CCW Packet MM

CITY OF DOVER, DELAWARE COUNCIL COMMITTEE OF THE WHOLE MEETING Tuesday, February 23, 2021 at 6:00 PM Virtual via WebEx AGENDA Public comments are welcomed on any item and will be permitted at the appropriate time. When possible, please notify the City Clerk (736-7008 or email at cityclerk@dover.de.us) should you wish to be recognized. VIRTUAL MEETING NOTICE This meeting will be held electronically. Public participation information is as follows: Dial: 1-408-418-9388 Link: https://rb.gy/nknazg Event number: 129 280 0977 Event password: DOVER (if needed) If you are new to WebEx get the app now at https://www.webex.com/ to be ready when the meeting starts. CALL THE COUNCIL COMMITTEE OF THE WHOLE MEETING TO ORDER UTILITY COMMITTEE ADOPTION OF THE AGENDA ACTIONABLE ITEMS 1. Street Sweeping Operations and Enforcement (Staff recommendation: Approval of the proposed changes to the Annual Street Sweeping and Leaf Collection plans with service and enforcement suspended from January 15 – March 15 annually) ADJOURNMENT OF THE UTILITY COMMITTEE MEETING • 1

COUNCIL COMMITTEE OF THE WHOLE MEETING - February 23, 2021 PAGE 2 LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE ADOPTION OF THE AGENDA ACTIONABLE ITEMS 2. Proposed Resolution No. 2021-01 - Application for Wastewater Matching Planning Grant (Staff recommendation: Adopt resolution as submitted so Staff may submit application for a Wastewater Matching Planning Grant) 3. Evaluation of Proposals - HVAC (Heating, Ventilation, and Air Conditioning) Design and Install for the City of Dover Warehouse, City Hall, and Electric Administration Buildings (Staff recommendation: 1. Award the HVAC Design and Install for the City of Dover Warehouse, City Hall, and Electric Administration Building contracts to Statewide Mechanical Inc. as per the proposal submitted in response to RFP #21-0007CS, 21-0006CS, and 21-0005CS. 2. Authorize the City Manager and Controller to bring back a resolution to obtain financing to cover the General Fund projects as referenced.) 4. Evaluation of Bids - Landscaping (Staff recommendation: Awarding #21-0020EL Landscaping Contract to Joseph R. Smith for three years with a City option to extend it an additional two years (five years total) as per the pricing included in the bid submittal) 5. Evaluation of Bids - Overhead Linework (Staff recommendation: Awarding #21-0021EL Overhead Linework Contract to AUI Power for three years with a City option to extend it an additional two years (five years total) as per the pricing included in the bid submittal) 6. CliftonLarsenAllen LLP Audit Results and Comprehensive Annual Financial Report (CAFR) for the Fiscal Year Ending June 30, 2020 (Staff recommendation: Acceptance of the Report) 7. Segal Waters Consulting - Classification, Compensation and Benefit Study (Referred back to Committee during the Regular City Council Meeting of February 8, 2021) (Staff recommendation: Approval of the implementation of the Classification, Compensation and Benefit Study as presented) ADJOURNMENT OF THE LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE MEETING • 2

COUNCIL COMMITTEE OF THE WHOLE MEETING - February 23, 2021 PAGE 3 SAFETY ADVISORY AND TRANSPORTATION COMMITTEE ADOPTION OF THE AGENDA INFORMATIONAL ITEMS 8. Quarterly Briefing on Dover/Kent County Metropolitan Planning Organization (MPO) Projects 9. Community Update (Ms. Lachelle Paul, Criminal Justice Committee Chair, National Association for the Advancement of Colored People (NAACP) Delaware State Conference of Branches) ADJOURNMENT OF THE SAFETY ADVISORY AND TRANSPORTATION COMMITTEE MEETING ADJOURNMENT OF THE COUNCIL COMMITTEE OF THE WHOLE MEETING 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 • 3

D Item 1. • CITY OF DOVER, DELAWARE ACTION FORM PROCEEDING: Council Committee of the Whole (Utility) DEPARTMENT OF ORIGIN: Public Works SUBMITTED ON: February 12, 2021 PREPARED BY: Sharon J. Duca, P.E., Public Works Director REVIEWED BY: Matthew Harline, Assistant City Manager/Lori Peddicord, Controller SUBJECT: Street Sweeping Operations and Enforcement TIMETABLE: Resume night sweeping operations and enforcement of parking restrictions on March 15, 2021 and proceed with annualized plan thereafter. RELATED PROJECT: n/a REFERENCE: n/a EXPENDITURE REQUIRED: n/a AMOUNT BUDGETED: n/a FUNDING SOURCE (Dept./Page in CIP & Budget): n/a STAFF RECOMMENDATION: Staff recommends City Council approve the proposed changes to the annual street sweeping and leaf collection plans with service and enforcement suspended from January 15 – March 15 annually. BACKGROUND AND ANALYSIS: The City of Dover Department of Public Works (DPW) utilizes a street sweeper to remove sediment and other small sized debris from City streets. Street sweeping operations are provided on a weekly basis, both day and night, weather permitting. Factors that can prohibit sweeping include temperatures below freezing, heavy rain and snow. In order to clean streets and control dust emitted during sweeping operations, a sprayer is used to wet the roadway. When temperatures are below freezing, and during inclement weather, this method becomes impractical as it can result in damage to the street sweeper itself due to freezing as well as create hazardous driving conditions. Using the sweepers without water is not recommended as it would create an objectionable amount of dust, grit and dirt to be thrown into the air and on sidewalks. Due to the parking restrictions and associated enforcement related to nighttime sweeping operations, the information above was discussed with Major David E. Spicer of the City of Dover Police Department (DPD). It was important that DPD and DPW coordinate on actual times for street sweeping, leaf collection and enforcement to ensure an effective plan was put in place. An effective plan must recognize the limitations of the equipment and be simple to explain and enforce. If the plan is not straightforward, even the most cooperative citizens will become frustrated and think that the City is unreasonable. As a result, the following annual plan is proposed: • 4

1. Approximately March 15th – October 15th D Item 1. a. Day and night street sweeping will be performed in accordance with scheduled weekly routes from the third week of March through the second week of October. b. Parking restrictions will be enforced by the DPD. 2. Approximately October 15th – January 15th a. Leaf collection will be performed in accordance with scheduled weekly routes from the third week of October through the second week of January. b. Parking restrictions will be enforced by the DPD. 3. Approximately January 15th – March 15th a. Night street sweeping will be suspended from the third week of January through the second week of March. Day and night sweeping will be addressed during the day, as feasible, weather and temperature permitting. b. Parking restrictions will not be enforced by the DPD. • 5

D Item 2. CITY OF DOVER, DELAWARE ACTION FORM PROCEEDING: Council Committee of the Whole (L & F) DEPARTMENT OF ORIGIN: Water & Wastewater SUBMITTED ON: February 10, 2021 PREPARED BY: Jason A. Lyon, P.E., Director of Water & Wastewater REVIEWED BY: Matthew Harline, Assistant City Manager / Lori Peddicord, Controller SUBJECT: Resolution Application for Wastewater Matching Planning Grant TIMETABLE: Application to be submitted by March 10, 2021. Once adopted by Council, this will be forwarded to State of Delaware Clean Water State Revolving Fund Program. RELATED PROJECT: N/A REFERENCE: N/A EXPENDITURE REQUIRED: N/A AMOUNT BUDGETED: N/A FUNDING SOURCE (Dept./Page in CIP & Budget): N/A STAFF RECOMMENDATION: Adopt resolution as submitted so staff may submit application for a Wastewater Matching Planning Grant. BACKGROUND AND ANALYSIS: Through its Clean Water State Revolving Fund, the State of Delaware has allotted matching funds to assist in funding studies that promote wastewater planning and also certain projects that address wastewater. The Fiscal Year 2021 and 2022 includes funds in the Wastewater Division to evaluate and provide recommendations to reduce the inflow and infiltration problem with its existing sanitary sewer infrastructure. This issue results in rain and / or ground water entering the sanitary sewer system and eventually being treated by the Kent County Regional Resource Recovery Facility in Frederica. This is a cost that is unnecessary and is being absorbed by the rate payers. In general, this evaluation will investigate approximately seventy-one (71) miles of existing sanitary sewer gravity lines throughout the City of Dover. The size of the pipes ranges from eight-inch (8”) diameter to twenty-seven (27”). The awarded contractor will provide evaluation of the conditions of the sewer infrastructure and recommendations and cost estimates for any necessary repair. This will be conducted using the Pipeline Assessment Certification Program (PACP), which is monitored by NASSCO. The total cost of this project is budgeted for $1,219,000. The Department of Water & Wastewater will be seeking matching funds in the amount of $50,000 that will help offset the total cost. The application process for the grant requires the City Council to adopt a resolution endorsing the application for the Wastewater Matching Planning Grant. If approved at the Committee level, it will be on the agenda of the meeting of March 8, 2021. • 6

D Item 2. Qtttp of 1!\ober MAYORANDCO CIL PROPOSED COUNCIL RESOLUTION NO. 2021-01 1 A RESOLUTION PROPOSING APPLICATION FOR WASTEWATER MATCHING 2 PLANNING GRANT 3 4 WHEREAS, the Mayor and Council of the City of Dover, Delaware, herein called the “Applicant”, has, 5 after adequate consideration, of the various aspects of available data as it relates to the wastewater 6 infrastructure, determined that improvements to the City of Dover wastewater infrastructure is necessary; 7 and 8 WHEREAS, the Applicant has determined that the expeditious evaluation of the Inflow & Infiltration 9 affecting our wastewater system is desirable and in the public interest, and to that end it is necessary that 10 actions be taken immediately; and 11 WHEREAS, the State of Delaware, through the Delaware Water Infrastructure Advisory Council has 12 authorized the making of matching grants to aid in financing Wastewater Systems and related services in 13 connection therewith; and 14 WHEREAS, the Applicant has examined and duly considered the Guidelines for said grants and the 15 Applicant deems it to be in the public interest and to the public benefit to file an application for a grant 16 under these Guidelines, and to authorize other action in connection therewith. 17 NOW, THEREFORE, BE IT RESOLVED BY the Mayor and Council of the City of Dover, Delaware, 18 the governing body of said Applicant, as follows: 19 1. That the said Project is essential to and is in the best interest of the Applicant and to the end that 20 the said Project may be carried out as promptly as practical, it is desirable that action hereto be 21 undertaken immediately. 22 23 2. That Randy Robertson, City Manager, or his designated representative, be hereby authorized to 24 file on behalf of the Applicant, an application (in the format required by the State of Delaware and 25 in conformity with the request hereto) for a matching grant to be made from the State of Delaware 26 Clean Water State Revolving Fund’s (CSWRF) Non-Federal Administrative Account to the 27 Applicant to aid in defraying the cost of the Project described above. 28 29 3. That if such a grant is made, the Applicant agrees to pay all the remaining cost of the approved 30 Project, over and above the amount of the State grant. 31 P.O. Box 475 ❖ Dover, Delaware ❖19903 Community Excellence Through Quality Service •7

D Item 2. 32 4. That the said Randy Robertson, City Manager, or his designated representative, is hereby 33 authorized to accept any State grant that may be offered, to furnish such information and to take 34 other action as may be necessary to enable the Applicant to qualify for the grant; and 35 36 5. That the said Randy Robertson, City Manager, or his representative designated as the Authorized 37 Representative of the Applicant for the purpose of furnishing to the State of Delaware such 38 information, data, and documents pertaining to the application for the grant as may be required; 39 and otherwise to act as the authorized representative of the Applicant in connection to the 40 application and in connection with any requirements of the State grant which may be made. 41 42 6. That certified copies of this Resolution be included as part of the Application to be submitted to 43 the State of Delaware. 44 45 ADOPTED: 46 S:\RESOLUTIONS-PROCLAMATIONS-TRIBUTES\TEMPLATES\TEMPLATE - Resolution.wpd 47 48 49 50 ROBIN R. CHRISTIANSEN WILLIAM F. HARE MAYOR COUNCIL PRESIDENT Actions History 02/23/2021 – Introduction – CCW-Legislative, Finance & Administration Committee P.O. Box 475 ❖ Dover, Delaware ❖19903 Community Excellence Through Quality Service •8

ACTION FORM D Item 3. PROCEEDING: Council Committee of the Whole – Legislative, Finance and Administration Committee DEPARTMENT OF ORIGIN: Central Services/Facilities DATE SUBMITTED: 2/11/2021 PREPARED BY: Michael C. Hamlett, Central Services Director SUBJECT: Evaluation of Proposals – HVAC Design and Install for City Hall, COD Warehouse and Electric Administration Building REFERENCE: N/A RELATED PROJECT: N/A APPROVALS: Assistant City Manager, Matt Harline and Controller, Lori Peddicord EXHIBITS: N/A EXPENDITURE REQUIRED: $1,606,000 AMOUNT BUDGETED: $1,343,000 FUNDING SOURCE (Dept/Page in CIP & Budget): COD Warehouse Project #CS2001 and City Hall Project #FC2001 are identified as Bank/Bond Borrowings, and the Electric Admin Project #EE2009 is funded with cash on hand (Totals contained within CAF) TIMETABLE: Contract to be executed upon Council approval. RECOMMENDED ACTION: Staff recommends: 1. Award the HVAC Design and Install for the City of Dover Warehouse, City Hall, and Electric Administration Building contracts to Statewide Mechanical Inc. as per the proposal submitted in response to RFP #21-0007CS, 21-0006CS, and 21-0005CS. 2. Authorize the City Manager and Controller to bring back a resolution to obtain financing to cover the General Fund projects as referenced. BACKGROUND AND ANALYSIS Proposals were solicited and advertised according to City of Dover Purchasing Policy by the City’s Contract and Procurement Manager under RFP #21-0007CS, 21-0006CS, and 21-0005CS. The Request for Proposals were delivered to four (4) contractors of which two (2) were obtained through the State of Delaware Directory of Certified Businesses. All three RFPs were posted on the City website as well. submissions were received from one (1), Statewide Mechanical Inc The proposal evaluation was based on work experience with HVAC design and installation projects including any government or municipal experience and references; ability to provide a quality proposal with a detailed information as outlined within the RFP; total cost; geographical location in relation to the City of Dover; and their ability to provide adequate staffing, equipment and supplies for the project as well as provide a reasonable timeline for completion as outlined. The contractor will be responsible for performing the HVAC design and install for our COD Warehouse, City Hall, and Electric Administration locations. Statewide Mechanical Inc. was able to provide all required information as outlined in the RFP and is a local business within the state of Delaware. They have a Townsend office here in Delaware and are staffed with eight (8) employees. Statewide Mechanical Inc. provided four (4) references from the State of Delaware to include the Division of Facilities Management, the University of Delaware, the Christiana School District, and the Department of Corrections. Each of these references had similar projects by the said contractor who also holds the Preventative Maintenance and Service-Chillers contract (GSS15079-CHILLER_MAINT) with the state of Delaware which the City of Dover has utilized for the library HVAC maintenance since 2017. Unfortunately, there were no other submissions for all three HVAC design and install RFP’s. As such, Statewide Mechanical Inc. is the sole vendor for all three (3) locations. The proposer has provided pricing as outlined within RFP’s #21-0007CS, 21-0006CS, and 21-0005CS. At our request they have provided proposals to address each location’s specific needs while minimizing energy consumption and maximizing • 9

HVAC Design and Install for the City of Dover Warehouse, City Hall, and Electric Administration Buildings 02/23/2021 D Item 3. quality with non-proprietary equipment. Please see pricing and scope summaries below: LOCATION SCOPE SUMMARY PRICE COD Warehouse Replace existing system in-kind $ 297,000 City Hall Replace existing system in-kind $ 852,000 Electric Administration Replace existing system with VRV system $ 457,000 Outlined above you will find the recommended HVAC design and install upgrades for the three (3) City of Dover locations. The COD Warehouse and City Hall will be upgraded with the same design that currently exists; however, all components will be upgraded with modern efficient components and controls to include replacement of ductwork and cleaning of any remaining duct work. The Electric Administration building is being completely redesigned with modern VRV split systems which allows for individual zone climate control and greater energy efficiency. Each proposal includes non-proprietary controls, training for Facilities staff, and industry standard warranties. Performance bonds are required upon acceptance of each proposal. HVAC RFP & Proposals Budgeted Costs Proposed Costs Cost Difference Estimated Completion Warehouse 21-0007CS $ 325,000.00 $ 297,000.00 $ 28,000.00 60 Days City Hall 21-0006CS $ 700,000.00 $ 852,000.00 $ (152,000.00) 120 Days Electric Admin 21-0005CS $ 318,000.00 $ 457,000.00 $ (139,000.00) 90 Days Balance $ 1,343,000.00 $ 1,606,000.00 $ (263,000.00) The proposed method of billing for each contract consists of six (6) installments as follows: 10% deposit will be invoiced upon receipt of purchase order, 15% due upon demolition of old systems, 20% due upon installation of new equipment, 20% due upon installation of piping and duct work, 25% will be billed upon equipment start up, and 10% due upon commissioning of system. Funding for the work on City Hall and the Warehouse will be financed as proposed in the budget. Up to $335,000 (minus fees) could be financed by an “Energize Delaware Low Interest Loan,” based on analysis of the potential energy savings. However, if the cost of obtaining bank financing is more appealing than with the energy savings loan, we will finance the entire project with traditional financing. Moreover, the loan through Energize Delaware requires that the length of the loan be 20 years so that the energy and maintenance savings can offset some of the cost of the loan. A significant portion of the funding of the upgrade at the Electric Administration Building, will be transferred from Project EE2105 (Radio upgrades) $375,000, it was recently discovered the RFP is not ready to send out. • 10

COMMITTEE ACTION FORM D Item 4. PROCEEDING: Council Committee of the Whole - Legislative, Finance and Administrative Committee DEPARTMENT OF ORIGIN: Electric DATE SUBMITTED: Feb 11, 2021 PREPARED BY: Paul Waddell, Electric Director SUBJECT: Evaluation of Bids - Landscaping REFERENCE: N/A RELATED PROJECT: N/A REVIEWED BY: Matthew Harline, Assistant City Manager / Lori Peddicord, Controller EXHIBITS: Exhibit A – Draft Contract for Landscaping Services EXPENDITURE REQUIRED: As required AMOUNT BUDGETED: N/A FUNDING SOURCE (Dept./Page in CIP & Budget): Funding will be embedded in Capital Improvement Projects proposed that will require landscaping work and will be allocated on a time and material basis only. TIMETABLE: Award upon Council Approval RECOMMENDED ACTION: Staff recommends awarding #21-0020EL Landscaping Contract to Joseph R. Smith for three years with a City option to extend it an additional two years (five years total) as per the pricing included in the bid submittal. BACKGROUND AND ANALYSIS The Electric Department maintains contracts with several entities to perform specialized work outside the City’s capabilities. This contract will be awarded on a time and material basis and the City will only pay for services rendered by the contractor. The scope of the contract will be for assistance in the performance of landscaping work outside the normal capabilities of City staff, for example, large extension projects or assistance during storm recovery. Over the last two calendar years expenditures tied to landscaping services has totaled approximately $4,800. This award would be for landscaping work associated with Capital Improvement Projects. This would include work to restore and repair landscaping and lawns around new or replaced electric equipment on customer’s property and in the right of way. For example, we may need to replace vegetation after work performed around areas where overhead lines are converted to underground or when new service extensions are installed. A Request for Proposals was developed and advertised per the City Purchasing Policy by the Procurement Manager and sent out to five contractors directly and posted on the City website. The City received a complete bid package from only two contractors, Joseph R. Smith and South Shore Ventures. The staff recommends awarding the contract to Joseph R. Smith for the term of three years with the option to extend for two (2) one (1) year extensions. Proposer: Evaluation Score Evaluation Score Evaluation Score #1 #2 #3 Joseph R. Smith 65 60 56 South Shore Ventures 40 45 45 Evaluations were based on four categories, Experience (15 points), Overall Cost (30 points), Recent Project History (15 points) and Location (5 points) with 75 points being the highest possible score. • 11

D Item 4. EXHIBIT A AGREEMENT FOR PROFESSIONAL SERVICES THIS AGREEMENT is made as of the _____ day of ________ in the year 2021, between The City of Dover, a Delaware Municipal Corporation, whose address is 15 Loockerman Plaza, Dover, Delaware 19901 (hereinafter referred to as the CITY), and ____________________, whose address is, ___________________________ (hereinafter referred to as the CONTRACTOR). NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties to this Agreement, and for other good and valuable considerations, the parties agree as follows: 1. SERVICES The CONTRACTOR shall perform the following services: SEE REQUEST FOR PROPOSAL FOR LANDSCAPING, RFP NO.: 21-0020EL AND THE SUBMITTED PROPOSAL FORM. Nothing herein shall limit the CITY's right to obtain proposals or services from other professionals for similar projects at any time the CITY so chooses. 2. INDEMNIFICATION The CONTRACTOR, and any agent or subcontractor, shall defend, indemnify and hold harmless the CITY and its officials, officers, board members, council members, commissioners, representatives, employees, agents, and contractors, against any and all liability, costs, damages, fines, taxes, special charges by others, penalties, payments (including payments made under any Workers' Compensation Laws or under any plan for employees' disability and death benefits), and expenses (including reasonable attorney fees of the CITY and all other costs and expenses of litigation). Claims arising in any way, including any act, omission, failure, negligence or willful misconduct, in connection with the work, construction, maintenance, repair, presence, use, or operation by the CONTRACTOR, or the CONTRACTOR’s officers, directors, employees, agents, and sub-contractors, shall be responsible for Claims. Such Claims include, but are not limited to, the following: a. Intellectual property infringement, libel and slander, trespass, unauthorized use of television or radio broadcast programs and other program material, and infringement of patents; b. Cost of work performed by the CITY that was necessitated by the CONTRACTOR’s failure, or the failure of the CONTRACTOR’s officers, directors, employees, agents, or sub- contractors, to perform work, or maintain CITY facilities in accordance with the requirements and specifications of this Agreement, or from any other work authorized under this Agreement; c. Damage to property, injury to or death of any person arising out of the performance or nonperformance of any work or obligation undertaken by the CONTRACTOR, or CONTRACTOR’s officers, directors, employees, agents, and sub-contractors, pursuant to this Agreement; A-1 • 12

D Item 4. 3. PROCEDURE FOR INDEMNIFICATION a. The CITY shall give notice promptly to the CONTRACTOR of any claim or threatened claim, specifying the factual basis for such claim and the amount of the claim. If the claim relates to an action, suit or proceeding filed by a third party against the CITY, the notice shall be given to the CONTRACTOR by the CITY no later than ten (10) calendar days after written notice of the action, suit or proceeding was received by the CITY. b. Failure to timely give the required notice will not relieve the CONTRACTOR from its obligation to indemnify the CITY unless the CITY is materially prejudiced by such failure. c. The CITY will have the right at any time, by notice to the CONTRACTOR, to participate in or assume control of the defense of the claim with counsel of its choice, which counsel must be reasonably acceptable to the CONTRACTOR. The CONTRACTOR agrees to cooperate fully with the CITY. If the CITY so assumes control of the defense of any third-party claim, the CONTRACTOR shall have the right to participate in the defense at its own expense. If the CONTRACTOR does not so assume control or otherwise participate in the defense of any third-party claim, it shall be bound by the results obtained by the CITY with respect to the claim. d. If the CITY assumes the defense of a third-party claim as described above, then in no event will the CITY admit any liability with respect to, or settle, compromise or discharge, any third-party claim without the CONTRACTOR’s prior written consent, and the CONTRACTOR will agree to any settlement, compromise or discharge of any third-party claim which the CITY may recommend which releases the CITY completely from such claim. e. Municipal Liability Limits. No provision of this Agreement is intended, or shall be construed, to be a waiver for any purpose by either entity of any applicable State limits on municipal liability. f. Disclaimer. The CITY makes no express or implied warranties with regard to its structures, fixtures, materials, or other equipment, all of which are hereby disclaimed. The CITY makes no other express or implied warranties, except to the extent expressly set forth in this Agreement. The CITY expressly disclaims any implied warranties of merchantability or fitness for a particular purpose g. Duty to Competent Supervision and Performance. The CONTRACTOR shall ensure that its employees, servants, agents, and subcontractors have the necessary qualifications, skill, knowledge, training, and experience to protect themselves, their fellow employees, employees of the CITY, and the general public, from harm or injury while performing work permitted pursuant to this Agreement. In addition, the CONTRACTOR shall furnish its employees, servants, agents, and subcontractors with competent supervision and sufficient and adequate tools and equipment for their work to be performed in a safe manner. h. Duty to Inform. The CONTRACTOR further warrants that it understands the imminent dangers (INCLUDING SERIOUS BODILY INJURY OR DEATH FROM FALLING) inherent in the work necessary to perform the work expected under this agreement by the CONTRACTOR’s employees, servants, agents, contractors or subcontractors, and accepts as its duty and sole responsibility to notify and inform the CONTRACTOR’s employees, servants, agents, contractors or subcontractors of such dangers, and to keep them informed regarding same. A-2 • 13

