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COUNCIL COMMITTEE OF THE WHOLE
AGENDA
FEBRUARY 14, 2017 - 6:00 P.M.
CITY HALL COUNCIL CHAMBERS
15 LOOCKERMAN PLAZA - DOVER, DELAWARE
PUBLIC COMMENTS ARE WELCOMED ON ANY ITEM AND WILL BE PERMITTED AT APPROPRIATE
TIMES. WHEN POSSIBLE, PLEASE NOTIFY THE CITY CLERK (736-7008 OR E-MAIL AT
CITYCLERK@DOVER.DE.US) SHOULD YOU WISH TO BE RECOGNIZED.
PARKS, RECREATION, AND COMMUNITY ENHANCEMENT COMMITTEE
AGENDA ADDITIONS/DELETIONS
1. REVIEW OF SCHUTTE PARK MASTER PLAN
(STAFF RECOMMENDS APPROVAL OF THE SCHUTTE PARK MASTER PLAN)
2. COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) PROGRAM QUARTERLY UPDATE (OCTOBER,
NOVEMBER, AND DECEMBER)
(COMMITTEE ACTION NOT REQUIRED)
3. ADJOURNMENT OF PARKS, RECREATION, AND COMMUNITY ENHANCEMENT COMMITTEE MEETING
UTILITY COMMITTEE
AGENDA ADDITIONS/DELETIONS
1. DISCUSSION - OVERVIEW OF ELECTRIC RATES
2. QUARTERLY REVIEW OF UTILITY RELATED CAPITAL INVESTMENT PLAN (CIP) (ELECTRIC AND
WATER/WASTEWATER)(OCTOBER, NOVEMBER, AND DECEMBER)
(COMMITTEE ACTION NOT REQUIRED)
3. UPDATES
(COMMITTEE ACTION NOT REQUIRED ON THE BELOW ITEMS)
A. GREEN ENERGY FUNDING AND PROGRAMMING
B. NATIONAL POLLUTION DISCHARGE ELIMINATION SYSTEM (NPDES) MUNICIPAL SEPARATE
STORM SEWER SYSTEMS (MS4) PERMIT
4. ADJOURNMENT OF UTILITY COMMITTEE MEETING
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COUNCIL COMMITTEE OF THE WHOLE AGENDA - FEBRUARY 14, 2017 Page 2
LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE
AGENDA ADDITIONS/DELETIONS
1. PROPOSED AMENDMENTS TO CHAPTER 17, TITLE 22 OF THE DELAWARE CODE RELATING TO
MUNICIPAL TAX INCREMENT FINANCING AND CHAPTER 18, TITLE 22 OF THE DELAWARE CODE
RELATING TO MUNICIPAL SPECIAL DEVELOPMENT DISTRICTS (JOHN PARADEE)
2. EXPIRATION OF DOWNTOWN DOVER PARTNERSHIP (DDP) LOAN GUARANTEE EXTENSION
(DURING THEIR MEETING OF JULY 14, 2014, COUNCIL APPROVED THE EXTENSION OF THE DOWNTOWN
DOVER PARTNERSHIP (DDP) LOAN GUARANTEE WITH PNC BANK THROUGH MARCH 1, 2017)
(STAFF RECOMMENDS AN EXTENSION OF THE CITY GUARANTEE OF THE DOWNTOWN DOVER
PARTNERSHIP LOANS FOR A PERIOD OF THREE (3) YEARS EFFECTIVE MARCH 1, 2017 ON THE LOANS
BETWEEN PNC BANK AND THE PARTNERSHIP)
3. REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING JUNE 30, 2016
(STAFF RECOMMENDS ACCEPTANCE OF THE REPORT)
4. PRESENTATION - COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR)
(STAFF RECOMMENDS ACCEPTANCE OF THE REPORT)
5. STATUS OF OTHER POST-EMPLOYMENT BENEFITS (OPEB) AND PENSION FUNDS
(COMMITTEE ACTION NOT REQUIRED)
6. ADJOURNMENT OF LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING
ADJOURNMENT OF COUNCIL COMMITTEE OF THE WHOLE MEETING
/TM
S:\AGENDAS-MINUTES-PACKETS-PRESENTATIONS-ATT&EXH\COMMITTEE-AGENDAS\2017\02-14-2017 CCW AGENDA.WPD
THE AGENDA ITEMS AS LISTED MAY NOT BE CONSIDERED IN SEQUENCE. PURSUANT TO 29 DEL. C. §10004(E)(2), THIS
AGENDA IS SUBJECT TO CHANGE TO INCLUDE THE ADDITION OR THE DELETION OF ITEMS, INCLUDING EXECUTIVE
SESSIONS, WHICH ARISE AT THE TIME OF THE MEETING.
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ACTION FORM
PROCEEDING: Parks, Recreation and Community Enhancement Committee
DEPARTMENT OF ORIGIN: Planning/Parks and Recreation DATE SUBMITTED: February 1,
2017
PREPARED BY: Ann Marie Townshend, AICP, Director of Planning & Community Development
SUBJECT: Review of Schutte Park Master Plan
REFERENCE: N/A
RELATED PROJECT: City of Dover Recreation Needs Assessment
REVIEWED BY: Scott Koenig, P.E., City Manager
EXHIBITS: Schutte Park Master Plan
EXPENDITURE REQUIRED: None with this action AMOUNT BUDGETED: $100,000
FUNDING SOURCE (Dept./Page in CIP & Budget): 147-1500-525.40-31
TIME TIMETABLE: Following approval of concept, staff will proceed with getting costs for the
stormwater and entrance design and construction cost estimates.
RECOMMENDED ACTION: Staff recommends that the Committee recommend approval of the Schutte
Park Master Plan.
BACKGROUND AND ANALYSIS
Following the completion of the Recreation Needs Assessment, the Planning Office, Public Works Department,
and Parks and Recreation Department began work on a master plan for Schutte Park. This master plan was to
include the development of multi-purpose fields, completion of the loop pathway system, and other amenities
that were identified in the Recreation Needs Assessment. Staff developed a conceptual plan, which was shared
at a public workshop on July 20, 2016. Following review of the public feedback, staff worked on additional
design. The results of this work are attached for the Committee’s review.
Once the design is endorsed, staff will work with the Public Works Department to complete the stormwater and
entrance design and to develop cost estimates for each phase. This will likely be done by one of the City’s
engineering consultants.
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Schutte Park Master Plan
February 14, 2017
Overview
The Schutte Park Master Plan is a product of the City of Dover Recreation Needs Assessment. This
primary planning document for all of the city parks was approved by City Council on August 10, 2015.
Among the implementation strategies named in this plan is a recommendation that master plans be
developed for each of Dover’s three anchor parks (Schutte Park, Silver Lake Park, and Dover Park). The
master plan for Schutte Park is the first of the three to be developed.
The Needs Assessment included a public process to determine park users’ priorities in the future
development of the anchor parks. Many of the specific recommendations of the Schutte Park Master
Plan, including the finished loop trail, new athletic fields, additional parking, fitness stations and skate
park come directly from the Needs Assessment. The primary purpose of the master plan is to organize
these desired amenities into an attractive and efficient park design that park visitors will enjoy returning
to again and again.
Development of the master plan was ongoing throughout 2016, and included a public workshop on July
20, 2016 to gather feedback on a draft design. The public workshop led to several important changes to
the design, including a reduction in new parking on the west side of the park and the addition of restrooms
and water fountains. Development also included consultation with outside experts, who produced the
concepts included in this plan for the skate park and a disc golf course. More detailed design of these two
amenities is needed based on the particular needs and desires of their users.
Phasing
The master plan includes four phases, detailed below:
PHASING
Phase Description Anticipated Timeframe
-Finish loop trail; plant additional trees and wooded
areas and install benches along paths
-Install disc golf course
Phase 1 -Pave and stripe existing parking lots; use pervious 2017-2018
pavement for parking spaces
-Grade and seed west of Former Wyoming Mill Rd;
begin using additional field space
-Construct multi-use artificial turf field and entrance
plaza
Phase 2 -Plant rain garden between pond and softball fields; 2019-2020
wooded area east of pond
-Add additional storage space
-Construct new parking and event plaza using shared
paving near intersection of Wyoming Mill Rd and
Hazlettville Rd
-Install outdoor exercise equipment along loop trail
Phase 3 2021-2022
-Install bathrooms and water fountains adjacent to event
plaza
-Plant rain garden south of future skate park; wooded
area east of new parking lot
-Construct new park shelter adjacent to event plaza
Phase 4 2023-2024
-Construct skate park adjacent to event plaza
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Estimates of the area to be developed in each phase are as follows:
AREA/QUANTITY ESTIMATES
Phase 1 Phase 2 Phase 3 Phase 4 Total
New trails 75,320 S.F. / 5,954 S.F. / 6,742 S.F. / 88,016 S.F. /
7,532 L.F. 595 L.F. 674 L.F. N/A 8,802 L.F.
New Drive aisles 91,295 S.F. N/A 26,918 S.F. N/A 118,213 S.F.
Pervious Parking 62,991 S.F. / 16,776 S.F. 79,767 S.F. /
N/A N/A
Spaces 378 spaces / 94 spaces 472 spaces
Plazas N/A 1,292 S.F. 10,499 S.F. N/A 11,791 S.F.
858 S.F.
437 S.F. 558 S.F.
New structures N/A (park 1,853 S.F.
(sheds) (bathroom)
shelter)
Artificial Turf Field N/A 97,275 S.F. N/A N/A 97,275 S.F.
Skate Park N/A N/A N/A 8,100 S.F. 8,100 S.F.
New trees 665 116 71 N/A 853
New light poles 65 5 47 N/A 117
Plan Documents
1. Existing Conditions Map
2. Phase 1 Plan
3. Phase 2 Plan
4. Phases 3 & 4 Plan
5. Renderings
6. Skate park concepts
7. Disc golf route
8. Rain garden examples
9. Shared pavement examples
10. Draft plan of 7/20/16 (for comparison purposes only)
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Schutte Park Master Plan
Whole Park View
'" "'
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Pitts Center and artificial turf field, looking northwest
*Renderings are illustrative, and do not show final site details (furnishings, pavement patterns, etc.)
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Western plaza and park shelter, looking west
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Northwest entrance to park, looking south
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SPOHN RANCH SCHUTIE PARKskatepark
----~ sK A TE p A R K5 DOVER, DE
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~;;;) SPOHN RANCH SCHUTIE PARK skatepark
(,~ ~ 5 K A T E p A R K 5 DOV ER, DE
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Schutte Park Master Plan
Disc Golf Plan
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Rain Garden examples
Source: hƩp://www.nature.org/ouriniƟaƟves/regions/northamerica/unitedstates/newjersey/explore/rain-gardens-1.xml
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Shared pavement examples
Characteristics:
-textured pavements with flush
curbing to reinforce priority of
pedestrians
-street furniture (bollards,
planters, etc.) to delineate
car-traveled way and
pedestrian-only space
Source: hƩp://nacto.org/publicaƟon/urban-street-design-guide/streets/residenƟal-shared-street/
Broad Street, Victoria, BC West Broadway, Eugene, OR
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DRAFT PLAN
7/20/2016
Rain Garden
Rain Garden
Skate Park
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CDBG Quarterly Report
October, November, December 2016
CDBG FY16 Projects
The following projects are underway.
