‐1600‐532.10‐12 OVERTIME 1,770 Planning 110‐1600‐533.10‐12 OVERTIME 3,600 Inspections 110‐1600‐534.10‐12 OVERTIME 1,500 Economic Development 110‐1600‐535.10‐12 OVERTIME ‐ Police Civilian 110‐1700‐542.10‐12 OVERTIME 50,000 Police Law Enforcement 110‐1700‐543.10‐12 OVERTIME 500,000 P.S. Streets 110‐1800‐554.10‐12 OVERTIME 13,200 P.S. Sanitation 110‐1800‐555.10‐12 OVERTIME 18,000 City Manager 110‐2100‐515.10‐12 OVERTIME ‐ Information Technology 110‐2200‐516.10‐12 OVERTIME ‐ Finance 110‐2300‐517.10‐12 OVERTIME ‐ Public Services Admin 110‐2400‐551.10‐12 OVERTIME 500 Facilities Mantenance 110‐2500‐552.10‐12 OVERTIME 500 Central Services 110‐2700‐571.10‐12 OVERTIME 800 Fleet Maintenance 110‐2800‐572.10‐12 OVERTIME 1,500 Customer Services 110‐2900‐529.10‐12 OVERTIME ‐ Human Resources 110‐3100‐518.10‐12 OVERTIME ‐ GENERAL FUND TOTAL 665,868 W/W Engineering 412‐2600‐553.10‐12 OVERTIME 1,000 W/W Construction 412‐5600‐556.10‐12 OVERTIME 5,000 W/W Meter Reading 412‐6600‐566.10‐12 OVERTIME ‐ Water 412‐6800‐568.10‐12 OVERTIME 11,000 Wastewater 412‐6900‐569.10‐12 OVERTIME 27,000 Water Treatment Plant 412‐7600‐576.10‐12 OVERTIME 25,880 WATER/WASTEWATER FUND TOTAL 69,880 Power Plant 480‐8101‐591.10‐12 OVERTIME 192,000 Electric T&D 480‐8200‐562.10‐12 OVERTIME 110,074 Electric Engineering 480‐8300‐563.10‐12 OVERTIME 22,500 Public Utilities Admin 480‐8400‐564.10‐12 OVERTIME ‐ Meter Reading 480‐8500‐565.10‐12 OVERTIME 13,610 P.U. Systems Operations 480‐8600‐526.10‐12 OVERTIME 20,000 ELECTRIC FUND TOTAL 358,184 ‐ GRAND TOTAL 1,093,932 AS OF : 5/18/2011

EXHIBIT #7 2011 Budget Review Special Council Meeting of 05/17/2011 Finance Department--Eliminating Accounting I Position From Accounting I position: Eliminating the Accountant I position would affect me both personally and professionally. I have 3 children ages 11, 14, and 18. Daily living expenses will be impossible to maintain without my employment at the City of Dover. My 18 year old daughter is graduating from high school in June and will be attending college in September. College is a huge expense that I will not be able to cover if I am without employment. I believe that my position is a strong asset to the Finance department. My daily and monthly job responsibilities aid in the ability of the Finance department to service all departments within the City of Dover. I work closely with all positions within the Finance department. Eliminating my position would cause a heavy burden on all other positions in the department. This would cause the other Accountants to take on my job responsibilities as well as having to maintain their own job responsibilities. They will have to work extra hours during the week just to maintain the functionality of the department. This will cause burn out for the other positions and I believe it will eventually cause low morale. It will affect their home lives and time spent with their families. Summary of Staff Reaction to the Elimination of the Accounting I Position in the Finance Department. The workload in the Finance Department has greatly increased over the last 5 to 10 years. The increase can be attributed to an overall increase in the quantity of work required by the department. It is also the result of several changes in accounting regulations. One change in particular is the Financial/Accounting industry’s focus on proper internal controls. This emphasis as everyone knows is a result of MCI, Enron and others. The City of Dover was written up for internal controls in the Annual Auditor’s Management Letter a few years ago. In an attempt to meet the Auditor’s requirement, the ADP Committee Action Form stated that any time savings resulting from the ADP implementation would be used for internal control risk testing. This plan replaced the initial recommendation to add a full time position. The Finance Department is tasked with ensuring all departments are following City Policy by monitoring the City’s financial transactions such as invoices/expenditures & revenues. We are also deeply involved with the CDBG & NSP grant program. The elimination of the Accountant I position will require a reallocation of the daily, monthly, quarterly and annual duties to remaining staff. This level of work requires an accounting background which means three employees besides the Controller are qualified. Therefore, we will need to review all duties and attempt to reshuffle them among the staff. This brings with it a learning curve to overcome. All staff agrees the department is already over tasked. Most

employees work through lunch, come in early, stay late and bring work home just to meet the current demands. This does not include the nights worked by the Controller trying to help with our workload & outside requests while meeting her own requirements. We have been frequently unable to fulfill the requests from Council for reports or additional information due to our current workload. With the loss of this position, we fear we will be unable to successfully fulfill any requests for additional information including those coming from Council. We have worked hard to meet our reporting deadlines over the last few years. This includes required reporting as well as internal reports. We are concerned that with the loss of this critical position we could face difficulties meeting the deadlines especially producing timely and accurate monthly reports. The Monthly Reports are relied upon by both our City Department managers and Council to gauge the City’s performance. Untimely and/or inaccurate monthly reports could also be frowned upon by the Citizens of Dover. The elimination of this position could also affect the CDBG and the NSP grant due to the timeliness required by HUD. HUD not only requires programs to be completed in a timely manner, they also require reporting and drawing of funds to be timely. Some tasks will fall through the cracks while we attempt to prioritize all the important tasks. This could inadvertently impact our citizens. The elimination of the position will have a large impact on the quality and timeliness of the annual audit and the CAFR. It would also have an impact on our internal controls and review process required for the audit. It will require the Controller to take on the review process role currently filled by the Finance & Reporting Manager in order to separate the review process from the preparing process. Overloading the staff will impact time available for the review of City Policies. Each year the auditors have increased their testing of our internal controls and policy compliance so this too could impact our audit. All of the items above could impact the credit rating agencies and our ability to produce documentation required when additional debt service is requested. Currently one of the accountants is heavily involved with assisting a department with the Revolving Fund Loan. This type of assistance is critical for future cash flow to ensure the City meets the requirements of the lending agency on a timely basis. We understand there may be some who believe that the implementation of the ADP system should free up enough time to allow us to absorb this additional workload. It is too early in the implementation process to determine the actual time savings. Also we are not implementing all of the initial modules so some of the expected efficiencies are lost. The Time & Attendance module is meant to automate some of the workload at the department level but will not decrease

the payroll office’s workload. Still, we do expect time savings from the ADP system. The plan from the beginning was to utilize the time savings to meet the auditor’s requirements and to help with the increased workload we have absorbed over the last few years. In the end, the ADP system still requires a payroll specialist to operate. The payroll office is still required to enter and manage employee/retiree changes and manage the employee benefits and corresponding payments. Right now two employees are working full time on the ADP implementation and payroll. This doesn’t include the countless hours of work done in the evening or weekends. To reiterate, until the system is fully functional, it is too early to determine the workload of the payroll office. In summary, we feel it would be a detriment to the City and the citizens of Dover to eliminate the Accountant 1 position. Many members of the Finance staff already sacrifice personal family time for the City. If the staff is reduced the remaining staff will be required to work more than 40 hours/week creating OT or comp time. This could create morale issues and/or increase the chance for error due to fatigue. In the end when you consider the possible consequences and add the value of the comp time or OT, it does not appear to be a wise financial decision to eliminate this position.

EXHIBIT #8 2011 Budget Review Special Council Meeting of 05/17/2011 DRAFT BUDGET REVIEW Fiscal Year 2011-2012 EXHIBIT #8 2011 Budget Review May 18, 2011 – Budget Review Hearing Special Council Meeting of 05/17/2011

General Fund Continued 2

Parks & Recreation page 240 Personnel Costs 520,791 5%
Materials & Supplies 64,687 1% Administrative Expenditures 221,777 3%
Overall Operating Expenses $807,255 4%
Capital Outlay 80,000 78%
Total Expenditures $887,255 8%
Highlights: Materials & Supplies expenditures are decreased due to reductions in computer hardware and software. Administrative Expenditures increased due to $10,355 in contractual services associated with the Fourth of July Fireworks. This was offset by savings in heating, advertisement, and office equipment and repair. 3

Library page 241 Personnel Costs 1,038,391 12%
Materials & Supplies 95,777 13%
Administrative Expenditures 103,013 10% Overall Operating Expenses $1,237,181 10%
Capital Outlay 11,195,009 67%
Total Expenditures $12,432,190 59%
Highlights: This division increased by 1.5 positions. Personnel costs up due to increased staffing and OPEB. Materials & Supplies increased due computer hardware replacements Administrative Expenses increased due to Capital expenses include the continuation of the Regional Library project which is funded by State grants, donations and reserves. No current General Fund monies are used. 4

Public Services 5

Life Safety page 272 Personnel Costs 294,797 13%
Materials & Supplies 23,605 7%
Administrative Expenditures 221,966 2%
Overall Operating Expenses $540,368 8%
Capital Outlay - - Highlights: Materials & Supplies are increased due to the strategic program for implementing Global Connect -$9,000. This expense is partially offset by decreases in other lines. Administrative Expenses are increased due to a strategic program which would send one Fire Marshall to the Police Academy for training $4,000. 6

Economic Development page 279 Personnel Costs 190,480 7%
Materials & Supplies 4,000 100%
Administrative Expenditures 42,500 36% Overall Operating Expenses $237,030 4% Capital Outlay - - Highlights: Personnel Costs increased due to OPEB. Materials and Supplies are up due to computer hardware purchase. Administrative Expenses are down due to lower rent charges. 7

Inspections & Permitting page 273 Personnel Costs 437,121 7%
Materials & Supplies 15,980 2%
Administrative Expenditures 15,636 78% Overall Operating Expenses $468,737 5% Capital Outlay - - Highlights: Personnel Costs increased due to OPEB. Materials & Supplies are increased for computer hardware purchases. Administrative Expenses are decreased due to the way demolition is budgeted. It is budgeted as a direct expense to the General Fund and not included in this budget. 8

Grounds page 287 Personnel Costs 873,572 2% Materials & Supplies 66,690 2% Administrative Expenditures 93,768 3% Overall Operating Expenses $1,034,030 2% Capital Outlay 44,720 30% Total Expenditures $1,078,750 4% Highlights: Personnel Costs decreased due to transferring one staff person to Sanitation. Materials & Supplies decreased due to reduction of small tools budget. Administrative Expenditures decreased due to reductions in electricity and heating oil. Capital expenses decreased due to replacement vehicles and equipment charges being less than the previous year. 9