D Item 4. 4. INSURANCE A. Prior to the commencement of any work and until completion and final payment is made for the work / final acceptance of the work for the RFP No. 21-0020EL, the Contractor will provide and maintain the following minimum levels of insurance at Contractor’s own expense. The cost of the required insurance shall be included in the Contractor’s proposal price and no adjustment shall be made to the contract price on account of such costs unless such approval is provided. The term Contractor shall include Subcontractors and Sub-Subcontractors of every tier. Contractor shall furnish Certificates of Insurance evidencing and reflecting the effective date of coverage as outlined below. In no event shall Work be performed until the required evidence of Insurance is provided in accordance with these Contract Documents and is approved by the City of Dover. If found to be non-compliant, the City of Dover may purchase the required insurance coverage(s) and the cost will be borne by the Contractor through direct payment/reimbursement to the City of Dover or the City of Dover may withhold payment to the Contractor for amounts owed to them. a. All insurance shall be procured from insurers permitted to do business in the State in which the project is taking place and having an A.M. Best Rating of at least “A- , Class VIII”. b. Contractor shall not have a Self Insured Retention (SIR) on any policy greater than $50,000, which is the responsibility of the Contractor. If Contractor’s policy(ies) has a Self Insured Retention exceeding this amount, approval must be received from the City of Dover prior to starting work. In the event any policy includes an SIR, the Contractor is solely responsible for payment within the SIR of their policy(ies) and the Additional Insured requirements specified herein shall be provided within the SIR amount(s). c. All insurance required herein, with the exception of the Professional Liability Insurance, shall be written on an “occurrence” basis. Claims-Made coverage must include: i. The retroactive date must be on or prior to the start of work under this contract; and ii. The Contractor must purchase “tail coverage/an extended reporting period” or maintain coverage for a period of three years, subsequent to the completion of their work / final payment. d. The Contractor’s insurance carrier (s) shall agree to provide at least thirty (30) days prior written notice to the City of Dover in the event coverage is canceled or non-renewed. In the event of cancellation or non-renewal of coverage(s), it is the Contractor’s responsibility to replace coverage to comply with the Contract requirements so there is no lapse of coverage for any time period. In the event the insurance carriers will not issue or endorse their policy(s) to comply with the above it is the responsibility of the Contractor to report any notice of cancellation or non-renewal at least thirty (30) days prior to the effective date of this notice. A-3 • 14

D Item 4. e. Contractor shall provide the City of Dover with Certificates of Insurance, evidencing the insurance coverages listed below, ten days prior to the start of work and thereafter upon renewal or replacement of each coverage. The Contractor shall not begin any work until the City of Dover has reviewed and approved the Certificate of Insurance. The required insurance shall not contain any exclusions or endorsements, which are not acceptable to the City of Dover. Failure of the City of Dover to demand such certificate or other evidence of full compliance with these insurance requirements or failure of the City of Dover to identify a deficiency from evidence that is provided shall not be construed as a waiver of Contractor's obligation to maintain such insurance. With respect to insurance maintained after final payment in compliance with a requirement below, an additional certificate(s) evidencing such coverage shall be provided to the City of Dover with final application for payment and thereafter upon renewal or replacement of such insurance until the expiration of the time period for which such insurance must be maintained. f. Owner/Client and the City of Dover, (including the City of Dover’s Parent, Subsidiaries, and Affiliates) shall be added as ADDITIONAL INSUREDS on all liability policies (except Workers’ Compensation and Professional Liability Policy, where applicable), for ongoing operations and completed operations (using ISO Endorsements CG 2010 and CG 2037, or their equivalents) on a primary noncontributory basis. Coverage to include ongoing and completed operations. Each of the Additional Insured’s respective directors, officers, partners, members, employees, agents and representatives shall also be afforded coverage as an Additional Insured. If you are operating in a state that has implemented the “Anti-Indemnity” Additional Insured Endorsements, you are required to provide the state specific additional insured endorsements for ongoing and completed operations. These states include but are not limited to: Montana, New Mexico, Oregon, Colorado, Kansas, California, Louisiana, and Texas. The City of Dover reserves the right to require Contractor to name other parties as additional insureds as required by the City of Dover. There shall be no “Insured versus Insured Exclusion” on any policies (other than “Named Insured versus Named Insured”); all policies will provide for “cross liability coverage” as per standard ISO policy forms. g. Waiver of Rights of Subrogation: Contractor shall waive all rights of recovery against Owner/Client, the City of Dover and all the additional insureds for loss or damage covered by any of the insurance maintained by the Contractor. h. The amount of insurance provided in the required insurance coverages, shall not be construed to be a limitation of the liability on the part of the Contractor. i. The carrying of insurance described shall in no way be interpreted as relieving the Contractor of any responsibility or liability under the contract. A-4 • 15

D Item 4. j. Any type of insurance or any increase in limits of liability not described above which the Contractor requires for its own protection or on account of statute shall be its own expense. k. Contractor shall promptly notify the City of Dover and the appropriate insurance company(ies) in writing of any accident(s) as well as any claim, suit or process received by the Contractor arising in the course of operations under the contract. The Contractor shall forward such documents received to his insurance company(ies), as soon as practicable, or as required by their insurance policy(ies). REQUIRED COVERAGES - the following may be provided through a combination of primary and excess policies in order to meet the minimum limits set forth below: 1. Worker’s Compensation and Employers’ Liability Insurance. Statutory worker’s compensation benefits and employers’ liability insurance with a limit of liability no less than that required by Delaware law at the time of the application of this provision for each accident. This policy shall be endorsed to include a waiver of subrogation in favor of the City of Dover. The Contractor shall require subcontractors and others not protected under its insurance to obtain and maintain insurance that includes: a. Workers’ Compensation Coverage: Statutory Requirements b. Employers Liability Limits not less than: Bodily Injury by Accident: $100,000 Each Accident Bodily Injury by Disease: $100,000 Each Employee Bodily Injury by Disease: $500,000 Policy Limit c. Includes coverage for sole proprietors, partners, members or officers who will be performing the work. 2. Commercial General Liability Insurance. Policy will be written to provide coverage for, but not limited to, the following: premises and operations, products and completed operations, personal injury, blanket contractual coverage, broad form property damage, independent contractor’s coverage with Limits of liability not less than the following: a. Occurrence Form with the following limits: i. General Aggregate: $2,000,000 ii. Products/Completed Operations Aggregate: $2,000,000 iii. Each Occurrence: $1,000,000 iv. Personal and Advertising Injury: $1,000,000 b. Products/Completed Operations Coverage must be maintained for a period of at least three (3) years after final payment / completion of work (including coverage for the Additional Insureds as set forth in these Insurance Requirements). c. The General Aggregate Limit must apply on a Per Project basis. d. No Exclusions for residential construction with respect to the work to be A-5 • 16

D Item 4. completed by the Contractor. (If Applicable) e. Coverage for “Resulting Damage”. f. No sexual abuse or molestation exclusion. g. No amendment to the definition of an “Insured Contract”. h. The definition of an “Insured Contract” must be amended to provide coverage for all work on or within 50 feet of a railroad, if applicable. A stand alone Railroad Protective Liability policy may be required based on the scope of this project. 3. Automobile Liability Insurance. a. Coverage to include All Owned, Hired and Non-Owned Vehicles (or “Any Auto”), if you do not have any Owned Vehicles you are still required to maintain coverage for Hired and Non-Owned Vehicles as either a stand alone policy or endorsed onto the Commercial General Liability policy above. b. Per Accident Combined Single Limit $1,000,000 c. For Contractor(s) involved in the transportation of hazardous material, include the following endorsements: MCS-90 and ISO-9948. 4. Commercial Umbrella Liability: a. Policy(ies) to apply on a Following Form Basis of the following: i. Commercial General Liability, ii. Automobile Liability, and iii. Employers Liability Coverage. b. Minimum Limits of Liability Occurrence Limit: $10,000,000 c. Aggregate Limit (where applicable): $10,000,000 5. Professional Liability Insurance: (IF DESIGNATED BY CONTRACTOR’S SCOPE OF WORK) a. Minimum Limits of Liability Per Claim Limit: $2,000,000 Aggregate Limit: $2,000,000 b. The Definition of “Covered Services” shall include the services required in the scope of this contract. c. Coverage shall be extended to cover “Green Building”, if applicable. A-6 • 17

D Item 4. 6. Privacy Liability: (IF DESIGNATED BY CONTRACTOR’S SCOPE OF WORK) a. Subcontractor shall maintain coverage for third party liability arising out of breach of privacy, inclusive of confidential and proprietary business information, HIPAA violations and other breaches of personally identifiable information and/or protected health information, that may arise from their work with this contract. b. Minimum Limits of Liability: Per Claim: $1,000,000 Aggregate: $1,000,000 c. Privacy Breach Notification and Credit Monitoring: $250,000 Per Occurrence. 7. Qualification; Priority; Contractors’ Coverage. The insurer must be authorized to do business under the laws of the State of Delaware. Such insurance will be primary. All contractors and all of their subcontractors who perform work on behalf of Contractor shall be responsible for carrying, in full force and effect, worker’s compensation and employer’s liability, and automobile liability insurance coverage. 8. Certificate of Insurance; Other Requirements. At the execution of this Agreement and prior to each insurance policy expiration date during the term of this Agreement, Contractor will furnish the City of Dover with a Certificate of Insurance with the CITY named as an additional insured. The Certificate shall reference this Agreement and worker’s compensation and property insurance waivers of subrogation required by this Agreement. The City of Dover shall be given thirty (30) calendar days advance notice of cancellation or nonrenewal of insurance during the term of this Agreement. 9. Limits. The limits of liability set out in this Agreement may be increased by mutual consent of the parties, which consent will not be unreasonably withheld by either party, in the event of any factors or occurrences, including substantial increases in the level of jury verdicts or judgments or the passage of state, federal or other governmental compensation plans, or laws which would materially increase the City of Dover’s exposure to risk. 10. Deductible/Self-insurance Retention Amounts. Contractor shall be fully responsible for any deductible or self-insured retention amounts contained in its insurance program or for any deficiencies in the amounts of insurance maintained. 5. CODES, LAWS, AND REGULATIONS The CONTRACTOR will comply with all applicable codes, laws, regulations, standards, and ordinances in force during the term of this Agreement. 6. PERMITS, LICENSES, AND FEES The CONTRACTOR will obtain and pay for all permits and licenses required by law that are associated with the CONTRACTOR’s performance of the Scope of Services. 7. ACCESS TO RECORDS A-7 • 18

D Item 4. The CONTRACTOR will maintain accounting records, in accordance with generally accepted accounting principles and practices, to substantiate all invoiced amounts. Said records will be available for examination by the CITY during the CONTRACTOR’s normal business hours. Said records will be maintained for a period of three (3) years after the date of the invoice. 8. CONTINGENT FEES PROHIBITED The CONTRACTOR warrants that he or she has not employed or retained any company or person, other than a bona fide employee working solely for the CONTRACTOR, to solicit or secure this Agreement and that he or she has not paid or agreed to pay any person, company, corporation, individual, or firm, other than a bona fide employee working solely for the CONTRACTOR any fee, commission, percentage, gift, or other consideration contingent upon or resulting from the award or making of this Agreement. In the event of a breach of this provision, the CITY shall have the right to terminate this Agreement without further liability and at its discretion, deduct from the contract price, or otherwise recover, the full amount of any such fee, commission, percentage, gift or consideration paid in breach of this Agreement. 9. PAYMENT It is understood and agreed by and between the parties hereto that this Contract is for the cost of time and material only while performing work for and that work is accepted by the City. All requests for payment shall be accompanied by supporting documentation which will include proof of the work performed in accordance to the Contract Documents and other CITY required supporting documentation. Any reimbursement for expenses shall include receipts or copies of the invoices. No other costs or services shall be billed to the CITY. 10. INDEPENDENT CONTRACTOR The CONTRACTOR is an independent contractor and as such will be responsible for paying his own Federal income tax and self-employment tax, or any other taxes applicable to the compensation paid under this agreement. 11. ASSIGNMENT Neither party shall have the power to assign any of the duties or rights or any claim arising out of or related to the Agreement, whether arising in tort, contract, or otherwise, without the written consent of the other party. These conditions and the entire Agreement are binding on the heirs, successors, and assigns of the parties hereto. 12. NO THIRD PARTY BENEFICIARIES This Agreement gives no rights or benefits to anyone other than the CONTRACTOR and the CITY. 13. JURISDICTION The laws of the State of Delaware shall govern the validity of this Agreement, its interpretation and performance, and any other claims related to it. In the event of any litigation arising under or construing this Agreement, venue shall lie only in Kent County, Delaware. 14. TERM AND TERMINATION All or part of this Agreement may be terminated by the CITY for its convenience on thirty (30) days A-8 • 19

D Item 4. written notice to the CONTRACTOR. In such event, the CONTRACTOR will be entitled to compensation for services competently performed up to the date of termination. In the event of termination not the fault of the CONTRACTOR, the CONTRACTOR shall be compensated for with Reimbursable Expenses then due and all Termination Expenses. 15. CONTACT PERSON The primary contact person under this Agreement for the CONTRACTOR shall be Name: _____________________________, Phone No.:_________________________, Address:______________________________. The primary contact person under this Agreement for the CITY shall be Paul Waddell, Electric Director, Electric Department, 302-736-7088, pwaddell@dover.de.us. 16. APPROVAL OF SERVICE PERSONNEL The CITY reserves the right to approve the contact person and the persons actually performing the services on behalf of the CONTRACTOR pursuant to this Agreement. If the CITY, in its sole discretion, is dissatisfied with the contact person or the person or persons actually performing the services on behalf of the CONTRACTOR pursuant to this Agreement, the CITY may require the CONTRACTOR assign a different person or persons be designated to be the contact person or to perform the services hereunder. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the respective dates under each signature. (CONTRACTOR) CITY OF DOVER By: By: Randy Robertson Title: Title: City Manager Signature: Signature: Date: Date: A-9 • 20

COMMITTEE ACTION FORM D Item 5. PROCEEDING: Council Committee of the Whole - Legislative, Finance and Administrative Committee DEPARTMENT OF ORIGIN: Electric DATE SUBMITTED: Feb 11, 2021 PREPARED BY: Paul Waddell, Electric Director SUBJECT: Evaluation of Bids – Overhead Linework REFERENCE: N/A RELATED PROJECT: N/A REVIEWED BY: Matthew Harline, Assistant City Manager / Lori Peddicord, Controller EXHIBITS: Exhibit A – Draft Contract for Overhead Linework EXPENDITURE REQUIRED: As required AMOUNT BUDGETED: N/A FUNDING SOURCE (Dept./Page in CIP & Budget): Funding will be from applicable Contractual Services budgets. TIMETABLE: Award upon Council Approval RECOMMENDED ACTION: Staff recommends awarding #21-0021EL Overhead Linework Contract to AUI Power for three years with a City option to extend it an additional two years (five years total) as per the pricing included in the bid submittal. BACKGROUND AND ANALYSIS The Electric Department maintains contracts with several entities to perform specialized work outside the City’s capabilities. This could be due to scope and timeliness of the project or the Electric Department not having the required equipment such as a bucket truck or wire reel capable of installing overhead cable for the transmission loops in the City. This contract will be awarded on a time and material basis and the City will only pay for services rendered by the contractor. Since the last contract was awarded, there has been one instance of expenses related to a contractor performing overhead linework. Given that the request for assistance came after the tornado spawned by Tropical Storm Isaias, the company we selected in 2016 was unavailable and another company that was available was utilized. Total costs from the company who assisted us was $71,510. A Request for Proposals was developed and advertised per the City Purchasing Policy by the Procurement Manager and sent out to eight contractors directly and posted on the City website. The City received one response to the RFP and the staff recommends award of the contract to AUI Power for the period of three years with the option to extend two (2) additional (1) one year periods. Since there was only one submission, staff compared the pricing from this response to the company used in Tropical Storm Isaias support. We found that the prices from this submission are approximately 14% lower than the company we used in August. • 21

D Item 5. EXHIBIT A AGREEMENT FOR PROFESSIONAL SERVICES THIS AGREEMENT is made as of the _____ day of ________ in the year 2021, between The City of Dover, a Delaware Municipal Corporation, whose address is 15 Loockerman Plaza, Dover, Delaware 19901 (hereinafter referred to as the CITY), and ____________________, whose address is, ___________________________ (hereinafter referred to as the CONTRACTOR). NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties to this Agreement, and for other good and valuable considerations, the parties agree as follows: 1. SERVICES The CONTRACTOR shall perform the following services: SEE REQUEST FOR PROPOSAL FOR OVERHEAD LINEWORK, RFP NO.: 21-0021EL AND THE SUBMITTED PROPOSAL FORM. Nothing herein shall limit the CITY's right to obtain proposals or services from other professionals for similar projects at any time the CITY so chooses. 2. INDEMNIFICATION The CONTRACTOR, and any agent or subcontractor, shall defend, indemnify and hold harmless the CITY and its officials, officers, board members, council members, commissioners, representatives, employees, agents, and contractors, against any and all liability, costs, damages, fines, taxes, special charges by others, penalties, payments (including payments made under any Workers' Compensation Laws or under any plan for employees' disability and death benefits), and expenses (including reasonable attorney fees of the CITY and all other costs and expenses of litigation). Claims arising in any way, including any act, omission, failure, negligence or willful misconduct, in connection with the work, construction, maintenance, repair, presence, use, or operation by the CONTRACTOR, or the CONTRACTOR’s officers, directors, employees, agents, and sub-contractors, shall be responsible for Claims. Such Claims include, but are not limited to, the following: a. Intellectual property infringement, libel and slander, trespass, unauthorized use of television or radio broadcast programs and other program material, and infringement of patents; b. Cost of work performed by the CITY that was necessitated by the CONTRACTOR’s failure, or the failure of the CONTRACTOR’s officers, directors, employees, agents, or sub- contractors, to perform work, or maintain CITY facilities in accordance with the requirements and specifications of this Agreement, or from any other work authorized under this Agreement; c. Damage to property, injury to or death of any person arising out of the performance or nonperformance of any work or obligation undertaken by the CONTRACTOR, or CONTRACTOR’s officers, directors, employees, agents, and sub-contractors, pursuant to this Agreement; A-1 • 22

D Item 5. 3. PROCEDURE FOR INDEMNIFICATION a. The CITY shall give notice promptly to the CONTRACTOR of any claim or threatened claim, specifying the factual basis for such claim and the amount of the claim. If the claim relates to an action, suit or proceeding filed by a third party against the CITY, the notice shall be given to the CONTRACTOR by the CITY no later than ten (10) calendar days after written notice of the action, suit or proceeding was received by the CITY. b. Failure to timely give the required notice will not relieve the CONTRACTOR from its obligation to indemnify the CITY unless the CITY is materially prejudiced by such failure. c. The CITY will have the right at any time, by notice to the CONTRACTOR, to participate in or assume control of the defense of the claim with counsel of its choice, which counsel must be reasonably acceptable to the CONTRACTOR. The CONTRACTOR agrees to cooperate fully with the CITY. If the CITY so assumes control of the defense of any third-party claim, the CONTRACTOR shall have the right to participate in the defense at its own expense. If the CONTRACTOR does not so assume control or otherwise participate in the defense of any third-party claim, it shall be bound by the results obtained by the CITY with respect to the claim. d. If the CITY assumes the defense of a third-party claim as described above, then in no event will the CITY admit any liability with respect to, or settle, compromise or discharge, any third-party claim without the CONTRACTOR’s prior written consent, and the CONTRACTOR will agree to any settlement, compromise or discharge of any third-party claim which the CITY may recommend which releases the CITY completely from such claim. e. Municipal Liability Limits. No provision of this Agreement is intended, or shall be construed, to be a waiver for any purpose by either entity of any applicable State limits on municipal liability. f. Disclaimer. The CITY makes no express or implied warranties with regard to its structures, fixtures, materials, or other equipment, all of which are hereby disclaimed. The CITY makes no other express or implied warranties, except to the extent expressly set forth in this Agreement. The CITY expressly disclaims any implied warranties of merchantability or fitness for a particular purpose g. Duty to Competent Supervision and Performance. The CONTRACTOR shall ensure that its employees, servants, agents, and subcontractors have the necessary qualifications, skill, knowledge, training, and experience to protect themselves, their fellow employees, employees of the CITY, and the general public, from harm or injury while performing work permitted pursuant to this Agreement. In addition, the CONTRACTOR shall furnish its employees, servants, agents, and subcontractors with competent supervision and sufficient and adequate tools and equipment for their work to be performed in a safe manner. h. Duty to Inform. The CONTRACTOR further warrants that it understands the imminent dangers (INCLUDING SERIOUS BODILY INJURY OR DEATH FROM FALLING) inherent in the work necessary to perform the work expected under this agreement by the CONTRACTOR’s employees, servants, agents, contractors or subcontractors, and accepts as its duty and sole responsibility to notify and inform the CONTRACTOR’s employees, servants, agents, contractors or subcontractors of such dangers, and to keep them informed regarding same. A-2 • 23

D Item 5. 4. INSURANCE A. Prior to the commencement of any work and until completion and final payment is made for the work / final acceptance of the work for the RFP No. 21-0021EL, the Contractor will provide and maintain the following minimum levels of insurance at Contractor’s own expense. The cost of the required insurance shall be included in the Contractor’s proposal price and no adjustment shall be made to the contract price on account of such costs unless such approval is provided. The term Contractor shall include Subcontractors and Sub-Subcontractors of every tier. Contractor shall furnish Certificates of Insurance evidencing and reflecting the effective date of coverage as outlined below. In no event shall Work be performed until the required evidence of Insurance is provided in accordance with these Contract Documents and is approved by the City of Dover. If found to be non-compliant, the City of Dover may purchase the required insurance coverage(s) and the cost will be borne by the Contractor through direct payment/reimbursement to the City of Dover or the City of Dover may withhold payment to the Contractor for amounts owed to them. a. All insurance shall be procured from insurers permitted to do business in the State in which the project is taking place and having an A.M. Best Rating of at least “A- , Class VIII”. b. Contractor shall not have a Self Insured Retention (SIR) on any policy greater than $50,000, which is the responsibility of the Contractor. If Contractor’s policy(ies) has a Self Insured Retention exceeding this amount, approval must be received from the City of Dover prior to starting work. In the event any policy includes an SIR, the Contractor is solely responsible for payment within the SIR of their policy(ies) and the Additional Insured requirements specified herein shall be provided within the SIR amount(s). c. All insurance required herein, with the exception of the Professional Liability Insurance, shall be written on an “occurrence” basis. Claims-Made coverage must include: i. The retroactive date must be on or prior to the start of work under this contract; and ii. The Contractor must purchase “tail coverage/an extended reporting period” or maintain coverage for a period of three years, subsequent to the completion of their work / final payment. d. The Contractor’s insurance carrier (s) shall agree to provide at least thirty (30) days prior written notice to the City of Dover in the event coverage is canceled or non-renewed. In the event of cancellation or non-renewal of coverage(s), it is the Contractor’s responsibility to replace coverage to comply with the Contract requirements so there is no lapse of coverage for any time period. In the event the insurance carriers will not issue or endorse their policy(s) to comply with the above it is the responsibility of the Contractor to report any notice of cancellation or non-renewal at least thirty (30) days prior to the effective date of this notice. A-3 • 24

D Item 5. e. Contractor shall provide the City of Dover with Certificates of Insurance, evidencing the insurance coverages listed below, ten days prior to the start of work and thereafter upon renewal or replacement of each coverage. The Contractor shall not begin any work until the City of Dover has reviewed and approved the Certificate of Insurance. The required insurance shall not contain any exclusions or endorsements, which are not acceptable to the City of Dover. Failure of the City of Dover to demand such certificate or other evidence of full compliance with these insurance requirements or failure of the City of Dover to identify a deficiency from evidence that is provided shall not be construed as a waiver of Contractor's obligation to maintain such insurance. With respect to insurance maintained after final payment in compliance with a requirement below, an additional certificate(s) evidencing such coverage shall be provided to the City of Dover with final application for payment and thereafter upon renewal or replacement of such insurance until the expiration of the time period for which such insurance must be maintained. f. Owner/Client and the City of Dover, (including the City of Dover’s Parent, Subsidiaries, and Affiliates) shall be added as ADDITIONAL INSUREDS on all liability policies (except Workers’ Compensation and Professional Liability Policy, where applicable), for ongoing operations and completed operations (using ISO Endorsements CG 2010 and CG 2037, or their equivalents) on a primary noncontributory basis. Coverage to include ongoing and completed operations. Each of the Additional Insured’s respective directors, officers, partners, members, employees, agents and representatives shall also be afforded coverage as an Additional Insured. If you are operating in a state that has implemented the “Anti-Indemnity” Additional Insured Endorsements, you are required to provide the state specific additional insured endorsements for ongoing and completed operations. These states include but are not limited to: Montana, New Mexico, Oregon, Colorado, Kansas, California, Louisiana, and Texas. The City of Dover reserves the right to require Contractor to name other parties as additional insureds as required by the City of Dover. There shall be no “Insured versus Insured Exclusion” on any policies (other than “Named Insured versus Named Insured”); all policies will provide for “cross liability coverage” as per standard ISO policy forms. g. Waiver of Rights of Subrogation: Contractor shall waive all rights of recovery against Owner/Client, the City of Dover and all the additional insureds for loss or damage covered by any of the insurance maintained by the Contractor. h. The amount of insurance provided in the required insurance coverages, shall not be construed to be a limitation of the liability on the part of the Contractor. i. The carrying of insurance described shall in no way be interpreted as relieving the Contractor of any responsibility or liability under the contract. A-4 • 25

D Item 5. j. Any type of insurance or any increase in limits of liability not described above which the Contractor requires for its own protection or on account of statute shall be its own expense. k. Contractor shall promptly notify the City of Dover and the appropriate insurance company(ies) in writing of any accident(s) as well as any claim, suit or process received by the Contractor arising in the course of operations under the contract. The Contractor shall forward such documents received to his insurance company(ies), as soon as practicable, or as required by their insurance policy(ies). REQUIRED COVERAGES - the following may be provided through a combination of primary and excess policies in order to meet the minimum limits set forth below: 1. Worker’s Compensation and Employers’ Liability Insurance. Statutory worker’s compensation benefits and employers’ liability insurance with a limit of liability no less than that required by Delaware law at the time of the application of this provision for each accident. This policy shall be endorsed to include a waiver of subrogation in favor of the City of Dover. The Contractor shall require subcontractors and others not protected under its insurance to obtain and maintain insurance that includes: a. Workers’ Compensation Coverage: Statutory Requirements b. Employers Liability Limits not less than: Bodily Injury by Accident: $100,000 Each Accident Bodily Injury by Disease: $100,000 Each Employee Bodily Injury by Disease: $500,000 Policy Limit c. Includes coverage for sole proprietors, partners, members or officers who will be performing the work. 2. Commercial General Liability Insurance. Policy will be written to provide coverage for, but not limited to, the following: premises and operations, products and completed operations, personal injury, blanket contractual coverage, broad form property damage, independent contractor’s coverage with Limits of liability not less than the following: a. Occurrence Form with the following limits: i. General Aggregate: $2,000,000 ii. Products/Completed Operations Aggregate: $2,000,000 iii. Each Occurrence: $1,000,000 iv. Personal and Advertising Injury: $1,000,000 b. Products/Completed Operations Coverage must be maintained for a period of at least three (3) years after final payment / completion of work (including coverage for the Additional Insureds as set forth in these Insurance Requirements). c. The General Aggregate Limit must apply on a Per Project basis. d. No Exclusions for residential construction with respect to the work to be A-5 • 26