Homeownership Assistance Program
CDBG funds will be used to provide homeownership assistance to first-time homebuyers who
purchase affordable housing in the City of Dover. One family has purchased a home, and two
families are under contract to purchase homes.
Dover Interfaith Mission for Housing
CDBG funds will be used to provide operations cost for the shelter. Sixty-two 62% of funds have
been expended year to date.
Connections Community Support Program
CDBG funds will be used to provide rapid re-housing/rental assistance services for homeless
households within the City.
Milford Housing Homeowner Rehabilitation/Emergency Home Repair Programs
CDBG funds will be used to rehabilitate existing owner occupied housing in the City that is in
violation of the City’s Housing Code and complete emergency home repairs to eliminate
housing conditions that threaten the health and safety of low income homeowners. Bids have
been advertised for two (2) single family homes to be rehabbed in the city, and emergency home
repairs have been completed for three (3) families.
Habitat for Humanity
CDBG funds will be used to rehabilitate a vacant property to sell to a low income family and
provide affordable housing in the City of Dover.
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Parks, Recreation, and Community Enhancement 2/14/2017
Status of FY-16 Program Funds Spent - Fiscal Year 7/1/16- 6/30/17
2016 Grant Projects Project Details Total Grant Funds Expended Unencumbered Balance
Funds will be utilized for
settlement assistance for
Homeownership Assistance Program $50,000 $50,000 $0
properties purchased in
the City
Funds will be utilized for
rapid re-housing/rental
Connections $7,208 $0 $7,208
assistance for low income
persons
Funds will be used for
Dover Interfaith Mission for Housing $22,000 $13,774 $8,227
operation cost
Funds will be utilized for
Milford Housing Development Corp emergency home repairs. $55,000 $0 $55,000
Project underway
Funds will be utilized for
rehabbing owner
Milford Housing Development Corp $25,000 $7,430 $17,569
occupied homes. Project
underway
Funds will be utilized to
rehab a single family
Habitat for Humanity $30,000 $0 $30,000
home for a low income
family
Total $189,208 $71,204 $118,004
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City of Dover
Capital Investment Plan
Project Tracking Report
Quarterly Report as of December 31, 2016
Points to Remember -
* Original Project Budget = Original Total Project Budget initially included in approved annual budget.
* Latest Project Budget = Revised Total Project Budget included in most recent approved annual budget or one of the following:
bond resolution, revolving fund loan agreement, Council approved budget amendment, or City Manager approved amendment as per
the Budget Amendment Procedure.
* Current Fiscal Year - Revised Fiscal Year Budget = Current Year approved project budgets plus carry forward balances of unspent
budgets in the prior fiscal year. Project Carry Forward balances will be submitted to City Council for amendment in January 2010.
Can also be amended with City Manager approval per the Budget Amendment Procedure.
* Water Quality, Inflow/Infiltration, Distribution Upgrades and New Development projects are budgeted as a blanket project and once
individual projects are identified and estimated they are created using an allocation of the overall budgeted amount.
* Status and Comments provided by City Manager.
Community Water & Total
Current Year Budget Funding Sources General Transportation Wastewater Electric CIP
Budget Balance $ 1,425,000 $ 5,500 $ 3,437,200 $ 2,707,400 $ 7,575,100
General Billings for Reimbursement of Expense 105,000 - - 900,000 1,005,000
Debt Financing - - 3,284,000 - 3,284,000
State Community Transportation Funds - 500,000 - - 500,000
Transfer from WW Impact Fee Reserve - - 402,000 - 402,000
Transfer from General Fund 1,859,400 - - - 1,859,400
Transfer from Operating Funds - - 2,000,000 2,731,200 4,731,200
Transfer from Parkland Reserve 80,000 - - - 80,000
Grant Receipt - - - 5,000 5,000
Interest Income 5,000 - 20,000 40,000 65,000
Total Funding Sources (Unaudited) $ 3,474,400 $ 505,500 $ 9,143,200 $ 6,383,600 $ 19,506,700
1
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City of Dover
General Fund - Major CIP Projects
Quarterly Report as of December 31, 2016
TOTAL PROJECT - PAST, CURRENT & FUTURE BUDGETS CURRENT FISCAL YEAR
Original Latest Project Project % Original Revised Fiscal %
Project Project Project To Date Budget Budget Fiscal Year Fiscal Year YTD Budget Budget
Code Type Description Budget Budget Expenses Balance Spent Budget Budget Expenses Balance Spent Status Comments
1 FY 2015
2 PR1402 M Schutte Park Land Improvements $ 100,000 $ 190,000 $ 49,700 $ 140,300 26.2% $ 100,000 $ 100,000 $ - $ 100,000 0.0%
3 ST1504 Old PW2 Site Improvements 535,000 603,500 573,543 29,957 95.0% - 106,700 76,695 30,005 71.9% In Process Design work ongoing 85% level
4 Totals - FY 2015 $ 635,000 $ 793,500 $ 623,243 $ 170,257 78.5% $ 100,000 $ 206,700 $ 76,695 $ 130,005 37.1%
5
6 FY 2016
7 ST1601 FY16 Street and Alley Program $ 1,000,000 $ 859,400 $ 717,708 $ 141,692 83.5% $ - $ 401,700 $ 260,043 $ 141,657 64.7% Complete Final invoices to be paid
8 ST1603 Valve Replacement - Silver Lake Dam 60,000 97,600 97,513 87 0.0% - 93,900 93,862 38 100.0% Complete
9 ST1604 Salt Storage Barn (originally proj ST1301) 50,000 135,000 12,562 122,438 9.3% - 122,400 - 122,400 0.0% In Process Project awarded, to begin in Spring
10 CT1669 Persimmon Park Place Drainage Study 24,600 24,600 23,661 940 96.2% - 10,900 9,916 985 91.0% In Process 99% complete with project
11 Totals - FY 2016 $ 1,134,600 $ 1,116,600 $ 851,444 $ 265,156 76.3% $ - $ 628,900 $ 363,820 $ 265,080 57.9%
12
13 FY 2017
14 --- Vehicles & Equipment $ 695,200 $ 854,600 $ 369,404 $ 485,196 43.2% $ 695,200 $ 854,600 $ 369,404 $ 485,196 43.2% In Process
15 --- Library Wall - 15,000 - 15,000 0.0% - 15,000 - 15,000 0.0%
16 CM1701 401 & 415 Water Street Properties - 485,000 411,362 73,638 84.8% - 485,000 411,362 73,638 84.8% In Process
17 FR1700 R Annual Contribution for Ladder 1 145,700 145,700 145,614 86 99.9% 145,700 145,700 145,614 86 99.9% Complete
18 PR1701 Dover Park - Master Plan 50,000 50,000 - 50,000 0.0% 50,000 50,000 - 50,000 0.0%
19 PR1704 Small Park Improvements 15,000 15,000 - 15,000 0.0% 15,000 15,000 - 15,000 0.0%
20 PD1701 Video Storage Array 12,500 12,500 - 12,500 0.0% 12,500 12,500 - 12,500 0.0%
21 ST1701 R FY17 Street and Alley Program 900,000 812,000 - 812,000 0.0% 900,000 812,000 - 812,000 0.0% In Process Proj awarded, awaiting paperwork
22 ST1702 Misc Emerg Street/Stormwater Repairs - 123,000 51,172 71,828 41.6% - 123,000 51,172 71,828 41.6% In Process Project open and ongoing
23 ST1703 Silver Lake Dam Improvements 126,000 126,000 - 126,000 0.0% 126,000 126,000 - 126,000 0.0% In Process Design to begin by 11/15
24 Totals - FY 2017 $ 1,944,400 $ 2,638,800 $ 977,552 $ 1,661,248 37.0% $ 1,944,400 $ 2,638,800 $ 977,552 $ 1,661,248 37.0%
25
26 Grand Totals $ 3,714,000 $ 4,548,900 $ 2,452,239 $ 2,096,662 53.9% $ 2,044,400 $ 3,474,400 $ 1,418,067 $ 2,056,333 40.8%
Legend
M = Multi-year project - a project with a specific schedule to occur over multiple years.
R = Recurring project - a project that begins and ends each fiscal year and is re-budgeted to start over each fiscal year.
G = Grant funded project
B/L = To be financed through bonds or commercial loan.
2
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City of Dover
Community Transportation - Major CIP Projects
Quarterly Report as of December 31, 2016
TOTAL PROJECT - PAST, CURRENT & FUTURE BUDGETS CURRENT FISCAL YEAR
Original Latest Project Project % Original Revised Fiscal %
Project Project Project To Date Budget Budget Fiscal Year Fiscal Year YTD Budget Budget
Code Type Description Budget Budget Expenses Balance Spent Budget Budget Expenses Balance Spent Status Comments
1 FY 2014 & Prior
2 ST0232 Pat Lynn Drive/D.H.S. Storm Drain Pipe $ 155,200 $ 190,300 $ 184,778 $ 5,522 97.1% $ - $ 5,500 $ - $ 5,500 0.0%
3 TE0601 Lincoln Park Center 900,000 602,400 523,277 79,123 86.9% 79,100 79,100 - 79,100 0.0%
4 Totals - FY 2014 & Prior $ 1,055,200 $ 792,700 $ 708,055 $ 84,645 89.3% $ 79,100 $ 84,600 $ - $ 84,600 0.0%
5
6 FY 2016
7 CT1627 FY16 Paving Projects - Boggs Drive $ 247,400 $ 247,400 $ 139,762 $ 107,638 56.5% $ 107,600 $ 107,600 $ - $ 107,600 0.0% In Process Scheduled to begin in Spring
8 CT1681 Pedestrian Enhancement-Mallard Pond Pathway 50,000 100,000 71,093 28,907 71.1% 50,000 100,000 71,093 28,907 71.1% In Process Lighting being installed in coming weeks
9 Totals - FY 2016 $ 297,400 $ 347,400 $ 210,855 $ 136,545 60.7% $ 157,600 $ 207,600 $ 71,093 $ 136,507 34.2%
10
11 FY 2017
12 CT1714 Paving Project - Paper Alley $ 15,000 $ 15,000 $ - $ 15,000 0.0% $ 15,000 $ 15,000 $ - $ 15,000 0.0% In Process Scheduled to begin in Spring
13 CT1731 E Water Street Brick 85,000 85,000 1,000 84,000 1.2% 85,000 85,000 1,000 84,000 1.2% Complete Awaiting final invoice
14 CTxxxx Unapplied CT Projects (placeholder) 500,000 242,400 - 242,400 0.0% 163,300 113,300 - 113,300 0.0%
15 Totals - FY 2017 $ 600,000 $ 342,400 $ 1,000 $ 341,400 0.3% $ 263,300 $ 213,300 $ 1,000 $ 212,300 0.5%
16
17 Grand Totals $ 1,952,600 $ 1,482,500 $ 919,910 $ 562,590 62.1% $ 500,000 $ 505,500 $ 72,093 $ 433,407 14.3%
Legend
M = Multi-year project - a project with a specific schedule to occur over multiple years.