Sanitation page 292 Personnel Costs 766,584 16%
Materials & Supplies 42,847 5% Administrative Expenditures 1,550,982 5% Overall Operating Expenses $2,360,413 -% Capital Outlay 368,584 50%
Total Expenditures $2,728,997 5%
Highlights: Personnel Costs increased due to transferring staff from Grounds and OPEB. Materials & Supplies increased due to decreased computer hardware expense . Administrative Expenses are decreased due to decreased tonnage taken to the landfill. Capital spending increase is related to the replacement of one automated trash truck ($232,084) and a bulk trash truck ($136,500). 10

Streets page 287 Personnel Costs 596,042 3% Materials & Supplies 105,562 9%
Administrative Expenditures 91,044 2%
Overall Operating Expenses $792,648 1% Capital Outlay 821,237 71%
Total Expenditures $1,613,885 26%
Highlights: Personnel costs are down due to budgeting for retirement pay in FY 2011. Materials and supplies are increased due to increased budget for sand and salt. Administrative expenses are increased due to addition of line item for environmental expense ($2,500) Capital Outlay increased due budget for a street sweeper($170,027) and dump truck($128,000), salt storage shed ($50,000), and equipment and refurbishment. 11

Public Services Admin page 293 Personnel Costs 416,094 20%
Materials & Supplies 51,871 888%
Administrative Expenditures 18,166 -2% Overall Operating Expenses $486,131 31%
Capital Outlay 18,000 N/A Highlights: Personnel Costs increased due to the change in the way we account for the GIS Technician’s salary. Due to a change in the payroll system, the position is now charged directly to the division and the division is allocated. Previously, the position was charged to the Water/Wastewater Engineering Division. Materials & Supplies are increased due to a purchase of $42,276 upgraded radios for the public services divisions. The purchase is necessary due to FCC regulations. Capital Outlay for GIS mobile data solutions for staff. 12 12

Planning & Community Enhancement Services 13

Planning page 258 Personnel Costs 424,430 6%
Materials & Supplies 16,510 47%
Administrative Expenditures 28,105 139%
Overall Operating Expenses $469,045 11%
Capital Outlay - Highlights: Personnel Costs increased due to OPEB. Materials & Supplies expenditures increased due to computer hardware purchases. Administrative expenses are increased for a storm water compliance program ($18.500). 14

Code Enforcement page 262 Personnel Costs 285,235 15%
Materials & Supplies 6,160 68% Administrative Expenditures 8,585 7%
Overall Operating Expenses $299,980 8%
Capital Outlay - - Salary expenses are increased due to the addition of a part-time position approved by Council in mid FY 2011 and OPEB. Materials & Supplies decreased due to moving the expense for grass cutting to a reserve expense in the General entitled Nuisance Improvement Reserve. There are also decreased computer hardware expense. Administrative Expenditures increased due to increase telephone expense . 15 15

Community Development page 267 Personnel Costs 74,087 2% Materials & Supplies 585 4% Administrative Expenditures 2,603 1%
Overall Operating Budget $79,315 2% Highlights: Personnel Costs decreased due to decrease in temporary help. Materials & Supplies and Administrative Expenses are unchanged from the Fiscal 2011 Budget. Please note that the programmatic portion of this budget is approved through another process and the final approved version will be added to the final budget document. Only salary and administrative expenses are approved through the budget process. 16 16

Fire page 217 Personnel Costs $411,970 4% Materials & Supplies 75,680 - Administrative Expenditures 281,252 - Overall Operating Expenses $768,902 8%
Capital Outlay 273,054 5% Total Expenditures $1,041,956 4%
Highlights: Personnel Costs decreased due to changes in health care coverage and usage of temporary help There are strategic requests for upgrading pagers $40,640 and new dispatch software $40,800 Capital Expenses cover the payments for Engine 2 and Ladder 2. There is a request for new Holmatro rescue equipment - $56,234 17

EXHIBIT #9 City Manager's Legal Expenses for Fiscal 2011 2011 Budget Review July 1, 2010 - To Date Special Council Meeting of 05/17/2011 Type Total Date Paid To Amount Description Other Legal Issues $ 4,200 2/1/2011 Pauline McNeely 125.0 Sewer Line Clogged 1/11/2011 Compliance Environmental 950.0 Annual DNREC Inspection 11/1/2010 IMLA, Inc 625.0 2011 Membership Renewal (Nick Rodriguez) 9/24/2010 Prickett, Jones 2,500.0 Library Reciprocal Borrowing Opinion Monthly Legal Fees $ 68,206 5/16/2011 Schmittinger & Rodriguez 5,328.7 April 2011 Billing 4/7/2011 Schmittinger & Rodriguez 5,804.2 March 2011 Billing 3/17/2011 Schmittinger & Rodriguez 9,785.1 February 2011 Billing 2/18/2011 Schmittinger & Rodriguez 6,827.5 January 2011 Billing 1/19/2011 Schmittinger & Rodriguez 6,536.0 December 2010 Billing 12/16/2010 Schmittinger & Rodriguez 4,826.0 November 2010 Billing 11/12/2010 Schmittinger & Rodriguez 11,451.0 October 2010 Billing 10/26/2010 Schmittinger & Rodriguez 7,334.3 September 2010 Billing 9/16/2010 Schmittinger & Rodriguez 4,868.0 August 2010 Billing 8/25/2010 Schmittinger & Rodriguez 5,445.6 July 2010 Billing Insurance Deductibles $ 9,375 1/10/2011 Travelers 2,370.0 Claim Deductible 12/30/2010 Travelers 1,340.0 Claim Deductible 10/29/2010 Travelers 70.0 Claim Deductible 9/30/2010 Travelers 1,854.5 Claim Deductible 8/31/2010 Travelers 3,740.0 Claim Deductible Total FY 11 Expenses $ 81,781 as of May 19, 2011 Transferred to Tax Assessor's Budget in the Latest Estimate of February 2011. Assessment $ 43,543 2/15/2011 The Lawson Firm 9,460.0 2010‐2011 Assessment Appeals & Litigations EXHIBIT #9 billed at $195 per hour 1/19/2011 The Lawson Firm 7,540.0 2010‐2011 Assessment Appeals & Litigations 12/31/2010 The Lawson Firm 13,318.5 2010‐2011 Assessment Appeals & Litigations 10/31/2010 The Lawson Firm 11,101.2 2010‐2011 Assessment Appeals & Litigations 9/30/2010 The Lawson Firm 8,268.0 2010‐2011 Assessment Appeals & Litigations 2011 Budget Review 8/31/2010 The Lawson Firm 2,925.0 2010‐2011 Assessment Appeals & Litigations 7/31/2010 The Lawson Firm 390.0 2010‐2011 Assessment Appeals & Litigations Special Council Meeting of 05/17/2011

EXHIBIT #10 2011 Budget Review Special Council Meeting of 05/17/2011 Memorandum Office of the City Manager PO Box 475 Dover, DE 19903 Phone: (302) 736-7005 FAX: (302) 736-7002 E-mail: tdeprima@dover.de.us To: Mayor and City Council From: Anthony J. DePrima, AICP, ICMA‐CM, City Manager Date: May 19, 2011 Subject: Take Home Vehicles The following report is in response to Councilman Hare’s question regarding “take home” vehicles. 1) Vehicles assigned to on‐call personnel. These individuals generally use specialized vehicles when responding to afterhours requests or if the nature of their job requires them to take home a vehicle. The following is a list of the vehicles that I put in this class. Some of these vehicles are taken home by the same individual every night while others are taken home to whoever is assigned on‐call duty. For IBEW members this is a contract provision.  (2) Electric Line Vehicles  (1) Electric Substation Technician Vehicle  (1) Water/Wastewater Employee Vehicle  (1) On‐call Deputy Fire Marshal  (1) Warehouse Vehicle (If warehouse needs to be open after hours for parts)  (1) Meter Reader  (2) K‐9 Police Officers  (1) Criminal Investigation Sergeant  (7) Detectives  (1)Victim Services Coordinator  (5) Drug and Vice Organized Crime Officers 2) Mayor and Staff Vehicles. These individuals frequently use their vehicles for City business after hours or are expected to be available for City business anytime, anywhere for any reason that may arise. Allowing the vehicle to be taken home enables the employee to travel directly to wherever their services are needed, without first picking up their assigned City vehicle. I believe the titles listed below have been taking home vehicles for the last 20 years.  Mayor (per Council action when Mayor went to full time)

 City Manager (per employment contract)  Police Chief  Police Major  (2) Police Captains  (4) Police Lieutenants  Fire Marshal  Public Utilities Director (per employment agreement)  Central Services Director  Electric Systems Operations Manager  Water/Wastewater Supervisor  Tax Assessor If you have any questions, please feel free to give me a call. Thank you. AJD/hf

EXHIBIT #11 2011 Budget Review CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES Special Council Meeting of 05/17/2011 PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD Production CIP Expenses Wellhead Redevelopment Program $12,179.00 SPENT: Description : capacity and flow improvements WD0801 $6,600.00 WQ Recommendation : n/a $32,151.00 PENDING: Account # : 417-6800-568.40-31 $990.00 $150,961.29 $143,840.15 $23,838.98 $21,984.00 WD0904 $70,238.00 $53,400.00 $499,150.42 $65,000.00 Project #: WS0201 WS0404 WS0505 WS0606 WD0801 $36,368.00 WD1001 WD1102 WD12XX Water System SCADA Upgrade WD0905 Description : flow control improvements WQ Recommendation : data acquisition and storage Account # : 417-6800-568.40-31 $192,198.00 $21,294.60 $213,492.60 Project #: WS0301 WS0301 Water Quality Evaluation Description : system analysis WQ Recommendation : n/a Account # : 417-6800-568.40-34 $1,660.00 $77,407.64 $79,067.64 Project #: WD0504 WD0504 Water Quality Improvements: WTP Transducer / Analyzers Description : flow control improvements, monitoring WQ Recommendation : water quality monitoring (analyzers) Account # : 417-6800-568.40-34 $12,317.10 $12,317.10 Project #: WS0502 Water Quality Improvements: Well #2 VFD Upgrade Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-34 $22,655.85 $22,655.85 Project #: WS0502 Water Quality Improvements: Consulting Description : Deep Well Contact Chamber Design, Stage II Disinfection By-Product Rule Analysis WQ Recommendation: deep well contact chambers, preparation for new / pending regulations Account # : 417-6800-568.40-34 $103,765.47 $35,836.70 $139,602.17 Project #: WS0502 WD0811 Bayard Avenue Contact Chamber: Well #13R Description : chlorine reaction time improvements WQ Recommendation : deep well contact chambers Account # : 417-6800-568.40-34/.40-31 $71,043.47 $8,905.21 $79,948.68 Project #: WS0707 WS0707 Remote Control and Monitor Wells Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $51,135.46 $63,767.66 $23,104.00 $31,896.00 $169,903.12 EXHIBIT #11 Project #: WD0802 WD0802 WD1002 WD1002 Water Quality Improvements: Deep Well Contact Chambers Wells #1, #2, #3, #4, #6, #7, #8, #9, #10, #11, #14, #15 Description : chlorine reaction time improvements WQ Recommendation : deep well contact chambers Account # : 417-6800-568.40-34/.40-31 $805,753.22 $95,484.30 $901,237.52 2011 Budget Review Project #: WD0811 WQ0904 Wellhead VFD Upgrades: Well #11 Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $2,505.06 $18,780.94 $21,286.00 Project #: WD0808 WD0808 Special Council Meeting of 05/17/2011 Updated: 5-19-11 Public Utilities Department Page 1 of 6

CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD Wellhead VFD Upgrades: Well #13R Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $2,505.06 $11,717.99 $14,223.05 Project #: WD0809 WD0809 Wellhead VFD Upgrades: Well #15 Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $2,505.06 $11,717.99 $14,223.05 Project #: WD0810 WD0810 Wellhead VFD Upgrades: Well #3 Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $17,960.97 $17,960.97 Project #: WD0901 Wellhead VFD Upgrades: Well #9 Description : flow control improvements WQ Recommendation : n/a Account # : 417-6800-568.40-31 $20,262.38 $20,262.38 Project #: WD0902 Production CIP Expenses $193,188.00 $172,255.89 $145,500.15 $101,246.62 $209,781.89 $931,129.77 $239,692.23 $93,342.00 $38,496.00 $2,205,330.55 $65,000.00 Distribution System CIP Expenses Dead End Water Main Removal Description : flow improvements WQ Recommendation : n/a Account # : 417-6800-568.40-34 $22,391.79 $22,391.79 Project #: WD0306 Division Street Water Main Upgrade Description : unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-34 $12,033.20 $8,498.73 $1,334,251.51 $1,354,783.44 Project #: WD0304 WD0304 WD0304 Misc. Distribution System Improvements Description : capacity and flow improvements, SPENT: unlined pipe replacement $11,353.00 WQ Recommendation : main rehabilitation PENDING: Account # : 417-6800-568.40-34 $100.00 $56,440.04 $20,917.96 $36,700.41 $21,449.28 $20,206.06 $21,188.32 $48,647.00 $188,355.07 $60,000.00 Project #: WD0401 WD0503 WS0602 WS0706 WD0806 WD0903 WD1004 WD1101 WD12XX Water Quality Improvements: Bayard Avenue Connection Description : Division Street Upgrade completion WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-34 $23,102.71 $23,102.71 Project #: WS0502 Water Quality Improvements: Water Main Rehabilitation Description : Surveying and Design WQ Recommendation: main rehabilitation Account # : 417-6800-568.40-31 $50,137.50 $50,137.50 Project #: WD0811 Water Quality Improvements: Pear St./West St. Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $321,903.84 $203,693.63 $525,597.47 Project #: WQ0902 WQ0902 Updated: 5-19-11 Public Utilities Department Page 2 of 6

CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD Water Quality Improvements: South St. Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $37,469.28 $37,469.28 Project #: WQ0903 Water Quality Improvements: Washington St./Pennsylvania Ave. Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $310,063.02 $310,063.02 Project #: WQ0901 Water Quality Improvements: Route 13 Water Main Description: capacity improvements, unlined pipe SPENT: replacement $815,970.72 WQ Recommendation : main rehabilitation PENDING: Account # : 417-6800-568.40-31 $67,396.65 $56,599.26 $151,830.28 $275,826.19 Project #: WQ0907 WQ0907 WQ0907 Water Quality Improvements: Bayard Ave. area Partial Const. Description: capacity improvements, unlined pipe SPENT: replacement $305,347.39 WQ Recommendation : main rehabilitation PENDING: Account # : 417-6800-568.40-31 $6,490.00 $279,072.61 $285,562.61 Project #: WQ0905 WQ0905 Water Quality Improvements: East of North State Street Description: capacity improvements, unlined pipe SPENT: replacement $148,175.38 WQ Recommendation : main rehabilitation PENDING: Account # : 417-6800-568.40-31 $29,002.50 $699,524.62 $177,177.88 $280,000.00 Project #: WQ0906 WQ0906 WQ0906 S. Governors Avenue Water Main Upgrade Description : capacity improvements unlined pipe replacement WQ Recommendation : main rehabilitation PENDING: Account # : 417-6800-568.40-34 $2,664.00 $197,336.00 $2,664.00 Project #: WD0807 WD0807 Water Quality Improvements: McKee Run Plant WMR Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $95,612.76 $95,612.76 Project #: WQ1001 Water Quality Improvements: Walker Road Description : Surveying and Design WQ Recommendation: main rehabilitation Account # : 417-6800-568.40-31 $23,750.00 $23,750.00 Project #: WQ1002 Water Quality Improvements: Loockerman Plaza Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $96,435.49 $96,435.49 Project #: WQ1101 Updated: 5-19-11 Public Utilities Department Page 3 of 6

CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD Water Quality Improvements: Ross Street Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $4,250.00 $4,250.00 $72,520.00 Project #: WQ1103 WQ1103 Water Quality Improvements: West Street W Alley Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $4,250.00 $4,250.00 $122,480.00 Project #: WQ1105 WQ1105 Water Quality Improvements: Columbia Avenue Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $4,250.00 $4,250.00 Project #: WQ1102 Water Quality Improvements: William Street Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $4,250.00 $4,250.00 Project #: WQ1104 Water Quality Improvements: West Street E Alley Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $0.00 $6,250.00 Project #: WQ12XX Water Quality Improvements: Fairview Ave W Alley Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $0.00 $6,250.00 Project #: WQ12XX Water Quality Improvements: Lakewood Place Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $0.00 $6,250.00 Project #: WQ12XX Water Quality Improvements: Governors Avenue Description: capacity improvements, unlined pipe replacement WQ Recommendation : main rehabilitation Account # : 417-6800-568.40-31 $0.00 $6,250.00 Project #: WQ12XX Distribution System CIP Expenses $34,424.99 $8,598.73 $56,440.04 $1,355,169.47 $59,803.12 $71,586.78 $792,531.35 $403,507.97 $1,394,281.98 $3,462,179.21 $560,000.00 Updated: 5-19-11 Public Utilities Department Page 4 of 6

CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD Operating Expenses Claims Since 12/2002 Description : damaged laundry, etc. WQ Recommendation : n/a Account # : 412-6800-568.20-51 $1,143.31 $3,376.00 $5,586.40 $2,939.41 $1,259.93 $1,888.82 $417.74 $1,220.38 $921.32 $18,753.31 $1,000.00 Distribution System Flushing $19,602.12 $112,406.97 $105,572.54 $177,062.77 $184,505.68 $82,072.50 $78,730.45 $77,118.90 $78,205.14 $915,277.07 $79,600.00 Description : advertising, labor, supplies WQ Recommendation : distribution system flushing program  ADVERTISING Account #: 412-6800-568.30-25 $504.12 $5,309.70 $2,974.44 $9,592.00 $15,340.30 $12,156.08 $9,530.45 $7,218.90 $7,105.14 $69,731.13 $7,500.00  LABOR (in-house) Account #: 412-2600/5600/6800/6900/7600 $19,098.00 $106,948.80 $101,856.00 $165,516.00 $168,257.35 $68,768.64 $68,100.00 $68,800.00 $70,000.00 $837,344.79 $71,000.00  SUPPLIES - DISTRIBUTION (estimate) Account #: 412-6800-568 $148.47 $742.10 $777.31 $598.03 $892.78 $800.00 $800.00 $800.00 $5,558.69 $800.00  SUPPLIES - WTP (estimate) Account #: 412-7600-576 $1,177.46 $310.00 $255.00 $300.00 $300.00 $300.00 $2,642.46 $300.00 System Monitoring Description : sample analysis supplies (est.) WQ Recommendation : distribution system monitoring, water quality monitoring program Account # : 412-7600-576 $3,276.90 $4,521.48 $3,909.00 $3,500.00 $3,500.00 $3,500.00 $22,207.38 $3,500.00 Operating Expenses $20,745.43 $115,782.97 $111,158.94 $183,279.08 $190,287.09 $87,870.32 $82,648.19 $81,839.28 $82,626.46 $956,237.76 $84,100.00 WATER QUALITY EXPENSE TOTAL $248,358.42 $296,637.59 $313,099.13 $1,639,695.17 $459,872.10 $1,090,586.87 $1,114,871.77 $578,689.25 $1,515,404.44 $6,623,747.52 $709,100.00 WATER QUALITY COMPLAINTS 271 627 906 369 542 241 221 249 111 2,956 Updated: 5-19-11 Public Utilities Department Page 5 of 6

CITY OF DOVER WATER QUALITY APPLICABLE EXPENDITURES PROJECT INFORMATION FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 TO DATE FY 2012 BUD $1,800,000.00 3,000 $101,246.62 $38,496.00 $1,355,169.47 PRODUCTION CIP EXPENSES $1,394,281.98 $1,600,000.00 $183,279.08 $82,626.46 DISTRIBUTION SYSTEM CIP EXPENSES 2,500 $239,692.23 $1,400,000.00 OPERATING EXPENSES $931,129.77 $792,531.35 $71,586.78 $82,648.19 $1,200,000.00 WATER QUALITY COMPLAINTS 2,000 $87,870.32 $1,000,000.00 $65,000.00 1,500 $560,000.00 $145,500.15 $93,342.00 $800,000.00 $56,440.04 $209,781.89 $403,507.97 $84,100.00 $111,158.94 $59,803.12 $81,839.28 $172,255.89 $600,000.00 1,000 $193,188.00 $8,598.73 906 $190,287.09 $34,424.99 $115,782.97 $400,000.00 $20,745.43 627 542 500 369 249 $200,000.00 221 271 111 241 $0.00 0 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Updated: 5-19-11 Public Utilities Department Page 6 of 6