D Item 5. completed by the Contractor. (If Applicable) e. Coverage for “Resulting Damage”. f. No sexual abuse or molestation exclusion. g. No amendment to the definition of an “Insured Contract”. h. The definition of an “Insured Contract” must be amended to provide coverage for all work on or within 50 feet of a railroad, if applicable. A stand alone Railroad Protective Liability policy may be required based on the scope of this project. 3. Automobile Liability Insurance. a. Coverage to include All Owned, Hired and Non-Owned Vehicles (or “Any Auto”), if you do not have any Owned Vehicles you are still required to maintain coverage for Hired and Non-Owned Vehicles as either a stand alone policy or endorsed onto the Commercial General Liability policy above. b. Per Accident Combined Single Limit $1,000,000 c. For Contractor(s) involved in the transportation of hazardous material, include the following endorsements: MCS-90 and ISO-9948. 4. Commercial Umbrella Liability: a. Policy(ies) to apply on a Following Form Basis of the following: i. Commercial General Liability, ii. Automobile Liability, and iii. Employers Liability Coverage. b. Minimum Limits of Liability Occurrence Limit: $10,000,000 c. Aggregate Limit (where applicable): $10,000,000 5. Professional Liability Insurance: (IF DESIGNATED BY CONTRACTOR’S SCOPE OF WORK) a. Minimum Limits of Liability Per Claim Limit: $2,000,000 Aggregate Limit: $2,000,000 b. The Definition of “Covered Services” shall include the services required in the scope of this contract. c. Coverage shall be extended to cover “Green Building”, if applicable. A-6 • 27

D Item 5. 6. Privacy Liability: (IF DESIGNATED BY CONTRACTOR’S SCOPE OF WORK) a. Subcontractor shall maintain coverage for third party liability arising out of breach of privacy, inclusive of confidential and proprietary business information, HIPAA violations and other breaches of personally identifiable information and/or protected health information, that may arise from their work with this contract. b. Minimum Limits of Liability: Per Claim: $1,000,000 Aggregate: $1,000,000 c. Privacy Breach Notification and Credit Monitoring: $250,000 Per Occurrence. 7. Qualification; Priority; Contractors’ Coverage. The insurer must be authorized to do business under the laws of the State of Delaware. Such insurance will be primary. All contractors and all of their subcontractors who perform work on behalf of Contractor shall be responsible for carrying, in full force and effect, worker’s compensation and employer’s liability, and automobile liability insurance coverage. 8. Certificate of Insurance; Other Requirements. At the execution of this Agreement and prior to each insurance policy expiration date during the term of this Agreement, Contractor will furnish the City of Dover with a Certificate of Insurance with the CITY named as an additional insured. The Certificate shall reference this Agreement and worker’s compensation and property insurance waivers of subrogation required by this Agreement. The City of Dover shall be given thirty (30) calendar days advance notice of cancellation or nonrenewal of insurance during the term of this Agreement. 9. Limits. The limits of liability set out in this Agreement may be increased by mutual consent of the parties, which consent will not be unreasonably withheld by either party, in the event of any factors or occurrences, including substantial increases in the level of jury verdicts or judgments or the passage of state, federal or other governmental compensation plans, or laws which would materially increase the City of Dover’s exposure to risk. 10. Deductible/Self-insurance Retention Amounts. Contractor shall be fully responsible for any deductible or self-insured retention amounts contained in its insurance program or for any deficiencies in the amounts of insurance maintained. 5. CODES, LAWS, AND REGULATIONS The CONTRACTOR will comply with all applicable codes, laws, regulations, standards, and ordinances in force during the term of this Agreement. 6. PERMITS, LICENSES, AND FEES The CONTRACTOR will obtain and pay for all permits and licenses required by law that are associated with the CONTRACTOR’s performance of the Scope of Services. 7. ACCESS TO RECORDS A-7 • 28

D Item 5. The CONTRACTOR will maintain accounting records, in accordance with generally accepted accounting principles and practices, to substantiate all invoiced amounts. Said records will be available for examination by the CITY during the CONTRACTOR’s normal business hours. Said records will be maintained for a period of three (3) years after the date of the invoice. 8. CONTINGENT FEES PROHIBITED The CONTRACTOR warrants that he or she has not employed or retained any company or person, other than a bona fide employee working solely for the CONTRACTOR, to solicit or secure this Agreement and that he or she has not paid or agreed to pay any person, company, corporation, individual, or firm, other than a bona fide employee working solely for the CONTRACTOR any fee, commission, percentage, gift, or other consideration contingent upon or resulting from the award or making of this Agreement. In the event of a breach of this provision, the CITY shall have the right to terminate this Agreement without further liability and at its discretion, deduct from the contract price, or otherwise recover, the full amount of any such fee, commission, percentage, gift or consideration paid in breach of this Agreement. 9. PAYMENT It is understood and agreed by and between the parties hereto that this Contract is for the cost of time and material only while performing work for and that work is accepted by the City. All requests for payment shall be accompanied by supporting documentation which will include proof of the work performed in accordance to the Contract Documents and other CITY required supporting documentation. Any reimbursement for expenses shall include receipts or copies of the invoices. No other costs or services shall be billed to the CITY. 10. INDEPENDENT CONTRACTOR The CONTRACTOR is an independent contractor and as such will be responsible for paying his own Federal income tax and self-employment tax, or any other taxes applicable to the compensation paid under this agreement. 11. ASSIGNMENT Neither party shall have the power to assign any of the duties or rights or any claim arising out of or related to the Agreement, whether arising in tort, contract, or otherwise, without the written consent of the other party. These conditions and the entire Agreement are binding on the heirs, successors, and assigns of the parties hereto. 12. NO THIRD PARTY BENEFICIARIES This Agreement gives no rights or benefits to anyone other than the CONTRACTOR and the CITY. 13. JURISDICTION The laws of the State of Delaware shall govern the validity of this Agreement, its interpretation and performance, and any other claims related to it. In the event of any litigation arising under or construing this Agreement, venue shall lie only in Kent County, Delaware. 14. TERM AND TERMINATION All or part of this Agreement may be terminated by the CITY for its convenience on thirty (30) days A-8 • 29

D Item 5. written notice to the CONTRACTOR. In such event, the CONTRACTOR will be entitled to compensation for services competently performed up to the date of termination. In the event of termination not the fault of the CONTRACTOR, the CONTRACTOR shall be compensated for with Reimbursable Expenses then due and all Termination Expenses. 15. CONTACT PERSON The primary contact person under this Agreement for the CONTRACTOR shall be Name: _____________________________, Phone No.:_________________________, Address:______________________________. The primary contact person under this Agreement for the CITY shall be Paul Waddell, Electric Director, Electric Department, 302-736-7088, pwaddell@dover.de.us. 16. APPROVAL OF SERVICE PERSONNEL The CITY reserves the right to approve the contact person and the persons actually performing the services on behalf of the CONTRACTOR pursuant to this Agreement. If the CITY, in its sole discretion, is dissatisfied with the contact person or the person or persons actually performing the services on behalf of the CONTRACTOR pursuant to this Agreement, the CITY may require the CONTRACTOR assign a different person or persons be designated to be the contact person or to perform the services hereunder. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the respective dates under each signature. (CONTRACTOR) CITY OF DOVER By: By: Randy Robertson Title: Title: City Manager Signature: Signature: Date: Date: A-9 • 30

©2021 CliftonLarsonAllen LLP D Item 6. City of Dover, Delaware Audit Results Year Ended June 30, 2020 February 23, 2021 31 WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor

©2019 CliftonLarsonAllen LLP Contents DItem 6. Content Page We welcome the opportunity to meet with you to Scope and Deliverables discuss the results of our audits of the financial statements of the City of Dover, Delaware for the year Scope and Deliverables 3 ended June 30, 2020. We completed our audit and have Required Communications issued our report dated January 28, 2021. Industry and Firm Required Communications 4 CLA exists to create opportunities for our clients, our Industry Trends and Developments people, and our communities. We achieve this goal by CRF Resources 7 living the CLA Promise: to know you and help you. The GASB Pronouncements 8 contact at CLA in connection with this communication is listed below: Other Developments 9 Remi Omisore, CPA, MBA, CISA, CIA Remi.Omisore@CLAConnect.com (410)308-8157 Create Opportunities • 32 2

©2019 CliftonLarsonAllen LLP Scope and Deliverables DItem 6. Scope of the Engagement (Article IV, Section 46 of the City Charter) Issue an opinion on the City’s Financial Statements Single Audit - Audit of the Schedule of Expenditures of Federal Awards rc@ Responsibilities ® Management is responsible for the preparation and fair presentation of these financial statements. @J Auditors' responsibility is to express opinions on these financial statements based on an audit and to conduct the audit to obtain reasonable assurance that the financial statements are free from material misstatement. Conclusion ~ - Unmodified Opinion Required communications - Communications to those charged with governance on key components Report on internal control and compliance ~ - Report on the Schedule of Expenditures of Federal Awards Create Opportunities • 33 3

Accounting Principles ©2019 CliftonLarsonAllen LLP Other Accounting Auditors Estimates Required Communications Required Communications Item 6. Audit Key Difficulties Disclosures Audit Adjustments Topic Communication Our Responsibility • Express an opinion on the fair presentation of the financial statements in conformity with GAAP Under Generally • Plan and perform the audit to obtain reasonable, but not absolute, assurance that the financial Accepted Auditing statements are free of material misstatement Standards • Evaluate internal control over financial reporting • Utilize a risk-based audit approach • Communicate significant matters to appropriate parties Planned Scope and • Performed the audit according to the planned scope and timing previously communicated Timing of the Audit Other Information in • Financial statements may only be used in their entirety Documents Containing • Our approval is required to use our audit report in a client prepared document the Audited Financial • We have no responsibility to perform procedures beyond those related to the financial statements Statements Create Opportunities • 34 4

Accounting Principles ©2019 CliftonLarsonAllen LLP Other Accounting Auditors Estimates Required Communications Required Communications Item 6. Audit Key Difficulties Disclosures Audit Adjustments Topic Communication Significant Accounting Policies • Management is responsible for the accounting policies of the organization • Accounting policies are outlined in Note 2 to the financial statements • No significant changes to the accounting policies during the year • Accounting policies deemed appropriate • No unusual transactions occurred Significant Accounting • An area of focus under a risk-based audit approach Estimates • Significant estimates include: allowance for uncollectible receivables, depreciable lives of fixed assets, compensated absences, fair value of financial instruments, incurred but not reported claims, OPEB and net pension liability, Asset Retirement for Mckee Run Station • Estimates determined by management based on their knowledge and experience • No management bias indicated • Estimates were deemed reasonable • Estimate uncertainty is disclosed in the financial statements Management Representation • Management provided a signed representation letter prior to finalization of the audit report Letter Other • No difficulties encountered in performing the audit • No issues discussed prior to retention as independent auditors • No disagreements with management regarding accounting, reporting, or other matters • No consultations with other independent auditors 35 Create Opportunities 5

Accounting Principles ©2019 CliftonLarsonAllen LLP Other Accounting Auditors Estimates Internal Control Matters Required Communications Item 6. Audit Key Difficulties Disclosures Audit Adjustments Topic Communication Purpose • Express an opinion on the financial statements, not on the effectiveness of internal controls. • Our consideration of internal controls was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore material weaknesses or significant deficiencies may exist that were not identified. In addition, because of inherent limitations in internal control, including the possibility of management override of controls, misstatements due to fraud or error may occur and not be detected by such controls. Material Weakness • Reasonable possibility that a material misstatement would not be prevented, or detected and corrected on a timely basis. Significant Deficiencies • Less significant than a material weakness, yet important enough to merit the attention of governance. Restricted Use • This communication is intended solely for the information and use of management, the audit committee, and others within the County, and is not intended to be, and should not be, used by anyone other than these specified parties. Results • No material weaknesses or significant deficiencies identified • Separate management letter issued • Two Passed adjustments (OPEB and fixed assets) Current Year Changes • Debt Issuance (Water Fund $1.4M) • Separation of Water and Wastewater funds • CARES Grants • Fixed Asset Disposals (library) 36 Create Opportunities 6

©2021 CliftonLarsonAllen LLP Responding to COVID-19: Item 6. CLA Resources Right Click Links for CLA Resource Pages Operational ® Regulatory and Tax Inspirational and Support Updates Leadersh ip Tips Financial Accounting and Workforce, Hu man Management and Financ ial Statement Resource, and Disaster Relief Gu idance Benefits Gu idance 37 ~,.. Create Opportunities 7

Governmental Accounting Standards Board D ©2019 CliftonLarsonAllen LLP Item 6. Update Effective Dates • 2020 • Statement 83—Asset Retirement Obligations • Statement 88—Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements • 2021 • Statement 84—Fiduciary Activities • Statement 90—Majority Equity Interests • 2022 • Statement 87—Leases • Statement 89—Accounting for Interest Cost Incurred before the End of a Construction Period • 2023 NOW Q] • Statement 91—Conduit Debt Obligations • Statement 94—Public-Private and Public-Public Partnerships and LATER ~ Availability Payment Arrangements 38 Create Opportunities 8

8 Assessments to Help Mitigate ©2021 CliftonLarsonAllen LLP D Item 6. Cybersecurity Threats • Network penetration and wireless testing — Help keep • GLBA information, HIPAA, and PCI data protection risk hackers away by knowing your current level of exposure and assessments—Avoid compliance risks and impacts, loss of your monitoring functions, as well as how to recognize and funds, or reputation loss due to data breach or stolen respond to breaches in your network systems. credentials, by thoroughly understanding your compliance • Web and application penetration testing — From business levels and any gaps in process, tools, and functions. partners requesting access through your firewall to your • Security policy review and development — The weakest link staff requiring 24/7 mobile connectivity, it is imperative to in a cybersecurity strategy is often the end user. Do you understand your current risk profile and how to strengthen have security policies that help develop the proper culture your defenses. of awareness and communication among your staff? • Application and general controls review — How recently • Security awareness training — Is your team aware of the have you reviewed your general controls (i.e., your people types of current attacks and trends, and how to respond to or policies)? Develop an IT risk assessment and internal or avoid these threats? Teach your staff how to recognize audit plan. Identify simple and moderate (low-cost) controls threats and use security controls. that can be applied to mitigate application and data security • Incident response and forensic investigation — Are you risks. confident in your policies and responses? Align your • Social engineering assessment — Do your employees know strategy with proven practices when identifying, assessing, and understand how to protect sensitive information and and documenting security incidents respond to email phishing or pretext calls? Analyze the effectiveness of your administrative, physical, and technical ~,.. safeguards. Create Opportunities • 39 9

Remi Omisore, CPA, MBA, CISA, CIA Item 6. Principal Remi.Omisore@CLAConnect.com (410)308-8157 Justin Measley, CPA Manager Justin.Measley@CLAConnect.com (410)308-8071 CLAconnect.com WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING 40 ©2021 CliftonLarsonAllen LLP Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor

D Item 6. ANNlUAL FINANCIAL REPORT • 41

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D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2020 Prepared Prepared by by the Finance Finance Department Departmen Lori Lori Peddicord, Peddicord Controller/Treasurer Controller/Treasurer • 43

D Item 6. ACKNOWLEDGEMENTS THE CITY OF DOVER’S COMPREHENSIVE ANNUAL FINANCIAL REPORT WAS PREPARED BY THE FINANCE DEPARTMENT TRACEY LISIECKI FINANCIAL REPORTING & ACCOUNTING MANAGER ROBIN DICKERSON ACCOUNTANT II DEBBIE O’BRIEN ACCOUNTANT I SHARON DANIEL ACCOUNT CLERK II SPECIAL APPRECIATION IS EXTENDED TO MRS. DONNA S. MITCHELL, CITY MANAGER, AND ALL PERSONNEL THROUGHOUT THE CITY FOR THEIR CONTINUED SUPPORT OF THE FINANCE DEPARTMENT. • 44

CITY OF DOVER, DELAWARE D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 2020 TABLE OF CONTENTS PAGE INTRODUCTORY SECTION 1 Letter of Transmittal ................................................................................................................................... 3 Certificate of Achievement for Excellence in Financial Reporting ......................................................... 10 Mayor and City Council Members ............................................................................................................ 11 List of Elected Officials ............................................................................................................................ 12 List of Appointed Officials ........................................................................................................................ 13 List of Committees, Commissions, and Boards ..................................................................................... 14 Organization Chart ................................................................................................................................... 17 Vision ......................................................................................................................................................... 18 FINANCIAL SECTION 19 PART A - Report of Independent Public Accountants.............................................................................. 21 PART B - Management’s Discussion and Analysis ................................................................................. 27 PART C - Basic Financial Statements....................................................................................................... 45 Government-wide Financial Statements Statement of Net Position ................................................................................................................... 47 Statement of Activities ........................................................................................................................ 48 Fund Financial Statements Governmental Funds Balance Sheet .................................................................................................. 49 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ... 50 Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds .. 51 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ......................................................................... 52 Statement of Net Position – Proprietary Funds ................................................................................. 53 Statement of Revenues, Expenses and Changes in Fund Net Position – Proprietary Funds ......... 54 Statement of Cash Flows – Proprietary Funds ................................................................................... 55 Statement of Net Position – Fiduciary Funds..................................................................................... 56 Statement of Changes in Net Position – Fiduciary Funds ................................................................. 57 i • 45

CITY OF DOVER, DELAWARE D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 2020 OF co TABLE 0 CONTENTS PAGE FINANCIAL SECTION – CONTINUED Notes to Financial Statements Index to Notes to Financial Statements ............................................................................................ 59 Notes to Financial Statements .......................................................................................................... 61 Part D - Required Supplementary Information ................................................................................. 121 General Fund – Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual (Non-GAAP Basis) ................................................................................................................. 123 Police Pension Fund Schedule of Changes in Net Pension Liability, Related Ratios..................................................... 125 Schedule of Employer Contributions .............................................................................................. 125 Schedule of Investment Returns .................................................................................................... 126 Net Pension Liability ........................................................................................................................ 126 General Employee Pension Fund Schedule of Changes in Net Pension Liability, Related Ratios..................................................... 127 Schedule of Employer Contributions .............................................................................................. 128 Schedule of Investment Returns .................................................................................................... 128 Net Pension Liability ........................................................................................................................ 128 Delaware Public Employee Retirement System – County and Municipal Police and Firefighter’s Pension Plan Schedule of the City of Dover’s Proportionate Share of the Net Pension Liability ...................... 130 Schedule of the City of Dover’s Contributions ............................................................................... 130 Other Post-Employment Benefits Trust Fund Schedule of Changes in Net OPEB Liability, Related Ratios ......................................................... 131 Schedule of City’s Contributions..................................................................................................... 132 Schedule of Investment Returns .................................................................................................... 132 Notes to Required Supplementary Information Governmental Budgets ................................................................................................................... 133 Part E - Supplementary Information ..................................................................................................... 135 General Fund Combining Schedules.......................................................................................... 137 Combining General Fund Balance Sheet ....................................................................................... 138 ii • 46

CITY OF DOVER, DELAWARE D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 2020 OF co TABLE 0 CONTENTS PAGE FINANCIAL SECTION – CONTINUED Combining Schedule of Revenues, Expenditures and Changes in Fund Balances of the General Fund (Non-GAAP Basis) ................................................................................................................... 139 Governmental Capital Projects Fund – Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual (Non-GAAP Basis) ......................................................................... 140 Financial Statements Special Revenue Funds .......................................................................... 141 Special Revenue Funds – Combining Balance Sheet ................................................................... 143 Special Revenue Funds – Combining Statement of Revenues, Expenditures and Changes in Fund Balances .......................................................................................................................................... 144 Police Grants – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non- GAAP Basis) and Actual ................................................................................................................... 145 Library Grants – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non-GAAP Basis) and Actual .......................................................................................................... 146 Municipal Street Aid Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non-GAAP Basis) and Actual ............................................................................................. 147 Housing Programs – CDBG & NSP – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non-GAAP Basis) and Actual ........................................................................... 148 State of Delaware Department of Transportation Grants – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non-GAAP Basis) and Actual ...................................... 149 Substance Abuse Prevention Program – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget (Non-GAAP Basis) and Actual ........................................................................... 149 Electronic Red Light Safety Program – Schedule of Revenues, Expenditures and Changes in Unreserved Fund Balance – Budget (Non-GAAP Basis) and Actual ............................................. 150 Realty Transfer Tax Fund – Schedule of Revenues, Expenditures and Changes in Unreserved Fund Balance – Budget (Non-GAAP Basis) and Actual ........................................................................... 150 Proprietary Fund Types - Enterprise Funds ................................................................................ 151 Combining Non-Major Enterprise Funds Balance Sheet............................................................... 153 Combining Schedule of Revenues, Expenses and Changes in Fund Net Position – Non-Major Enterprise Funds ............................................................................................................................. 154 Combining Schedule of Cash Flows – Non-Major Enterprise Funds ............................................ 155 Water Fund Schedule of Revenues and Expenses Budget (Non-GAAP Basis) and Actual ......... 156 Water Improvement & Extension Fund Schedule of Revenues and Expenses Budget (Non-GAAP Basis) and Actual ............................................................................................................................. 157 Wastewater Fund Schedule of Revenues and Expenses Budget (Non-GAAP Basis) and Actual 158 iii • 47

CITY OF DOVER, DELAWARE D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 2020 TABLE OF CONTENTS PAGE FINANCIAL SECTION – CONTINUED Wastewater Improvement & Extension Fund Schedule of Revenues and Expenses Budget (Non- GAAP Basis) and Actual ................................................................................................................... 159 Electric Revenue Fund – Schedule of Revenues and Expenses – Budget (Non-GAAP Basis) and Actual................................................................................................................................................ 160 Electric Improvement & Extension Fund – Schedule of Revenues and Expenses – Budget (Non- GAAP Basis) and Actual ................................................................................................................... 161 Proprietary Fund Types - Internal Service Funds ....................................................................... 162 Internal Service Fund – Worker’s Compensation – Schedule of Revenues and Expenses – Budget (Non-GAAP Basis) and Actual .......................................................................................................... 163 Fiduciary Fund Types - Agencies ................................................................................................ 164 Combining Statement of Changes in Assets and Liabilities – All Agency Funds ......................... 165 STATISTICAL SECTION 167 Net Position by Component ............................................................................................................ 170 Changes in Net Position .................................................................................................................. 171 Fund Balances of Governmental Funds ......................................................................................... 173 Changes in Fund Balances of Governmental Funds ..................................................................... 174 Governmental Activities Tax Revenues by Source ....................................................................... 176 Assessed and Estimated Actual Value of Taxable Property ......................................................... 177 Property Tax Rates – All Direct and Overlapping Governments with the Capital School District .......................................................................................................................................................... 178 Principal Tax Payers ........................................................................................................................ 179 Property Tax Levies and Collections ............................................................................................... 180 Ratios of Outstanding Debt by Type ............................................................................................... 181 Ratio of Net General Obligation Bonded Debt to Assessed Value and Net Bonded Debt Per Capita .......................................................................................................................................................... 182 Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Expenditures .......................................................................................................................................................... 183 Computation of Direct and Overlapping Debt with the Capital School District ........................... 184 Computation of Legal Debt Margin ................................................................................................ 185 iv • 48

CITY OF DOVER, DELAWARE D Item 6. COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 2020 OF co TABLE 0 CONTENTS PAGE STATISTICAL SECTION – CONTINUED Revenue Bond Coverage – Electric Revenue Bonds..................................................................... 186 Revenue Bond Coverage – Water Bonds ....................................................................................... 187 Revenue Bond Coverage – Wastewater Bonds ............................................................................. 188 Top Ten Water and Wastewater Utility Customers ........................................................................ 189 Top Ten Electric Utility Customers .................................................................................................. 190 Demographic and Economic Statistics .......................................................................................... 191 Major Employers – Current Year and Nine Years Ago ................................................................... 192 Full-time Equivalent City Government Employees by Function – Budgeted ............................... 193 Operating Indicators and Capital Assets Used in Operations ....................................................... 194 Summary of Insurance .................................................................................................................... 197 v • 49

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware D Item 6. INTRODUCTORY 0 SECTION 0 LETTER OF TRANSMITTAL CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING MAYOR AND MEMBERS OF COUNCIL LIST OF ELECTED OFFICIALS LIST OF APPOINTED OFFICIALS LIST OF COMMITTEES, COMMISSIONS AND BOARDS ORGANIZATION CHART VISION 1 • 51

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. January 31, 2021 The Honorable Mayor, Honorable Council President, Members of the City Council and Citizens of the City of Dover Dover, Delaware 19901 Ladies and Gentlemen: I am pleased to submit the Comprehensive Annual Financial Report of the City of Dover for the fiscal year ended June 30, 2020. This report is published to comply with the provisions of Article IV, Section 46 of the City Charter. It is also intended to provide financial data to the tax and ratepayers, bondholders, trustees, banks, federal and state agencies and the financial community at large. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. The financial statements in this report have been audited by CliftonLarsonAllen LLP, an independent firm of certified public accountants as required by Section 46 of the City Charter. CliftonLarsonAllen LLP has provided an unmodified opinion on the City of Dover financial statements for the year ended June 30, 2020. The report of independent public accountants is located at the front of the financial section of this report. Management’s Discussion and Analysis (MD&A) provides a narrative introduction, overview, and analysis of the basic financial statements. The MD&A complements this letter of transmittal and should be read in conjunction with it. Our MD&A can be found immediately following the report of our independent auditors. 3 • 53