R = Recurring project - a project that begins and ends each fiscal year and is re-budgeted to start over each fiscal year.
C = Project funded by combination of CT Funds and General Fund
B/L = To be financed through bonds or commercial loan.
3
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City of Dover
Electric Improvement & Extension Fund - Major CIP Projects
Quarterly Report as of December 31, 2016
TOTAL PROJECT - PAST, CURRENT & FUTURE BUDGETS CURRENT FISCAL YEAR
Original Latest Project Project % Current Revised Fiscal %
Project Project Project To Date Budget Budget Fiscal Year Fiscal Year YTD Budget Budget
Code Type Description Budget Budget Expenses Balance Spent Budget Budget Expenses Balance Spent Status Comments
1 FY 2014
2 EG1407 Metering System Upgrades $ 150,000 $ 90,000 $ 79,636 $ 10,364 88.5% $ - $ 90,000 $ 79,636 $ 10,364 88.5% In Process Complete, working punch list with contractor
3 EE1415 R Metering Infrastructure 150,000 150,000 - 150,000 0.0% - 150,000 - 150,000 0.0% In Process
4 EG1416 M VanSant Capacity Increase 1,500,000 774,100 761,487 12,613 98.4% - 45,000 32,339 12,661 71.9% Complete
5 Totals - FY 2014 $ 1,800,000 $ 1,014,100 $ 841,123 $ 172,977 82.9% $ - $ 285,000 $ 111,975 $ 173,025 39.3%
6
7 FY 2015
8 EE1500 69 kV Rebuild - Horsepond Road $ 330,500 $ 330,500 $ 142,712 $ 187,788 43.2% $ - $ 250,600 $ 62,802 $ 187,798 25.1% In Process 40% complete; weather hold
9 EE1513 M Town Point Distribution Feeders 1,650,000 1,650,000 725,857 924,143 44.0% 350,000 350,000 214,379 135,621 61.3% In Process Phase 2 about 80% complete
10 Totals - FY 2015 $ 1,980,500 $ 1,980,500 $ 868,569 $ 1,111,931 43.9% $ 350,000 $ 600,600 $ 277,181 $ 323,419 46.2%
11
12 FY 2016
Contractor to begin work Spring 2017. Outage
13 EG1612 Van Sant Exhaust Plenum Replacement $ 469,000 $ 469,000 $ 429,958 $ 39,042 91.7% $ - $ 46,300 $ 7,299 $ 39,001 15.8% In Process begins March 3, 2017
14 EG1613 McKee Unit 3 Stack Repairs 485,000 342,600 304,469 38,131 88.9% - 340,000 301,845 38,155 88.8% Complete Awaiting final report from Contractor
15 EE1605 69 kV Cable Replacement - North Street 565,700 565,700 - 565,700 0.0% - 135,000 - 135,000 0.0% In Process Eng work underway
16 EE1607 Horsepond URD - Distribution Feeders 67,000 67,000 49,450 17,550 73.8% - 62,500 - 62,500 0.0% Complete Additional funds were not needed
17 EE1617 Oak Grove Trailer Park - Dist Upgrade 77,400 77,400 889 76,511 1.1% - 77,400 889 76,511 1.1% In Process On hold; other projects
18 EE1627 Dover East Estates - Dist Upgrade 125,500 125,500 - 125,500 0.0% - 125,500 - 125,500 0.0% In Process On hold; other projects
19 EE1631 North Street OH to UG 170,000 170,000 - 170,000 0.0% - 170,000 - 170,000 0.0% In Process Eng work underway
20 Totals - FY 2016 $ 1,959,600 $ 1,817,200 $ 784,766 $ 1,032,434 43.2% $ - $ 956,700 $ 310,033 $ 646,667 32.4%
21
22 FY 2017
23 --- R Vehicles & Equipment $ 165,800 $ 188,800 $ 20,703 $ 168,097 11.0% $ 165,800 $ 188,800 $ 20,703 $ 168,097 11.0% In Process Waiting on contract specifications
24 --- Economic Development Program - 50,000 - 50,000 0.0% - 50,000 - 50,000 0.0%
25 --- Replace Weyandt Hall Door - 10,000 - 10,000 0.0% - 10,000 - 10,000 0.0%
26 --- Compressor Replacement - 13,000 - 13,000 0.0% - 13,000 - 13,000 0.0%
27 --- R New Developments 1,500,000 1,500,000 620,445 879,555 41.4% 1,500,000 1,500,000 353,251 1,146,749 23.6% In Process
28 EE1700 SCADA Master Hardware Replacement 150,000 150,000 35,631 114,369 23.8% 150,000 150,000 35,631 114,369 23.8% In Process Coordinating delivery
29 EE1707 LED Lighting Upgrades 17,500 17,500 - 17,500 0.0% 17,500 17,500 - 17,500 0.0% In Process
30 EE1708 R Ampacity Standardization 25,000 25,000 - 25,000 0.0% 25,000 25,000 - 25,000 0.0% In Process
31 EE1709 Substation Relay Upgrade 125,000 125,000 4,882 120,118 3.9% 125,000 125,000 4,882 120,118 3.9% In Process
32 EE1710 Meeting House Branch Pole Relocation 450,000 450,000 - 450,000 0.0% 450,000 450,000 - 450,000 0.0% On Hold
33 EE1711 R Transmission Line Maintenance Program 75,000 75,000 - 75,000 0.0% 75,000 75,000 - 75,000 0.0% In Process
34 EE1712 R Lighting Project 50,000 50,000 - 50,000 0.0% 50,000 50,000 - 50,000 0.0% In Process
35 EE1713 R Fault Indicators 10,000 10,000 9,935 65 99.4% 10,000 10,000 9,935 65 99.4% Complete
36 EE1714 UPS System Replacement 25,000 25,000 - 25,000 0.0% 25,000 25,000 - 25,000 0.0% In Process Bid awarded; coordinating install
37 EE1715 R Distribution Capacitors and Controls 50,000 50,000 2,082 47,918 4.2% 50,000 50,000 2,082 47,918 4.2% In Process
Awaiting quote from GE. Establish list of parts
38 EG1701 Van Sant Unit 11 Major Inspection 400,000 400,000 5,840 394,160 1.5% 400,000 400,000 5,840 394,160 1.5% In Process needed and bid out to other vendors.
39 EG1702 R McKee Run Unit 3 Boiler Systems 382,000 382,000 - 382,000 0.0% 382,000 382,000 382,000 0.0% In Process
40 EG1703 R McKee Run Bldg Equipment Replacement 59,000 59,000 - 59,000 0.0% 59,000 59,000 - 59,000 0.0% In Process Purchase in Feb, install in March
Received quotes; researching suppliers for new
41 EG1704 McKee Run Hydrogen Purity Analyzer 96,000 96,000 - 96,000 0.0% 96,000 96,000 - 96,000 0.0% In Process equipment
42 EG1707 R McKee Run Auxiliary System Components 128,000 128,000 30,937 97,063 24.2% 128,000 128,000 30,937 97,063 24.2% In Process
43 EG1709 Unit 3 Cooling Water Line Repairs 469,000 469,000 10,867 458,133 2.3% 469,000 469,000 10,867 458,133 2.3% In Process Inspection complete. Work done in Fall 2017
44 EG1710 R Plant Syst Safety & Compl Improvements 112,000 112,000 3,177 108,823 2.8% 112,000 112,000 3,177 108,823 2.8% In Process Fencing to be replaced in Spring 2017
45 EG1711 R Preservation of Structures 131,000 131,000 - 131,000 0.0% 131,000 131,000 - 131,000 0.0% In Process
46 EG1712 Remote Start Capability at VanSant - 25,000 - 25,000 0.0% - 25,000 - 25,000 0.0%
47
48
49 Totals - FY 2017 $ 4,420,300 $ 4,541,300 $ 744,498 $ 3,796,802 16.4% $ 4,420,300 $ 4,541,300 $ 477,304 $ 4,063,996 10.5%
50
51 Grand Totals $ 10,160,400 $ 9,353,100 $ 3,238,956 $ 6,114,144 34.6% $ 4,770,300 $ 6,383,600 $ 1,176,493 $ 5,207,107 18.4%
Legend
M = Multi-year project - a project with a specific schedule to occur over multiple years. B = Bonded Project T = Transfer from blanket New Development original budget
R = Recurring project - a project that begins and ends each fiscal year and is re-budgeted to start over each fiscal year. S = State fully or partially reimbursed project G = Grant funded project
4
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City of Dover
Water/Wastewater Improvement & Extension Fund - Major CIP Projects
Quarterly Report as of December 31, 2016
TOTAL PROJECT - PAST, CURRENT & FUTURE BUDGETS CURRENT FISCAL YEAR
Original Latest Project Project % Original Revised Fiscal %
Project Project Project To Date Budget Budget Fiscal Year Fiscal Year YTD Budget Budget
Code Type Description Budget Budget Expenses Balance Spent Budget Budget Expenses Balance Spent Status Comments
1 FY 2008
Awaiting approval of proposed Memorandum of
2
WD0804 M 1.0 MG Elevated Water Storage $ 4,196,600 $ 2,556,000 $ 87,827 $ 2,468,173 3.4% $ - $ 2,468,200 $ - $ 2,468,200 0.0% In Process Understanding from owner
3 Totals - FY 2008 $ 4,196,600 $ 2,556,000 $ 87,827 $ 2,468,173 3.4% $ - $ 2,468,200 $ - $ 2,468,200 0.0%
4
5 FY 2013
6 WW1303 Westover PS $ 768,800 $ 1,403,900 $ 859,327 $ 544,573 61.2% $ - $ 593,000 $ 48,437 $ 544,563 8.2% In Process Construction to restart in April
7 Totals - FY 2014 $ 768,800 $ 1,403,900 $ 859,327 $ 544,573 61.2% $ - $ 593,000 $ 48,437 $ 544,563 8.2%
8
9 FY 2015
10 WW1503 Hazlettville Road Interceptor $ 755,000 $ 774,100 $ 659,432 $ 114,668 85.2% $ - $ 618,900 $ 504,221 $ 114,680 81.5% In Process Awaiting final punch list items
11 WW1507 Retreat Pump Station Replacement 412,500 483,900 343,231 140,669 70.9% - 447,500 306,900 140,600 68.6% In Process 95% complete construction
12 Totals - FY 2015 $ 1,167,500 $ 1,258,000 $ 1,002,663 $ 255,337 79.7% $ - $ 1,066,400 $ 811,121 $ 255,280 76.1%
13
14 FY 2016
15 WD1609 M WTP Process Improvements $ 1,050,000 $ 1,375,000 $ 324,095 $ 1,050,905 23.6% $ 1,200,000 $ 1,200,000 $ 78,043 $ 1,121,957 6.5% In Process Design work continuing
16 WW1603 Rolling Acres PS Replacement 424,000 424,000 39,173 384,827 9.2% 372,000 396,100 11,279 384,821 2.8% In Process Project awarded 1/23/17, contract pending
17 WW1605 Delaware Avenue Sanitary Sewer Ext 25,000 33,000 - 33,000 0.0% - 33,000 - 33,000 0.0% In Process Project to begin in mid February
18 Totals - FY 2016 $ 1,499,000 $ 1,832,000 $ 363,268 $ 1,468,732 19.8% $ 1,572,000 $ 1,629,100 $ 89,322 $ 1,539,778 5.5%
19
20 FY 2017
21 --- R Vehicles & Equipment $ 222,600 $ 268,700 $ 46,055 $ 222,645 17.1% $ 222,600 $ 268,700 $ 46,055 $ 222,645 17.1% In Process
22 --- Economic Development Program - 100,000 - 100,000 0.0% - 100,000 - 100,000 0.0%
WD1700/ Meters have been ordered. Staff replacing large
23
WW1700 R Meter Replacement Project 400,000 400,000 59,564 340,436 14.9% 400,000 400,000 59,564 340,436 14.9% In Process meters as time allows
24 WD1701 R Wellhead Redevelopment 85,000 85,000 - 85,000 0.0% 85,000 85,000 - 85,000 0.0% In Process Wells currently being evaluated
25 WD1704 New Fence - Well #6 - 40,000 - 40,000 0.0% - 40,000 - 40,000 0.0% Complete Awaiting invoice processing
26 WD1705 R Future Well Installation 100,000 100,000 14,907 85,093 14.9% 100,000 100,000 14,907 85,093 14.9% In Process Design is underway for new well
27 WD1706 R SCADA Equipment Tech Upgrade 88,000 88,000 - 88,000 0.0% 88,000 88,000 - 88,000 0.0% In Process Materials scheduled to be ordered soon.