EXHIBIT #12 2011 Budget Review Special Council Meeting of 05/17/2011 Planning Office Statement The City of Dover Planning Office is unique in the State of Delaware as it serves as one of, if not likely the only planning office staffed entirely with AICP certified planners. This distinction is important in understanding the strength of services available to the City from its Planning Office. Issues such as land use, zoning, and permitting are complicated matters that both residents and businessmen within the City must address in a variety of ways every day. From simple answers that explain why a shed may be placed in one area or another, or the height of fencing in a neighbor’s yard to complicated answers such as how to go about starting a business in the City or how zoning and land use categories determine growth patterns in an area; the City of Dover Planning Office is the public intermediary. Much of what the Planning Office does can be described as striving to achieve and maintain a balance between the needs and interests of individual property owners, be they residents, developers or business owners, and the needs and interests of the community as a whole. The office is tasked with the difficult responsibility of maintaining the existing zoning codes and ordinances and at the same time advancing both public and private interests as they relate to the improvement of neighborhoods and businesses alike. Professional planners are a necessity where these matters are concerned as any or all of the previously mentioned aspects of growth management have the potential to affect quality of life and business alike across the City. Similar to statements made with regards to the City Clerk’s Office, the Planning Office has a number of statutory responsibilities related to preparing and posting of agendas, packets and minutes; preparing reports for the Planning Commission, Board of Adjustment, Historic District Commission and City Council; responding to Freedom of Information Act Requests, and complying with state and federal mandates relating to the City’s Municipal Separate Storm Sewer System and Comprehensive Planning requirements. In recent years, the Planning Office has found itself in the role of mediator between developers and outside agencies, particularly DelDOT. The City manages the Development Advisory Committee, which coordinates regulatory agency comments on development application to avoid conflict, duplication or confusion. The review process under the Department of Transportation has become increasingly cumbersome, and the Planning Office has been successful in bringing DelDOT together with developers to find reasonable solutions. Reducing staff in the Planning Office would reduce our ability to serve in this role. The skill set offered by the Planning Office extends beyond the public realm and into other matters including but not limited to: maintaining State required growth management policies and regulations, ensuring that proposed and current zoning ordinances comply with State statutes and case law, and research that is vital to City of Dover interest and compliance with Federal laws. Without over-stating the amount of responsibility placed upon the Dover Planning Office, it should be known and recognized that this office is responsible for but not limited to: • The City’s Comprehensive Plan, a five year plan for growth that is mandatory for compliance with State growth management laws.

• The City’s Historic District, including the numerous national grants and matters of recognition that our historic buildings and places have garnered. The Planning office is also staff to the Historic District Commission, ensuring the Historic District Guidelines are maintained and enforced. • The Board of Adjustment, a quasi-judicial board, including accurate public notice, meeting reports, and compliance with State Law. • Ordinance revisions, updates, and additions. Community improvement is constantly at the forefront of all code amendments put forth by our office and the Planning Staff has successfully met numerous requests by council, committee, and citizenry over the past few years in this manner. • The federal NPDES permit which regulates the management of stormwater in municipal jurisdictions. This is a massive endeavor that for nearly 5 years was under-staffed to the point that the City is now on its second Notice of Violation. The efforts of this office have made significant progress in achieving compliance with both State and Federal requirements on this matter. • The planning office was responsible for the research and proposals that led to the current Schutte Park master plan. Coordination with the GIS department to create a physical plan that demonstrated these things resulted in a savings of 30-50 thousand dollars for the City according to the City Manager. • Census information, including active membership on the Delaware Population Consortium, ensuring the boundary and addresses are provided on a regular basis to the Census ensuring Dover receives its accurate share of state and federal funding. The planners act as staff to the Planning Commission in preparing both the reports and meetings that are held monthly. This includes working with other city departments and state agencies, providing public notice information to applicants, attending night meetings, ensuring compliance with city codes and regulations, ensuring compliance with the approved plans, etc. All that being said, City Planners still have plans to review, permits and licenses to review and approve, and citizen questions to address on a daily basis. These tasks are not things to be taken lightly and are essentially available to the City of Dover as a result of its professional planning staff. When addressing the issue of staffing cuts within this department, the questions become: Which of these priorities will be allowed to fall away? Which of these priorities are not essential to the smooth functioning of the City’s interaction’s with the public and with the business community? Will we take longer in our response on plan review and permits diminishing customer service quality? Would we continue to be in violation of the requirements of the National Pollution Discharge Elimination System, whose requirements are continuing to increase? Would we stop reviewing and updating antiquated provisions within our codes (Zoning Ordinance and Subdivision Regulations)? Would we be left to contract out development of the Comprehensive Plan, which would add cost in the future years and give us less control over a process which we managed effectively during the last process? The work load for our office is divided equally according to skill set. With the removal of 33% of the available staff time and knowledge (noting that the director does not serve as a full time planner), there will be many

responsibilities that will not receive the kind of attention and effort that they are due, potentially resulting in errors that could leave us legally vulnerable. Again, the question is which items do you want removed, as all of these functions and responsibilities will not be able to be accomplished or maintained at the current level if a planner is lost?

EXHIBIT #13 2011 Budget Review Special Council Meeting of 05/17/2011 DRAFT BUDGET REVIEW Fiscal Year 2011-2012 EXHIBIT #13 2011 Budget Review May 19, 2011 – Budget Review Hearing Special Council Meeting of 05/17/2011

Police page 246-247 Personnel Costs 12,657,390 6%
Materials & Supplies 377,200 7%
Administrative Expenditures 581,900 2% Overall Operating Expenses 13,616,490 5%
Capital Outlay 266,534 6% Highlights: Increase to Personnel Costs are due to budgeted salary increases for non-bargaining employees, changes in staffing levels and OPEB. Materials and Supplies increased due to the addition of Criminal Justice petty cash disbursements, a new line to handle accounting for Criminal Justice expenses and is offset by revenue. Also, uniform allowance and computer hardware expenses were greater than in Fiscal 2011. These expenses were partially offset by savings in other areas. Administrative Expenses decreased mostly due to a reduction in office equipment repair. Capital Outlay include the purchase of 11 vehicles and other vehicle expenses. 2

WATER/WASTEWATER FUND 3

Water/Wastewater Engineering page 300 Personnel Costs 568,763 - Materials & Supplies 21,005 174%
Administrative Expenditures 44,579 32% Overall Operating Expenses 634,347 1% Capital Outlay - - Highlights: Personnel Costs remain unchanged due a change in head count. GIS Tech position was previously charged to this budget and is currently charged to Public Services Administration. Materials & Supplies expenditures are increased due to computer software and hardware purchases. Administrative expenditures are reduced due to adjustments in contracting locating services. 4

Water Construction page 301 Personnel Costs 361,335 6%
Materials & Supplies 9,255 15% Administrative Expenditures 55,139 38%
Overall Operating Expenses 424,749 5% Capital Outlay 30,100 100%
Total Expenditures 455,849 3%
Highlights: Personnel Costs are increased to due union salary increases of 2% and OPEB. Administrative Expenditures are increased for the purchase of radios in order to be incompliance with FCC regulations. Capital Outlay increased $30,100 for vehicle purchases. 5 5

Water Management page 302 Personnel Costs 237,206 11% Materials & Supplies 63,427 1% Administrative Expenditures 86,716 6%
Overall Operating Expenses $387,349 6% Capital Outlay 766,240 24%
Total Expenditures $1,153,589 12%
Highlights: Salary is down due to corrections for splitting salary costs between Water and Wastewater. Materials & Supplies are down slightly due to decreases in computer hardware expense. Administrative Expenditures are increased for the purchase of radios in order to be incompliance with FCC regulations. Capital Expenses increased compared to the Fiscal 2011 budget; however decreased when compared to the Fiscal 2011 revised budget. This is due to completion of major capital projects in Fiscal 2011. 6

Wastewater Management page 303 Personnel Costs 608,052 5% Materials & Supplies 89,689 7%
Administrative Expenditures 284,746 17%
Overall Operating Expenses 982,487 1%
Capital Outlay 3,404,900 118%
Total Expenditures 4,387,387 73%
Highlights: Personnel Costs decreased due to corrections for splitting salary costs between Water and Wastewater. Materials & Supplies increased due to increased expenses in computer hardware. Administrative Expenses are increased for the purchase of radios in order to be incompliance with FCC regulations. Capital Expenses have increased when compared to Fiscal 2011 budget; however they decreased when compared to Fiscal 2011 revised budget. The budget is dependent on the amount of planned capital projects. 7

Water Treatment page 304 Personnel Costs 720,174 9%
Materials & Supplies 145,185 1%
Administrative Expenditures 689,890 1% Overall Operating Expenses 1,555,249 4%
Capital Outlay 22,900 - Total Expenditures 1,578,149 5%
Highlights: Personnel costs are increased for contract wage increases and OPEB. Materials & Supplies and Administrative Expenses are relatively unchanged. Computer hardware purchases are increased and electricity charges are decreased. Capital Expense is increased for the purchase of a replacement van. 8

EXHIBIT #14 2011 Budget Review Special Council Meeting of 05/17/2011 DRAFT BUDGET REVIEW Fiscal Year 2011-2012 EXHIBIT #14 2011 Budget Review May 24, 2011 – Budget Review Hearing Special Council Meeting of 05/17/2011

ELECTRIC FUND 2

Electric T&D page 310 Personnel Costs 2,222,928 1%
Materials & Supplies 436,999 3%
Administrative Expenditures 602,045 17% Overall Operating Expenses 3,261,972 2% Capital Outlay 748,337 1% Total Expenditures 4,010,309 2% Highlights: Personnel Costs decreased due to less retirement pay budgeted in Fiscal 2012 than in Fiscal 2011. Materials & Supplies are decreased due to reductions in electric materials and supplies. Administrative Expenses are increased for two strategic projects. The 5-year Distribution Pole Testing Program will begin in 2012 -$45,000 and $23,158 for upgrading radios due to a change in FCC regulations. Capital Outlay is increased slightly. Change in costs of vehicle replacement accounts for the increase of $9,337. 3

Electric Engineering page 311 Personnel Costs 853,161 10%
Materials & Supplies 86,399 1%
Administrative Expenditures 282,963 65%
Overall Operating Expenses 1,222,523 34%
Capital Outlay 1,840,716 32% Total Budget 3,063,239 5%
Highlights: Personnel Costs decreased due to less retirement pay budgeted in Fiscal 2012 than in Fiscal 2011. Materials & Supplies decreased overall due to reductions in electrical material and supplies. The department will purchase two ergonomic chairs for systems operations and computer hardware is increased based on the Lifecycle Maintenance Program. Administrative Expenses decreased due to a reduction of contractual services. Last year the Transmission Relay and Coordination Project ($500,000) was budgeted in this line. A radio upgrade is also included in this budget due to a change in FCC regulations. Capital Outlay is higher due to increased budgets for capacitor installations, substations, upgrading SCADA, and distribution upgrades. 4

Public Utilities Admin page 312 Personnel Costs 334,632 7% Materials & Supplies 104,232 - Administrative Expenditures 191,770 - Overall Operating Expenses 629,724 3% Highlights: Personnel Costs decreased due budgeted salary increases and OPEB. Due to reductions Materials & Supplies and Administrative expenses are close to Fiscal 2011 levels. 5