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. THE REPORTING ENTITY AND ITS SERVICES The City of Dover was incorporated in 1829 under a Charter granted by the General Assembly. Dover is the Capital of the State of Delaware and is located in the central part of the State. It is home to the State Governor’s office, legislative offices, and is the County seat for Kent County. The City currently occupies a land area of 23.87 square miles and serves a population of approximately 38,349. Dover’s governing body is composed of a Mayor and nine Council Members, with one Council Member elected by Council to serve as Council President. Two members of City Council are elected from each of the four districts; the ninth Council member of Council and the Mayor are elected at-large. The Council is responsible for all matters of policy and is the authority for levying taxes, securing revenues, authorizing expenditures of City funds and incurring City debts. The City of Dover operates under a Council – Manager form of government. The City provides a full range of services as mandated by the Charter or adopted by the City Council. They include police protection, street, sanitation and stormwater maintenance, recreation, library, community development, economic development, public improvements, planning and zoning, safety inspections, electric power generation and distribution, water and wastewater services, legislative services and general administration. Within the City is a volunteer fire company that is autonomous. Under established criteria, the operations of the Robbins Hose Fire Company are not a part of this report. However, the City provides financing for dispatching, personnel costs, most of the building and equipment maintenance, supplies, and contractual services. The City also provides funding to Robbins Hose for payments on fire engine no. 5. These payments are grouped under the Fire Department and are included in the General Fund. The Fire Chief is elected by the volunteer members of the Fire Company. The City Council traditionally adopts the election and officially appoints the Fire Chief for a one-year term. Therefore, the Fire Department is included in the City organization chart. The Capital School District does not meet the established criteria for inclusion in the reporting entity and, accordingly, is excluded from this report. The City Council shall, on or before the second Monday of June in each year, adopt a budget for the succeeding fiscal year. This annual budget serves as the foundation for the City of Dover’s financial planning and control. The budget is prepared by fund and department. With approval of the City Manager and Controller/Treasurer, Department Heads may transfer resources within or between departments, with the exception of capital project budgets. Transfers between funds and transfers of capital project budgets, however, need special approval from the City Council. ECONOMIC CONDITION AND FUTURE GROWTH Dover continues to be the dominant center of population, employment, commerce, education, and culture in Central Delaware. Economic growth continues in all sectors with construction and permit activity occurring during the year, even with the effects of a nation-wide pandemic. Population and employment growth remain 4 • 54

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. steady, but consumer spending has been reduced and some retail closings could impact utility and other revenues. Growth in the health care and commercial/retail sectors is especially strong, with significant new projects occurring throughout the City. Revitalization of the historic Downtown commercial core continues somewhat slowly, but increasingly successful projects to include the older nearby residential neighborhoods is ongoing. Total value of commercial construction in FY20 was approximately $28.6 million, up only slightly from the prior year, reflecting projects still under construction and a limited number of very large project proposals. Almost 1,400 building permits of all types were issued, along with 3,700 businesses and related licenses; both down slightly from the previous year, reflecting uncertain economic conditions in the second half of the fiscal year. Year to year comparisons are not necessarily indicative of the health of Dover’s economy due to the timing of activity and the variability of general economic factors. Growth and development trends during fiscal year 2020 are discussed below. Population Growth The last decennial census was conducted in 2010 and set Dover’s population at 36,047. The Delaware Population Consortium estimates that Dover’s October 31, 2019 population is 38,349 (their most recent official estimate), or a 6.4% increase since the 2010 count. Dover’s population is projected to reach 38,597 in 2020 and grow to 41,032 by 2030, with a sustained growth rate of about 5% during each of the next ten- year periods. Statistically, Dover’s population is younger than that of the County or the State, with a slightly lower proportion of population of senior citizens as well. Working age adults (23-64) are projected to remain stable as a percentage of the City’s population, making up slightly less than half of the City’s population through 2030. Residential Development Dover’s residential construction market is still recovering from the prior recession, but older developments are seeing increased build-out and the market for apartment units has been strong. Home sales for new and pre- owned are reported to be strong as well. Significant activity occurred in the Village of Cannon Mills PND, Clearview Meadow TND, Village of Westover PND, Patriot Village, Seskinore, Oak Shadows and Chestnut Grove Farms, many of which are nearing build-out. Construction wrapped up in several multi-family residential projects including the Arbors and Leander Lakes. These projects, and general residential construction, are expected to have a positive impact on Dover’s rate of population growth. Downtown Dover Redevelopment Despite the limitations imposed by COVID-19, revitalization of the historic Downtown core is continuing in both commercial and residential sectors, with potential new businesses locating in existing spaces, primarily along Loockerman Street. Through the efforts of groups like National Council on Agricultural Life and Labor (NCALL) Research and Habitat for Humanity, several deteriorated and blighted residential properties have been demolished and are being replaced by new owner occupied dwellings, transforming entire block-fronts adjacent to the commercial core. During 2020, eight (8) residential units and one (1) commercial unit qualified for Downtown Development District incentives. While this is a decrease over last year (again, due chiefly to the ongoing COVID-19 pandemic), $8,931 in City Downtown Development District incentives were awarded in 2020. In addition to the incentives, the tax abatements totaled $2,979. 5 • 55

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. Retail/Commercial Development This sector continues to show significant growth with new and expanded locations along the major highway corridors and throughout the City. Construction of Capital Station (replacing a long vacant industrial building on US13) continues with new tenants including: Aldi, Starbucks, Supercuts, Red Robin, Village Optical, and others. Lidl opened a new grocery facility nearby. Century Engineering and Chesapeake Utilities completed new buildings along the Bay Road Corridor. Plans for a new facility for the Solid Waste Authority are in the works. An office for Delaware State Police/Homeland Security, and other commercial buildings and renovations are in progress in that portion of the City. Plans are also underway for several new restaurants and other businesses along US 13, and along the Route 8 corridor. Other projects include the conversion of the former Acme grocery to a Hobby Lobby craft goods store and numerous renovations throughout the City (DelDOT, Blue Hen Corporate Center, WAWA, Target, Dover Downs, etc.) Health Care, Institutional and Other Sectors Development Dover’s economy is well balanced across a range of sectors including health care, government and military, education, and industrial categories. Health care, again in 2020, saw significant projects underway or completed, including medical offices at Eden Hill, the Post-Acute Medical Rehabilitation Hospital on McKee Road, renovations at Bayhealth Medical Center, and a medical building at Dover Wellness Center. In education, Delaware State University completed their 620-bed dormitory complex replacing outdated existing facilities. Two large governmental projects were in preliminary development: planning for a future Family Court facility and site selection for relocation and construction of a new U.S. Post Office for Dover both proposed location within the downtown area. Summary Fiscal Year 2020 saw a continuation of strong growth in the state capital. Dover remains the geographic and economic center of the County, and is well posed for future growth, development and reinvestment. LONG-TERM FINANCIAL PLANNING AND MAJOR INITIATIVES The City Council continues its focus and commitment to improving the quality and reliability of our City assets and infrastructure in order to continue to provide safe and reliable municipal services to the citizens of Dover. In FY20, the City recorded $2.3 million in acceptance of developer contributed streets and stormwater assets in the Clearview Meadows community known as Phase 2. Other street, stormwater and infrastructure improvements totaling $1.9 million were completed throughout the City to include: Bertrand, Bradford, Cherry, N State Street, Paul and Reese Streets, Maple Parkway, N Governors Avenue, Simon Circle, Police Station Impound Lot and the stormwater improvements to the Meeting House Branch site which will Silver Lake. Other asset additions totaling $0.3 million included improvements to existing infrastructure at the City library, police department, and City Hall. $1.2 million was spent on vehicle and equipment purchases. The electric utility had fixed asset additions totaling $1.6 million in fiscal year 2020. Many projects involved our Electric Engineering team as well as our Transmission and Distribution crews. The installation of transformers, conductors and metering work of approximately $0.6 million completed in the areas known as Clearview Meadows, Chestnut Grove and Capital Station, as well as projects to include Dunkin Donuts, LIDL 6 • 56

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. and DNREC. There were also a number of smaller projects involving line maintenance, pole design and switchgear replacements. The City completed the Upgrade of the Van Sant Fire Suppression system at $0.1 million. The electric utility had vehicle and equipment additions of $0.8 million. The water utility had capital improvements totaling $1.0 million, of this was a developer dedication of $0.8 million in water infrastructure this in the Clearview Meadow community development Phase 2. The City also recognized $0.2 million of improvements to include water main replacements in the Lakewood Place area and a Wellhead Redevelopment program. There were vehicle replacements totaling $0.62 thousand. The wastewater utility capital improvements and replacements were approximately $2.4 million, of this which included the developer dedication in association with the Clearview Meadow community development Phase 2 consisting of sewer main and laterals totaling $0.6 million. The City also had pump station replacements and improvements amounting to $1.5 million in various locations throughout the City of Dover to include; Delaware Tech, Silver Lake, Walker Woods, College Road and Kurt Drive. There was also an equipment retrofit the Eco Star System, which is a camera system used to review sewer line issues/problems. This purchase was in the amount of $0.2 million and was included in the capital asset additions/improvements during FY2020. The City maintains a five-year Capital Investment Plan which serves as its planning and budgeting tool to program upgrades and replacements to its equipment, facilities, and infrastructure. As part of this process, operating expenses are identified, and funding sources are determined. Managers are required to rank capital expenditures by criticality based on the impacts on customer services and revenue losses. The fiscal year 2020/2021 Capital Investment Plan includes $1.2 million for vehicles and equipment and $12.3 million of infrastructure and utility improvement projects. The Capital Investment Plan is presented to City Council each year during the budget workshops, and the final plan is approved by City Council along with the annual budget. In fiscal year 2021, the General Fund capital improvements budget is $4.1 million. The City Hall is expected to have HVAC improvements of approximately $0.7 million. The Police department has budgeted for numerous building improvements/upgrades also to include Information Technology related items totaling $0.8 million. The Public Works-Streets department has an approved capital project budget of $0.9 million for Street, Concrete and Alley program items. The Public Works-Stormwater department has an approved budget of $1.1 million for miscellaneous storm sewer, dam and basin improvements. The Parks and Recreation department has earmarked funding of $0.4 million for park master plan and park improvements at numerous locations throughout the City. There are smaller appropriated amounts for Facilities Management, Information Technologies and the Procurement departments. The Water Fund budget includes capital improvements of $1.2 million. This funding will be used for various water quality improvement projects, to include the Wellhead Redevelopment program and also for the purchase of an IPlan Table. The total Wastewater Fund capital improvements budget is $1.1 million. There are pump station replacement projects identified to include College Road and Turnberry, as well as the Lepore sanitary sewer upgrade project. Funding of $0.8 million is included for the inflow/infiltration removal project. The Electric Fund is projecting $5.4 million in capital improvements for FY21. The new development budget totals $0.8 million. There are various infrastructure improvements scheduled for the Reed Street and Butner office locations totaling $0.4 million. The electric engineering division has budgeted funds for numerous 7 • 57

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. replacement/ugrade projects to include the following; the Radio Infrastructure to convert from analog to digital, the ArcFM migration database upgrade project, upgrade of the system operations voice recorder system and the purchase of an IPlan Table totaling $0.6 million. There are a number of projects totaling approximately $1.6 million to include Garrison Oak Tech Park substation, College Road switchgear relocation, conversion of existing services from overhead to underground at the Towne Point Subdivision and smaller substation equipment test and component upgrades within the FY21 budget. $1.0 million is budgeted to continue with the LED lighting conversion project allowing the City to continue to move forward with the upgrade from the non-LED lighting change over to LED lighting for Roadway, Decorative and Security lights. The plant decommissioning project to dismantle the McKee Run Power Plant is budgeted at $1.0 million. FINANCIAL POLICIES AND FINANCIAL PLANNING Unassigned fund balances in the General Fund of 14.5% exceeded the policy guidelines of a minimum of 8% and maximum of 12% of current year operating revenues as approved by City Council in the City of Dover financial policies. This overage was attributed to lower than budgeted expenditures along all functions of the government due to attrition and vacancies, and as a result, the fiscal year 2021 budget will be adjusted to address the overage. The water and wastewater utility guidelines are to maintain a minimum budget balance of at least 8% and no greater than 17% (two months) of the current year operating revenues. The current budget balances as of June 30, 2020 for the utilities are water at 24.9% of the actual water revenues and wastewater at 8.5% of the actual wastewater revenues. The wastewater budget balance excess will be addressed in the fiscal year 2021 budget. The electric utility is to maintain a minimum budget balance of at least 12% (45 days) of the current year operating revenues less the Distribution of Earnings – PCA Credit. If the balances fall below the established percentages, the City Manager is required to submit budgets to bring the balances up to minimum within three years. The electric utility ended the year with a budget balance greater than the 12% at 20.4%. This was attributed to lower than projected power supply and generation cost and lower than anticipated divisional expense and interfund service fees. The fiscal year 2021 budget will continue to include a distribution of prior year earnings to the electric customers in the form of a negative power cost adjustment. The City policies also require non-recurring revenues to be set aside for capital improvements as designated by City Council (reserve accounts) and a $700,000 contingency reserve in the General Fund, $250,000 each for the Water and Wastewater Fund contingency reserves and $750,000 contingency in the Electric Revenue Fund to address unforeseeable natural disasters and insurance losses. All major funds meet the contingency reserve requirements. The water and wastewater utilities impose impact fees, which are reserved by ordinance, on new developments or facilities to assist with financing future expansion projects. The electric utility maintains depreciation and future capacity reserves to assist with asset replacements and system expansions. Financial policies require the electric utility to maintain a minimum of $10.0 million in each of these reserves, with replenishment over seven years when used to finance projects. The City’s financial policies also include an Electric Rate Stabilization Reserve account. The purpose of this reserve is to level off the fluctuations in the wholesale power supply market and in turn provide stable rates to the City’s customers. The reserve balance shall be maintained at a minimum of 10% not to exceed 20% of 8 • 58

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. the purchase power cost in any given year. If the reserve balance exceeds the 20% maximum, a credit will be applied to the power cost adjustment. AWARDS AND ACKNOWLEDGEMENTS The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Dover, Delaware for its comprehensive annual financial report (CAFR) for the fiscal year ended June 30, 2019. This was the thirty-fifth (35) consecutive year that the City of Dover has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized comprehensive annual financial report. The report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program’s requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate. The Finance Department extends our thanks to you for your continued interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner. I also express my appreciation to the many City employees for their assistance and cooperation during the year in preparation of this report. My appreciation is extended to Mr. David S. Hugg III, City Planner for his assistance with the preparation of the local economy section, Mrs. Tracey Lisiecki for her continued years of dedication and knowledge, and the support she provides in producing this annual report. The City Finance team continues to work diligently to meet the continuous deadlines upon us as well as support and assist the numerous departments within the City with the undertaking of the implementation of a City-wide software system. The implementation is a team effort involving all functions of the City as we continue to improve the processes and procedures in order to conduct efficient and effective management of the City funds. The employees of the Finance Department are commended for their true pride and dedication as they continue to make this report and each year a success. Respectfully submitted, Lori Peddicord Controller/Treasurer 9 • 59

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. Govemm.ent Finance Officef"S Assoc-iaitfon Certificate of Achievement for Excellence in Financial Repoding Presented to City of U ove1· D,ela,va1·e For ·~ Comprehemive Annnal Financi.d Report F:or the Fiscal Year Ended 11.Dle 30, 2019 Executive Director/CEO 10 • 60

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. MAYOR 0 AND MEMBERS OF COUNCIL OFCO Tanner Wm. Polce, William F. Hare, Scott W. Cole, David L. Anderson, 1st District 2nd District 3rd District 4th District Matthew J. Lindell, Ralph L. Taylor, Jr., Fred A. Neil, Roy Sudler, Jr., 1st District 2nd District 3rd District 4th District Timothy A. Slavin, At- Robin R Robin R. Large Christiansen, r.hr st1arsen Mayor Mayor 11 • 61

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. LIST OF ELECTED O F OF L OFFICIALS June 30, 2020 Length of Term Service Expires Mayor Robin R. Christiansen 6 Years May 2023 City Council At-Large Timothy A. Slavin 7 Years May 2021 First District Matthew J. Lindell 3 Years May 2023 Tanner Wm. Polce 3 Years May 2021 Second District * William F. Hare 9 Years May 2021 Ralph L. Taylor, Jr. 1 Year May 2023 Third District Scott W. Cole 5 Years May 2023 Fred A. Neil 5 Years May 2021 Fourth District David L. Anderson 9 Years May 2021 Roy Sudler, Jr. 5 Years May 2023 * Council President Note: length of service does not reflect previous, non-consecutive service, or interim appointment prior to permanent appointment 12 • 62

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. LIST OF APPOINTED OFFICIALS June 30, 2020 Length Length of of Time Time in with the Position City City Clerk/Assistant Treasurer – Traci A. McDowell 14 Years 32 Years City Manager/Civil Defense Director – Donna S. Mitchell 2 Years 19 Years City Solicitor – Nicholas H. Rodriquez 52 Years 52 Years Deputy City Solicitor – Gary E. Junge 1 Month 1 Month Council President – William F. Hare 1 Year 9 Years City Assessor – Cheryl A. Bundek 11 Years 28 Years City Building Inspector – David S. Hugg III 2 Years 2 Years City Planner – David S. Hugg III 2 Years 2 Years Controller/Treasurer – Lori Peddicord 2 Years 5 Years Fire Chief - Ronald W. Rhodes, Sr. 2 Years 2 Years Fire Marshal - Jason A. Osika 4 Years 18 Years Police Chief – Thomas Johnson 4 Months 4 Months Note: length of service does not reflect previous, non-consecutive service, or interim appointment prior to permanent appointment 13 • 63

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. LIST OF COMMITTEES, COMMISSIONS, AND BOARDS Awards Committee Peggy Angel Dover Public Library Advisory Commission Ronald R. Gough Councilman Scott W. Cole Georgia Van Sant Zachery C. Carter Gertrude Jackson Board of Adjustment Beth Petit De Mange K.C. Sheth, Chair Jill B. Street Arthur G. Ericson, Vice Chair Robert S. Wetherall William A. Hufnal James N. Keller Dover/Kent County MPO Council Richard D. Senato Mayor Robin R. Christiansen Board of Assessment Appeals Downtown Dover Partnership Board of Directors William Garfinkel, Accounting, Chair City Manager, Donna S. Mitchell Thomas Burns, Real Estate Brokerage of Sales City Planner, David S. Hugg III James Galvin, Undesignated Mayor Robin R. Christiansen Vacancy Councilman David L. Anderson, Chair Todd Stonesifer, Real Estate Brokerage of Sales Councilman Fred A. Neil Vacancy, Property Appraisal/Assessments Economic Development Committee Construction and Property Maintenance Code Board of Mayor Robin R. Christiansen, Chair Appeals Councilman Matthew J. Lindell Councilman David L. Anderson, Chair Councilman Scott W. Cole Councilman Fred A. Neil Kim I. Adams Charles Martin Clayton E. Hammond II Vacancy City Manager, Donna S. Mitchell Vacancy City Planner, David S. Hugg III Diane Laird Dover Fourth of July Celebration Committee Mayor Robin R. Christiansen, Chair Election Board Vacancy At Large: Juanita F. Walker Andrea Maucher, Vice-President First District: Anita L. McDowell Boyer Jeffrey C. Dill, Treasurer/Secretary Second District: Cherritta L. Matthews Susan Betts Third District: James W. Brockton Carolyn D. Courtney Fourth District: M. Milford Caldwell, Jr. Gail Nemcic Traci A. McDowell, City Clerk (Liaison Member) Vacancy Sarah Zimmerman Ethics Commission Thomas C. Jackson, Chair Dover Housing Authority Robin F. Case Mark Harmon Gary Coy Enrico LePore Lisa M. Enright Robert F. Merritt Vacancy Audrey Daniels Phillip McGinnis Sandra Taylor Rufus Mincey, Interim Executive Director/Secretary 14 • 64

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section LIST OF COMMITTEES, COMMISSIONS, AND BOARDS (CONT’D) D Item 6. General Employee Pension Plan Board of Trustees Planning Commission Councilman David L. Anderson At-Large: Dr. Bobby Jones Councilman Ralph L. Taylor, Jr. First District: Kathleen Welsh, Vice Chair Donna S. Mitchell First District: Deborah L. Edwards Lori Peddicord Second District: Robert Hartman Robert Gedney Second District: Andrea Maucher Carolyn Courtney Third District: Nicholas A. Adams Samuel C. "Carter" Knotts Third District: Frederick Tolbert, Chair Fourth District: John H. Baldwin, Sr. Historic District Commission Fourth District: Kenneth Roach Joseph McDaniel (Chair) Business Rep./Resident Ann Baker Horsey, (Vice-Chair) Professional/Resident Police Pension Plan - Retirement Committee Eric S. Czerwinski, Professional Councilman David L. Anderson Mary Terry Mason, Resident Councilman Ralph L. Taylor, Jr. Jonathan N.H. Street, Professional City Manager, Donna S. Mitchell Police Chief Tom Johnson Human Relations Commission (Ret. Lt.) Timothy Mullaney, Sr., Chair At-Large: Sara Herbert (Ret. Captain) Larry Gray First District: Paul Fleming (Ret. Sgt.) Steve Rogers First District: Gerald Rocha, Sr. Second District: Vacancy Public Advisory Committee of the Dover/Kent County MPO Second District: Vacancy Dr. Carlton L. Cannon, Jr. Third District: Alan Gaddis, Chair Jonathan Contant Third District: Wanda Mullen Karen McGloughlin Fourth District: Rita Mishoe Paige Albert W. Holmes, Jr. (At-Large Alternate) Fourth District: Vacancy Safety Advisory and Transportation Committee Kent County Tourism Board of Directors Councilman Ralph L. Taylor, Jr., Chair Councilman Fred A. Neil C.C. Bud Wagner Dana Shelton Kent Economic Partnership Board of Directors Mayor Robin R. Christiansen Silver Lake Commission Tricia K. Arndt, Chair Legislative, Finance, and Administration Committee Vacancy Councilman Matthew J. Lindell, Chair Zachery C. Carter Jonathan D. Contant Vacancy Daniel T. Shevock Lyle Allen Jones Marie E. Kozel Other Post-Employment Benefits (OPEB) Board Michael W. Lewis Councilman David L. Anderson Councilman Ralph L.Taylor, Jr. St. Jones Greenway Commission City Manager, Donna S. Mitchell Vacancy Controller/Treasurer, Lori Peddicord Michael P. Mercer Human Resources Director, Kimberly Hawkins City Parks and Recreation Director, Robin Eaton Parks, Recreation and Community Enhancement Utility Committee Councilman David L. Anderson, Chair Councilman Scott W. Cole, Chair M. Milford Caldwell, Jr. Vacancy Thomas J. Dix Andrea B. Maucher 15 • 65

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. FY2020 ORGANIZATION CHART Citizens of Dover City Council Mayor City Solicitor Police City Manager City Clerk Finance Fire Tax Assessor Planning & Commun ity Enhancement Services Assistant City Central Electric Human Public Works Code Enforcement Manager Services Resources Administration Administration Community Customer Procurement Development Services & Inventory Engineering & Engineering System Ops Inspections & Information Facilities Permitting Management Operations Technology Transmission & Distribution Life Safety Fleet Public Library Grounds Maintenance Generation Water Management Planning Sanitation Parks & Recreation Wastewater Management Streets Water Treatment Plant 17 • 67

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Introductory Section D Item 6. VISION 10 The C The City o of Dover Dover Iis a a place place he where people people want to Ilive! ve' Through the team Th team effort of of Iits el elected oofficials, employees, c1al emplo and and citizens, cItIzen Dover Do is I aa clean clean and and safe community, commu Ity with It a a future of future balanced gro of a growth aand oppo opportunity where all all ccitizens Izens are heard are heard, enJoy enjoy aa high quality Igh qua I ofof 1fe life, and and ddiversity is va ers1ty Is valued. ued. 18 • 68

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section D Item 6. FINANCIAL Fl SECTION ECT 0 THIS SECTION INCLUDES THE FOLLOWING: PART A – REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS PART B – MANAGEMENT’S DISCUSSION AND ANALYSIS PART C – BASIC FINANCIAL STATEMENTS Government-wide Financial Statements Fund Financial Statements Notes to Financial Statements PART D – REQUIRED SUPPLEMENTARY INFORMATION PART E – SUPPLEMENTARY INFORMATION Combined Fund Statements Budgetary Schedules 19 • 69

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part A – Report of Independent Public Accountants D Item 6. PART A REPORT OF EPO INDEPENDENT PUBL OF I PE PUBLIC ACCOUNTANTS CCOU 21 • 71

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part A – Report of Independent Public Accountants D Item 6. CliftonlarsonAllen LLP CLAconnect.com INDEPENDENT AUDITORS' REPORT The Honorable Mayor and Members of the City Council of Dover, Delaware Dover, Delaware Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business- type activities , each major fund , and the aggregate remaining fund information of the City of Dover, Delaware (the City), as of and for the year ended June 30 , 2020, and the related notes lo the financial statements , which collectively comprise the City's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United states of America ; this includes the design , implementation , and maintenance of internal control relevant lo the preparation and fair presentation of financial statements that are free from material misstatement , whether due to fraud or error. Auditors' Responsibility Our responsibility is to express opinions on these financial statements based on our audit . We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States . Those standards require that we plan and perform the audit lo obtain reasonable assurance about whether the financial statements are free from material misstatement . An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment , including the assessment of the risks of material misstatement of the financial statements , whether due lo fraud or error. In making those risk assessments , the auditor considers internal control relevant to the City's preparation and fair presentation of the financial statements in order lo design audit procedures that are appropriate in the circumstances , but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly , we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management , as well as evaluating the overall presentation of the financial statements . We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. 23 • 73

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part A – Report of Independent Public Accountants D Item 6. The Honorable Mayor and Members of the City Council of Dover, Delaware Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities , the business-type activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2020, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis, the General fund-schedule of revenues, expenditures, and changes in fund balance-budget and actual; the schedules of changes in net pension liability, related ratios for the police pension plan and the general employee pension plan ; the schedule of employer contributions for the police pension plan and the general employee pension plan, the schedule of the City of Dover's proportionate share of the net pension liability for the county and municipal police and firefighters pension plan ; the schedule of the City of Dover's contributions for the county and municipal police and firefighters pension plan ; and the schedule of changes in net OPEB liability, related ratios for the OPEB plan , schedule of City Contributions for the other post-employment plan, and the Schedule of investment returns for the police pension plan , general employee pension plan, and OPEB plan be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements , is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance . Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The introductory section , combining and individual fund schedules , budgetary comparison schedules and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements . The combining and individual fund schedules and budgetary comparison schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves , and other additional procedures in accordance with auditing standards generally accepted in the United States of America . In our opinion, the combining and individual fund schedules and budgetary comparison schedules is fairly stated , in all material respects, in relation to the basic financial statements as a whole . 24 • 74