28 WQ1702 R Water Quality Improvements 720,800 330,800 - 330,800 0.0% 720,800 330,800 - 330,800 0.0% In Process
29 WQ1701 Bradford Street Survey - 28,000 - 28,000 0.0% - 28,000 - 28,000 0.0% Complete
30 WQ1703 Misc Emerg Water Repairs - 80,000 13,193 66,807 16.5% - 80,000 13,193 66,807 16.5% In Process Project open and ongoing
31 WQ1704 S New Street Water Main Rplcmnt - 247,000 - 247,000 0.0% - 247,000 - 247,000 0.0% In Process Work began in mid December, 25% complete
32 WW1702 Misc Emerg Sanitary Sewer Repairs 75,000 300,000 73,719 226,281 24.6% 75,000 300,000 73,719 226,281 24.6% In Process Project open and ongoing
33 WW1703 Lepore Road Sanitary Sewer Upgrade 50,000 50,000 16,905 33,095 33.8% 50,000 50,000 16,905 33,095 33.8% In Process Design is underway, awaiting 75% design submittal
34 WW1704 Delaware Tech PS Replacement 52,000 52,000 - 52,000 0.0% 52,000 52,000 - 52,000 0.0% In Process Design is underway, 50% design complete
35 WW1705 Silver Lake PS Replacement 52,000 52,000 - 52,000 0.0% 52,000 52,000 - 52,000 0.0% In Process Design is underway, design to follow Del Tech
36 WW1706 Walker Woods PS Replacement 52,000 52,000 - 52,000 0.0% 52,000 52,000 - 52,000 0.0% In Process Design is underway, 50% design complete
37 II1700 R Inflow/Infiltration Removal 1,121,000 777,500 - 777,500 0.0% 1,121,000 777,500 - 777,500 0.0% In Process Other projects under review by DelDOT
38 II1701 North Street Gravity Sewer Repair - 335,500 203,130 132,370 60.5% - 335,500 203,130 132,370 60.5% In Process Awaiting final pavement patch
39 Totals - FY 2017 $ 3,018,400 $ 3,386,500 $ 427,473 $ 2,959,027 12.6% $ 3,018,400 $ 3,386,500 $ 427,473 $ 2,959,027 12.6%
40
41 Grand Totals $ 10,650,300 $ 10,436,400 $ 2,740,559 $ 7,695,841 26.3% $ 4,590,400 $ 9,143,200 $ 1,376,353 $ 7,766,847 15.1%
Legend
M = Multi-year project - a project with a specific schedule to occur over multiple years.
R = Recurring project - a project that begins and ends each fiscal year and is budgeted to start over each fiscal year. No carry forward.
SL = State Loan Project - construction phase is financed
I = Impact Fee (partially) financed project
T = Transfer from blanket WQ or I&I original budget
5
Page 29
Dover GREEN ENERGY SUMMARY AS OF 1/27/2017 Dover Green Energy Funds
Total Collected Green Energy Funds Ever $ 1,372,599.15 As January 27, 2017 Monthly Deposits and Payments
DEMEC Admin Fee Paid $ 90,453.80 Starting Balance $ 74,256.80
State Annual Admin Fee Total Paid $ 26,675.07 Deposit* $ 30,537.63
Grants Paid $ 546,163.25 Outgoing Payments
*Grants/Fees Reserved and Amounts Owed $ 858.75 DEMEC Admin Fee* $ 3,053.76
Dover Library Green Building Improvements Cost $ 1,500,000.00 State 2016 Admin Fee $ -
Dover Library Reimbursements paid to Dover to date $ 495,908.32 New Reservations/Fees $ -
Energy Depot Program Costs Paid $ 68,746.68 Energy Depot $ 1,692.13
Efficiency Program Incentives Paid $ 37,268.34 Library Reimbursement $ -
Solar Electric Power Association (SEPA) Dues Paid $ 6,476.41 SEPA Dues $ -
Dover GEF Account Balance minus Grants/Fees Owed $ 100,048.54 Dover GEF Account Balance $ 100,048.54
Funds Necessary for Dov. Lib. Payment due June 1 $ 98,500.00 *Deposits during this period represent through December 2016
Funds Necessary for Library June 1 Payment $ (1,548.54)
*Grants are paid in a manner to ensure sufficient funds for the June 1 Lib. payment are collected
When "Funds Necessary for Library June 1 Payment" line is negative then sufficient funds have
been collected to satisfy the June 1 Payment. Completed projects and fees can be paid with the surplus.
COMPLETED PROJECTS ONLY DNREC FEE OWED
Status Applicant Type Grant Reservation Request Review Fee
COMPLETED PROJECTS ONLY DNREC FEE OWED Michael J Kopp Geo-Res Paid $ 37.50
COMPLETED PROJECTS ONLY DNREC FEE OWED Frank Daniels Geo-Res Paid $ 26.25
COMPLETED PROJECTS ONLY DNREC FEE OWED Perrry T. Boulter Geo-Res Paid $ 225.00
COMPLETED PROJECTS ONLY DNREC FEE OWED Ms. Lee Herrera Res-Geo Paid $ 172.50
COMPLETED PROJECTS ONLY DNREC FEE OWED John Crowley Res-Geo Paid $ 225.00
COMPLETED PROJECTS ONLY DNREC FEE OWED Lloyd Schmid Res-Geo Paid $ 172.50
Total $ 858.75
RESERVED BUT INCOMPLETE PROJECTS
Status Applicant Type Grant Reservation Request Review Fee
Total $ - $ -
ENERGY DEPOT FEES - (quarterly)
Paid Fee Period Amount
3/3/2008 Start-up Fees $ 5,872.50
4/15/2008 Start-up Fees $ 1,957.50
4/15/2008 Mar, Apr, May 2008 $ 1,692.13
7/22/2008 June, July, Aug 2008 $ 1,692.13
10/10/2008 Sept, Oct, Nov 2008 $ 1,692.13
1/2/2009 Dec 08, Jan, Feb 2009 $ 1,692.13
4/3/2008 Mar, Apr, May 2009 $ 1,692.13
7/1/2009 June, July, Aug 2009 $ 1,692.13
9/11/2009 Sept, Oct, Nov 2009 $ 1,692.13
1/4/2010 Dec 09, Jan, Feb 2010 $ 1,692.13
3/29/2010 Mar, Apr, May 2010 $ 1,692.13
Page 30
6/30/2010 June, July, Aug 2010 $ 1,692.13
10/4/2010 Sept, Oct, Nov 2010 $ 1,692.13
1/3/2011 Dec 2010, Jan, Feb 2011 $ 1,692.13
4/5/2011 Mar, Apr, May 2011 $ 1,692.13
7/8/2011 June, July, Aug 2011 $ 1,692.13
10/4/2011 Sept, Oct, Nov 2011 $ 1,692.13
1/3/2012 Dec 2011; Jan, Feb 2012 $ 1,692.13
4/5/2012 Mar, Apr, May 2012 $ 1,692.13
7/2/2012 June, July, Aug 2012 $ 1,692.13
9/25/2012 Sept, Oct, Nov 2012 $ 1,692.13
11/30/2012 Dec 12, Jan, Feb 2013 $ 1,692.13
2/25/2013 Mar, Apr, May 2013 $ 1,692.13
7/22/2013 June, July, Aug 2013 $ 1,692.13
8/26/2013 Sept, Oct, Nov 2013 $ 1,692.13
12/3/2013 Dec 13. Jan, Feb 2014 $ 1,692.13
3/4/2014 Mar, Apr, May 2014 $ 1,692.13
6/4/2014 June, July, Aug 2014 $ 1,692.13
9/4/2014 Sept, Oct, Nov 2014 $ 1,692.13
12/1/2014 Dec 14, Jan, Feb 2015 $ 1,692.13
3/9/2015 Mar, Apr, May 2014 $ 1,692.13
6/11/2015 June, July, Aug 2015 $ 1,692.13
9/1/2015 Sept, Oct, Nov 2015 $ 1,692.13
12/11/2015 Dec 15. Jan, Feb 2016 $ 1,692.13
3/1/2016 Mar, Apr, May 2016 $ 1,692.13
6/1/2016 June, July, Aug 2016 $ 1,692.13
9/1/2016 Sept, Oct, Nov 2016 $ 1,692.13
12/28/2016 Dec 15. Jan, Feb 2017 $ 1,692.13
Total $ 68,746.68
Solar Energy Professionals Association (SEPA) - (2015 and Forward participation is through AMP at no additional charge)
Paid Membership Fee Amount
3/19/2012 2012 Annual Membership $ 2,158.81
1/31/2013 2013 Annual Membership $ 2,158.80
1/27/2014 2014 Annual Membership $ 2,158.80
Total $ 6,476.41
Page 31
COLLECTOR-DISTRIBUTOR ROAD MODIFICATION
TO
THE SCARBOROUGH ROAD INTERCHANGE
I. Background/History
-DelDOT’s 2007 U.S. Route 13 Corridor Study
-Continuing Growth & Development in the U.S. Route 13 Corridor is
Straining the Existing Roadway Infrastructure
-The Delaware General Assembly’s 2015 Bond Bill Directives
II. DelDOT’s 2016 Feasibility Study
-The CD Road Modification is Feasible
-The CD Road Modification Will Relieve Congestion, Improve Circulation, and
Enhance Traffic Safety
-The CD Road Modification Will Foster and Accommodate Continued Economic
Growth and Development
III. Next Steps/Costs & Funding
-Wetlands Delineation Performed
-Toll Study Conducted
-Public-Private Initiative (Chapter 20, Title 2 of the Delaware Code)
-$31,200,000 Estimated Project Cost is Self-Funded
-Tax Increment Financing (TIF) and Special Development District (SDD) Legislation
IV. Project Has Broad Support/Need to Maintain Momentum
-City of Dover
-Kent Economic Partnership
-Central Delaware Chamber of Commerce
-Dover/Kent County MPO Prioritization Process
-Continued Support from the Community is Critical
Page 32
SPONSOR:
DELAWARE HOUSE OF REPRESENTATIVES
149th GENERAL ASSEMBLY
HOUSE BILL NO. ___
AN ACT TO AMEND CHAPTER 17, TITLE 22 OF THE DELAWARE CODE RELATING
TO MUNICIPAL TAX INCREMENT FINANCING.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. AMEND Section 1702(k), Chapter 17, Title 22 of the Delaware Code by
striking the figure “50,000” and substituting in lieu thereof the figure “35,000”.