Systems Operations page 313 Personnel Costs 475,895 8%
Materials & Supplies - - Overall Operating Expenses 475,8953 8%
Capital Outlay - - Highlights: Personnel Costs decreased due to less retirement pay budgeted in Fiscal 2012 than in Fiscal 2011. 6

Power Plant Operations pages 314 (revised) Personnel Costs 3,776,168 8% Materials & Supplies 145,130 21%
Administrative Expenditures 2,103,524 5% Overall Operating Expenditures 6,024,822 6% Capital Outlay 1,810,410 22% Total Expenditures 7,835,232 9% Highlights: Personnel Costs are increased. Materials & Supplies are decreased mainly due to reductions in uniforms, water treatment chemicals, and water/waste water charges. Administrative Expenses are increased for the following strategic projects – Stack Testing ($40,000); NAES ESS support for Title V & NPDES renewals ($10,000); Outfall Discharge Evaluation ($15,000); purchase of new vibration equipment ($15,000); and evaluating technologies for capacity increase at VanSant Unit I($12,000) Capital Outlay is increased as per the proposed capital plan. 7 7

Power Supply page 315 65 Series Supply Mgmt and Incentive Fees 1,285,000 44%
95 Series Purchases, capacity, and PJM Charges 56,923,380 4%
98 Fuel 664,641 123% Total Expenditures 58,873,021 5%
Highlights: The budget includes estimated power supply and fuel costs for Fiscal 2012. 8

Final Discussion and Wrap-Up 9

EXHIBIT #15 Special City Council Meeting of 05/17/2011

EXHIBIT #16 2011 Budget Review Special Council Meeting of 05/17/2011 Janice Green Subject: FW: City of Dover Budget Importance: High From: Bruce Marvel [mailto:BWM521@verizon.net] Sent: Saturday, June 04, 2011 1:32 PM To: Leary, Thomas J.; Hutchison, James L.; tmcdowell-bcw; Hare, Bill; McGlumphy, William; Bonar, David L; Lynn, Sean M.; Anderson, David; Russell, Sophia Cc: Carey Sr., Carleton Subject: City of Dover Budget Importance: High Council Members, I just read with interest the DSN article entitled “Dover looks ahead to solve city’s budget woes.” The budget issue definitely needs a fresh perspective and I commend each and every one of you for closely reviewing this lengthy document. I am glad to see that the panel is taking a new approach and viewing the budget two or three years going forward. I am also happy to read that the Council would like to empower the city workforce. Beverly Williams is correct when she stated that “they know their budgets better than we do.” I suggest you take that one step further and perhaps offer an incentive (maybe a “free” day or afternoon off) to the worker who offers a workable budget cutting or cost saving idea. These are the people that get the job done and they may have some great ideas – all they need is for someone to listen. I was extremely dismayed, as were many others, when the City received pay raises while local businesses were hurting, unemployment rising, even State employees had to take a pay cut. How in the midst of all this could the City justify giving raises and now talking about downsizing and laying off employees …?? It didn’t make sense then and doesn’t make sense now. I hope this Council can get the City back on track and moving forward. I was sorry to read Ms. Russell’s statement about peoples’ attitudes and the “poison” being spread. I hope that is not the case and if it is, that Council will work hard to change that attitude. I agree with her statement that a “person should be allowed to work as long as he or she can,” but only if that person is fulfilling his/her responsibilities and being productive. I strongly agree with Mr. Bonar’s statement about steps needed to increase development efforts. The problem of attracting and keeping businesses is something that Council needs to address. Between the City Planning rules and regulations (that seem to change with the mood), the Historical Society’s rules (sometimes unrealistic), and other codes and specifications (the list goes on), existing and potential businesses are discouraged and not encouraged. Some business owners have found it to be more cost effective to pay the fines rather than abide by all the regulations – and you can’t blame them! 1

I love this little town, I work in this town, I enjoy spending time at 33 West and other local shops. Dover has so much potential, but as long as these entities keep putting up road blocks, our little town will never reach its full potential. I implore you to please focus on assisting businesses to succeed. One suggestion is to have an open forum where the business owner can freely voice whatever obstacle they might run into and work with them to find a solution without the feeling of retaliation. I understand that there must be rules and regulations – but they do not have to be roadblocks. There needs to be a more realistic approach - each and every regulation can be fulfilled but sometimes creativity and flexibility are needed to get the job done. Once again I commend each of you for taking on this huge responsibility. I look forward to seeing a brighter future for the City. Roylene Roylene Marvel 521 N. West St. Dover, DE 19904 bwm521@verizon.net 2

BBBB EXHIBIT #17 2011 Budget Review Special Council Meeting of 05/17/2011

EXHIBIT #18 2011 Budget Review Requested Retirement Pay Special Council Meeting of 05/17/2011 by Position, Division Fund Fiscal 2012 Budget General Fund Police Civilian $ 25,108 Administrative Assistant $ 25,108 Police Law Enforcement* $ 237,344 Sergeant $ 58,121 Lieutenant $ 65,441 Sergeant $ 65,322 Corporal $ 48,459 * $100,000 was reduced from this amount for the budget Facilities Maintenance $ 8,227 Custodian $ 8,227 Human Resources $ 31,261 Administrative Assistant $ 31,261 Total General $ 301,940 Water/Wastewater Fund Water Construction $ 9,816 Heavy Equipment Operator $ 9,816 Total Water/Wastewater $ 9,816 Electric Fund Electric T&D $ 12,840 Lineman First Class II $ 12,840 Total Electric Fund $ 12,840 Total City‐wide $ 324,596

EXHIBIT #19 2011 Budget Review Special Council Meeting of 05/17/2011 Subscriptions & Dues – Redundant or Duplicate Memberships City Manager’s Office APA $ 480 Recreation Duplicates: National Parks & Recreation Assoc. – Zach & Wayne Delaware Recreation & Park Society – Wayne & Sherwanda Zach would recommend that these continue although they appear to be duplicate; the benefit to having these membership is unique to the position. Public Utilities – Water/Wastewater/Electric To our knowledge, we have no duplicate dues and/or memberships Information Technology The IT Department has only one membership/subscription that is paid annually for SunGard Public Sector User’s Group Association (SUGA). Here are some of the benefits of SUGA membership:  Entitles each member in the organization the ability to submit and prioritize revisions/enhancements to the SunGard Public Sector products.  Reduced conference fees for the Annual SUGA Education Conference for all individuals in the organization.  Vote in electing the SUGA Board of Directors (must be in attendance at the conference to vote).  Networking and sharing of information among thousands of SunGard Public Sector users.  Access to the members only section of website, which includes discussion forums, quarterly newsletters, and more detailed descriptions of conference sessions. Central Services All subscriptions and dues for Central Services have been reviewed and are in order – there are no duplications ‐ therefore changes or adjustments are not necessary. Public Services Most the subscription and/or dues shown the spreadsheet that I sent you are individual memberships. To my knowledge there are not group membership offers for areas under my department. If we need to extinguish memberships or have a policy where staff can belong to X organizations under the city budget and they would have to pay personally for memberships in addition to the policy, I have no objections to that concept. That way staff would have to prioritize what is important to each of them. City Clerk & Council The Clerk’s Office and City Council do not have any redundant or duplicate items that can be reduced from the budget. I have reviewed these items and there are not any licenses, subscriptions, memberships, or dues that can be shared by all.

Finance Both Assistant Director and Director have GFOA and Delaware CPA Society Memberships. This is done to obtain discounts of $100 ‐ $200 per class for continuing professional education credits that are needed to maintain certification. National memberships were already removed from the budget. Human Resources There are no redundancies. Law Enforcement & Administration Under line 30‐27 is “DPCC Dues” and “IACP Dues”. These are not redundant and are done this way so we are eligible for executive law enforcement training through both organizations. These memberships are for the Chief, the Deputy Chief and both Captains and you must be a member to receive or attend any training offered by these organizations. Assessor We do not have multiple subscriptions or dues that can be shared by all.

EXHIBIT #20 2011 Budget Review Special Council Meeting of 05/17/2011

EXHIBIT #21 City of Dover 2011 Budget Review Employees Eligible to Retire Special Council Meeting of 05/17/2011 May 24, 2011 Prepared by Kim Hawkins Eligible with a Reduced Pension Eligible with an Unreduced Pension Labor Labor Name Fund Dept. Organization Pension Plan Name Fund Dept. Organization Pension Plan 1 Anderson, Floyd 110 571 IUE 401 1 Attix, Richard 110 552 IUE Defined 2 Baker, Rodney 110 552 IUE 401 2 Baker, Ed 110 552 NB Defined 3 Bautista, Emy 110 529 IUE 401 3 Burris, Sandy 480 563 IBEW Defined 4 Bosak, John 110 572 IUE 401 4 Burton, Joanne 110 523 IUE Defined 5 Clendaniel, Kenneth 110 552 IUE Defined 5 Carter, Zach 110 525 NB Defined 6 DePrima, Tony 110 515 NB 401 6 Cooper, William 110 522 NB Defined 7 Flint, James 110 572 IUE 401 7 DePue, Robert 110 552 IUE Defined 8 Frazier, Nancy 110 542 IUE Defined 8 Divver, Kathy 110 529 NB Defined 9 Gillcrese, Denise 110 542 IUE Defined 9 Embert, Tom 480 563 IBEW Defined 10 Gomes, Linda 110 517 NB 401 10 Gardner, Richard 480 563 NB Defined 11 Gonzalez, Sam 110 531 IUE 401 11 Glisson, Dee 110 516 NB Defined 12 Hand, Michael 110 522 IUE Defined 12 Grinstead, John 480 562 IBEW Defined 13 Hoeflich, Robert 110 522 IUE Defined 13 Hayes, Earl 110 554 IUE 401 14 Kucek, Jeff 110 552 IUE Defined 14 Hodges, Vicky 110 542 IUE Defined 15 Long, Joyce 110 523 IUE 401 15 Hutchins, Charles 110 542 IUE 401 16 Miller, Richard 110 572 IUE 401 16 Jackson, Cheryl 110 518 NB Defined 17 Morris, Dothory 110 529 IUE 401 17 Johnson, Theresa 110 552 IUE 401 18 Mumford, Johnny 412 553 IUE 401 18 Lawson, Gary 480 563 IBEW Defined 19 O'Brian, Peggy 110 525 IUE 401 19 Loomis, Marlene 110 518 NB Defined 20 O'Neal, George 412 568 IUE 401 20 McDougall, Ralph 412 568 NB Defined 21 Olsen, Tom 480 565 IUE 401 21 Mills, Donna 110 542 NB Defined 22 Parsell, Greg 110 514 IUE Defined 22 Myers, Rick 110 552 IUE Defined 23 Reichelt, Paul 412 556 IUE 401 23 O'Neal, Carolee 110 551 NB Defined 24 Stubbs, Tom 110 542 IUE Defined 24 Pearson, Jeff 480 565 IUE Defined 25 Thompson, John 480 563 IBEW Defined 25 Polasko, Andy 412 576 IUE Defined 26 Walker, Sharon 110 542 IUE Defined 26 Porter, Tim 480 562 IBEW Defined 27 Wentler, Gail 110 529 IUE Defined 27 Richardson, Derrick 480 526 IBEW 401 28 Ridgeway, Roger 480 526 IBEW Defined 29 Roan, Wes 110 554 NB Defined Police 30 Roberson, Denise 110 529 NB Defined 1 Balke, Ken 31 Sammons, Perry 110 555 NB Defined 2 Bernat, Paul 32 Scheers, Michael 412 569 IUE Defined 3 Boney, David 33 Scott, Curtis 480 562 IBEW Defined 4 Counselman, Benton 34 Semans, John 110 554 IUE Defined 5 Getek, Steve 35 Sherman, Linda 110 552 IUE Defined 6 Hester, Keith (Ed) 36 Swaggard, Ron 110 554 NB Defined 7 Hosfelt, James 37 Tieman, Terry 110 515 NB Defined 8 Humphrey, Carl 38 Turner, Angie 110 529 IUE 401 9 McKeown, Dan 39 Walker, Sharon 110 542 IUE Defined 10 Morris, Andrew 11 Rachko, Alan 12 Ranger, Danny 13 Scott, Robert 14 Stump, Tim My Docs/Budget1112/pension overview