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part A – Report of Independent Public Accountants D Item 6. The Honorable Mayor and Members of the City Council of Dover, Delaware The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them . Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 28, 2021, on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws , regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the result of that testing, and not to provide an opinion on the effectiveness of internal control over financial reporting or on compliance . That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial reporting and compliance . CliftonlarsonAllen LLP Baltimore, Maryland January 28, 2021 25 • 75

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section D Item 6. PART B MANAGEMENT’S DISCUSSION AND ANALYSIS 27 • 77

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. The City of Dover Management’s Discussion and Analysis For the Year Ended June 30, 2020 The following is a discussion and analysis of the City of Dover’s (the City’s) financial activities for the fiscal year ended June 30, 2020. Readers are encouraged to consider the information presented here in conjunction with additional information provided in our letter of transmittal, which can be found on pages 3-9 of this report, and the City’s financial statements which follow this section. Financial Highlights The City’s assets and deferred outflows of resources exceeded its liabilities and deferred inflows of resources by $229.8 million (net position). Included in this amount is a negative $2.9 million balance in “unrestricted net position”. The total Net Position represents the funds available to meet the City’s ongoing obligations to citizens and creditors. The general government reported an unrestricted deficit of $23.7 million and the business-type activities, Water, Wastewater and Electric funds, reported a positive $20.8 million unrestricted net position. The difference between the unrestricted amounts and the total net position is $232.7 million, of which $71.5 million is restricted primarily for debt and capital construction purposes, and $161.2 million is net investment in capital assets. Total Assets increased for both the governmental and business-type activities in the amounts of $4.6 million and $13.9 million respectively. Deferred Outflows for the governmental activities increased $0.9 million and for the business-type activities it increased $0.4 million. Deferred Inflows decreased for both the governmental and business-type activities by $1.6 million and $0.5 million respectively. Liabilities also decreased for both the governmental activities business-type activities by $0.7 million and $0.2 million respectively. • For governmental activities, the City reported: an increase of $2.0 million invested in capital assets, an increase in restricted net assets of $0.2 million, and an increase of $5.6 million in unrestricted net position. As a result of its operations, the City recognized a positive change in net position of governmental activities of $7.8 million. The current year’s change in net position is $0.1 million lower than the previous years’ change in net position and is primarily due to increases in expenses across most functions of government totaling $1.9 million with an offsetting $1.8 million increase in revenues from the prior year. • For business-type activities the City reported: a decrease of $4.6 million invested in capital assets, an increase in restricted net position of $16.6 million and an increase of $3.0 million in unrestricted net position. As a result of its operations, the City recognized a positive change in net position of business-type activities of $15.0 million, which is an increase over last years’ positive change of $3.4 million driven primarily by reductions of $4.3 million in energy costs, $1.0 million reduction in wastewater treatment expense with an offset of $0.4 million increase in water treatment expense. Other contributing factors include a $1.4 million increase in infrastructure contributions dedicated by contractors and $0.4 million increase in investment earnings with offsetting decreases in revenue across all three utilities as follows: $0.7 million in Water charges, $0.4 million in wastewater charges and $2.2 million in electric charges for services. 29 • 79

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Overview of the Financial Statements This discussion and analysis section is intended to serve as an introduction to the City’s Comprehensive Annual Financial Report (CAFR). The CAFR consists primarily of three required components: 1) management’s discussion and analysis (this section), 2) the basic financial statements; and 3) required supplementary information. The CAFR also includes optional supplementary information that provides summary and detail level information, and a statistical section. The basic financial statements are presented in two categories that present different views of the City’s financial condition: • The two government-wide financial statements (pages 47-48) provide both long-term and short-term information about the City’s overall financial position and operations. • The remaining (pages 49-57) fund financial statements focus on specific activities of City government, reporting the City’s operations in more detail than the government-wide statements. The City financial statements can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. - The governmental fund statements (pages 49-52) tell how general government services, like community services, planning, public safety, and public works, were financed in the short term as well as what remains for future spending. - Proprietary fund statements (pages 53-55) offer short and long-term financial information about the activities the government operates like businesses, which for the City of Dover are the Electric, Water & Wastewater Funds. - The Fiduciary fund statements (pages 56-57) provide information about the financial relationships in which the City acts solely as a trustee or agent for the benefit of others, to whom the resources belong. The City is the trustee, or fiduciary, for its Employee and Police Pension plans and Other Post-Employment Benefits plan and acts in an agency capacity for the Dover Downtown Partnership, Fourth of July Celebration Committee, and Dover Days Celebration Fund, none of which are component units of the City. All the City’s Fiduciary activities are reported in separate Statements of Fiduciary Net Position and Changes in Fiduciary Net Position. We exclude these activities from the City’s other financial statements because the City may not use these assets to finance its operations. The City is responsible for insuring that the assets reported in these funds are used for their intended purposes. The financial statements also include notes (pages 61-120) that explain some of the information in the financial statements and provide more detailed data. The statements are followed by a section of required supplementary information (pages 121-134) that further explains and supports the information in the financial statements. Other supplementary information includes details on non- major funds and other information that can be found on pages 135 through 166. The following page summarizes the major features of the City’s financial statements, including the portion of the City government they cover and the types of information they contain. The remainder 30 • 80

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis DItem 6. of this overview section of management’s discussion and analysis explains the structure and content of each of the statements: Major Features of City’s Government-wide and Fund Financial Statements Government-wide Statements Governmental Funds Proprietary Funds Fiduciary Funds Scope Entire City The activities of the City Activities the City Instances in which government (except that are not proprietary operates similar to the City is the trustee fiduciary funds) or fiduciary, such as private businesses, or agent for public safety and public such as electric, water someone else’s works and wastewater funds resources Required financial • Statement of • Balance sheet • Statement of net • Statement of statements net position • Statement of position fiduciary net • Statement of revenues, • Statement of position activities expenditures, and revenues, • Statement of changes in fund expenses and changes in balances changes in net fiduciary net position position • Statement of cash flows Accounting basis Accrual accounting Modified accrual Accrual accounting Accrual accounting and measurement and economic accounting and current and economic and economic focus resources focus financial resources resources focus resources focus focus Continued 31 • 81

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Continued Government-wide Statements Governmental Funds Proprietary Funds Fiduciary Funds Type of All assets deferred Generally, assets and All assets deferred All assets and asset/deferred outflows of deferred outflows of outflows of resources, liabilities, both short- outflows of resources, liabilities, resources expected to liabilities, and deferred term and long-term resources/liability/ and deferred inflows be used up and inflows of resources deferred inflows of of resources both liabilities and deferred both financial and resources financial and inflows of resources capital, and short-term information capital, and short- that come due or and long-term term and long-term available during the year or soon thereafter, no capital assets, or long-term liabilities included Type of All revenues and Revenues for which All revenues and All revenues and inflow/outflow expenses during the cash is received during expenses during the expenses during the information year, regardless of or soon after the end of year, regardless of year, regardless of when cash is the year; expenditures when cash is received when cash is received or paid when goods or services or paid received or paid have been received and payment is due during the year or soon thereafter Government-wide Statements The government-wide statements report information about the City as a whole using accounting methods similar to those used by private-sector companies. The statement of net position includes all of the City of Dover’s assets, liabilities, and deferred inflows and outflows of resources with the difference reported as net position. Net position is one way to measure the City’s financial health or position. Over time, increases or decreases in the City’s net position is an indicator of whether its financial health is improving or deteriorating, respectively. To assess the overall health of the City, one needs to consider additional non-financial factors such as changes in the City’s property tax base and the condition of the City’s physical assets and infrastructure. The government-wide financial statements of the City are divided into two categories: • Governmental activities—Most of the City’s basic services are included here, such as general government, public safety, planning and code enforcement, public works, library and recreation, community and economic development, central services and financial administration. Property taxes, business licenses, permits, sanitation fees, fines, utility transfers and state and federal grants finance most of these activities. • Business-type activities—The City charges fees to customers to help it cover the costs of certain services it provides. The City’s electric, water, and wastewater services are included here. Fund Financial Statements The fund financial statements provide more detailed information about the City’s most significant funds—not the City as a whole. Funds are accounting devices that the City uses to keep track of 32 • 82

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. specific sources of funding and spending for particular purposes. Some funds are required by State law and by covenants. The City Council may also establish other funds to control and manage spending for other purposes. The City has three kinds of funds: • Governmental Funds - Most of the City’s basic services are included in governmental funds, which focus on (1) how cash and other financial assets that can readily be converted to cash flow in and out, and (2) the balances left at year end that are available for spending. Consequently, the governmental funds statements provide a detailed short-term view that helps one determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. Because this information does not encompass the additional long-term focus of the government-wide statements, we provide additional information on a separate schedule, which explains the relationship (or differences) between them. - Governmental Fund Balance classifications are reported to the extent to which they are constrained as promulgated by Governmental Accounting Standards Board Statement No. 54. - The City’s General Fund is the only governmental fund considered to be a major fund under the requirements of Governmental Accounting Standards Board Statement No. 34. • Proprietary Funds – Services, for which the City charges customers a fee, are generally reported in proprietary funds. Proprietary funds, like the government-wide statements, provide both long- and short-term financial information. - The City’s enterprise funds (one type of proprietary fund) are the same as its business- type activities, but provide more detail and additional information, such as cash flows. - The City’s Electric enterprise fund is considered a major fund under the requirements of GASB Statement No. 34. - The City’s Water & Wastewater funds are considered non-major funds under the requirements of GASB Statement No. 34. • Fiduciary Funds – The City is responsible for certain assets which, because of a trust arrangement, can be used only for the trust beneficiaries. The City is responsible for ensuring that the assets reported in these funds are used for their intended purposes. All the City’s fiduciary activities are reported separately in a statement of fiduciary net position and a statement of changes in fiduciary net position. We exclude these activities from the City’s government-wide financial statements because the City cannot use these assets to finance its operations. Financial Analysis of the City as a Whole The City produces government-wide financial statements using the full accrual basis of accounting and economic resource management focus. As year-to-year financial information is accumulated on a consistent basis, changes in net assets may be observed and used to discuss the changing financial position of the City as a whole. 33 • 83

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. The Net Position of the City of Dover as of June 30, 2019 and 2020 are presented below (in millions of dollars): Governmental Business-Type Activities Activities Total 2019 2020 2019 2020 2019 2020 Assets Non-Capital Assets $ 17.9 $ 20.8 $ 114.0 $ 130.4 $ 131.9 $ 151.2 Capital Assets 60.0 61.7 137.9 135.4 197.9 197.1 Total Assets 77.9 82.5 251.9 265.8 329.8 348.3 Deferred Outflow of Resources 4.9 5.8 1.0 1.4 5.9 7.2 Liabilities Current Liabilities 4.5 5.9 12.6 12.0 17.1 17.9 Non-Current Liabilities 42.0 39.9 55.5 55.9 97.5 95.8 Total Liabilities 46.5 45.8 68.1 67.9 114.6 113.7 Deferred Inflow of Resources 11.0 9.4 3.1 2.6 14.1 12.0 Net Position Net investment in Capital Assets 54.3 56.3 109.5 104.9 163.8 161.2 Restricted 0.3 0.5 54.4 71.0 54.7 71.5 Unrestricted (29.3) (23.7) 17.8 20.8 (11.5) (2.9) Total Net Position $ 25.3 $ 33.1 $ 181.7 $ 196.7 $ 207.0 $ 229.8 34 • 84

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. The Changes in Net Position for the City of Dover as of June 30, 2019 and 2020 are presented below (in millions of dollars): Governmental Business-Type Activities Activities Total 2019 2020 2019 2020 2019 2020 Revenues: Program Revenues Charges for Services $ 10.7 $ 9.7 $ - $ - $ 10.7 $ 9.7 Water/Wastewater Charges for Services - - 16.0 14.9 16.0 14.9 Electric Charges for Services - - 83.7 81.5 83.7 81.5 Operating Grants and Contributions 2.4 3.7 - - 2.4 3.7 Capital Grants and Contributions 0.4 0.6 - 1.4 0.4 2.0 General Revenues Property Taxes 13.5 14.8 - - 13.5 14.8 Transfer Taxes 1.6 1.8 - - 1.6 1.8 Earnings on Investments-Other 0.8 0.6 3.8 4.2 4.6 4.8 Total Revenues 29.4 31.2 103.5 102.0 132.9 133.2 Expenses General Government 4.4 5.3 - - 4.4 5.3 Public Safety 17.6 19.7 - - 17.6 19.7 Public Works 6.9 5.1 - - 6.9 5.1 Library and Recreation 3.2 3.7 - - 3.2 3.7 Community and Economic Development 0.5 0.5 - - 0.5 0.5 Central Services 1.4 1.4 - - 1.4 1.4 Financial Administration 3.3 3.3 - - 3.3 3.3 Interest Charges 0.2 0.1 - - 0.2 0.1 Plus (less) Indirect Expense Allocation (5.2) (4.9) 5.2 4.9 - - Water/Wastewater - - 10.9 10.6 10.9 10.6 Electric - - 65.0 60.7 65.0 60.7 Total Expenses 32.3 34.2 81.1 76.2 113.4 110.4 Change in Net Position before Transfers (2.9) (3.0) 22.4 25.8 19.5 22.8 Transfers 10.8 10.8 (10.8) (10.8) - - Change in Net Position 7.9 7.8 11.6 15.0 19.5 22.8 Net Position, beginning of year 17.4 25.3 181.3 181.7 198.7 207.0 Prior Period Adjustment - ARO - - (11.2) - (11.2) - Net Position, Beginning of Year restated 17.4 25.3 170.1 181.7 187.5 207.0 Net Position, End of Year $ 25.3 $ 33.1 $ 181.7 $ 196.7 $ 207.0 $ 229.8 Governmental Activities The preceding table shows changes in net position for the year ended June 30, 2020 compared to the year ended June 30, 2019. Governmental net position increased by $7.8 million; this is a decrease of $0.1 million from the prior years’ positive change in net position of $7.9 million. Total revenues of $31.2 million were more than the prior year by $1.8 million. The increase in revenues is primarily due to increases in: operating grants and contributions, property tax receipts and transfer tax receipts, which exceeded the FY’19 revenues by $2.9 million. The increases were partially offset by decreases in investment earnings, license and permit revenue and miscellaneous services totaling $1.2 million. Minor increases and decreases in other revenue categories were offsetting. 35 • 85

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Total expenses of $34.2 million reflects an increase from the prior year of $1.9 million across all but one function of government – Public Works – which decreased its FY’20 spending by about $1.8 million driven by a decrease in expense for streets and sanitation expense as well as a decrease in road construction and maintenance. General Government, Public Safety and Library & Recreation functions all increased expense from prior year by $3.5 million driven by the loss on sale of the old library, as well as the change in Net OPEB and Pension liabilities. The chart that follows allocates revenues to program costs as applicable. It shows that some City functions are in part self-supporting either through customer charges or inter-fund receipts through the utilities (presented in millions of dollars): Expenses, Program Revenue & Interfund Receipts - Governmental Activities $25 $19.7 $20 $15 Millions $10 $5.3 $4.9 $5.1 $5 $4.3 $3.7 $3.3 $2.6 $2.5 $1.9 $1.4 $1.1 $0.8 $0.6 $0.3 $0.5 $0 General Public Safety Public Works Library & Community & Central Services Financial Government Recreation Economic Administration Development Interfund Receipts m Revenues • Expenses 36 • 86

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. The following chart shows the sources of funding for program costs for the last fiscal year. As can be seen, a substantial portion of funding for governmental operations is provided by property taxes, charges for services and transfers from the utilities. Revenues by Source - Governmental Activities Interfund Receipts 11% Charges for Services 21% Utility Transfer In 23% Operating Grants and Contributions 8% Capital Grants and Contributions 1% Transfer Taxes 4% Property Taxes 32% Business-Type Activities The business-type activities generated an increase in net position of $15.0 million, which exceeds the previous year’s $11.6 million change in net position by $3.4 million. The improvement was driven by the combination of $1.5 million in total revenue decreases offset by expense reductions totaling $4.9 million. Transfers included $1.3 million transferred out of the water & wastewater funds and net transfers of $9.8 million out of the electric fund, which included $10.0 million transferred to the general fund net of $0.2 million transferred in. The indirect expense allocation decreased by $0.3 million. The water utility realized a positive change in net position of approximately $1.8 million; a decrease from prior year of $0.3 million. Operating revenues decreased by $0.7 million primarily due to a decrease in impact fees of over $0.5 million and a decrease in water fees of over $0.1 million compared to the previous year. There was a system-wide decrease in consumption for water which in turn resulted in lower billable usage of approximately 39 million total gallons. Consumption decreases were primarily driven by customer usage. The average billing rate in the water division was flat from the previous year. Operating expenses in the water fund increased by $0.6 million, which was driven mostly by a $0.4 million increase in water treatment fees. Other contributors to the increase in operating expenses were the water and administration fees exceeding FY’19 by $0.1 million in each division. Nonoperating contributors to the increase in net position was the $0.8 million in 37 • 87

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. infrastructure contributions from developers. Finally, the transfers out remained constant at over $0.6 million. The wastewater utility realized a positive change in net position of approximately $1.7 million; an increase from the prior year of over $1.0 million. Operating revenues decreased by $0.4 million primarily due to a decrease in: impact fees of $0.5 million and water fees of $0.1 million offset by an increase in wastewater treatment fees of $0.2 million. There was a system-wide decrease in consumption for wastewater which in turn resulted in lower billable usage of approximately 26 million total gallons. Consumption decreases were primarily driven by customer usage. The average billing rate in the wastewater division was flat from the previous year. Operating expenses in the wastewater fund decreased from the prior year by just short of $0.9 million. The driving factor to the decrease in operating expense was a $1.0 million reduction in Kent County wastewater treatment expense. Cost increases were spread relatively evenly over wastewater operations and engineering divisions. Nonoperating contributors to the increase in net position was just under $0.6 million in infrastructure contributions from developers. Finally, the transfers out remained constant at over $0.6 million. The electric utility realized a positive change in net position of $11.4 million. Operating revenues decreased by $2.2 million attributed to a decrease in power consumption of 28.5 million Kwh resulting in a reduction of $2.0 million in charges for services across all customer types. Additionally, there was a reduction in miscellaneous receipts of $0.2 million driven by rent reductions and lower billable customer installations. Operating Expenses in the Electric Fund decreased by about $4.1 million. A significant $4.3 million reduction in power supply and generation costs, coupled with a $0.3 million reduction in administrative expenses and non-cash depreciation expense, were offset by decreases across all division expenses totaling $0.6 million. As with the water and wastewater utility, nonoperating revenues in the electric utility increased by $0.4 million versus the previous year on higher interest earnings and investment gains. Finally, nonoperating expenses were $0.5 million lower than FY’19 due to normalized customer distributions and reduced interest expenses to round out the positive change in net position. Operating Revenues, Expenses and Transfers - Business-Type Activities $90.0 $82 Operating $80.0 $71 Revenues & $70.0 Millions Transfers $60.0 $50.0 Operating Expenses & $40.0 Transfers $30.0 $20.0 $6 $5 $9 $8 $10.0 $- Electric Revenue Fund Water Fund Wastewater Fund 38 • 88

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Financial Analysis of the City’s Funds Governmental Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Government funds focus on expendable resources and near-term inflows and outflows of those resources. As such, fund balance is generally a good indicator of net resources available for spending at the end of the fiscal year, subject to any stated restrictions on its use. The combined fund balance of the City’s governmental funds as of June 30, 2020, was nearly $14.1 million. This represented an increase of almost $1.0 million during the year. Approximately 45% of the combined fund balances, $6.4 million, constitutes unassigned fund balance, which is available to meet the City’s current and future needs. The remainder of fund balance is non- spendable, restricted, committed or assigned to indicate that it is not available for operational spending because it is constrained by legally enforceable contracts, other governmental agreements and legislation, City Council resolution, management, or it is not convertible to cash within a reasonable period of time. Further detail of fund balances is presented in the Notes to the Basic Financial Statements in Note 7. The General Fund is the primary operating fund of the City, accounting for such activities as general government, public safety, public works, library, recreation, planning, community and economic development, central services and financial administration. The General Fund balance as of June 30, 2020, was $13.6 million. Revenue increased by $1.2 million, due primarily to increases in property tax receipts, grant revenue, sanitation fees and rebates and Court of Chancery fees totaling in excess of $2.3 million. The increases were partially offset by decreases in license and permit revenue, Library revenue, franchise fees, police fines, police extra-duty revenue and investment income, which combined to fall short of FY’19 revenues by $1.1 million. Total expenses of $41.0 million reflect an increase from the prior year of $1.0 million, which was driven primarily by expense increases of $0.7 million in recreational services, $0.2 million in public works $0.3 million in Garage and Stores, $0.1 million in interest and fiscal charges, $0.1 million in insurance expense, and $0.1 million in library services. The expense increases were offset by $0.5 million in reductions to streets and sanitation services, $0.1 million in Engineering services and $0.1 million in public safety and law enforcement, while minor differences in all other functional areas round out the expense variance. Proprietary Funds The City’s proprietary funds provide the same type of information found in the government- wide financial statements, but in more detail. As of June 30, 2020, the water fund has a net position of $32.7 million, of which $4.5 million is unrestricted. The fund’s net position increased $1.8 million as explained on page 37. As of June 30, 2020, the wastewater fund had a net position of $32.9 million, of which a negative $0.1 million is unrestricted. The fund’s net position increased $1.7 million during the year as explained on page 38. As of June 30, 2020, the electric revenue fund has a net position of 39 • 89

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. $131.1 million, of which $16.3 million is unrestricted. This fund experienced an increase in net position of $11.4 million during the year as explained on page 38. General Fund Budgetary Highlights During this fiscal year, the City Council amended the budget three times. The budget amendment ordinances were primarily for the following purposes: 1. To re-appropriate budget balances for ongoing capital projects. 2. To amend the grant budgets and reserve accounts for the actual results from the prior fiscal year and all carried forward budget balances for the major operating funds from the prior fiscal year, as well as program revenues and expenses based on changes in program revenues, expenses based on actual amounts. 3. To amend revenue and expense accounts based on actual experience during fiscal year 2020. The General Fund financials in the Governmental Funds Balance Sheet (page 49) and Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds (page 51) include both the General Fund operating activities and the Governmental Capital Project Fund activities. The General Fund – Schedule of Revenues, Expenditures and Changes in Fund Balances – Budget & Actual is included in Part D – Required Supplementary Information (pages 123-124). The Governmental Capital Projects Fund – Schedule of Revenues, Expenditures and Changes in Fund Balances-Budget and Actual is included in Part E – Supplementary Information (page 140). The Combining Statements – Combining General Fund Balance Sheet and Combining Statement of Revenues, Expenditures and Changes in Fund Balances of the General Fund and the Governmental Capital Projects Fund is included in Part E – Supplementary Information (pages 138-140). The Final General Fund Budget incorporated an increase in beginning budget balance of $1.8 million carried forward from the prior fiscal year. Budgeted expenditures were revised to reflect an aggregate decrease of $1.3 million. The expenditure decreases were primarily across all operating divisions totaling $1.5 million. Operating divisions with budgeted increases were Library, Life Safety, Police, Sanitation, Procurement and Inventory and Human Resources all totaling $0.1 million. Additionally, the only non-divisional expenditure that increased was for insurance in the amount of $0.1 million, no other expenditure line item budgets were changed. Actual revenues and other financing sources received were below the final budgeted amounts in the General Fund by less than $0.1 million for the current fiscal year. The more significant negative variances were in permits and other fees, interfund service receipts and fines & police revenue. These revenue decreases were mostly offset by increases in franchise fees, court of chancery fees, Investment income, police related grants, and transfer taxes. The General Fund budget balance carry forward was $0.7 million higher than originally budgeted a result of the above variances. 40 • 90

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Capital Asset and Debt Administration At the end of the current fiscal year, the City’s governmental and proprietary funds had invested $61.7 million and $135.4 million, respectively, in a variety of capital assets and infrastructure, as reflected in the following schedule, which exhibits a net increase of $1.7 million for governmental activities and a net decrease of $2.5 million for the business-type activities. The increase in assets reported within Governmental Activities is attributable to equipment and vehicle acquisitions $0.1 million and general infrastructure assets, $2.2 million. The decrease in assets reported was in buildings ($0.5 million) and in furniture & fixtures ($0.1 million). The value of construction projects that remained open as of June 30, 2020 was basically unchanged and land had a small reduction for sale of a small park. The decrease in Business-Type Activities is due primarily to increased depreciation expenses recorded in the electric fund in anticipation of the retirement of the City’s McKee Run generating plant. The water fund added $2.8 million to its construction projects that remained open as of June 30, 2020. Additional detailed data for all capital assets of the City is presented in the Notes to the Basic Financial Statements in Note 4. The following schedule is presented in millions of dollars. Governmental Business-Type Activities Activities Total 2019 2020 2019 2020 2019 2020 Depreciable Assets, Net Buildings $ 22.4 $ 21.9 $ - $ - $ 22.4 $ 21.9 Equipment & Vehicles 4.6 4.7 6.5 5.9 11.1 10.6 General Infrastructure 26.7 28.9 - - 26.7 28.9 Utility, Plant, Buildings, and - - Infrastructure - - 118.9 114.4 118.9 114.4 Other 0.4 0.3 1.4 1.2 1.8 1.5 Non-depreciable Assets Land 4.7 4.7 1.6 1.6 6.3 6.3 Construction in Progress 1.2 1.2 9.5 12.3 10.7 13.5 $ 60.0 $ 61.7 $ 137.9 $ 135.4 $ 197.9 $ 197.1 The chart below shows that the City’s Total Net OPEB Liability decreased by $5.1 million, with the majority of $4.0 million attributable to the Governmental Activities and the balance attributable to the Business-Type Activities. The City’s Total Net Pension Liability increase of $3.6 million was mostly attributable to the Governmental Activities $2.4 million and the balance attributable to the Business- Type Activities $1.2 million. Additional detailed information regarding the City’s Other Post- Employment Benefits and Retirement Plans is presented in the Notes to the Basic Financial Statements in Notes 15 and 17, respectively. The City Charter limits the amount of general obligation debt the City can issue in any one year to 25% of the taxable assessed value of real property within the City. The aggregate of amounts borrowed for which the full faith and credit of the City is pledged cannot exceed 5.0% of assessed value of real property within the City boundaries. The City has used 3.28% of its debt limit. The City of Dover’s non-current liabilities as of June 30, 2019 and 2020 are presented below (in millions of dollars): 41 • 91