Section 2. This Act shall become effective upon its enactment into law.
SYNOPSIS
This amendment to the definition of “municipality” in the Municipal Tax Increment
Financing Act would allow the City of Dover to take advantage of the economic development
opportunities afforded by the Act.
Page 33
SPONSOR:
DELAWARE HOUSE OF REPRESENTATIVES
149th GENERAL ASSEMBLY
HOUSE BILL NO. ___
AN ACT TO AMEND CHAPTER 18, TITLE 22 OF THE DELAWARE CODE RELATING
TO MUNICIPAL SPECIAL DEVELOPMENT DISTRICTS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. AMEND Section 1801(4), Chapter 18, Title 22 of the Delaware Code by
striking the figure “50,000” and substituting in lieu thereof the figure “35,000”.
Section 2. This Act shall become effective upon its enactment into law.
SYNOPSIS
This amendment to the definition of “municipality” in 22 Del. C. § 1801(4) would allow
the City of Dover to take advantage of the economic development opportunities afforded by
Municipal Special Development Districts.
Page 34
ACTION FORM
PROCEEDING: Legislative, Finance & Administration Committee AGENDA ITEM NO.:
DEPARTMENT OF ORIGIN: Finance DATE SUBMITTED: 02/14/17
PREPARED BY: Donna Mitchell, Controller/Treasurer
SUBJECT: Downtown Dover Partnership – Loan Guarantee, City of Dover
APPROVALS: Council Committee of the Whole and City Council
EXHIBITS:
EXPENDITURE REQUIRED: N/A AMOUNT BUDGETED: N/A
FUNDING SOURCE (Dept./Page in CIP & Budget): Loan Payments to be paid from DDP’s tenant
lease payments.
TIMETABLE: Upon approval
RECOMMENDED ACTION: Staff recommends an extension of the City guarantee of the
Downtown Dover Partnership loans for a period of three years effective 3/1/17 on the loans between
PNC Bank and the Partnership.
BACKGROUND AND ANALYSIS
The Downtown Dover Partnership has two PNC loans with a City loan guarantee. These loans
are collateralized by the Partnerships property holdings and payments are covered through the
rents on the properties. The City provides the guarantee as the loan to asset value is not greater
than 80%. The balances and interest rate on these loans are as follows.
Original Loan Loan Balance
120 & 144 So. Governors Ave. $1.3 Million $1.2 Million
Loockerman St. (EZ Pass) $1.3 Million $1.2 Million
As provided above, staff is recommending extending the guarantee on the PNC loans.
Page 35
Presentation to the City Council
February 14, 2017
Page 36
Engagement Team Leadership
CLIENT SERVICE SB & Company, LLC
William Seymour, Engagement Partner
Sisilia Mo, Audit Partner
QUALITY
KNOWLEDGE
2
Page 37
Scope of Services
CLIENT SERVICE
Audit of June 30, 2016, Comprehensive Annual Financial
Report
Available for year-round consultation
QUALITY
KNOWLEDGE
3
Page 38
Summary of the Results
CLIENT SERVICE
• Issued an unmodified opinion on the financial statements
• We did not discover any instances of fraud
• Discovered no material weakness in internal controls
• Received full cooperation from management
QUALITY
KNOWLEDGE
4
Page 39
FORCAM Audit Approach
CLIENT SERVICE
“Focus on Risk, Controls and Misstatement”
QUALITY
KNOWLEDGE
5
Page 40
Significant Risk Areas
CLIENT SERVICE Significant Risk Areas
Cash reconciliations
Investment valuation
Collectability of receivables
QUALITY Accounts payable
Pension Liabilities
OPEB Liabilities
Revenue recognition
KNOWLEDGE
Expenditures control
6
Page 41
Assessment of Control Environment
CLIENT SERVICE Area Points to Consider Our Assessment
Key executive integrity, ethical, and behavior
Control consciousness and operating style
Commitment to competence
Control Environment Board’s participation in governance and oversight
Organizational structure, responsibility, and authority
HR policies and procedures
Mechanisms to anticipate, identify, and react to significant events
Risk Assessment Processes and procedures to identify changes in GAAP, business practices, and
QUALITY
internal control
Existence of necessary policies and procedures
Clear financial objectives with active monitoring
Logical segregation of duties
Control Activities Adequate safeguards of documents, records, and assets
Assess controls in place
Not effective
KNOWLEDGE
Suggested improvements
Effective
7
Page 42
Assessment of Control Environment
CLIENT SERVICE
(continued)
Area Points to Consider Our Assessment
Adequate performance reports produced from information systems
Information systems are connected with business strategy
Commitment of HR and finance to develop, test, and monitor IT systems and
Information and programs
Communication Business continuity and disaster plan for IT
Established communication channels for employees to fulfill responsibilities
Adequate communication across organization
QUALITY
Periodic evaluations of internal controls
Monitoring Implementation of improvement recommendations
Not effective
Suggested improvements
Effective
KNOWLEDGE
8
Page 43
Evaluation of Key Processes
CLIENT SERVICE
Process Function Our Assessment
Cash Management
Investment Accounting
Investment Monitoring
Treasury
Investment Valuation
Investment Policy
Reconciliation
Methodology
Estimation Information
QUALITY
Calculation
Accounting Principles and Disclosure
Closing the Books
Financial Reporting Report Preparation
General Ledger and Journal Entry Processing
Verification and Review of Results
Purchasing
Expenditures Receiving
Accounts Payable and Cash Disbursement
KNOWLEDGE
Not effective
Suggested improvements
Effective
9
Page 44
Evaluation of Key Processes (continued)
CLIENT SERVICE Process Function Our Assessment
Hiring
Attendance Reporting
Payroll Payroll Accounting and Processing
Payroll Disbursements
Separation
QUALITY
Billing
Cash Receipts
Revenue
Revenue Recognition
Cutoff
Physical Custody
Fixed Assets Asset and Construction in Process Accounting
Depreciation
Not effective
KNOWLEDGE
Suggested improvements
Effective
10
Page 45
Evaluation of Key Processes (continued)
CLIENT SERVICE Process Function Our Assessment
Assess Internal and External Risk
Regulatory Compliance
Compliance
Monitor Compliance
Grant Compliance
QUALITY
Computer Operations
Information Segregation of Duties and Management Oversight
Technology Information Security and Transaction Authorization
Program Integrity and Change Management
Not effective
KNOWLEDGE
Suggested improvements
Effective
11
Page 46
Observations
CLIENT SERVICE
Consideration of hiring of internal auditor to perform
periodical performance and compliance audits
Finalization of contracts prior to execution of actions
QUALITY
KNOWLEDGE
12
Page 47
Accounting Update
CLIENT SERVICE
GASB 72, Fair Value Measurement and Application
Adopted in current year
Additional disclosure on investments valuation methodology
GASB 77, Tax Abatement Disclosure
Effective FY 2017
QUALITY
New disclosure about tax abatement agreements
GASG 74 and 75, Other Postemployment Benefits
GASB 74 effective FY 2017 and GASB 75 effective FY18
Reporting net OPEB liabilities on government-wide financial statements
Additional footnote and required supplemental information similar to pension
accounting
KNOWLEDGE
Additional disclosure on effect on net OPEB liability would include both a
discount rate +/- 1 percent and a healthcare cost trend rate +/- 1 percent
13
Page 48
REQUIRED
COMMUNICATIONS
KNOWLEDGE QUALITY CLIENT SERVICE
Page 49
Required Communications
CLIENT SERVICE 1. Auditor’s Responsibilities Under Generally Accepted Auditing Standards (GAAS)
The financial statements are the responsibility of management. Our audit was designed in accordance with
auditing standards generally accepted in the United States of America, and provide for reasonable, rather
than absolute, assurance that the financial statements are free of material misstatement.
2. Significant Accounting Policies
Management has the responsibility for selection and use of appropriate accounting policies. In accordance
with the terms of our engagement letter, we will advise management about the appropriateness of
QUALITY
accounting policies and their application.
The significant accounting policies used by management are described in the notes to the financial
statements.
3. Auditor’s Judgments About the Quality of Accounting Policies
We discuss our judgments about the quality, not just the acceptability, of accounting policies selected by
management, the consistency of their application, and the clarity and completeness of the financial
statements, which include related disclosures.
We have reviewed the significant accounting policies adopted by the City of Dover, Delaware (the City) and
KNOWLEDGE
have determined that these policies are acceptable accounting policies.
15
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Required Communications (continued)
CLIENT SERVICE 4. Audit Adjustments
We are required to inform the City’s oversight body about adjustments arising from the audit (whether
recorded or not) that could in our judgment either individually or in the aggregate have a significant effect
on the entity’s financial reporting process. We also are required to inform the City’s oversight body about
unadjusted audit differences that were determined by management to be individually and in the
aggregate, immaterial.
There were no passed adjustments identified during the audit process.
QUALITY
5. Fraud and Illegal Acts
We are required to report to the City’s oversight body any fraud and illegal acts involving senior
management and fraud and illegal acts (whether caused by senior management or other employees) that
cause a material misstatement of the financial statements.
Our procedures identified no instances of fraud or illegal acts.
6. Material Weaknesses in Internal Control
We are required to communicate all significant deficiencies in the City’s systems of internal controls,
KNOWLEDGE
whether or not they are also material weaknesses.
There were no material weaknesses noted during the audit.
16
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Required Communications (continued)
CLIENT SERVICE 7. Other Information in Documents Containing Audited Financial Statements
None.
8. Disagreements with Management on Financial Accounting and Reporting Matters
None.
9. Serious Difficulties Encountered in Performing the Audit
None.
10. Major Issues Discussed with Management Prior to Acceptance
QUALITY
None.
11. Management Representations
We received certain written representations from management as part of the completion of the audit.
12. Consultation with Other Accountants
To our knowledge, there were no consultations with other accountants since our appointment as the City’s
independent public accountants.
13. Independence
KNOWLEDGE
As part of our client acceptance process, we go through a process to ensure we are independent of the City. We are
independent of the City.
14. Non-attest Service
We did not perform any non-attest service for the City.
17
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Required Communications (continued)
CLIENT SERVICE 15. Our Responsibility Related to Fraud
Plan and perform the audit to obtain reasonable assurance that there is no material misstatement caused
by error or fraud;
Comply with AU-C Section 240: Consideration of Fraud in a Financial Statement Audit
Approach all audits with an understanding that fraud could occur in any entity, at any time, by anyone; and
Perform mandatory procedures required by GAAS and our firm policies.