EXHIBIT #22 Open Positions 2011 Budget Review Prepared by Kim Hawkins, Human Resources Director Special Council Meeting of 05/17/2011 May 24, 2011 Person Who Open since: Occupied Position Department Open Positions 1 10/29/2008 Tom Keiper Central Service Custodian 2 11/17/2008 Joe Heeger Water Water/Wastewater Project Supervisor 3 12/31/2008 Melissa Jones Library Library Clerk 1 (PT) Termination caused a few organizational 4 2/3/2009 changes Customer Service Account Clerk 1 5 7/10/2009 Aaron Officer IT Programmer/Analyst 6 7/13/2009 Jeff McCarthy Electric Meter Tech 1 7 8/4/2009 Linda Calvert Central Services Storekeeper/Buyer 1 8 8/31/2009 Diane Faircloth Library Library Clerk II 9 9/23/2009 Rhonda Walker Human Resources Human Resources Specialist 10 9/25/2009 Jim Baynard Public Utilities Utility Locator III 11 1/19/2010 Charles Washington Public Utilities Utility Locator 12 1/27/2010 Randy Speicher Inspections-Property Inspector I 13 3/26/2010 Richard Larimore Public Utilities Engineering Fieldman 14 3/26/2010 Marie Dee Public Utilities Meter Crewleader 15 4/30/2010 Michael Scheers Customer Service Field Service Representative I 16 4/30/2010 Roger Carney Customer Service Field Service Representative II 17 5/13/2010 Keith VanVleck Public Services/Grounds Motor Equipment Operator I 18 11/14/2010 Barry Wolfgang Facilities Management Building Craftperson 1 19 8/2/2010 Mark Callan Information Technology Sr. LAN Analyst 20 12/23/2010 Wayne Hutchison Public Safety Emergency Management Coordinator 21 2/15/2011 Christina Zlock Tax Assessor Temporary employee 22 4/15/2011 Brian Allen Library Library Page 1 23 4/21/2011 Margaret Russell Customer Service Customer Service Clerk 1 24 5/16/2011 Michael Hand Public Services/Grounds Motor Equipment Operator II Exceptions: *1 Tom Keiper, Custodian This position is currently filled with a temporary employee. *5 Aaron Officer, Programmer/Analyst Contractor services are being utilized. *10 Jim Baynard, Utility Locator III *11 Charles Washington, Utility Locator II- IUE Both employees retired. The locating responsibility has been outsourced to an independent contractor. *15 Mike Scheers and Roger Carney *16 Positions have been eliminated do to advancements in technology. Mr. Scheers bid and was awarded another open position. Mr. Carney retired. *19 Andy Siegel is the acting IT Director. Mr. Siegel's position is Sr. LAN Analyst. *22 -24 These are recent open positions. They have not been filled due to the uncertainty of the proposed FY12 Budget. Each of these departments were subject to lay-offs. #23 is currently being grieved by the IUE-CWA. H/Budget/FY12/vacant positions left unfilled 1

EXHIBIT #23 2011 Budget Review Funding Sources Special Council Meeting of 05/17/2011 Dover Public Library Building Project Update: June 6, 2011 ** A B C Funding Sources Budget Committed Highly Probable Notes 1 State Grant $10,584,357 $ 8,084,357 $10,584,357 $2.5 M in Gov’s budget. Bond Bill hearing 5/12/11 very positive. 2 City Reserve Contribution $ 3,592,457 $ 3,622,457 $ 3,622,457 3 City Reserve Interest $ 460,063 $ 424,858 $ 460,134 4 Kent County $1,000,000 $1,000,000 $1,000,000 5 Library Foundation (Bid Pack A $1,747,020 $ 1,165,196 $ 1,307,525 Column C5 = Cash & B) Donations + Pledges 6 Sale of 45 S. State St. $ 1,200,000 0 Use Bridge Loan See Row 14 7 Green Energy Grants $ 215,000 $ 215,000 $ 215,000 8 Friends of the Library $ 210,000 $ 210,000 $ 210,000 100% available; will be transferred as needed 9 Reynolds Trust $ 46,355 $ 46,355 $ 46,355 10 Community Transportation $ 155,000 $ 155,000 $ 155,000 Funds 11 BTOP Grant $ 50,000 $ 50,000 $ 50,000 12 DE Greenhouse Gas Reduction $ 40,000 $ 40,000 $ 40,000 Grant Financing Needs: 13 Green Energy Bonds $ 1,500,000 $ 1,500,000 $ 1,500,000 14 Bridge Loan: Sale of Bldg 0 0 $ 1,200,000 In discussions with interested party to purchase. 15 Construction Loan 0 0 $ 409,424 Difference between what is raised to date and goal. See A5 Total Funding Sources $20,800,252 $16,513,223 $20,800,252 ** Estimated Figures Pending Close of Month Note: Bid Pack C: Alternate: The Reading Garden is not included in this chart

EXHIBIT #24 2011 Budget Review Special Council Meeting of 05/17/2011 May 24, 2011 To: Tom Leary, President, Dover City Council Members of the Dover City Council Terry Tieman Donna Mitchell From: Margie Cyr, Director, Dover Public Library Re: additions to Library budget presentation During last week’s Library budget presentation, Mr. Leary asked about part-time staff positions that the Library has which are funded by other agencies and which may have been affected by cutbacks. In my answer, I explained that the Library has two part-time clerical employees who are provided to us the RSVP program at the Modern Maturity Center. The weekly hours for both these positions have been recently reduced due to cutbacks in federal funding for the RSVP program. Late this afternoon, I have received word that our part-time Community Resources Librarian who has been provided to us by the Delaware Academy of Medicine will no longer be available to us after June 30, 2011. This Librarian has been working Monday evenings each week and one Saturday each month. The elimination of this position will leave us even more short staffed than anticipated in my remarks to you last week. cc: Tony DePrima, City Manager Zachery Carter, Director, Parks, Recreation and Library

EXHIBIT #25 2011 Budget Review Special Council Meeting of 05/17/2011 Parks & Recreation Activity / Program / League Comparison 2002 verses 2010 2002 Stats 2010 Stats Winter - 15 Opportunities Winter - 180 Opportunities Spring / Summer - 129 Opportunities Spring / Summer - 252 Opportunities Fall - 28 Opportunities Fall - 94 Opportunities Program listing attached Program listing attached Park Rentals & Permits Issued Park Rentals & Permits Issued 2002 data is an estimate 2010 data used for comparison 97 permits issued 167 permits issued Report prepared by: Carolyn Courtney Report Date: May 26, 2011

Activity / Program / League Comparison Adult / 2002 verses 2010 Winter 2010 Misc. Notes LocaƟon Child PHL Flower Show: Bus trip 1 me trip Depart: JWP Any Dover Walks Mon—Fri AM hours JWP gym Adult AARP 4 classes offered JWP room 16 & up Winter 2002 Misc. Notes LocaƟon Adult / Child Senior Wii 4 sessions JWP room Seniors Senior Gym Space Weekly JWP gym Seniors PHL Flower Show: Depart: Dover Soccer 1 session JWP gym 30 & up 1 me trip Any Bus trip Park Basketball 4 sessions JWP gym 40 & up Dover Park MP Digital Scrapbooking 3 sessions JWP room Adult HABIT 3 sessions Adult Room New York - 3 trips New York & PHL Flower Dover Park MP PHL Flower Show - 1 Depart: JWP Family T’AI CHI 1 session Adult Show: Bus Trips trip Room Dover Park MP Volleyball League 8 teams / 32 games JWP gym Adult Cardio Kickboxing 1 session Adult Room Female Soccer League 4 teams / 8 games JWP gym Adult PeeWee Karate 1 session Rigby’s Child 4 – 6 Indoor Futsal 1 session JWP gym 18 & up 3 on 3 Basketball 2 sessions JWP gym 18 & up Jr. Karate 1 session Rigby’s Child 7 – 13 Kickboxing 4 sessions JWP room Adult Dover Park MP Intro. to Cheer- Dover Park MP Pilates 2 sessions Adult 1 session Child 8 – 12 room leading Room Lunch me Yoga 4 sessions JWP room Adult Arts & Cra s Dover Park MP 1 session Child 6 – 10 Boot Camp Blast 6 sessions JWP room Adult (Saturdays) Room Zumba 5 sessions JWP room Adult Arts & Cra s Dover Park MP Fitness Yoga 4 sessions JWP room Adult 1 session Youth 6 – 12 (A erschool) Room Women on Weights 8 sessions JWP room Adult Youth Basketball 3 age groups - WM Henry Mid- Mommy & Me Fitness 4 sessions JWP room Adult Youth 7 - 13 Dover Park MP League 1 session each dle School Gym Soul Line Dancing 8 sessions Adult room Youth In Govern- High School Jr & Harrington Ice 1 me event City Hall Learn-N-Skate 8 sessions Youth ment Day Seniors Rink Learn-N-Play 7 sessions JWP gym Child 3 – 5 Harrington Ice Ice Hockey 2 sessions Youth Rink Dover Park & Holiday Wrap & Play 1 session Family 2002 Winter - 15 opportunities JWP rooms Friday Fun Nights 1 session JWP room Youth 8 - 14 2010 Winter - 180 opportunities Field Hockey Clinic(s) 4 sessions JWP gym Youth 3 - 18 Toddlers 18 – 36 JumpBunch 9 sessions JWP gym Months 2 age groups / 1 Soccer JWP gym Youth 7 - 17 session each Birth Years 1993 Volleyball 1 session JWP gym - 2000 3 age groups / 1 Youth Basketball League JWP gym Youth 6 - 14 session each High School Jr & Youth In Government Day 1 one event City Hall Seniors 13 teams / 10 Womens Field Hockey JWP gym Women 18 & up games each 5 teams / 6 games Men & Women CoEd Field Hockey JWP gym each 18 & up 18 teams / 8 games High School Field Hockey JWP gym High School each 12 teams / 6 games Middle School Field Hock. JWP gym Middle School each