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. Governmental Business-Type Activities Activities Total 2019 2020 2019 2020 2019 2020 Non-current liabilities Police Officer Separation Agreement $ 0.1 $ 0.1 $ - $ - $ 0.1 $ 0.1 Liability for Compensated Absences 2.5 2.5 0.7 0.8 3.2 3.3 Bonds (Net of Discount/Issuance Cost) 5.7 5.4 28.9 29.4 34.6 34.8 Bond Premium - - 1.2 1.1 1.2 1.1 Net OPEB Liability 21.2 17.2 4.5 3.4 25.7 20.6 Net Pension Liability 14.1 16.5 10.2 11.4 24.3 27.9 Asset Retirement Obligation - - 11.9 11.9 11.9 11.9 $ 43.6 $ 41.7 $ 57.4 $ 58.0 $ 101.0 $ 99.7 Additional detailed data for all debt of the City is presented in the Notes to the Basic Financial Statements in Note 5. Economic Factors and Next Year’s Budgets and Rates The City developed the fiscal year 2020 budget in accordance with the City’s financial policies ensuring all budgets are balanced and reserve requirements were adhered to. The following changes over fiscal year 2020 were incorporated into the fiscal year 2021 budget. • Due to uncertainty of the General Fund revenues this budget: o Reduces the transfer to the General Governmental Capital Project Fund o Cuts the General Fund CIP from $6.57 million requested to $4.87 million recommended o Budgets only 2% raises for the Non-bargaining employees; 0% increase in Health Care • Implementation of rate increases in water and wastewater for needed improvements to infrastructure as well as establishing a prudent reserve in the wastewater fund over time. • This budget maintains staffing added last year for maintenance of basic public works such as ditch maintenance, streets, stormwater culverts, catch basins, vegetation/tree maintenance, building inspections and code enforcement. • This budget anticipates holding the gains in personnel from last year, but due to stagnant revenues, no additional full-time personnel are recommended. • Long range plans are continuing to address the aging facilities, park improvements and upgrades to HVAC systems in the City facilities. • A self-funding Stormwater Utility is not included in this budget. The City will still have to address stormwater infrastructure maintenance and operational requirements as required by Federal and State regulations, but any additional fees will require discussion during FY21 for implementation in late FY21 or in FY22. • Increases in wages based on collective bargaining agreements were included. • Increased the PCA credit for electric rates which offset the increase in the water and wastewater rate increases. • In March of 2020, the World Health Organization declared the spread of COVID-19 a worldwide pandemic. The COVID-19 pandemic is having significant effects on global markets, supply chains, businesses, and communities. The full impact of COVID-19 is unknown and cannot be reasonably estimated as these events are still developing. To date, the city has received $0.3 million in COVID-19-related grants, some of which will be carried forward to next year, as they 42 • 92

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. are on a reimbursement basis. • Decommissioning of McKee Run Power Plant #3 during FY21 – FY23. • Secure Solar energy PPA’s for 25 years. The General Fund operating revenues are projected to decrease by 0.3%, or $0.1 million, with expenditures decreasing by 1.0%, or $0.4 million. The property tax rate is decreasing to offset the increase in reassessments. The tax rate is going back to the previous rate from FY’18 of $0.4050 a rollback of $.0350 which due to new construction, is expecting to generate an increase of $0.3 million over the FY’20 budgeted revenue. The property tax increase is offset by anticipated reductions in permits and other fees revenue. Grants revenue is increasing by $0.1 million with offsetting decreases in transfers in and interfund transfers. The decreased expenditures were attributed to a lower budgeted transfer to the capital project fund of $1.2 million, offset by increased expenditures to support police operations, code enforcement, grounds maintenance and information technology with offsetting expense increases in the tax assessor, public works administration and engineering, and streets and stormwater divisions netting a total decrease of $0.8 million. Other expense increases were in retiree healthcare and transfers to uncollectible reserves and insurance which rounds out the total decrease in expenditures. Water operating revenues are projected at $7.3 million, which is an increase of $0.8 million, or about 11.9% above the prior year’s original budget of $6.5 million. Total expenses are projected to decrease by 0.8% to $7.1 million, or about $0.1 million lower than FY’20. The revenue increase is driven by increased water service rates and an increase in interest income based on trends. The expense essentially remains flat with increases in direct divisional expenses of $0.2 million and other expenses of $0.1 million with offsetting decreases in transfers out to the capital project fund and electric revenue project fund as funding for the ERP system was completed in FY’20. Wastewater operating revenues are expected to increase by $1.0 million to $10.3 million in FY’21, representing an increase of 10.9%. Total expenses are projected to decrease by 4.6%, or less than $0.5 million to $9.0 million. All major revenue categories are driving the revenue increase except for miscellaneous service fees, but the $0.8 million increase in wastewater services is leading the way, while the other revenues, including impact fees, wastewater services and the groundwater inflow adjustment, combine for the remaining $0.2 million increase. Kent County Treatment Charges are expected to exceed $4.3 million in FY’21, which represents an $0.8 million decrease from FY’20 which is returning to previous levels. The offsetting principal component of the budgeted increases is for the transfer to the capital project fund. Total Electric Fund revenues are projected to remain relatively flat with a slight increase of $0.1 million to $85.1 million, which is about 0.1% higher than FY’20 anticipated revenue. Total expenses are projected to decrease by 6.3% or $5.3 million versus the prior budget year. Revenue increases are driven almost entirely by a transfer from the Rate Stabilization reserve of $2.5 million offset by the customer sales projections that fall short of the prior year budget by $2.3 million, which is attributable to rate changes as the FY’21 billing rates are reduced from the prior year. Other revenue sources are flat or modestly lower than FY’20 budgeted revenue. The PPA credit rate is increasing which offsets increases the distribution to customers by $3.3 million which is 24.5% higher than the previous year. The energy component of electric utility expense is $5.6 million lower in FY’21, driven by sharply offsetting movements in power supply expenses (decrease of $2.4 million) and generation/capacity costs (increase of $0.3 million). Direct expenditure categories combine for cost increases of $0.3 million, with the principal increases in transmission & distribution operations and administration. The remaining divisions also increased except for the metering division. Reductions in contractual services ($0.2 million) and interfund service fees ($0.1 million) help further reduce expenses versus FY’20. 43 • 93

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part B – Management’s Discussion and Analysis D Item 6. However, the added transfer to the Rate Stabilization reserve of $2.0 million offset by the reduction of transfer to the depreciation reserve of $5.0 million rounded out the decrease in the utilities expenses. The budgeted transfer to the general fund is $10 million in FY’21 and unchanged from the prior three fiscal years. The City continues to closely monitor the local economy and its impact on growth and revenues. Revenue enhancements, rate increases, and potential cost reductions will continue to be reviewed in order to maintain the City’s financial policies. Contacting the City’s Financial Management This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. If you have questions about this report or need additional financial information, contact Ms. Lori Peddicord, Controller/Treasurer at 302-736-4452 (TTY/TDD Operator 1- 800-855-1155). 44 • 94

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section D Item 6. PART RTC FINANCIAL Fl STATEMENTS TE 45 • 95

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Net Position June 30, 2020 Governmental Business-Type Activities Activities Total Assets: Cash and Cash Equivalents $ 8,237,002 $ 13,565,988 $ 21,802,990 Investments 10,200,651 37,049,743 47,250,394 Receivables, Net 171,558 5,054,353 5,225,911 Internal Balances 1,061,190 (1,061,190) - Due from Other Governments 297,290 - 297,290 Inventory 110,234 4,364,467 4,474,701 Prepaid Items 80,639 478,513 559,152 Restricted Cash and Cash Equivalents 601,665 13,530,525 14,132,190 Restricted Investments 18,954 57,467,769 57,486,723 Capital Assets, Not Being Depreciated 5,920,596 13,903,174 19,823,770 Capital Assets, Net of Depreciation 55,716,987 121,461,422 177,178,409 Total Assets 82,416,766 265,814,764 348,231,530 Deferred Outflows of Resources: Pension related Deferred Outflows 4,670,701 890,361 5,561,062 OPEB related Deferred Outflows 1,176,177 248,401 1,424,578 ARO related Deferred Outflows - 243,180 243,180 Total Deferred Outflows of Resources 5,846,878 1,381,942 7,228,820 Liabilities: Accounts Payable and Accrued Liabilities 3,816,729 6,467,217 10,283,946 Unearned Revenue 210,437 459,337 669,774 Customer Deposits - 2,543,083 2,543,083 Other 255,654 403,533 659,187 Liabilities Due within One Year 1,686,921 2,174,485 3,861,406 Non-Current Liabilities Due in more than One Year 6,281,500 29,067,372 35,348,872 Due in more than One Year - OPEB 17,182,610 3,465,852 20,648,462 Due in more than One Year - Pension 16,541,272 11,388,529 27,929,801 Due in more than One Year - ARO - 11,915,849 11,915,849 Total Liabilities 45,975,123 67,885,257 113,860,380 Deferred Inflows of Resources: Pension related deferred inflows 796,134 83,554 879,688 OPEB related Deferred Inflows 8,606,504 2,537,656 11,144,160 Total Deferred Inflows of Resources 9,402,638 2,621,210 12,023,848 Net Position: Net Investment in Capital Assets 56,266,299 104,913,375 161,179,674 Restricted for: Capital Projects 112,949 70,998,294 71,111,243 Public Safety Grants 161,731 - 161,731 Verizon Grant 36,629 - 36,629 Library Grant 33,689 - 33,689 Community Development Grants 1,828 - 1,828 Unrestricted (23,727,242) 20,778,570 (2,948,672) Total Net Position $ 32,885,883 $ 196,690,239 $ 229,576,122 The notes to financial statements are an integral part of this statement. 47 • 97

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Activities For the Year Ended June 30, 2020 Net (Expense) Revenue and Program Revenues Changes in Net Position Indirect Operating Capital Grants Expenses Charges for Grants and and Governmental Business Type Expenses Allocation Services Contributions Contributions Activities Activities Total Functions/Programs Governmental Activities General Government $ 5,301,953 $ (1,111,953) $ 2,571,127 $ 17,738 $ - $ (1,601,135) $ - $ (1,601,135) Public Safety 19,670,023 - 3,636,312 1,073,786 - (14,959,925) - (14,959,925) Public Works 5,071,449 (606,497) 3,080,960 793,731 473,317 (116,944) - (116,944) Library and Recreation 3,736,306 - 457,674 1,362,816 98,500 (1,817,316) - (1,817,316) Community and Economic Development 531,306 - - 338,936 - (192,370) - (192,370) Central Services 1,413,753 (787,494) - - - (626,259) - (626,259) Financial Administration 3,344,576 (2,458,081) - - - (886,495) - (886,495) Interest Charges 132,711 - - - - (132,711) - (132,711) Total Governmental Activities 39,202,077 (4,964,025) 9,746,073 3,587,007 571,817 (20,333,155) - (20,333,155) Business Type Activities - Water 3,942,555 929,918 6,152,724 - 811,744 - 2,091,995 2,091,995 Wastewater 6,625,619 700,605 8,754,314 - 597,401 - 2,025,491 - Electric 60,720,616 3,333,502 81,488,206 - - - 17,434,088 17,434,088 Total Business Type Activities 71,288,790 4,964,025 96,395,244 - 1,409,145 Total Primary Government $ 110,490,867 $ - $ 106,141,317 $ 3,587,007 $ 1,980,962 (20,333,155) 21,551,574 1,218,419 General Revenues Taxes Property Taxes 14,796,554 - 14,796,554 Transfer Taxes 1,825,438 - 1,825,438 Earnings on Investments 551,771 4,179,682 4,731,453 Total General Revenues 17,173,763 4,179,682 21,353,445 Transfers 10,741,590 (10,741,590) - Total General Revenues and Transfers 27,915,353 (6,561,908) 21,353,445 Changes in Net Position 7,582,198 14,989,666 22,571,864 Net Position Beginning 25,303,685 181,700,573 207,004,258 Net Position Ending $ 32,885,883 $ 196,690,239 $ 229,576,122 The notes to financial statements are an integral part of this statement. 48 • 98

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Governmental Funds Balance Sheet June 30, 2020 Total Total General Nonmajor Governmental Fund Funds Funds Assets: Cash and Cash Equivalents $ 6,905,218 $ - $ 6,905,218 Restricted Cash and Cash Equivalents - 601,665 601,665 Investments 8,637,793 - 8,637,793 Restricted Investments 18,954 - 18,954 Receivables, Net Accounts 88,966 787 89,753 Taxes 76,805 - 76,805 Due from Other Funds 1,270,754 - 1,270,754 Temporary Advances 70,000 - 70,000 Due from Other Governments - 297,290 297,290 Prepaid Items 80,639 - 80,639 Inventory 110,234 - 110,234 Total Assets $ 17,259,363 $ 899,742 $ 18,159,105 Liabilities: Accounts Payable $ 3,196,499 $ 158,790 $ 3,355,289 Unearned Revenue 56,156 154,281 210,437 Due to Other Funds 47,676 208,834 256,510 Temporary Advances - 70,000 70,000 Other 255,654 - 255,654 Total Liabilities 3,555,985 591,905 4,147,890 Deferred Inflows of Resources: Unavailable Revenue 99,697 - 99,697 Total Deferred Inflows of Resources 99,697 - 99,697 Fund Balances: Non-Spendable 212,467 - 212,467 Restricted 38,989 307,837 346,826 Committed 2,145,574 - 2,145,574 Assigned 4,823,060 - 4,823,060 Unassigned 6,383,591 - 6,383,591 Total Fund Balances 13,603,681 307,837 13,911,518 Total Liabilities, Deferred Inflows and Fund Balances $ 17,259,363 $ 899,742 $ 18,159,105 The notes to financial statements are an integral part of this statement. 49 • 99

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Reconciliation of the Balance Sheet of Governmental Funds To the Statement of Net Position June 30, 2020 Amounts reported for governmental activities in the statement of net position (page 47) are different because: Total fund balances for governmental funds (Page 49) 13,911,518 Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. 61,637,583 Other assets are not available to pay for current period expenditures and, therefore, are reported as unavailable revenue in the funds. Deferred inflows of resources 99,697 99,697 The Net Pension Liability & OPEB Liability is not due and payable in the current period; therefore, the liability and related deferred inflows/outflows are not reported in governmental funds: Deferred Outflows - Pension 4,670,701 Deferred Inflows - Pension (796,134) Deferred Outflows - OPEB 1,176,177 Deferred Inflows - OPEB (8,606,504) (3,555,760) An internal service fund (page 53) is used by the City to charge the cost of the workers' compensation fund. The assets and liabilities of the internal service fund are included in governmental activities in the statement of net position. 2,484,886 Accrual basis of bond interest paid 262 Long-term liabilities applicable to the City's governmental activities are not due and payable in the current period and, accordingly, are not reported as fund liabilities. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an expenditure when due. All liabilities both current and long-term are reported in the statement of net position. Compensated absences represent amounts accrued for sick leave for those employees who are vested and accrued vacation for all employees. The Net Pension Liability and OPEB Liability are not a use of current financial resources, and therefore, are not reported in the governmental funds. Current- General Obligation Bonds (335,760) Compensated Absences (1,313,661) Police Officer separation agreement (37,500) (1,686,921) Long-Term- General Obligation Bonds (5,035,524) Compensated Absences (1,208,476) Police Officer separation agreement (37,500) Net Pension Liability (16,541,272) Net OPEB Liability (17,182,610) (40,005,382) (41,692,303) Total net position of governmental activities (Page 47) $ 32,885,883 The notes to financial statements are an integral part of this statement. 50 • 100

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds For the Year Ended June 30, 2020 Total Total General Nonmajor Governmental Fund Funds Funds Revenues Fines $ 470,993 $ 430,204 $ 901,197 Library Revenue - General 99,089 - 99,089 Library Revenue County Reimbursement 230,412 - 230,412 Licenses and Permits 2,554,826 - 2,554,826 Sanitation Fees and Rebates 3,080,960 - 3,080,960 Recreation - 43,203 43,203 Miscellaneous Services 1,319,371 - 1,319,371 Property Taxes 14,758,590 - 14,758,590 Transfer Taxes - 1,825,438 1,825,438 Grants Received 1,697,260 2,461,563 4,158,823 Court of Chancery Fees 1,602,360 - 1,602,360 Investment Income 466,848 8,203 475,051 Total Revenues 26,280,709 4,768,611 31,049,320 Expenditures Current: General Government 1,770,930 - 1,770,930 Library Services 1,836,686 271,583 2,108,269 Public Safety and Law Enforcement 22,083,981 339,784 22,423,765 Public Works 2,567,009 497,570 3,064,579 Recreational Services 1,754,771 - 1,754,771 Streets and Sanitation Services 3,979,021 - 3,979,021 Engineering Services 209,197 - 209,197 Financial Administration 815,956 - 815,956 Garage and Stores 742,353 - 742,353 Insurance 376,584 - 376,584 Retiree Health Care 1,894,900 - 1,894,900 Community and Economic Development 150,000 381,306 531,306 Street Lights 807,794 - 807,794 Debt Service: Principal Retirement 328,716 - 328,716 Interest and Fiscal Charges 135,352 - 135,352 Total Expenditures 39,453,250 1,490,243 40,943,493 Excess (deficiency) of Revenues over Expenditures (13,172,541) 3,278,368 (9,894,173) Other Financing Sources (Uses) Transfers In 14,277,336 - 14,277,336 Transfers Out (250,000) (3,285,746) (3,535,746) Total other Financing Sources (Uses) 14,027,336 (3,285,746) 10,741,590 Net Change in Fund Balances 854,795 (7,378) 847,417 Fund Balances at Beginning of Year 12,748,886 315,215 13,064,101 Fund Balances at End of Year $ 13,603,681 $ 307,837 $ 13,911,518 The notes to financial statements are an integral part of this statement. 51 • 101

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2020 Amounts reported for governmental activities in the statement of activities (page 48) are different because: Net change in fund balances--total governmental funds (Page 51) $ 847,417 Governmental fund reports capital outlays as expenditures. However, in the statement of activities the cost of these assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. Capitalization of net capital asset expenditures including CIP $ 6,190,215 Loss on assets disposed of during the year (879,922) Current year depreciation (3,682,450) 1,627,843 Governmental funds report the repayment of principal of general long-term debt as an expenditure but the repayment reduces the liability in the statement of net position. 328,716 Revenues that are not available to pay for current period expenditures are not reported as revenues in the funds. (47,381) Governmental funds report pension contributions as expenditures. However, in the Statement of Activities, the cost of pension benefits earned net of employer contributions is reported as pension expense (2,497,744) Except for amounts reported as deferred inflows/outflows, changes in the net pension liability are reported as pension expense in the statement of activities. 1,589,684 Decreases in operating expenses due to the decrease in OPEB expense for the amortization of deferred outflows and inflows of resources related to the net OPEB liability. 994,942 Under the modified accrual basis of accounting used in the governmental funds, expenditures are not recognized for the transactions that are not normally paid with expendable available financial resources. In the statement of activities, however, which is presented on the accrual basis, expenses and liabilities are reported regardless of when financial resources are available. In addition, assets are not recognized in governmental funds unless they represent current financial resources but are recognized in the statement of activities as they accrue. The following differences, therefore, occur between the statement of activities and the governmental funds. Increase in compensated absences $ (27,322) Police separation agreement payout 35,700 Bond interest accrual 2,643 Decrease in OPEB Liability 4,044,624 4,055,645 An internal service fund is used by the City to charge the costs of workers' compensation insurance to individual funds. The change in net position of the internal service fund is transferred to the governmental funds and amounts attributable to internal charges are then allocated to functional expenditures. Net revenue is allocated back to respective functions and business type activities, as appropriate. 683,076 Change in net position of governmental activities (Page 48) $ 7,582,198 The notes to financial statements are an integral part of this statement. 52 • 102

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Net Position - Proprietary Funds Proprietary Funds June 30, 2020 Governmental Business-type Activities Activities Electric Non-Major Total Revenue Enterprise Enterprise Internal Fund Funds Funds Service Fund Assets Current Assets: Cash and Cash Equivalents $ 10,467,201 $ 3,098,787 $ 13,565,988 $ 1,331,784 Investments 28,532,658 8,517,085 37,049,743 1,562,858 Receivables, Net 4,252,062 802,291 5,054,353 5,000 Due from Other Funds 9,002 149 9,151 46,946 Inventory 4,292,365 72,102 4,364,467 - Prepaid Items 478,219 294 478,513 - Total Current Assets 48,031,507 12,490,708 60,522,215 2,946,588 Non-Current Assets: Restricted Assets Cash 13,032,907 497,618 13,530,525 - Investments 49,155,439 8,312,330 57,467,769 - Capital Assets, Not Being Depreciated 5,539,062 8,364,112 13,903,174 - Capital Assets, Net of Depreciation 63,136,233 58,325,189 121,461,422 - Total Non-Current Assets 130,863,641 75,499,249 206,362,890 - Total Assets 178,895,148 87,989,957 266,885,105 2,946,588 Deferred Outflows of Resources: Pension Related Deferred Outflows 558,098 332,263 890,361 - OPEB Related Deferred Outflows 157,625 90,776 248,401 - Asset Retirement Oblig. Deferred Outflows 243,180 - 243,180 - 958,903 423,039 1,381,942 - Liabilities Current Liabilities: Accounts Payable and Accrued Expenses 4,898,628 1,568,589 6,467,217 461,702 Due to Other Funds - Charges 707,294 363,047 1,070,341 - Unearned Revenue 459,337 - 459,337 - Accrued Interest Payable 306,600 96,933 403,533 - Customer Deposits 2,543,083 - 2,543,083 - Revenue Bonds Payable 785,000 1,021,254 1,806,254 - Liability for Compensated Absences 254,929 113,302 368,231 - Total Current Liabilities 9,954,871 3,163,125 13,117,996 461,702 Non-Current Liabilities: OPEB Liability 2,137,379 1,328,473 3,465,852 - Net Pension Liability 7,538,637 3,849,892 11,388,529 - Asset Retirement Obligation 11,915,849 - 11,915,849 - Revenue Bonds Payable 15,330,093 13,314,874 28,644,967 - Liability for Compensated Absences 300,901 121,504 422,405 - Total Non-Current Liabilities 37,222,859 18,614,743 55,837,602 - Total Liabilities 47,177,730 21,777,868 68,955,598 461,702 Deferred Inflows of Resources: Pension Related Deferred Inflows 55,078 28,476 83,554 - OPEB Related Deferred Inflows 1,564,060 973,596 2,537,656 - Total Deferred Inflows of Resources 1,619,138 1,002,072 2,621,210 - Net Position Net Investment in Capital Assets 52,560,202 52,353,173 104,913,375 - Restricted for Capital Construction 62,188,346 8,809,948 70,998,294 - Unrestricted 16,308,635 4,469,935 20,778,570 2,484,886 Total Net Position $ 131,057,183 $ 65,633,056 $ 196,690,239 $ 2,484,886 • The notes to financial statements are an integral part of this statement. 103 53

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Revenues, Expenses and Changes in Fund Net Position - Proprietary Funds For the Year Ended June 30, 2020 Governmental Business-type Activities Activities Electric Non-Major Total Revenue Enterprise Enterprise Internal Fund Funds Funds Service Fund Operating Revenues Charges for Services $ 79,898,697 $ 14,085,834 $ 93,984,531 $ - Miscellaneous Services/Income 1,506,053 836,368 2,342,421 966,825 Total Operating Revenues 81,404,750 14,922,202 96,326,952 966,825 Operating Expenses Water - 686,001 686,001 - Wastewater - 1,013,053 1,013,053 - Water Treatment Plant - 1,724,238 1,724,238 - Water/Wastewater Engineering - 326,115 326,115 - Kent County Wastewater Treatment - 3,769,636 3,769,636 - General Administrative 4,577,077 1,713,045 6,290,122 184,374 Power Supply 41,063,150 - 41,063,150 - Transmission/Distribution 3,185,002 - 3,185,002 - Engineering 1,077,676 - 1,077,676 - Metering 441,598 - 441,598 - Systems Operations 560,110 - 560,110 - Utility Tax 1,223,240 - 1,223,240 - Depreciation 7,953,193 2,363,680 10,316,873 - Contractual Services - - - 13,448 Taxes - - - 34,707 Retirees Health Care 721,400 226,300 947,700 - Self Insurance-Workers' Compensation - - - 127,940 Total Operating Expenses 60,802,446 11,822,068 72,624,514 360,469 Operating Income/Loss 20,602,304 3,100,134 23,702,438 606,356 Non-Operating Revenues (Expenses) Interest Earned: Operating Funds 467,317 186,946 654,263 - Reserve Funds 1,146,762 228,517 1,375,279 42,320 Net Increase in Fair Value of Investments 1,806,406 343,734 2,150,140 34,400 Interest and Fiscal Charges (524,295) (376,629) (900,924) - Distribution of Earnings - PCA Credit (2,727,377) - (2,727,377) - Gain (Loss) on Sale of Assets 83,456 (15,164) 68,292 - Total Non-Operating Revenue (expenses) 252,269 367,404 619,673 76,720 Income before Contributions and Transfers 20,854,573 3,467,538 24,322,111 683,076 Contractor Contributions - Infrastructure - 1,409,145 1,409,145 - Transfers In 556,410 - 556,410 - Transfers Out (10,000,000) (1,298,000) (11,298,000) - Total transfers (9,443,590) (1,298,000) (10,741,590) - Change in Net Position 11,410,983 3,578,683 14,989,666 683,076 Total Net Position--Beginning 119,646,200 62,054,373 181,700,573 1,801,810 Total Net Position--Ending $ 131,057,183 $ 65,633,056 $ 196,690,239 $ 2,484,886 The notes to financial statements are an integral part of this statement. 54 • 104