QUALITY
Examples of Procedures Performed
Discuss thoughts and ideas on where the financial statements might be susceptible to material
misstatement due to fraud;
Understand pressures on the financial statement results;
Understand the tone and culture of the organization;
Look for unusual or unexpected transactions, relationships, or procedures;
Discussions with individuals outside of finance;
Evaluate key processes and controls; and
KNOWLEDGE
Consider information gathered throughout the audit.
18
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Responsibility for Mitigating Fraud
CLIENT SERVICE
Management:
CFO/Controller: controls
to deter and detect fraud
Financial General
Misconduct by Fraudulent Counsel/Compliance:
Member(s) of Financial
Sr. Management Reporting monitoring
of the Board
External Auditor
Costs &
Misappropriation of
Evaluate management programs and Expenses
Assets
Avoided by
QUALITY
controls to deter and detect fraud for Fraud Audit Committee:
identified risks
Revenue & Expenditures & Evaluate management
Reasonable assurance that financial Assets Obtained Liabilities identification of fraud risk
statements are free of material by Fraud for an Improper
misstatement due to fraudulent financial
Purpose Evaluate implementation
reporting or misappropriation of assets of fraud controls
Compliance with fraud standard (SAS 99) Reinforce “tone at the
top”
Conversations with finance and
operations personnel Conduct special
investigations
Disaggregated analytics
Surprise audit procedures
KNOWLEDGE
Journal entry testing
19
Page 54
SBC’s Service Pledge to You
CLIENT SERVICE
We will consistently deliver a Quality Product and Quality Service so that we have
the opportunity to establish a Quality Relationship with you, allowing us to provide
you with Quality Knowledge for your continual success. Only after we have
provided you with the knowledge that enables your business to grow and prosper,
we have hit the bullseye!
Our commitment to you is the execution of our
QUALITY
Bullseye Philosophy. We execute this philosophy
for every client, on every engagement, every time.
KNOWLEDGE
20
Page 55
Engagement Team Contact Information
CLIENT SERVICE William Seymour, CPA – Engagement Partner
Over 18 years of experience
Former member of Arthur Andersen, LLP Experience serving many government entities
Reviewer for GFOA Certificate of Achievement for Excellence in Financial Reporting Program
Member of AICPA Government Quality Center
Office: 410-584-1404 Cell: 443-220-4401 Fax: 410-584-0061
Email: wseymour@sbandcompany.com
Executive Assistant: April Campagna
QUALITY
Office: 410-584-9303
Email: acampagna@sbandcompany.com
Sisilia Mo, CPA – Audit Partner
Extensive experience performing financial statement audits for various entities, especially for
government entities
Develops training programs and performs trainings on audit performance skills and industry-specific
issues
Reviewer for GFOA Certificate of Achievement for Excellence in Financial Reporting Program
Office: 410-584-2202 Cell: 443-739-0808 Fax: 410-584-0061
Email: smo@sbandcompany.com
KNOWLEDGE
Executive Assistant: April Campagna
Office: 410-584-9303
Email: acampagna@sbandcompany.com
21
Page 56
Baltimore Office: Washington, D.C. Office:
200 International Circle 1299 Pennsylvania Avenue, NW
Suite 5500 Suite 1120
Hunt Valley, Maryland 21030 Washington, D.C. 20004
410.584.0060 202.803.2335
KNOWLEDGE QUALITY CLIENT SERVICE
Page 57
CITY OF DOVER
Comprehensive Annual Financial Report
Fiscal Year Ended June 30, 2016
Page 58
2
FY 2016 Financial Highlights
The Government-wide change in Net position is inclusive of Pension
& OPEB expense, actuarial adjustments, cost vs. market differences
on investments and depreciation.
Governmental Business Type
Activities Activities Total
Changes in Net Position $ 8,949,366 $ 7,500,153 $ 16,449,519
Net Position Beginning 24,094,252 167,049,585 191,143,837
Net Position Ending $ 33,043,618 $ 174,549,738 $ 207,593,356
The most significant activities that affected the positive changes in
Net Position were:
• The transfer of Net Pension Liability of $5.4 million for indirect
interdepartmental allocation of expense from the Governmental
activities to the Business-type activities
• Electric Revenue Fund experienced a decrease of $7,353,700 due
to declining supply prices as compared to the prior year
Page 59
3
Capital Assets
Capital Asset Summary information
Water/Wastewater
General Fund Fund Electric Fund Total
Asset Beginning Balance $ 97,006,951 $ 86,892,622 $ 189,703,140 $ 373,602,713
New Assets 5,702,654 4,982,587 4,987,819 15,673,060
Disposed Assets (602,824) (774,516) (2,646,854) (4,024,194)
Asset Ending Balance 102,106,781 91,100,693 192,044,105 385,251,579
Net Accumulated Depreciation (40,998,742) (33,496,540) (108,366,795) (182,862,077)
Net Capital Assets $ 61,108,039 $ 57,604,153 $ 83,677,310 $ 202,389,502
Current Year Depreciation $ 3,284,341 $ 1,998,040 $ 5,713,104 $ 10,995,485
Major Assets added this fiscal year:
• General Fund
• Garrison Oak Tech Park street and storm sewer infrastructure $4.6 million
• Other street paving and curb work $1.8 million
• Vehicles and equipment totaling $1.0 million
• Additions to CIP of $3.1 million
• Water/Wastewater Fund
• Garrison Oak Tech Park water and sewer infrastructure $8.6 million
• Two pump station replacements $0.8 million
• Vehicles and equipment totaling $0.5 million
• Electric Fund
• General Scott Switchgear $0.8 million
• Units 1, 2 & 3 upgrades and modifications at McKee Run $1.9 million
• Additions to CIP of $2.5 million
• Vehicles and equipment totaling $0.5 million
Page 60
4
Long-Term Debt
Long-Term Debt is inclusive of Compensated absences, Bonds, OPEB
Obligation and Net Pension Liability.
Water/Wastewater
General Fund Fund Electric Fund Total
LT Debt Beginning Balance $ 48,232,958 $ 16,263,624 $ 27,401,361 $ 91,897,943 No new
New Debt 2,327,952 2,387,563 3,559,978 8,275,493
Reduction of Debt (8,408,960) (911,426) (2,724,621) (12,045,007) bonds
LT Debt Ending Balance $ 42,151,950 $ 17,739,761 $ 28,236,718 $ 88,128,429 were
• General Fund change in long-term debt is due to: issued
• $1.3 million increase offset by $1.4 million decrease in compensated absences in FY
• $1.0 million increase in OPEB Obligation
2016
• $6.5 million decrease in Net Pension Liability
• Final payment was made on the 2014 G.O. refunding bonds (refunded 2003 G.O. Bonds)
• Water/Wastewater Fund change in long-term debt is due to:
• Increases to compensated absences and OPEB Obligation of $121,166 & $83,077 respectively
• $2.2 million increase for Net Pension Liability
• Normal decrease for principal payments
• Electric Fund change in long-term debt is due to:
• $3.3 million increase for Net Pension Liability
• $297,795 increase in compensated absences
• Normal decrease for principal payments
• Final payment was made on the 2010 refunding bonds (refunded 2004 revenue bonds)
Page 61
5
Governmental Statement of Revenues,
Expenses and Transfers
Total net change across all funds:
Water/Wastewater
General Fund Fund Electric Fund Total
Revenues $ 24,022,570 $ 15,229,776 $ 81,545,330 $ 120,797,676
Expenses (38,405,636) (11,925,299) (61,054,151) (111,385,086)
Transfers- Operating 14,339,821 (850,000) (10,000,000) 3,489,821
Transfers - Pension - (2,183,320) (3,262,183) (5,445,503)
Net changes $ (43,245) $ 271,157 $ 7,228,996 $ 7,456,908
General Fund Revenues $1,567,700 General Fund Expenses
$280,901 $594,300 $122,813 $2,114,199
$659,418 $67,078 $352,599 $804,246
$3,525,992 $465,843 $1,430,640
$2,527,478 $919,086
$14,339,821
$1,874,534
$166,579
$6,081,813
$783,976 $20,798,762
$232,067
$12,893,566 $1,602,389
$1,239,300
$650,538
Fines Library Revenue - General General Government Library services
Library Revenue County Reimb. Licenses and Permits Public Safety Public Works
Recreation Services Street/Sanitation Services
Sanitation Fees and Rebates Miscellaneous Services
Engineering Services Financial Administration
Property Taxes Grants Received
Garage and Stores Insurance
Court of Chancery Fees Investment Income Retiree Health Care Employee Pension Approp
Transfers Street Lights Debt Service:
Page 62
6
Business-type Statement of Revenues, Expenses and Transfers
Page 63
7
Original vs. Final Budgets – Major Operating Funds
General Fund
All Funds
Original Budget Final Budget • Beginning Fund Balance adjusted to audited balance
Revenues $ 41,327,100 $ 41,936,100 • Revenues adjusted to actual/trending amounts
Expenditures/Expenses (41,201,300) (42,262,600) • Expenses adjusted for unanticipated expenses/project carryforwards
Net Change $ 125,800 $ (326,500)
General Fund
Beginning Fund Balance 3,977,500 4,820,400
• Interest earned adjusted up from $35K to $140K (actual $172K)
Ending Fund Balance $ 4,103,300 $ 4,493,900
• Transfer taxes adjusted up from $1.3M to $2.1M (actual $2.2M)
• Library – County adjusted down from $450K to $313K (actual $353K)
• Electric Inter-fund Service adj. down from $3.7M to $3.6M (actual $3.6M)
Water Fund
Original Budget Final Budget • Added transfer to Capital Asset Reserve $229,600
Revenues $ 6,824,900 $ 5,995,000 • Police Pension Appropriation adjusted up from $570K to $676.5K
Expenses (6,637,900) (6,501,400) • Added $594,300 General Pension Appropriation
Net Change $ 187,000 $ (506,400) • Added $240,000 for New Street Property Acquisitions
Beginning Fund Balance 861,600 1,072,900 Water & Wastewater Fund
Ending Fund Balance $ 1,048,600 $ 566,500
• Water fees adjusted down from $6.2M to $5.4M (actual $5.5M)
• Wastewater fees adjusted down from $969K to $841K (actual $774K)
• Wastewater Treatment expense adjusted down approx. $30K
Wastewater Fund
• Groundwater Adjustment exp. adjusted down $101K
Original Budget Final Budget
Revenues $ 8,902,800 $ 9,042,500 • WTP expenses adjusted down from $1.9M to $1.7M (actual was $1.6M)
Expenses (8,613,100) (8,586,200) • Retiree H/C adjusted down from $179K to $60K
Net Change $ 289,700 $ 456,300 • Inter-fund Service Fees adjusted down by $72,500
Beginning Fund Balance 293,400 206,900 • Bank fees and credit card expense adjusted down by $21,200
Ending Fund Balance $ 583,100 $ 663,200 • Added Appropriation to Pension Fund $248,400
Electric Fund
• Transfer from Rate Stabilization Fund decreased from $3.0M to $750K
Electric Fund
• Direct Base Sales adjusted up from $78.3M to $78.5M (actual $77.9M)
Original Budget Final Budget
• Miscellaneous Services adjusted up from $597K to $911K (actual $842K)
Revenues 83,536,000 81,830,400
• OPEB Trust Contribution of $1,030,000 removed from budget
Expenses (80,568,700) (76,865,700)
• Retirees H/C adjusted down from $538K to $58K
Net Change $ 2,967,300 $ 4,964,700
• T&D expense adjusted down from $4.1M to $3.4M (actual $3.3M)
Beginning Fund Balance 6,177,600 8,337,500 • Added transfer to Rate Stabilization Fund $394,800
Ending Fund Balance $ 9,144,900 $ 13,302,200
Page 64
8
General Fund Budget
General Fund Final General Fund
Budget Actual
Revenues $ 41,936,100 $ 42,674,501
Expenditures/Expenses (42,262,600) (42,070,164)
Net Change $ (326,500) $ 604,337
Beginning Fund Balance 4,820,400 4,820,414
Ending Fund Balance $ 4,493,900 $ 5,424,751
General
• The General Fund is the primary operating fund and the
Fund fund
largest source of day-to-day service delivery.
balance • The budget balance in the fund is $5,424,751, and is 12.7%
increased by of 2016 general fund revenues.