Activity / Program / League Comparison 2002 verses 2010 Page 2 of 3 Spring – Summer Misc. Notes LocaƟon Ages Spring – 2010 Misc. Notes LocaƟon Ages Dover Walks Mon—Fri AM hours JWP gym Adult Summer 2002 Basketball - Drop In 18 sessions JWP gym 20 & up 2 ages groups / Volleyball - Drop In 18 sessions JWP gym 20 & up Basketball Clinics Del Tech Youth 6 – 10 Womens Field Hockey 9 teams / 12 games 1 session Schu e Park 18 & up League each 3 ages groups / High School Field Hockey 12 teams/ 8 games Tennis Del Tech Youth 6 – 14 Schu e Park High School 1 session League each 4 teams / 8 games Jr. High Field Hockey League Schu e Park Middle School Field Hockey Clinic 1 session Dover Park Grades 1 – 8 each 17 teams / 26 Mens So ball League Dover Park(s) Men 18 & up games each Lacrosse Clinic 1 session Dover Park Grades 5 – 8 12 teams / 16 Men & Women 18 & Co-Ed So ball League Dover Park(s) games each up Arts & Cra s Pitch Hit Run 1 me event Schu e Park Youth 7 – 14 6 sessions Dover Park Youth 6 – 12 (A erschool) Jr. Olympic Skills 1 me event Schu e Park Youth 8 – 13 3 age groups / 1 Birth Years 1993 – Intermediate Volleyball League JWP gym 1 session Dover Park Youth 8 – 12 season each 2002 Cheerleading Egg Hunt 1 me event Dover Park Child 10 & under Intro. to Cheerlead- 3 age groups / 1 Birth Years 1994 - 1 session Dover Park Youth 8 – 12 Summer Basketball League JWP gym ing season each 2000 Super Summer Playground 1 session Dover Park Child 6 – 12 Child 10 & Egg Hunt 1 me event Dover Park Wii for Seniors 4 sessions JWP room Seniors under 5 on 5 Basketball League 1 season JWP gym 18 & up Pitch Hit Run 1 me event Schu e Park Youth 7 – 14 Tennis 1 session Dover Park 16 & up 5 on 5 Basketball Tournament 1 me event JWP gym 18 & up Super Summer Soul Line Dancing 9 sessions JWP room Adult 1 session Dover Park Child 6 – 12 Playground Zumba 6 sessions JWP room Adult Insanity 3 sessions JWP room Adult Field Hockey Camp 1 session Dover Park Grades 1 – 8 Kickboxing 4 sessions JWP room Adult Boot Camp Blast 4 sessions JWP room Adult Fitness Yoga 4 sessions JWP room Adult Sports & Educa on- 22 sessions Del Tech Youth 6 – 14 Women on Weights 4 sessions JWP room Adult al Camps City Hall Conf. Lunch me Yoga 4 sessions Adult Women’s Field 10 teams / 12 Room Schu e Park 18 & up Senior Classes: Chair Aerobics, Hockey League games each Chair Strength & Flexibility, and 9 sessions JWP room Adult Zumba Gold High School Field 9 teams / 12 Schu e Park High School New York 3 trips, Inner Bus Trips Hockey League games each New York, Inner Harbor, DE Harbor 1 trip, DE Bay Family Bay Fish: Day Trips Fishing 1 trip depart: JWP Adult Tennis 1 session Del Tech 16 & up Basketball 4 sessions JWP gym 40 & up Parents Night Out 1 session JWP gym Child 5 - 12 New York 1 trip Lunch Break Yoga 4 sessions JWP room Adult New York & Inner Depart: City Hall Inner Harbor 1 Family Harbor: Bus Trips Parking Yogalates 3 sessions JWP room Adult trip AARP Defensive Driving 4 sessions JWP room 16 & up Spring Summer 18 shows The Green Family Field Hockey Camp 1 session Schu e Park Child 6 - 12 Concerts Dover Park MP Hip Hop Hooray Camp 2 sessions Child 6 - 10 room Mens So ball 24 teams / 26 Dover Park(s) Men 18 & up Tennis 6 sessions Dover Park Child 7 - 14 League games each Wolverine Basketball Camp 2 age groups / 1 JWP gym Child 6 - 14 CoEd So ball 8 teams / 16 Men & Women & Clinic session each Dover Park(s) Dover Park MP League games each 18 & up Teen Hip Hop Camp 2 sessions Child 11 - 15 room Kent County Church 13 teams / 1 Local Church Get Kids Moving Camp 3 sessions JWP gym Child 6 – 16 Dover Parks(s) League season groups Learn N Play 7 sessions JWP gym Child 3 - 5 Dover Park MP Cheerleading Camp 1 session Child 6 -10 room Dress Up Movie Nights 4 sessions JWP room Family Dover Park / JR Camp Counselor 1 session 8th graders DSU COBRA 2 sessions Schu e Park Grades 2 - 6 2002 Spring/Summer - 129 opportunities Hoppin Poppin Popcorn 2 sessions JWP room Child 3 - 5 Preschool Camps: Dr. Seuss’ and 1 session each JWP room Child 4 - 5 2010 Spring/Summer - 252 opportunities Dora & Diego Sports Camps 7 sessions Schu e Park Child 6 - 12 Kent County Church League 12 teams / 1 season Dover Parks(s) Local Church groups Spring Summer Concerts 18 shows The Green Family

Activity / Program / League Comparison 2002 verses 2010 Page 3 of 3 Misc. 2002 Fall LocaƟon Ages 2010 Fall Misc. Notes LocaƟon Ages Notes Dover Walks Mon—Fri AM hours JWP gym Adult Shuffleboard 1 session Dover Park Adult Senior Classes: Chair Aero- bics, Chair Yoga, and Low 10 sessions JWP room Adult Impact Aerobics Holiday Wreath 1 session Dover Park Adult New York, DE Bay Fish: Day New York 4 trips Bust Trips Depart: Making Family Trips DE Bay Fish 1 trip JWP Franklin Mills Field Hockey Clinics 1 session Dover Park Grades 1 – 6 Mall 1 trip Punt Pass Kick 1 me event Schu e Park Grades 1 -6 Yule de In Depart: City Bus Trips Family Odessa 1 trip Hall Learn-N-Play 6 sessions JWP Child 3 - 5 New York 2 14 teams / 8 games CoEd Kickball League New Street Park 18 & up trips each Dover Park MP 13 teams / 12 games HABIT 2 sessions Adult Mens So ball League Dover Park(s) Men 18 & up Room each 13 teams / 8 games Men & Women CoEd So ball League Dover Park(s) Mens So ball 11 teams / 12 each 18 & up Dover Park(s) Men 18 & up League games each Simple Food Cooking 1 session JWP room Child 6 - 9 Crea ve Art 1 session JWP room Child 6 - 9 CoEd So ball 7 teams / 8 Men & Women 18 Dover Park(s) Jewelry Making 1 session JWP room Child 6 - 9 League games each & up Lets Do Robo cs 1 session JWP room Child 6 - 10 In addi on to these programs, staff coordinated logis cs for: Old Dover Days, Amish Bike Tour, Annual Food Drive, Caroling On The Green, & First Night Pumpkin Pals 2 session JWP room Child 2 - 5 Dover. Staff provided administra ve support to the Greater Dover Arts Council. Christmas Cra s for Tots 1 session JWP room Child 3 - 6 Kickball 1 session JWP room Child 8 – 12 Floor Hockey 1 session JWP gym Child 6 - 12 Basketball 4 sessions JWP gym 40 & up 3 on 3 Developmental 2 sessions JWP gym Child 7 - 12 Basketball Senior Fitness Fun Weekly JWP gym Seniors AARP Defensive Driving 3 sessions JWP room 16 & up Insanity 4 sessions JWP room Adult Kickboxing 4 sessions JWP room Adult 2002 Fall - 28 opportunities Boot Camp Blast 4 sessions JWP room Adult 2010 Fall - 94 opportunities Lunch me Yoga 4 sessions JWP room Adult Women on Weights 4 sessions JWP room Adult Volleyball League 1 session JWP gym 18 & up Volleyball Clinics 1 session JWP gym Grades 6 - 0 Womens So ball League 1 team / 0 games Dover Park(s) Women 18 & up In addi on to these programs, staff coordinated logis cs for: Old Dover Days, Amish Bike Tour, Dover Trail Ride, Annual Food Drive, Caroling On The Green, & First Night Dover. Staff provided administra ve support to the Silver Lake Commission and the Greater Dover Arts Council. Staff par cipated on the Youth Advisory Council.