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Cash Flows - Proprietary Funds For the Year Ended June 30, 2020 Governmental Business-type Activities Activities Electric Non-Major Total Revenue Enterprise Enterprise Internal Fund Funds Funds Service Fund Cash Flows from Operating Activities Receipts from Customers $ 87,919,765 $ 14,821,865 $ 102,741,630 $ - Payments to Suppliers (including Purchased Power) (44,819,258) (6,456,989) (51,276,247) (180,768) Payments to Employees (4,516,477) (2,346,114) (6,862,591) - Payments of Personnel Related Costs (2,227,755) (1,446,378) (3,674,133) 916,348 Internal Activity-Payments from (to) Other Funds 387,912 (451,078) (63,166) - Other Receipts (Payments) including Claims Paid (1,644,006) (439,388) (2,083,394) (213,272) Net Cash Provided by (used for) Operating Activities 35,643,486 3,681,918 39,325,404 522,308 Cash Flows from Noncapital Financing Activities Transfers Out (10,000,000) (1,298,000) (11,298,000) - Transfers In 556,410 - 556,410 - Distribution to Customers - PCA Credit (2,727,377) - (2,727,377) - Net Cash Used for Noncapital Financing Activities (12,170,967) (1,298,000) (13,468,967) - Cash Flows from Capital and Related Financing Activities Acquisition and Construction of Capital Assets (1,902,518) (4,477,056) (6,379,574) - Proceeds of issuance of debt - 1,979,958 1,979,958 - Bond Issuance Costs - (4,582) (4,582) - Principal Paid on Revenue Bond Maturities (650,000) (841,525) (1,491,525) - Interest Paid on Capital Debt (524,295) (372,047) (896,342) - Net Cash Used for Capital and Related Financing Activities (3,076,813) (3,715,252) (6,792,065) - Cash Flows from Investing Activities Interest on Investments 467,317 186,946 654,263 - Redemption of Investment Securities 131,356 - 131,356 - Purchase of Investment Securities (15,933,590) (1,125,717) (17,059,307) 10,132 Interest on Restricted Cash 1,146,762 228,517 1,375,279 - Net Cash Provided by (used for) Investing Activities (14,188,155) (710,254) (14,898,409) 10,132 Net Increase/Decrease in Cash and Cash Equivalents 6,207,551 (2,041,588) 4,165,963 532,440 Cash and cash equivalents July 1 (incl. $466,393 for Non-Major Enterprise Funds and $6,938,727 for Electric fund reported in restricted accounts) 17,292,557 5,637,993 22,930,550 799,344 Cash and cash equivalents June 30 (incl. $497,618 for Non-Major Enterprise Funds and $13,032,907 for Electric fund reported in restricted accounts) $ 23,500,108 $ 3,596,405 $ 27,096,513 $ 1,331,784 Reconciliation of Operating Income to Net Cash Provided by (Used for) Operating Activities: Operating Income $ 20,602,304 $ 3,100,134 $ 23,702,438 $ 606,356 Adjustments to Reconcile Operating Income to Net Cash provided by (Used for) Operating Activities: Depreciation Expense 7,953,193 2,363,680 10,316,873 - Effect of Changes in Operating Assets and Liabilities: Receivables 570,602 (101,334) 469,268 - Due from other funds 5,808,320 997 5,809,317 (46,946) Due from other funds - Advances - (400,000) (400,000) Inventory 70,933 (2,726) 68,207 - Prepaid items 29,951 502 30,453 - Deferred outflow of resources Pension (313,690) (191,011) (504,701) - Deferred outflow of resources OPEB (44,684) (29,805) (74,489) - Deferred outflow of resources ARO 243,181 - 243,181 - Accounts payable and accrued expenses 17,577 (1,068,916) (1,051,339) (37,102) Unearned revenue 89,139 - 89,139 - Due to other funds 696,274 (252,600) 443,674 - Due to other funds - Advances - 400,000 400,000 Customer Deposits 46,954 - 46,954 - Liability for Compensated Absences 58,362 52,435 110,797 - Net OPEB Liability (634,296) (452,303) (1,086,599) - Net pension liability 763,154 464,675 1,227,829 - Deferred inflow of resources Pension (202,441) (120,353) (322,794) - Deferred inflow of resources OPEB (111,347) (81,457) (192,804) - Net Cash Provided by Operating Activities $ 35,643,486 $ 3,681,918 $ 39,325,404 $ 522,308 Non-Cash Investing, Capital and Financing Activities: Change in Fair Value of Investments $ 1,806,406 $ 343,734 $ 2,150,140 $ 34,400 Capital Contributions - Infrastructure - 1,409,145 1,409,145 - The notes to financial statements are an integral part of this statement. 55 • 105

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Net Position Fiduciary Funds June 30, 2020 Police Employee OPEB Pension and Other Pension Pension Trust Post-Employment Agency Trust Trust Fund Benefit Trust Funds Funds Assets Cash and Cash Equivalents $ 1,347,732 $ 2,779,491 $ 1,347,503 $ 5,474,726 $ 888,341 Investments at Fair Value - Mutual Funds 12,614,269 42,025,958 41,416,054 96,056,281 - Receivables 262,900 102,095 - 364,995 9,016 Total Assets $ 14,224,901 $ 44,907,544 42,763,557 101,896,002 897,357 Liabilities Vouchers Payable & Deposit Payable - - 91,023 91,023 47,590 Due to Agencies - - - - 849,767 Total Liabilities - - 91,023 91,023 $ 897,357 Net Position Net Position Restricted for Pensions 14,224,901 44,907,544 59,132,445 Net Position Restricted for Health Benefits 42,672,534 42,672,534 Total Net Position $ 14,224,901 $ 44,907,544 $ 42,672,534 $ 101,804,979 The notes to financial statements are an integral part of this statement. 56 • 106

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Financial Statements D Item 6. City of Dover, Delaware Statement of Changes in Net Position Fiduciary Funds For the Year Ended June 30, 2020 Pension and Other Postemployment Benefit Trust Funds Additions: Net Investment Income $ 3,860,572 City's Contribution-Payroll Based 4,089,597 City's Contribution-Lump Sum 3,362,200 Employee Contribution 183,146 State Grants 513,549 Total Additions 12,009,064 Deductions: Benefit Payments 8,412,429 General Administration 33,967 Total Deductions 8,446,396 Change in Net Position 3,562,668 Net Position - Beginning 98,242,311 Net Position - Ending $ 101,804,979 The notes to financial statements are an integral part of this statement. 57 • 107

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C D Item 6. INDEX DE Notes toFinancial 0 Ci I Statements PAGE 1. FINANCIAL REPORTING ENTITY ............................................................................... 61 A. The City of Dover , Delaware .......................................................... 61 B. Reporting Entity ............................................................................ 61 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ............................................... 61 A. Basis of Presentation ...................................................................... 62 B. Basis of Accounting and Measurement Focus ................................... 63 C. New Pronouncements ..................................................................... 64 D. Capital Assets and Long-Term Liabilities ........................................ 65 E. Budget Procedures ......................................................................... 65 F. Major Transfers ............................................................................. 67 G. Inventories and Prepaid Items ........................................................ 68 H. Cash and Investments .................................................................... 68 I. Accounts Receivable ...................................................................... 68 J. Restricted Assets ............................................................................ 68 K. Unbilled Service Receivables .......................................................... 69 L. Bond Accounts/Issuance Costs ....................................................... 69 M. Deferred Outflows/Inflows of Resources ......................................... 69 N. Fund Balances and Net Position ..................................................... 69 O. Estimates ....................................................................................... 70 P. Net Position Flow Assumption ....................................................... 70 3. DEPOSITS AND INVESTMENTS ................................................................................ 71 A. Cash in Bank and Cash Equivalents ............................................... 71 B. Investments ................................................................................... 71 4. CAPITAL ASSETS ...................................................................................................... 77 5. LONG-TERM OBLIGATIONS ...................................................................................... 80 A. Summary of Bonded Indebtedness by Issue ..................................... 80 B. Status as of June 30, 2020 – General Obligation Bonds .................. 81 C. Change in Long-Term Debt ............................................................ 81 D. Debt Service Requirements ............................................................. 83 59 • 109

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C D Item 6. INDEX DE Notes toFinancial 0 Ci I Statements PAGE E. Certain Asset Retirement Obligation .............................................. 85 6. RESTRICTED NET POSITION ................................................................................... 86 7. FUND BALANCES & NET POSITION .......................................................................... 86 8. PROPERTY TAXES ................................................................................................... 87 9. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS ........................................ 88 A. Due To/From Other Funds – Charges and Allocations .................... 88 B. Temporary Advances ...................................................................... 88 C. Interfund Transfers ........................................................................ 88 10. RENTAL INCOME .................................................................................................... 89 11. MATERIAL COMMITMENTS ..................................................................................... 89 12. FORWARD CONTRACTS ........................................................................................... 90 13. INSURANCE ............................................................................................................. 92 A. Health Insurance – State of De laware ............................................. 92 B. Workers’ Compensation Fund – Self-Insurance .............................. 92 C. Other than Health or Workers’ Compensation Insurance ................ 92 14. COMPENSATED ABSENCES ..................................................................................... 92 15. OTHER POST-EMPLOYMENT BENEFITS .................................................................. 93 16. DEFERRED COMPENSATION PLAN .......................................................................... 102 17. RETIREMENT PLANS .............................................................................................. 102 A. Defined Contribution Plan ............................................................ 103 B. Defined Benefit Plans ................................................................... 104 60 • 110

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. NOTES TO FINANCIAL STATEMENTS YEAR ENDED JUNE 30, 2020 1. FINANCI AL REPORTING ENTITY A. The City of Dover, Delaw are The City of Dover, Delaware (the City) was incorporated in 1829 and is a municipal corporation governed by an elected mayor and a nine-member council. The accompanying financial statements present the financial position and operating results for fiscal year ended June 30, 2020. B. Reporting Entity In evaluating how to define the reporting entity, for financial reporting purposes, management has considered all potential component units. The decision to include a potential component unit was made by applying the criteria set forth in Generally Accepted Accounting Principles in the United States of America (GAAP). The criterion used is that set forth by Statement of Governmental Accounting Standards (GASB) number 14 and as updated by GASB 61 which defines the reporting entity as the primary government and those component units for which the primary government is financially accountable. Financial accountability is defined as appointment of a voting majority of the component unit's board and either a) the ability to impose will by the primary government, or b) the possibility that the component unit will provide a financial benefit to or impose a financial burden on the primary government. Based upon this criterion, the following is a brief review of each potential component unit addressed in defining the government’s reporting entity. Included within the reporting entity: The City provides many services as follows - police protection, street maintenance, sanitation, storm water maintenance, recreation, library, community development, public improvements, planning, safety inspections, electric generation and distribution, water and wastewater services, legislative services and general administration, including employee benefits. These functions are part of the City’s daily operations and therefore are not legally separate component units. Not included within the reporting entity: The City joined the State of Delaware Police Pension Plan for uniformed police officers employed by the City after September 1, 1982. The plan is completely managed by the State of Delaware and, therefore, is not included in the financial statements. The Robbins Hose Volunteer Fire Company and the Capital School District are not included within the financial reporting entity because they do not meet the criteria for inclusion set forth by GAAP. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the City conform to generally accepted accounting principles as applicable to governments. A summary of the more significant policies follows: 61 • 111

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. A. Basis of presentation Government-wide Statements: The statement of net position and the statement of activities include the financial activities of the overall government, except for fiduciary activities. Individual funds are not displayed but the statements distinguish governmental activities, generally funded by taxes and other City revenue, from business-type activities (BTAs), generally funded in whole or in part with fees charged to external users. Eliminations have been made for the doubling-up effect of certain internal activities, however, interfund services provided and used are not eliminated in the process of consolidation. The government-wide statement of activities presents a comparison between direct program expenses and program revenues for each function of the City’s governmental activities and for each of the City’s identifiable business-type activities. Direct expenses are those that are specifically associated with a program, function or activity. Program revenues include a) charges paid by the recipients or beneficiaries of goods or services offered by the programs and b) grants and contributions that are restricted for meeting the operational or capital requirements of particular programs. Revenues that are not classified as program revenues, including all taxes, are presented as general revenues. The City allocates the costs of certain governmental services to the costs of business-type activities (indirect expense allocation). These costs include allocated amounts of city management, centralized budgetary formulation and oversight, accounting, financial reporting, payroll, fleet and building maintenance, procurement contracting and oversight, investing and cash management, personnel services, etc. The allocations are charged to the BTAs based on the use of these services. As a matter of policy, the costs of certain governmental functions are not allocated to the business-type activities such as tax assessor, planning and zoning, public safety, library and recreation and community services. Fund Financial Statements: The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, deferred inflows/outflows, fund equity, revenues and expenditures or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The fund financial statements provide information about the City’s funds, including fiduciary funds. The emphasis of fund financial statements is on major governmental and enterprise funds, each displayed in a separate column. All remaining governmental funds are aggregated and reported as non-major funds. The City reports the following major governmental fund: General Fund The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. 62 • 112

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. The City reports the following major proprietary fund: Electric Revenue Fund This fund incorporates all transactions related to the generation, transmission and distribution of electricity. The City has contracted with both The Energy Authority and North American Energy Services to manage the City’s power supply and generation assets. The City reports the following non-major funds: Water Fund This fund accounts for transactions related to water services. The City also holds lease agreements with cell phone companies for equipment placed on City water towers. Wastewater Fund This fund accounts for transactions related to wastewater services, including the payment of fees to Kent County for the treatment of sewage. Internal Service Fund The City has created one internal service fund to account for the activities related to self- insured Workers’ Compensation. Receipts are provided from contributions by the City’s three enterprise funds. Expenses are related to payment of claims, premiums, and administration costs. Actuarial analyses are completed every three years to ensure sufficient reserves for claims for the Workers’ Compensation Fund. Special Revenue Funds The City has eight Special Revenue Funds to account for proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. Fiduciary Funds Fiduciary funds consist of trust and agency funds and are used to report assets held by the City in a trustee or agency capacity for other purposes. These funds are, therefore, not available to support City programs. The City is the trustee for the City’s two pension plans, the Police Pension Fund and the Employee Pension Fund, as well as the Other Post-Employment Benefit Trust. The activity of these plans is accounted for in the Basic Financial Statements. Agency Funds Agency funds are used to account for assets held by the City as an agent for individuals, private organizations or other governments. The City has two agency funds. The City acts as the receiving and paying agent for the Downtown Dover Partnership and the Fourth of July Celebration Committee. B. Basis of Accounting and Measurement Focus Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. 63 • 113

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. All governmental funds are accounted for using the modified accrual basis of accounting and the current financial resources measurement focus. Their revenues are recognized when they become measurable and available as net current assets. Revenues that are susceptible to accrual include property taxes, grants and billable service charges. All other revenues are accounted for when they are received. Property taxes are recognized in the fiscal period during which they are levied, provided they are “available;” meaning they are collected in the current period or are expected to be collected soon enough thereafter to satisfy liabilities in the current period. The City considers all revenues reported in the governmental funds to be available if the revenues are collected within sixty days after year-end, except for trash collection, which has a thirty-day collection period. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. The exception to this general rule is principal and interest on general long-term debt which is recognized when due. Also, claims and judgments and compensated absences are recognized as expenditures to the extent they have matured. General capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-term debt and acquisitions under capital leases are reported as other financing sources. The government-wide financial statements as well as all proprietary and fiduciary trust funds are accounted for using the accrual basis of accounting and the economic resources measurement focus. Agency funds have no measurement focus but utilize the accrual basis of accounting for reporting of assets and liabilities. A reconciliation of the governmental fund financial statements prepared on the modified accrual basis of accounting to the government-wide financial statements prepared on the accrual basis of accounting is also provided on pages 50 & 52. The types of transactions included in program revenues in the government-wide statement of activities include charges for services, operating grants and capital grants. Operating income reported in the proprietary fund financial statements includes revenue and expenses related to the continuing operations of the funds. Charges to customers for sales and services constitute the principal operating revenue for proprietary funds. Principal operating expenses are the costs of providing goods and services, which include purchased power, administrative expenses and depreciation of capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. C. New Pronouncements During the fiscal year ended June 30, 2020, GASB issued Statement No. 95 Postponement of the Effective Dates of Certain Authoritative Guidance, which delayed the implementation date of previously issued standards. In accordance with this standard, the City postponed the implementation of any previously issued applicable standards until their new required implementation date. Therefore, there were no new accounting pronouncements implemented during the fiscal year. 64 • 114

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. D. Capital Assets and Long -Term Liabilities Capital assets used in Governmental Fund type operations (general capital assets) are accounted for in the government-wide financial statements rather than in the funds. Public domain ("infrastructure") general capital assets consisting of certain improvements other than buildings, including roads, bridges, curbs and gutters, streets and sidewalks, drainage systems and lighting systems, are capitalized in the government-wide financial statements along with other general capital assets. The capitalization threshold for the City’s assets is $5,000. Personal computers and related hardware valued under $5,000 are manually controlled by the Information Technology Department. All capital assets are valued at historical cost and donated capital assets are shown at acquisition value based on the developers’ cost of the infrastructure. Depreciation has been provided on general capital assets and is shown in Note 4. Depreciation has been provided over the estimated useful lives using the straight-line method. Estimated useful lives are as follows: Buildings 20 – 50 years Infrastructure 20 – 50 years Vehicles 5 – 7 years Equipment, Furniture & Fixtures 5 – 15 years Long-term liabilities expected to be financed from governmental funds and the long-term estimated liabilities for compensated absences are accounted for in the government-wide financial statements, but not in the governmental funds. Depreciation of all exhaustible capital assets used by proprietary funds is charged as an expense against their operations. Accumulated depreciation is shown in Note 4 of this section. Depreciation in the proprietary funds has been provided over the estimated useful lives using the straight-line method. The estimated useful lives are presented below: Building, Mains & Plant 25 – 90 years Improvements 15 – 20 years Equipment 5 – 15 years Vehicles 5 – 7 years The remaining useful life for certain buildings, vehicles, equipment and plant assets recorded in the Electric Fund is being shortened to coincide with the estimated retirement date of the City’s principal generation assets. Capital assets are maintained substantially and reported in accordance with the Uniform System of Accounts prescribed by the Federal Energy Regulatory Commission (FERC) for the Electric Fund and the National Association of Regulatory Utility Commissioners (NARUC) for the Water and Wastewater Fund. E. Budget Procedures Legally adopted budgets are prepared for the General Fund, Water Fund, Wastewater Fund, Electric Revenue Fund, the Internal Service Fund and the following non-major special revenue funds: Municipal Street Aid Fund, Electronic Red-Light Safety Program Fund, Community Development Block Grant Fund (Federal), State Department of Transportation Grants Fund 65 • 115

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. (Community Transportation), Police Grant Funds, Substance Abuse Prevention Program Fund, Realty Transfer Tax Fund and Library Grants Fund. The General Governmental Capital Projects Fund provides for separate budgets to cover the planning and control of capital items for the governmental programs. The financial transactions of this fund are included in the financial statements of the General Fund. The Electric Improvement and Extension Fund the Water Improvement and Extension Fund and the Wastewater Improvement and Extension Fund are sections of each utility enterprise. These sections are required by bond resolutions. Separate budgets for these funds cover the planning and control of only the capital items of the utilities. The financial transactions of these funds are included in the financial statements of the Electric Revenue Fund the Water Fund and the Wastewater Fund. The City prepares the budget for the General Fund revenues on a basis consistent with the modified accrual basis. The expenditures are accounted for when the purchase orders are issued. The budget and actual schedule in the legal budget format (non-GAAP), adopted by the City for the General Fund, the City’s major governmental fund, is presented in the required supplementary information section of this report. Budgets for the Electric Revenue Fund, Water Fund, Wastewater Fund and Internal Service Fund are prepared on an accrual basis. Budgets are prepared under the assumption that the principal redemption of long-term debt must be assumed by Enterprise Fund activity in conformity with the bond ordinance. The Combining General Fund Balance Sheet and Combining Statement of Revenues, Expenditures and Changes in Fund Balances of the General Fund as well as the budget and actual schedules of the other funds are also presented in the supplementary information section of this report because they are not required to be presented elsewhere. According to the City's procedures, the preceding year's ending net budgetary balances are considered as resources for the following year. The beginning balances become operating items of revenues in the budgets. Estimated ending budgetary balances provide the balancing amount for each budget. In accordance with the City’s financial policies, adopted by City Council, the General and Water and Wastewater funds are required to maintain an 8% minimum ending budget balance and the Electric fund is required to maintain a 12% minimum. These percentages are expressed as a percentage of operating revenues, excluding the beginning budget balance. Unassigned fund balances as a percentage of current year operating revenues on a budgetary basis for the General Fund, Water and Wastewater Funds and Electric Fund are 14.5%, 24.9%, 8.5% and 20.4% respectively, and all are exceeding the financial policy maximum for each fund except for Wastewater, which is within policy. Per the Financial policy, the three funds with overages will be addressed in the next year’s budget. The City Manager may approve transfers of savings from completed CIP items to non- completed CIP items. Any transfers that cause the particular item or project to exceed its original budget 10% or greater will be communicated to Council and the Controller/Treasurer. The City Manager may approve intra-fund transfers (i.e. within the General Fund) of up to five percent per annum, except for line items associated with salary and benefits. Budget amendments exceeding that authorized above or that affect budget balances shall be referred 66 • 116

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. to the City Council. (Source: City of Dover Policy Manual, Budget Administration – Policy for Operating Departments, 2014). The following activities exceeded their budget: 1. The police department was over budget by $566,650 due to overtime pay and promotions. Approximately $225,000 of this overage is specifically identified with the pay period at the onset of the COVID pandemic in mid-March, when the Governor implemented an emergency declaration. The remaining overage would be a result of overtime and promotions combined. 2. The Recreation Department was over budget $268,378 due to: a. Three (3) employee transfers from the Grounds department, which is under budget by $261,181. These are new positions within the Recreation department. And, b. A senior staff member was transferred from Public Works-Administration to fill the Director position. The Public Works-Administration department is under budget by $44,859. 3. The Finance Department was over budget by $18,923 for temporary help due to understaffing. 4. The Customer Services Department was over budget by $6,882 due to a retirement. 5. Insurance exceeded the budget by $26,507. 6. Bank and credit card fees exceeded the budget by $2,534. 7. A $500 annual fee is charged by Moody’s every year except for the first year for bond issuance, which was not in the budget. 8. Transfer to Cable Franchise Reserve of $11,758 was not budgeted. 9. Appropriation to Police-State Grant is passed through this fund, and $68,549 more was received than budgeted. In all cases, the increase was needed to meet operational requirements of the City. F. Major Transfers The Electric Revenue Fund, Water Fund and Wastewater Fund annually transfer a budgeted portion of their revenues to the General Fund. Transfers are also made from the Realty Transfer Tax Fund, Municipal Street Aid Fund, Electronic Red-Light Safety Program (ERLSP) Fund and Police Grant Funds to the General Fund. The purpose of these transfers is to provide routine subsidies to the General Fund for operating functions, capital project expenditures and debt service requirements. Several Special Revenue Funds represent a pass-through of revenues collected by the State of Delaware on behalf of the City or other State revenues provided for in Delaware Code. These receipts are subsequently transferred to the General Fund in support of public safety, City maintenance of State roads and other public services. 67 • 117

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Several transfers between the General Fund and the non-major governmental funds are netted in the government-wide financial statements. G. Inventories and Prepaid Items Both inventories and prepaid items are accounted for using the consumption method. Inventories are treated as operational expenditures at the time of use rather than at the time of purchase for both the governmental and proprietary funds. Prepaid items are reflective of insurance policies and commitments due on July 1 for the following fiscal year. The warehouse inventories, consisting mostly of parts and supplies, are maintained on a perpetual inventory basis. Inventories of all funds are valued at cost and net of reserves, utilizing a weighted moving average method of valuation. The City maintains inventory reserves to charge off any damaged or obsolete items. The Electric Revenue Fund maintains fuel inventory for the generating assets on a perpetual basis and utilizes the weighted average method of valuation. H. Cash and Investments The City's cash and cash equivalents consist of cash on hand, demand deposits and short- term investments with original maturities of three months or less from the acquisition date. Investments consist of notes and bonds issued by the United States Government and its agencies, corporate debt instruments, common stock and open-end mutual funds. The fair value of investments is determined in accordance with GASB 72 Fair Value Measurements. I. Accounts Receivable Allowances for uncollectible accounts are maintained and uncollectible accounts are charged off against these allowances. The authority to write off accounts is vested with the City Council. Current balances of allowances are as follows: General Fund $506,910 Water Fund 20,360 Wastewater Fund 14,274 Electric Revenue Fund 961,371 J. Restricted Assets Certain assets are restricted because their use is limited by bond covenants, endowments, or other similar third-party restrictions. Restricted assets as of June 30, 2020 total $71,618,913 including cash and cash equivalents of $14,132,190 and $57,486,723 in investments. Of this amount, $620,619 is attributed to governmental activities and $70,998,294 is attributable to business-type activities. 68 • 118