$604,337 to • The overage will be allocated to unfunded retirement
an ending liabilities or as otherwise designated.
balance of Significant favorable variances are as follows:
$5,424,751 • $320,549 Permits & Other License fees
• $148,900 Court of Chancery fees
• $98,429 Police extra duty fees
Significant unfavorable variances are as follows:
• $300,000 Transfer to Uncollectible reserve
• $78,020 Police Department expense
• Medical supplies, uniforms, Insurance, Training, Contractual Services & Auto
repairs
Page 65
9
Governmental Capital Projects Fund
Governmental
Capital Projects Fleet Maintenance $84,234
$84,500
Fund City Manager $-
$24,700
Ending fund balance Sanitation $402,484
$449,000
was favorable by
$1,088,116. Of this Streets $2,918,713
$3,735,000
amount, $882,000 will
be carried forward to the Recreation $70,514
$73,900
next year.
Projects that will be Police $268,501
$302,700
carried forward include:
$56,411
• Grounds - 2 Dump Life Safety
$55,700
trucks
$68,352
• Streets – truck w/ Grounds Maintenance
$185,200
dump
$445,594
Fire
• Salt Storage barn $445,800
• Street Program $-
$500,000
• Persimmon Park $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000
Place drainage
• City Manager vehicle
Governmental Capital Projects Fund Actual Governmental Capital Projects Fund Budget
Page 66
10
Proprietary Funds – Water/Wastewater Budget
Water Fund Water Fund Wastewater Fund Wastewater Fund
Final Budget Actual Final Budget Actual
Revenues $ 5,995,000 $ 6,070,159 $ 9,042,500 $ 8,804,718
Expenses (6,501,400) (6,261,777) (8,586,200) (8,292,480)
Net Change $ (506,400) $ (191,618) $ 456,300 $ 512,238
Water Fund Beginning Fund Balance 1,072,900 1,072,915 206,900 206,896
balance Ending Fund Balance $ 566,500 $ 881,297 $ 663,200 $ 719,134
decreased
by $191,618 Fund balance for the Water Utility at the end of the year is $881,297 which is a
favorable variance of $314,797:
• Water fees came in over budget by $90,461
• Miscellaneous service fees came in under budget by approx. $6,700
• Water impact fees came in under budget by $15,370
Offset by:
• Water department expenses came in under budget by $32,024
Wastewater
• Water Treatment Plant expenses came in under budget by $95,847
Fund
balance Fund balance for the Wastewater Utility at the end of the year is $719,132, which
increased by is a favorable variance of $55,932
$512,238 • Wastewater fees came in under budget by $78,303
• Water Treatment Fees came in under budget by $60,769
Offset by:
• Transfer to impact fee reserve of $54,389
Page 67
11
Proprietary Funds – Water/Wastewater I & E Fund
Water/Wastewater Capital Outlay
• Both the Water and Wastewater fund balances have
$6,000,000
reduced from the prior year from $9,542,032 in $5,396,100 $5,299,100
2015 to $6,714,183 in 2016 since Garrison Oak $5,000,000
Tech Park a Multi-year project is now completed
• Some projects in this fund have been modified from $4,000,000
previous plans which resulted in a transfer of $3,045,887
$3,000,000
$1,271,343 back to the impact fee reserve since the
money was no longer needed $1,810,487
$2,000,000
• Some projects in this fund were not completed and $330,900 $1,271,343
the balances are being carried forward to FY 2017 $1,000,000
in the amount of $4,222,800, some of the larger $246,052
$-
projects are as follows: $-
Water Wastewater Water Treatment Transfer back to
• $2,468,200 1.0 MG Storage Tank – Denny’s Road Plant Imp Fee
• $593,000 Westover Pump-station upgrade Reserve
• $618,900 Hazlettville Road interceptor Budget Actual
• $447,500 Retreat Pump-station upgrade
• There continues to be large budget balances due to
delay of projects and various other issues like:
• Land acquisition
• Bid prices over budget – going out to re-bid
• Awaiting final invoices on completed projects
• Awaiting delivery of materials
• Project Engineering & Design not ready
• Emergency repairs taking precedence
Page 68
12
Proprietary Funds – Electric Fund Budget
Electric Fund Electric Fund
Final Budget Actual
Revenues $ 81,830,400 $ 81,176,596
Expenses (76,865,700) (69,617,696)
Net Change $ 4,964,700 $ 11,558,900
Beginning Fund Balance 8,337,500 8,337,466
Ending Fund Balance $ 13,302,200 $ 19,896,366
The Electric Fund balance for the Electric Utility at the end of the year is
Fund fund $19,986,366 which is a favorable variance of $6,594,166 primarily due
to the following favorable variances:
balance has
• Power Supply and Generation $6,765,549
a favorable
• Administration $122,903, attributed mainly to lower costs for legal
variance of expense and contractual services
$6,594,166 • Transmission and Distribution $157,615, resulting from lower labor
costs, contractual services and materials & supplies
• Other Employment Expenses $353,400
Offset by unfavorable variances as follows:
• Direct Base Sales $648,863
• Interfund service fees $54,269
Page 69
13
Proprietary Funds – Electric I & E Fund
• Electric I & E Fund balance has
increased by $2,219,081. New
Electric Capital Outlay
Development budgeted expense of
$4,000,000
$2,500,000 had actual expense of $3,500,000
$3,524,900
$3,288,000
$608,609. This expense is dependent $3,000,000
$2,299,800
$2,500,000
on developers. New Development $2,000,000 $1,740,853
revenue billed and collected $1,500,000
$964,880 $1,109,450
$1,000,000
amounted to $327,453 $500,000 $-
$23,000
• Some of the projects in this fund have $-
not been completed and the balances
are being carried forward to FY 2017
in the amount of $1,561,200, some of
the larger projects are as follows:
• $270,900 VanSant Capacity Increase Budget Actual
• $340,000 Unit 3 Stack Repair
• $150,000 Metering Infrastructure
• $250,600 69 KV Rebuild – Horsepond Rd
• $135,000 69 KV North St Cable Replacement
Page 70
14
Worker’s Compensation and Grants
Summary Revenue, Expense and Net Change of
Worker’s compensation and Grants
Worker’s
Worker's
Compensation Compensation Grants
Fund balance Revenues $ 717,335 $ 5,527,371
Expenses (708,543) (1,707,269)
increased by Transfers out - (3,489,821)
$8,792 Net Change $ 8,792 $ 330,281
Beginning Fund Balance 1,248,164 429,028
Ending Fund Balance $ 1,256,956 $ 759,309
Workers Compensation
• Claims payable increased by $261,532 from prior year
• Claims paid decreased by $62,988 from prior year
Grants Grants
ending fund • Includes Police, Library, Municipal Street Aid, CDBG, State DOT, Substance
balances abuse, ERLSP & Realty Transfer grants
• Grants revenue increased $1,552,377 from prior year in all of the Grant funds
increased by except the following:
$330,281 • CDBG Grant Fund
• Substance Abuse Fund
• ERLSP Fund
Page 71
MANAGEMENT SUMMARY
City of Dover, Delaware
January 24, 2017 Retiree Health Benefits
Page 72
Certification
This report was prepared for the City of Dover to summarize the results of the GASB 45 accounting reports as of
June 30, 2016, and may not be appropriate for other uses. Please contact Nyhart prior to disclosing this report to
any other party or relying on its content for any purpose other than the intended use.
Accounting results are based on the same data, assumptions, methods and plan provisions as described in the
6/30/2015 GASB 45 report prepared by the City’s prior actuary except as noted in the Nyhart 6/30/2016 GASB 45
report and further described in this report.
The discount rate and other economic assumptions have been selected by the Plan Sponsor. To our knowledge,
there have been no significant events prior to the current year’s measurement date or as of the date of this
report that could materially affect the results contained herein.
This report has been prepared in accordance with generally accepted actuarial principles and practice. Neither
Nyhart nor any of its employees has any relationship with the plan or its sponsor that could impair or appear to
impair the objectivity of this report.
The undersigned are compliant with the continuing education requirements of the Qualification Standards for
Actuaries Issuing Statements of Actuarial Opinion in the United States.
Randy Gomez, FSA, FCA, MAAA Evi Laksana, ASA, MAAA
2
Page 73
1 New actuary
A lot of
changes 2 Interim valuation changes and
results
3 Fresh look at where things are and
where they are going
3
Page 74
Transition to Nyhart Key
Figures
Prior Actuary Nyhart
Measurements as of 7/1/2014 6/30/2015 Full 6/30/2016 Limited Difference
Valuation Update
Actuarial Accrued Liability $51,224,524 $66,600,509 $15,373,985
Actuarial Value of Assets ($18,752,196) ($22,448,290) $3,696,094
Funded Ratio 36.6% 33.7% (2.9%)
Actuarially Required Contribution $3,809,600 $5,125,687 $1,316,087
• For the transition from the prior actuary, Nyhart reviewed data, plan provisions, &
assumptions summarized by the prior actuary in the 7/1/2014 valuation report.
• Significant change made by Nyhart was to include the value of implicit subsidy for pre-
Medicare benefits required by actuarial standards of practice.
• Healthcare trend rates were modified to reflect actual plan experience from 7/1/2014 to
7/1/2015. 4
Page 75
Liability Increase Key
Sources Factors
Actuarial Accrued
Description
Liability Impact
Based on actual premium rate
Impact of Premium Rate Experience +$4,083,000
increases from 2014/15 to 2016/17
Required by Actuarial Standards of
Impact of Implicit Subsidy +$8,823,000
Practice (ASOP) #6
Net Impact +$12,906,000
ACTUARY’S The City is a participating entity in the State of Delaware community-rated health
plans. Active and pre-Medicare retiree experience is blended together for these
COMMENT plans and premium rates do not vary by age. This triggers the application of ASOP
#6 in the valuation.