EXHIBIT #26 2011 Budget Review Special Council Meeting of 05/17/2011 One cent rate reduction - Mr. Bonar FY12 Proposed 1 Cent Budget Reduction Projected KwH 701,536,351 701,536,351 Projected Average $ Sales per KwH 0.13638 0.12638 Projected Sales Revenue $ 95,675,500 $ 88,660,136 Delta $ (7,015,364) Rates depend on class of customer - rate used above is the average rate of all customer classes. (Includes demand, lights, admin charges) Plant Operations - Mr. Hare 2007 2008 2009 2010 2011 2012 2013 2014 Plant Operating Budget $ 5,084,842 $ 5,603,064 $ 5,961,944 $ 5,547,750 $ 6,155,046 $ 6,024,822 $ 6,024,800 $ 6,024,800 Generation Fuels (for running plant) 3,879,167 3,454,718 1,494,017 355,428 3,469,731 664,641 579,722 508,354 Subtotal 8,964,009 9,057,782 7,455,961 5,903,178 9,624,777 6,689,463 6,604,522 6,533,154 PJM Revenue (for running plant) (4,517,569) (4,168,256) (1,543,199) (793,599) (5,697,552) (1,285,675) (1,166,501) (1,066,346) Capacity Credits - (11,726,108) (9,303,462) (12,133,292) (10,186,974) (7,388,283) (14,318,588) (15,339,048) Total Operations 4,446,440 (6,836,582) (3,390,700) (7,023,713) (6,259,749) (1,984,495) (8,880,567) (9,872,240) Capital Improvement Outlays - 521,762 2,534,763 649,955 2,106,427 1,810,410 2,180,650 1,839,290 Total Net Generating Cost $ 4,446,440 $ (6,314,820) $ (855,937) $ (6,373,758) $ (4,153,322) $ (174,085) $ (6,699,917) $ (8,032,950) Cumulative Net Generating Cost $ (1,868,380) $ (2,724,317) $ (9,098,075) $ (13,251,397) $ (13,425,482) $ (20,125,399) $ (28,158,349) EXHIBIT #26 2011 Budget Review Special Council Meeting of 05/17/2011

EXHIBIT #27 2011 Budget Review Special City Council Meeting of 05/17/2011 City of Dover Analysis of Library Reserve Account As of May 26, 2011 Any Excess Carry Forward Balances from prior year budgets are a net result of favorable revenue and favorable expense variances. Not any one source of revenue or expenditure savings. 2007 2008 2009 2010 2011 Total Balance Forward $ - $ 2,373,776 $ 3,778,149 $ 3,554,077 $ 3,471,410 $ - Receipts FY 07 Approp from Contingency Fund 100,000 - - - - 100,000 FY 07 Approp from General Fund 250,000 - - - - 250,000 FY 07 Approp from General Fund (Payment in Lieu of Taxes - unplanned receipts) 333,500 - - - - 333,500 Subtotal Library Reserve Appropriations as approved in the orginal budget 683,500 - - - - 683,500 FY 07 Approp from General Fund (1st Budget Amdmnt. Prelim Carry Forward) 941,533 - - - - 941,533 FY 07 Approp from General Fund (2nd Budget Amdmnt. Audited Excess Carry Forward) 95,937 - - - - 95,937 Subtotal of Changes as a result of Excess Carry Balances from FY06 1,037,470 - - - - 1,037,470 F/Y 07 Appropriation - Additional Reciprocal Borrowing Proceeds fr Kent County 605,962 - - - - 605,962 FY 08 Donations/Gifts - 700 1,590 - - 2,290 FY 08 Appropriation from General Fund (Payment in Lieu of Taxes - unplanned receipts) - 399,350 - - - 399,350 FY 08 Additional appropriation from General Fund - attributed to higher revenues - 1,249,759 - - - 1,249,759 Interest Income - Actual Year to Date 46,844 140,438 143,340 103,150 59,121 492,893 Total Receipts - Cumulative $4,412,103 ($433,772 Interest) $ 2,373,776 $ 1,790,247 $ 144,930 $ 103,150 $ 59,121 $ 4,471,224 Disbursements/Transfers Library Project Expenses $ - $ - $ 369,002 $ 185,817 $ 267,916 $ 822,735 FY 08 Approval of Computer Lab, Security Guards, & Document Imaging Equipment - 51,874 - - - 51,874 FY 08 Transfer to Parkland Reserve (as approved in the original budget by Council) (1) - 334,000 - - - 334,000 Total Disbursements $ - $ 385,874 $ 369,002 $ 185,817 $ 267,916 $ 1,208,609 Ending Balance $ 2,373,776 $ 3,778,149 $ 3,554,077 $ 3,471,410 $ 3,262,615 $ 3,262,615 Comments EXHIBIT #27 (1) Represents a transfer to the Parks & Recreation Reserve due to a double counting of prior year receipts needed to complete the Pitts Center. Recap of Sources of Funds Excess Carry Forward Balances $ 2,637,229 Unplanned Payment in Lieu of Taxes 732,850 2011 Budget Review Unplanned Reciprocal Borrowing Receipts from Kent County 605,962 Interest Earnings 492,893 Donations (Prior to establishment of the Library Foundation 501c3) 2,290 Total Sources of Funds as of May 26, 2011 $ 4,471,224 5/31/2011 Special City Council Meeting of 05/17/2011

EXHIBIT #28 2011 Budget Review Special City Council Meeting of 05/17/2011 CITY OF DOVER FISCAL YEAR 2011/2012 PROPOSED BUDGET AS AMENDED JUNE 6, 2011 EXHIBIT #28 PREPARED BY: DONNA MITCHELL, CONTROLLER/TREASURER & TERESA TIEMAN, SENIOR CITY ADMINISTRATOR 2011 Budget Review Special City Council Meeting of 05/17/2011

THREE STAGES IN RECOVERY • Bridging – get through the immediate crisis and create breathing room to make more sustainable reforms • Reform – carry out the short-term recovery plan and develop and implement long-term strategies • Transform – institutionalize long-term financial planning and become more resistant to financial distress and adaptable to a changing environment 2

STAGE 1 - BRIDGING • As discussed with Council President Leary and Councilman McGlumphy the Proposed FY11/12 Budget for the City of Dover has been amended for Council’s consideration. • These changes maintain City policies and procedures across all Funds. • The General Fund is balanced with the General Fund transfer policy change, no rate or fee increases (page 5), temporary cost reductions (page 6), further reduction of strategic budgets (page 7), and capital outlay reductions (page 8). Temporary cost reductions were consistently applied to all Funds. • IUE & IBEW Contractual pay increases are maintained at 2%. • No pay increases, promotions, or pay grade changes for non-bargaining. (see first bullet on page 6) • No Law Enforcement across the board pay increases, career ladder increases are maintained. • Budget Balances are all within the policy range of 8% to 12%. Any amounts over the policy minimum are recommended to be maintained while working towards next year’s budget. • Interest Earnings on reserves that are over their minimum balance are being credited to their respective operating funds. 3

FINANCIAL POLICY CHANGE • Revenue Policy – Section 11 • Upon satisfying all rate covenants the City will provide operating transfers to the General Fund. From the Water/Wastewater Utility no greater than 4.5% ($424,508) of operating revenues . or $750,000. From the Electric Utility no greater than 6.5% 8.0% ($7,876,288) of operating revenues. or $7,250,000 of the utility operating revenues. Both transfer calculations will exclude the carry forward budget balance, County Sewer Fees, and State Utility Tax. The Utility transfers will not exceed 25% of the General Fund Revenues. (Amended Budget FY11/12 = 23.8%) • The electric transfer percentage change increases the transfer by $1,538,288 • An Action Form for policy change will be included with Budget Ordinance. 4

GENERAL FUND REVENUE ADJUSTMENTS • Beginning Budget Balance adjustment $16,642 • Demolition & Grass Cutting adjustment $100,000 • Investment Income on reserve added $23,100 • Interfund Service Billings for Administrative Divisions reduced $239,142 • Electric Fund Transfer additional $1,538,288 • Net Revenue Adjustments $1,438,888 5

GENERAL FUND COST REDUCTIONS • Removal of non-contractual raises, temporary employees, new/vacant positions (Grounds 1; Library 1.5; Emergency Planning Coordinator 1; Temporary Code Enforcement 1;), upgrades, or promotions – Total $306,527 reduction • Police – Reduced terminal leave by $50,000 • Overtime - $72,670 or 10% reduction • Education Assistance - $63,497; Full reduction unless current personnel are receiving this benefit. Other budgets were reduced to be more reflective of actual expenses last two years. • Computer Hardware - $95,692; 50% reduction except server equipment • Subscriptions & Dues - $19,365 reduction or 50%, except Assessor Office (20%) to maintain IAAO, Marshals & Swift, and AAS Designation and Electric Administration – DEMEC membership . • Training, Conference & Travel - $45,065 reduction of 50%; includes Mayor’s strategic program $2,900 • Vehicle Maintenance & Program Expenses $58,964 • Transfer to Capital Asset Reserve $50,000 (per Financial Policy) • Transfer to Inventory Write-offs $116,800 • Nuisance Reserve $112,000 • Transfer to CDBG $6,000 • Total cost reductions as above $996,580 6

STRATEGIC PLAN/PROGRAM REDUCTIONS • Assessor $3,800 for publishing property card on the internet • Fire Department $81,440 pagers, radios, and software • Life Safety $4,000 reduction for Police Academy Training • Planning $18,500 placeholder for any cost related to storm water compliance permit; Maintains staffing for permit work; • Facilities Management $7,800 energy audit • Code Enforcement $480 air card • City Manager $50,000 legal fees for labor negotiations • Human Resources $2,000 recruitment • All upgraded radios for FCC requirements were kept in applicable budgets • Total strategic reductions $168,020 7

GENERAL FUND CAPITAL OUTLAY REDUCTIONS • Fire $28,234 for 50% of Holmatro equipment • Grounds $44,720 vehicle • Recreation $50,000 playground improvements and splash pad • Police $201,534 vehicles and station parking lot repaving • Street Division $621,210 • Salt Storage Building $50,000 • Brine System $27,825 • Vehicles & Equipment $163,385 • Street & Sidewalk Program $380,000 • Sanitation $232,084 automated trash truck • Information Technology $66,600 server replacements • Public Services Administration $18,000 mobile solutions • Central Services $30,670 forklift • Mayor $33,000 downtown security cameras • Capital outlay reductions $1,326,052 8

GENERAL FUND CAPITAL OUTLAY ADDITIONS • Capital Project Fund - Street Program $2,000,000 • Included in amendments to be financed through a “proposed” bond issue; Bond resolution authorizing the issuance of bonds would be submitted to City Council before starting project; • To cover FY12 and FY13 programs • No General Fund monies are included for any sidewalk and street improvements • Will create a future debt service payment estimated at $150,000 9

SUMMARY OF GENERAL FUND ADJUSTMENTS Amount Proposed Budget – Ending Budget Balance ($980,022) Adjustments: Revenue Adjustments $1,438,888 General Fund Cost Reductions 996,580 Strategic Adjustments 168,020 Capital Outlay Adjustments 1,326,052 Transfer to Capital Project Fund (147,191) Total Adjustments $3,782,349 Ending Budget Balance as presented $2,802,327 10

GENERAL FUND FUTURE BUDGETS • Worker’s Compensation $505,000 (based on FY11 payroll) • Ladder Truck Payment $153,000 • Library additional operating cost approximately $400,000 when fully operational • Fully funding OPEB $5.9 million as compared to FY12 funding of $1.1 million for active employees & $1.4 million for retiree’s • Health Insurance premiums did not increase in FY12; FY13 ? • Future debt service payments and capital asset replacements is dependent on affordability 11

SUMMARY OF UTILITY FUND ADJUSTMENTS Water/ Wastewater Electric Proposed Budget - Ending Budget Balance $2,961,479 $13,385,521 Adjustments: Revenue Adjustments & Reserve Transfers $ --- $1,036,048 Cost Reductions 67,459 181,416 Strategic Adjustments --- 125,005 Interfund Service Charges 49,508 185,486 Power Supply (reclass rate stabilization transfer) --- (1,000,000) General Fund Transfer --- (1,538,288) Total Adjustments $116,967 ($1,010,333) Ending Budget Balance as presented $3,078,446 $12,375,188 12