Premium rates on average increased close to 25% since the prior valuation. The
rate of increase was greater than expected based on the trend assumption from
the prior actuary’s report.
5
Page 76
Subsidy Illustration Implicit
Subsidy
GASB Subsidy Breakdown
Per Capita Premium Implicit
PPO Cost Rate Subsidy $1,200
(A) (B) (C) = (A) – (B)
289.20
Retiree $800
Only $1,083.33 $794.13 $289.20
Coverage
794.13
$400
$0
Retiree
Full Premium Implicit subsidy
• Example of a retiree, age 60, on the Comprehensive PPO plan.
• Per Capita Costs represent estimated cost of coverage for a retiree age 60. Implicit Subsidy
is the additional employer liability when the inherently higher health care cost for retired
employees is not directly reflected in the determination of the premium rates.
• Actuarial Standards of Practice (ASOP) 6 state an implicit subsidy exists for health plans that
comingle claims experience of active employees and retirees in setting of a blended
premium rate for all plan participants.
6
Page 77
OPEB Trust Assets
Trust
Summary
Market Value
6/30/2015 6/30/2016
Summary Asset Breakdown
Net OPEB Assets $22,448,290 $24,043,162 June 30, 2016
5%
% Mutual Funds 97.6% 95.5%
% Cash/Equivalents 2.4% 4.5%
95%
Asset Rate of
2.5% 2.1%
Return
Mutual Funds Cash/Cash Equivalents
ACTUARY’S Trust asset return for FY 2016 was 2.1% versus expected 6.5% (net of trust
expenses). Consistent underperformance of trust investments over an extended
COMMENT
ACTUARY’S period of time
Under GASB 67 can
and cause
68, theunder funding
Net Pension of future
Liability retiree
is equal to thehealth benefits.
unfunded liabilityNyhart
at the
measurement an
recommends date. In determining
experience studythe unfunded
using forward liability,
lookingthe market value of
simulations beassets is
COMMENT used.
completed prior to GASB 74/75 implementation.
7
Page 78
GASB 45 Accounting Results by Group
Group General Water Electric
Actuarial Accrued Liability $50,159,093 $3,990,734 $12,450,682
Actuarial Value of Assets ($11,635,925) ($1,830,545) ($8,981,820)
Unfunded Actuarial Accrued Liability $38,523,168 $2,160,189 $3,468,862
Annual Required Contribution $4,476,281 $248,111 $401,2955
Employer Contribution for Pre-Funding $3,295,855 $300,009 $1,709,143
Benefit Payments ($1,419,406) ($165,748) ($539,435)
Unfunded Liability as of Annual Required Contribution
6/30/2016 and Funding as of 6/30/2016
$50 $5.0 $4.48
ACTUARY’S
Millions Millions
$38.52
$40 $4.0 $3.29
$30COMMENT $3.0
$20 $2.0
*TPL refers to Total Pension Liability
ACTUARY’S
$10 $2.16 $3.47 $1.0 $0.25 $0.16 $0.40 $0.12
$0 ** The $530,00 charge includes charges due$0.0
to differences between expected and actual
COMMENT
General experience
Electric in measurement
Water of the TPL, changes of assumptions,
General and differences
projected and actual earnings on pension plan investments
Electricbetween Water
ARC Pre-Funding
8
Page 79
1 Full Actuarial Update for FY 2016/17
Looking
ahead 2 Review of Assumptions and GASB
74/75 Implementation
3 Long-term Projections and Planning
9
Page 80
MANAGEMENT SUMMARY
City of Dover, Delaware
General Employee and
January 24, 2017 Police Pension Plans
Page 81
Certification
This report was prepared for the City of Dover to summarize the results of the 7/1/2016 funding valuations and
the GASB 67 & 68 accounting reports as of June 30, 2016, and may not be appropriate for other uses. Please
contact Nyhart prior to disclosing this report to any other party or relying on its content for any purpose other
than the intended use.
Except where indicated otherwise, the funding results included in this report are based on the same data,
assumptions, methods, and plan provisions as the 7/1/2016 funding valuations. As a result, these sections of
the 2016 funding reports dated 12/30/2016 should be considered part of this report.
Accounting results are based on the same data, assumptions, methods and plan provisions as described in the
6/30/2016 GASB 67 & 68 reports. As a result, these sections of the GASB 67 & 68 report dated 10/4/2016 and
9/23/2016 should be considered part of this report.
This report has been prepared in accordance with generally accepted actuarial principles and practice.
The undersigned are compliant with the continuing education requirements of the Qualification Standards for
Actuaries Issuing Statements of Actuarial Opinion in the United States.
Carter M. Angell, FSA, EA, MAAA Elizabeth A. Wiley, ASA
2
Page 82
1 New actuary
A lot of
changes 2 Audit of previous results for funding
and accounting
3 Fresh look at where things are and
where they are going
3
Page 83
Transition to Nyhart General
Employees
Measurements as of 7/1/2014 Prior Actuary Nyhart $ Difference % Difference
Actuarial Accrued Liability $58,278,646 $57,854,095 ($424,551) (0.7%)
Employer Normal Cost $253,709 $237,390 ($16,319) (6.4%)
Employee Normal Cost $199,958 $203,725 $3,767 1.9%
PYE 2016 Contribution $2,983,776 $2,914,643 ($69,133) (2.3%)
• Nyhart was able to match key measurements within a reasonable range, and did not identify
any pension plan provisions which were not captured or were valued inappropriately.
• For the conversion, Nyhart reviewed data, plan provisions, & assumptions summarized by
the prior actuary in the 7/1/2014 valuation report.
4
Page 84
Valuation Results General
Employees
Recommended Contribution
4,000
Thousands
3,000 $188 $172
2,000
$2,542 $2,420
1,000
0 $254 $232
7/1/2014 7/1/2016
ER Normal Cost Amortization Interest
Valuation Date 7/1/2014 7/1/2016
Accrued Liability $58,278,646 $58,851,782
Actuarial Value of
32,825,853 36,791,391
Assets
Unfunded Liability 25,452,793 22,060,391
Funded Percentage 56.3% 62.5%
Recommended
$2,983,776 $2,824,098
Contribution
5
Page 85
GASB 67, 68 Accounting Results – General Employees
Measurement Date 6/30/2015 6/30/2016
Total pension liability (TPL) 58,673,000 58,807,821
Plan fiduciary net position (35,290,922) (35,698,537)
Net pension liability 23,382,078 23,109,284
Ratio of plan fiduciary net position to TPL 60.15% 60.70%
• The net pension liability decreased from 2015 to 2016.
• $1,435,000 expected decrease
• $267,000 decrease due to demographic gains
• $1,429,000 increase due to asset underperformance (i.e. return of 2.4% vs. expectation of 6.50%)
ACTUARY’S Under GASB 67 and 68, the Net Pension Liability is equal to the unfunded liability at the
measurement date. In determining the unfunded liability, the market value of assets is
COMMENT used.
6
Page 86
GASB 67, 68 Accounting Results – General Employees
Measurement Date 6/30/2015 6/30/2016
Service Cost $458,969 $401,218
Interest on TPL 3,861,154 3,718,982
Projected earnings on investments (2,406,707) (2,279,528)
Employee contributions (209,446) (202,340)
Administrative expense 18,792 16,040
Recognition of deferred outflows/(inflows)* $716,377 935,467
Pension Expense $2,439,139 $2,589,839
The expense was $219,000 higher than anticipated. The increase was
largely due to the $1.4 million loss on asset performance, which
ACTUARY’S caused a $286,000 increase in expense (as the loss is amortized over 5
COMMENT years). This loss was offset by demographic gains which lowered
expense by $67,000.
*TPL refers to Total Pension Liability
ACTUARY’S
** The $530,00 charge includes charges due to differences between expected and actual
COMMENT
* The experience
recognition of deferred
projected
in measurement
outflows/(inflows)
and actual
of charges
includes
earnings
changes
the TPL, due
on pension
of assumptions,
to differences
plan investments
differences
and expected
between
experience in measurement of the TPL, changes of assumptions, and differences between projected and actual
between
and actual
earnings on pension plan investments
7
Page 87
Transition to Nyhart Police
Measurements as of 7/1/2014 Prior Actuary Nyhart $ Difference % Difference
Actuarial Accrued Liability $20,736,450 $20,747,874 $11,424 0.1%
PYE 2016 Contribution $1,176,422 $1,178,011 $1,589 0.1%
• Nyhart was able to match key measurements within a reasonable range, and did not identify
any pension plan provisions which were not captured or were valued inappropriately.
• For the conversion, Nyhart reviewed the data, plan provisions, & assumptions summarized
by the prior actuary in the 7/1/2014 valuation report.
8
Page 88
Valuation Results Police
Recommended Contribution
1,500
Thousands
$72 $72
1,000
500 $1,105 $1,105
0
7/1/2014 7/1/2016
Amortization Interest
Valuation Date 7/1/2014 7/1/2016
Accrued Liability $20,736,450 $19,387,871
Actuarial Value of
12,279,347 12,224,685
Assets
Unfunded Liability 8,457,103 7,163,186
Funded Percentage 59.2% 63.1%
Recommended
$1,176,422 $1,176,462
Contribution
9
Page 89
GASB 67, 68 Accounting Results – Police
Measurement Date 6/30/2015 6/30/2016
Total pension liability (TPL) 20,471,000 19,387,871
Plan fiduciary net position (12,384,845) (12,224,685)
Net pension liability 8,086,155 7,163,186
Ratio of plan fiduciary net position to TPL 60.50% 63.05%
• The net pension liability decreased from 2015 to 2016.
• $598,000 expected decrease
• $836,000 decrease due to demographic gains
• $511,000 increase due to asset underperformance (i.e. return of 2.3% vs. expectation of 6.50%)
ACTUARY’S Under GASB 67 and 68, the Net Pension Liability is equal to the unfunded liability at the
measurement date. In determining the unfunded liability, the market value of assets is
COMMENT used.
10
Page 90
GASB 67, 68 Accounting Results – Police
Measurement Date 6/30/2015 6/30/2016
Service Cost $0 $0
Interest on TPL 1,311,335 1,280,958
Projected earnings on investments (853,442) (790,732)
Employee contributions 0 0
Administrative expense 5,794 4,831
Recognition of deferred outflows/(inflows)* $1,332,366 (619,831)
Pension Expense/(Income) $1,796,053 ($124,774)
The expense was $734,000 lower than anticipated. The decrease was
largely due to the $836,000 demographic gains which were
ACTUARY’S immediately recognized. The gain was offset by a $511,000 asset loss
COMMENT which will be recognized over 5 years. The asset loss increased expense
by $102,000.
*TPL refers to Total Pension Liability
ACTUARY’S
** The $530,00 charge includes charges due to differences between expected and actual
COMMENT
* The experience
recognition of deferred
projected
in measurement
outflows/(inflows)
and actual
of charges
includes
earnings
changes
the TPL, due
on pension
of assumptions,
to differences
plan investments
differences
and expected
between
experience in measurement of the TPL, changes of assumptions, and differences between projected and actual
between
and actual
earnings on pension plan investments
11
Page 91
1 Mortality Update
Looking
ahead 2 Review of Assumptions
3 Long-term Projections and Planning
12