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. K. Unbilled Service Receivables The City follows a policy of billing for services in accordance with billing cycle procedures. All known services rendered are billed and incorporated in the books at the end of the fiscal year. L. Bond Accounts/Issuance Costs The City recognizes issuance costs in governmental funds, as well as the proprietary funds, as a current period expense in accordance with GASB 65. All unamortized bond discounts and issuance costs held by the general fund and the proprietary funds have been expensed in prior years. M. Deferred Outflow s/Inflow s of Resources The statement of net position, in addition to reporting assets and liabilities, reports a separate section for deferred outflows / inflows of resources. Deferred outflows / inflows of resources represent either a consumption or acquisition of net position that applies to a future period(s) and will not be recognized as an outflow / inflow (expense / revenue) of resources until that period. The City’s deferred outflows / inflows of resources are reported on the government-wide statement of net position and proprietary funds statement of net position for pension, Other Post-Employment Benefits (OPEB), and asset retirement obligations. For purposes of measuring the OPEB and pension liability, deferred outflows of resources and deferred inflows of resources related to OPEB and pensions, and OPEB and pension expense, information about the fiduciary net position of the OPEB and pension plans and additions to/deductions from their fiduciary net position have been determined on the same basis as they are reported by the City of Dover’s OPEB Trust and pension systems. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. The OPEB and pension systems report investments at fair value. Deferred inflows of resources related to OPEB and pensions are explained in Notes 15 and 17, respectively. The City also reports unavailable revenue only in the governmental funds balance sheet, which arises only under a modified accrual basis of accounting that qualifies for reporting in this category. The governmental funds report unavailable revenues from property taxes, demolitions, general billings, grass cutting, police extra-duty, and State grants. In addition to the above deferred inflows / outflows, the City is reporting a deferred outflow of resources for asset retirement obligation on the Electric Revenue Fund, due to the retirement of the McKee Run Generating Facility. N. Fund Balances and Net Position Governmental fund balances are reported based on a hierarchy of constraints on the nature or specific purpose to which the funds can be spent. The classifications of fund balance are as follows: 69 • 119

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. • The non-spendable fund balance classification includes amounts that cannot be spent either because they are in a non-spendable form or because they are legally or contractually required to be maintained intact. • The restricted fund balance classification includes amounts that can be spent only for specific purposes defined by the City Charter, the City Code, State or Federal laws, or externally imposed conditions by grantors or creditors. • The committed fund balance classification includes amounts that can be used only for specific purposes determined by the formal action by City Council through a motion or an adopted City Ordinance which is approved by a majority vote of City Council, the City’s highest level of decision-making authority. • The assigned fund balance classification includes amounts authorized and established by City Council. The City’s financial policies as adopted by City Council includes the purpose and description of all classes of fund balance. Modifications require City Council approval. • The unassigned fund balance classification includes amounts that have not met the criteria of the aforementioned fund balance classifications. The unassigned fund balance is available for expenditures as they are incurred. The general fund is the only fund that reports a positive unassigned fund balance amount. The City considers restricted, committed, or assigned amounts to have been spent when a related expenditure is incurred. Proprietary funds report net position in three categories: 1) Net investment in capital assets 2) Restricted and 3) Unrestricted Fund balances and net position are further explained in Note 7. O. Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. P. Net Position Flow Assumption Sometimes the City will fund outlays for a specific purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted and unrestricted net position and fund balance in the government-wide, proprietary fund, and governmental fund financial statements, a flow assumption must be made about the order in which the resources are applied. It is the City’s policy to consider restricted net position to have been depleted before unrestricted net position is applied. 70 • 120

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 3. DEPOSITS AND INVESTMENTS A. Cash in Bank and Cash Equivalents Custodial credit risk – deposits. The City’s depository institutions collateralize the City’s deposits over and above those covered by the $250,000 FDIC Insurance limit with specific securities, which are ‘marked to market’ daily against the aggregate balances. The market value of the collateral is at a minimum of or equal to 102% of the amount of applicable deposits. Collateral consists solely of full faith and credit obligations of the United States Government or fixed rate obligations of agencies or instruments of the United States Government. On June 30, 2020, the carrying amount of unrestricted cash and cash equivalents totaled $21,802,990, and the bank cash balances totaled $21,582,250. The carrying amount of restricted cash totaled $14,132,190 and the bank cash balances on restricted accounts totaled $14,183,391. Therefore, $2,813,718 of the bank balance was exposed to custodial credit risk because it was uninsured and uncollateralized. Fiduciary funds cash and cash equivalents carrying value of $6,363,067 included $6,374,425 of cash deposits, $612,895 of the bank balance was exposed to custodial credit risk because it was uninsured and uncollateralized. The restricted deposits are held by the City for bond related transactions, special purpose operating and capital grants. B. Investments The City Council has adopted an investment policy which is reviewed every two years and updated as needed to meet best practices. The Pension Boards have adopted their own distinct investment policies to govern the Pension Trust funds because the objectives differ from those of the City. The City’s investments are segregated from the Pension Trust investments for clarity. As of June 30, 2020, the City had the following investments: i. Investments Held by Third Part y Custodian The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. The City’s government wide investments are held in several different investment capacities from mutual funds and certificate of deposit with a significant investment in debt securities. • Level 1 – Valuations based on unadjusted quoted prices for identical assets or liabilities in active markets; • Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets or identical assets or liabilities in less active markets, such as dealer or broker markets; and • Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable, such as pricing models, discounted cash flow models and similar techniques not based on market, exchange, dealer or broker-traded transactions. 71 • 121

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. The City recorded the following investments as of June 30, 2020: Fair Value Measurements Using: Quoted Prices Significant Weighted in Active Other Average Markets Observable Maturity for Identical Inputs Investment Type (Years) June 30, 2020 Assets (Level 1) (Level 2) Government-Wide: Investments by fair value level Debt securities: U.S. Government Treasuries 1.93 $ 25,850,725 $ - $ 25,850,725 Federal Agency Bond / Note 3.22 24,502,546 838,431 23,664,115 Municipal Obligations 2.80 3,753,670 - 3,753,670 Domestic Fixed Income 2.65 34,490,992 - 34,490,992 International Fixed Income 0.42 5,345,299 - 5,345,299 Federal Agency mortgage backed security* 12.52 4,275,890 340,501 3,935,389 Total Investments by fair value level 2.92 $ 98,219,123 $ 1,178,933 $ 97,040,190 Other Investments, at amortized cost: Money Market Mutual Funds & Equity Stock 1,255,940 Certificates of Deposit 5,262,054 Total other investments 6,517,994 Total Government-Wide Investments 104,737,117 Interest rate risk: As a means of limiting its exposure to fair value losses arising from rising interest rates the City’s investment policy limits U.S. Government securities and most other investments to a maximum maturity of 10 years from the date of purchase. Commercial Paper, Bankers’ Acceptances and Repurchase Agreements all have a much shorter investment period ranging from 90 days to 365 days. Short-term cash flow balances are invested up to one year. The portfolio’s weighted average maturity is 2.82 years. * For asset backed and Agency mortgage backed securities, the maximum maturity shall be defined as the weighted average life (“WAL”). WAL is a convention that estimates the expected weighted amount of time, in years, for the principal amount of an issue to be fully paid. For Agency mortgage backed securities, WAL shall be limited to 10 years, measured at the settlement date, provided by Bloomberg Financial Markets. As of June 30, 2020, Federal Agency mortgage backed security WAL is 3.15. Credit risk: The City’s investment policy applies the prudent-person rule. Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital and, in general, avoid speculative investments. 72 • 122

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. As of June 30, 2020, the City’s fixed income and short-term investments carried the following S&P Global Credit Ratings as compared to the policy’s minimum ratings: Policy Minimum Percent Authorized Investments Rating Category Portfolio Ratings Allocation U.S. Government N/A AAA 24.68% U.S. Government Agency N/A AA+ to AAA 27.48% Certificates of Deposit and Short-Term A-1 Short-Term A-1 to A-1+ 0.00% Time Deposits Long-Term AA N/A 0.00% Corporate Debt Issued by a US Corporation Commercial Paper A-1 N/A 0.00% Corporate Notes/Bonds A BBB+ to AAA 32.93% International Fixed Income A AAA 5.10% Repurchase Agreements ST A-1; LT AA N/A 0.00% Registered Investment Companies AAAm AAAm 6.22% (Money Market Funds) Municipal Obligations A A to AAA 3.58% Concentration of credit risk: As of June 30, 2020, United States Treasury Notes represented 23.67% of the portfolio, United States Treasury Bills represented 5.69% of the portfolio, Federal National Mortgage Association represented 8.80% of the portfolio and Federal Home Loan Mortgage Association represented 9.82% of the portfolio. No other issuer exceeded 5% of the portfolio. ii . Investments Held by Trustee f or Other Post-Employm ent Benef its & Pensions The Pension Trusts and OPEB Trust invest exclusively in open-end mutual funds. The fair value is measured using the net asset value (NAV) as quoted in active markets in a manner consistent with the measurement principles for investment companies calculated as of June 30, 2020. 73 • 123

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Investment Type June 30, 2020 Other Postemployment Benefits (OPEB) & Employee's Police OPEB Pension Funds (Trustee held): Plan Plan Trust Total Investments measured at the net asset value (NAV) Money market funds $ 2,658,835 $ 941,300 $ 1,241,549 $ 4,841,684 Fixed Income: Short-term bond funds 2,220,971 808,662 2,495,182 5,524,815 Intermediate-term bond funds 1,788,130 406,925 1,887,216 4,082,271 Long-term bond funds 2,245,707 680,574 1,698,935 4,625,217 Inflation-protected bond funds 2,234,948 678,120 1,677,213 4,590,281 High yield bond funds 2,198,152 667,075 2,104,697 4,969,925 Nontraditional bond funds 1,776,400 404,263 1,922,633 4,103,296 Total Fixed Income 12,464,309 3,645,619 11,785,876 27,895,805 Equities: Large cap value funds 3,518,750 1,067,670 3,321,649 7,908,069 Large cap growth funds 4,961,278 1,504,117 4,820,121 11,285,516 Mid-cap value funds 1,747,903 530,317 3,304,732 5,582,951 Mid-cap blend funds 1,781,065 540,401 - 2,321,466 Small-cap value funds 3,589,919 1,089,152 4,511,692 9,190,763 International growth funds 3,197,571 970,543 3,131,469 7,299,584 World stock funds 3,180,883 965,259 3,064,248 7,210,390 Diversified emerging market funds 5,432,392 1,648,245 5,369,519 12,450,156 Real estate funds 2,151,887 652,946 2,106,748 4,911,582 Total Equities 29,561,649 8,968,650 29,630,178 68,160,476 Total investments measured at the NAV $ 42,025,958 $ 12,614,269 $ 41,416,054 $ 96,056,281 74 • 124

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements The City recorded the following OPEB and Pension investments as of June 30, 2020: D Item 6. Quoted Prices in Active Markets for Identical Investment Type June 30, 2020 Assets (Level 1) Other Postemployment Benfits (OPEB) & Pension Funds Investments by fair value level Mutual Funds $ 96,056,281 $ 96,056,281 Other Investments at amortized Cost Money Market Mutual Funds 4,841,684 4,841,684 $ 100,897,965 $ 100,897,965 Limits on investments are as follows: Category Allocation Target Percentage Employee's Police OPEB Plan Plan Trust Cash & Short Term Bonds 11.00% 13.00% 9.00% Non-traditional Bonds 4.00% 3.00% 4.50% Inflation Protected Bonds 5.00% 5.00% 4.00% Intermediate Term Bonds 4.00% 3.00% 4.50% Long Term Bonds 5.00% 5.00% 4.00% High Yield Bond 5.00% 5.00% 5.00% Large Cap Value 8.00% 8.00% 8.00% Large Cap Growth 11.00% 11.00% 11.00% Mid Cap 8.00% 8.00% 8.00% Small Cap 8.00% 8.00% 11.00% Real Estate Investment 5.00% 5.00% 5.00% Foreign Equity 14.00% 14.00% 14.00% Emerging Markets 12.00% 12.00% 12.00% 100.00% 100.00% 100.00% Custodial Credit Risk is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. To avoid custodial credit risk, the City requires all investments held with a third-party custodian to be registered in the City’s name. Interest Rate Risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The Pension and OPEB Plans’ investment policies formally address interest rate risk. As of June 30, 2020, the Pension and OPEB plans had $27,895,805 in fixed income investments. The weighted average maturity for all of its fixed income funds was 6.62 years. Credit Risk: The OPEB Plan’s investments are exposed to both market risk, the risk arising from changes in fair value, and credit risk, the risk of failure by another party to perform according to 75 • 125

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements the terms of a contract. The Pension and OPEB Plan’s investment balances at June 30, 2020 D Item 6. consisted of open-ended mutual funds. Concentration of Credit Risk: Concentration of credit risk is the risk of loss attributable to the magnitude of an investment in a single issuer. The Pension and OPEB Plan’s investment policies do not formally address concentration of credit risk. The Pension and OPEB Plans held no positions of five percent or more in securities of any single issuer at June 30, 2020. Foreign Currency Risk is the risk that changes in the exchange rate of investments will adversely affect the fair value of an investment. As of June 30, 2020, the Pension and OPEB Plans had no investments that were denominated in foreign currency. 76 • 126

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 4. CAPITAL ASSETS A summary of the capital asset activity for the year ended June 30, 2020 is presented below and on the following two pages: Beginning Ending Balance Increases Decreases Adjustments Balance Governmental activities: Capital assets, not being depreciated Land $ 4,739,562 $ - $ 15,500 $ - $ 4,724,062 Construction in progress 1,196,119 1,376,409 1,375,994 - 1,196,534 Total capital assets, not being depreciated 5,935,681 1,376,409 1,391,494 - 5,920,596 Capital assets, being depreciated: Buildings 29,379,049 349,084 943,411 - 28,784,722 Furniture and fixtures 821,678 - - - 821,678 Equipment 8,777,598 695,534 514,805 307,498 9,265,825 Vehicles 6,531,853 693,042 560,293 - 6,664,602 Lights 655,647 - - - 655,647 Improvements other than buildings 57,090,519 4,144,642 101,941 - 61,133,220 Total capital assets, being depreciated 103,256,344 5,882,302 2,120,450 307,498 107,325,694 Less accumulated depreciation for: Buildings (7,012,859) (591,714) 650,119 - (6,954,454) Furniture and fixtures (598,444) (65,337) - - (663,781) Equipment (6,562,861) (393,765) 271,929 (281,911) (6,966,608) Vehicles (4,147,134) (619,527) 533,551 - (4,233,110) Lights (526,553) (11,576) - - (538,129) Improvements other than buildings (30,334,434) (2,000,531) 82,340 - (32,252,625) Total accumulated depreciation (49,182,285) (3,682,450) 1,537,939 (281,911) (51,608,707) Total capital assets, being depreciated, net 54,074,059 2,199,852 582,511 25,587 55,716,987 Governmental activities capital assets, net $ 60,009,740 $ 3,576,261 $ 1,974,005 $ 25,587 $ 61,637,583 The capital asset adjustments within the governmental activities section above, and the Water and Wastewater sections that follow, are due to the transfer of equipment in the amount of $189,999 and $117,500 from the Water and Wastewater funds respectively, to the new Stormwater utility within the General Fund. 77 • 127

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. (Continued) Beginning Ending Balance Increases Decreases Balance Business-type activities: Electric Revenue Fund Capital assets, not being depreciated Land $ 1,458,066 $ - $ - $ 1,458,066 Construction in progress 3,763,201 999,186 681,391 4,080,996 Total capital assets, not being depreciated 5,221,267 999,186 681,391 5,539,062 Capital assets, being depreciated Buildings 14,480,088 131,669 - 14,611,757 Vehicles and Equipment 28,609,036 801,413 510,454 28,899,995 Transformers, Meters, T&D & Fiber Optic Lines, Street Lights 65,214,352 616,578 - 65,830,930 SS, Switch Yards, Switchgears 36,687,862 28,860 - 36,716,722 Boiler, Turbo Generators, Cap Int - VS 39,122,189 - - 39,122,189 Other (Streets, EST, Swr Lines, Wells, Eng & Legal Svcs, Land Impr) 7,662,503 - - 7,662,503 Total capital assets, being depreciated 191,776,030 1,578,520 510,454 192,844,096 Less accumulated depreciation for: Buildings (11,152,317) (805,578) - (11,957,895) Vehicles and Equipment (24,535,482) (1,197,294) 510,454 (25,222,322) Transformers, Meters, T&D & Fiber Optic Lines, Street Lights/Signals (37,254,711) (1,783,707) - (39,038,418) SS, Switch Yards, Switchgears (15,729,410) (986,434) - (16,715,844) Boiler, Turbo Generators, Cap Int - VS (27,292,090) (2,994,271) - (30,286,361) Other (Streets, EST, Swr Lines, Wells, Eng & Legal Svcs, Land Impr) (6,301,114) (185,909) - (6,487,023) Total accumulated depreciation (122,265,124) (7,953,193) 510,454 (129,707,863) Total capital assets, being depreciated, net 69,510,906 (6,374,673) - 63,136,233 Total electric revenue fund capital assets, net 74,732,173 (5,375,487) 681,391 68,675,295 Water Fund Capital assets, not being depreciated Land 130,438 - - - 130,438 Construction in progress 4,717,430 2,839,306 162,197 - 7,394,539 Total capital assets, not being depreciated 4,847,868 2,839,306 162,197 - 7,524,977 Capital assets, being depreciated Buildings 1,964,622 - - - 1,964,622 Distribution Mains/Accessories 24,248,428 973,941 - - 25,222,369 Pumping stations 13,118,280 40,986 - - 13,159,266 Sewer Lines 38,284 - - - 38,284 Vehicles and equipment 5,391,729 62,533 - (189,999) 5,264,263 Total capital assets, being depreciated 44,761,343 1,077,460 - (189,999) 45,648,804 Less accumulated depreciation for: Buildings (897,476) (39,522) - - (936,998) Equipment (3,667,359) (197,527) - 164,412 (3,700,474) Distribution Mains/Accessories (8,577,482) (473,215) - - (9,050,697) Pumping Stations (5,578,903) (245,273) - - (5,824,176) Sewer Lines (17,604) (759) - - (18,363) Total accumulated depreciation (18,738,824) (956,296) - 164,412 (19,530,708) Total capital assets, being depreciated, net 26,022,519 121,164 - (25,587) 26,118,096 Total water fund capital assets, net 30,870,387 2,960,470 162,197 (25,587) 33,643,073 (Continued) 78 • 128

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. (Continued) Beginning Ending Balance Increases Decreases Adjustments Balance Business-type activities: Wastewater Fund Capital assets, not being depreciated Land 32,802 - - - 32,802 Construction in progress 1,052,812 1,219,271 1,465,750 - 806,333 Total capital assets, not being depreciated 1,085,614 1,219,271 1,465,750 - 839,135 Capital assets, being depreciated Buildings 62,040 - - - 62,040 Distribution Mains/Accessories 204,662 - - - 204,662 Pumping Stations 16,172,459 1,624,698 - - 17,797,157 Sewer Lines 33,660,064 597,401 - - 34,257,465 Vehicles and equipment 2,318,528 166,442 - (117,500) 2,367,470 Total capital assets, being depreciated 52,417,753 2,388,541 - (117,500) 54,688,794 Less accumulated depreciation for: Buildings (39,324) (2,681) - - (42,005) Equipment (1,603,162) (138,638) - - (1,741,800) Distribution mains, hydrant, and accessories (12,100) (2,868) - - (14,968) Pumping Stations (5,199,513) (496,381) - - (5,695,894) Sewer Lines (14,337,717) (766,817) - 117,500 (14,987,034) Total accumulated depreciation (21,191,816) (1,407,385) - 117,500 (22,481,701) Total capital assets, being depreciated, net 31,225,937 981,156 - - 32,207,093 Total wastewater fund capital assets, net 32,311,551 2,200,427 1,465,750 - 33,046,228 Total Business-type Activities $ 137,914,111 $ (214,590) $ 2,309,338 $ (25,587) $ 135,364,596 Capital Assets, not being depreciated $ 11,154,749 $ 5,057,763 $ 2,309,338 $ - $ 13,903,174 Capital Assets, being depreciated, net 126,759,362 (5,272,353) - (25,587) 121,461,422 Total $ 137,914,111 $ (214,590) $ 2,309,338 $ (25,587) $ 135,364,596 Depreciation expense was charged to functions/programs of the primary government as follows: General government $ 15,451 Central services 40,410 Public safety 540,399 Public works 2,404,318 Library and recreation 654,671 Financial administration 27,201 Total depreciation expense - governmental activities $ 3,682,450 79 • 129

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 5. LONG -TERM OBLIG ATIONS A. Summary of Bonded Indebt edness by Issue Original - Remaining - Interest -Maturity -Arbitrage Purpose Governmental Activities 2019 General Obligation Bonds $ 5,700,000 $ 5,371,284 2.39% 7/18/19 - 6/30/29 No Refund General Obligation Bonds Series 2012 and Series 2014 A, which funded public safety equipment and library, storm water and street infrastructure projects Business Type Activities Water Bonds 2010 State of Delaware - Revolving 2,404,017 1,472,966 2.47% 4/1/12 - 10/1/30 No Water quality improvements and main Loan Fund - Municipal Revenue replacements 2013 Revenue Bonds 4,295,463 2,861,304 3.58% 7/1/14 - 7/1/33 Yes Water and Wastewater capital project financing, refund 2003 Series WWW bonds 2018 State of Delaware - Revolving 4,000,000 4,000,000 2.00% 12/1/20 - 6/1/39 No Water Treatment Plant Improvements Loan Fund - Municipal Revenue Wastewater Bonds 2009 State of Delaware - Revolving 5,581,059 3,549,577 2.00% 12/1/12 - 12/1/31 No Pump station replacements/upgrades and Loan Fund - Municipal Revenue sanitary sewer main relining 2011 State of Delaware - Revolving 765,060 543,372 2.00% 6/1/12 - 12/1/31 No Pump station replacements/upgrades and Loan Fund - Municipal Revenue sanitary sewer main relining 2013 Revenue Bonds 1,829,538 1,218,696 3.58% 7/1/14 - 7/1/33 Yes Water and Wastewater capital project financing, refund 2003 Series WWW bonds 2018 State of Delaware - Revolving 690,214 690,214 2.00% 20 year term once No Replacement of 3 Pump Stations: Delaware Loan Fund - Municipal Revenue the projects are Tech, Walker Woods and Silver Lake complete (Coverage ratio on Water/Wastewater Bonds requires net revenues to be at least 1.2 times the maximum annual debt service) Electric Revenue Bonds 2018 Revenue Bonds $ 15,700,000 $ 15,050,000 3 - 5% 7/1/19 - 7/1/33 Yes Refund Electric Revenue Bonds Series 2008, which funded system expansion & upgrades (Coverage ratio on Electric Bonds requires net revenues to be at least 1.25 times the maximum annual debt service) 80 • 130

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. B. Status as of June 30, 2020 – General Obligation Bonds Long-term indebtedness of the City of Dover consists of Series 2019 General Obligation Bonds totaling $5,371,284. The total General Obligation Bonds outstanding amount includes $335,760 payable within one year. C. Change in Long -Term Debt The following tables summarize the debt transactions for the year ended June 30, 2020: i. General Long -Term Debt Payable within Item Balance 7/1/19 Additions Reductions Balance 6/30/20 One Year Police Officer Separation Agrmt $ 112,500 $ - $ 37,500 $ 75,000 $ 37,500 Compensated Absences 2,494,815 1,489,259 1,461,937 2,522,137 1,313,661 General Obligation Bonds 5,700,000 - 328,716 5,371,284 335,760 Net OPEB Liability 21,227,234 - 4,044,624 17,182,610 - Net Pension Liability 14,043,528 2,497,744 - 16,541,272 - Sub-total of General Long-Term Debt $ 43,578,077 $ 3,987,003 $ 5,872,777 $ 41,692,303 $ 1,686,921 ii . Enterprise Funds Debt – W ater and W astewater Fund WATER FUND Payable within Item Balance 7/1/19 Additions Reductions Balance 6/30/20 One Year Compensated Absences $ 133,126 $ 110,481 $ 64,405 $ 179,202 $ 80,542 Revenue Bonds-Water 3,113,772 - 252,468 2,861,304 262,988 State of Delaware Municipal Revenue Bond - Water 4,191,546 1,401,901 120,481 5,472,966 298,608 Net OPEB Liability 1,140,340 - 291,759 848,581 - Net Pension Liability 2,048,316 338,039 2,386,355 - Sub-total of Water Fund $ 10,627,100 $ 1,850,421 $ 729,113 $ 11,748,408 $ 642,138 WASTEWATER FUND Payable within Item Balance 7/1/19 Additions Reductions Balance 6/30/20 One Year Compensated Absences $ 49,243 $ 39,043 $ 32,682 $ 55,604 $ 32,760 Revenue Bonds-Water 1,326,228 - 107,532 1,218,696 112,012 State of Delaware Municipal Revenue Bond - Wastewater 4,566,149 578,056 361,043 4,783,162 347,646 Net OPEB Liability 640,436 - 160,544 479,892 - Net Pension Liability 1,336,901 126,636 - 1,463,537 - Sub-total of Wastewater $ 7,918,957 $ 743,735 $ 661,801 $ 8,000,891 $ 492,418 81 • 131

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. State of Delaware Water Pollution Control Revolving Fund (WPCRF) Loan and State of Delaware Drinking Water State Revolving Fund (DWSRF) The City had one Wastewater loan that is still in the process of being drawn down because the related projects are in the construction stage. Loan outstanding as of June 30, 2020 was: Loan # 12000090 Interest Rate 2.00% Maximum Loan Amount $881,400 Outstanding as of June 30, 2020 $690,214 The City’s repayment obligation is secured by a pledge of net operating revenue of the water and wastewater system. Upon completion of each project, semi-annual payments of principal and interest shall be payable in an amount sufficient to amortize the outstanding principal balance of the loan over a twenty-year term. iii . Enterprise Funds De bt – Electric Revenue Fund ELECTRIC REVENUE FUND Payable within Item Balance 7/1/19 Additions Reductions Balance 6/30/20 One Year Compensated Absences $ 497,468 $ 285,873 $ 227,511 $ 555,830 $ 254,929 Revenue Bonds 15,700,000 - 650,000 15,050,000 785,000 Bond Premium 1,154,752 - 89,659 1,065,093 - Net OPEB Liability 2,771,675 - 634,296 2,137,379 - Net Pension Liability 6,775,483 763,154 - 7,538,637 - Asset Retirement Obligation 11,915,849 - - 11,915,849 - Sub-total of Electric Revenue Fund 38,815,227 1,049,027 1,601,466 38,262,788 1,039,929 Sub-total of Enterprise Fund Debt 57,361,284 3,643,183 2,992,380 58,012,087 2,174,485 Grand Totals of Long-Term Debt $ 100,939,361 $ 7,630,186 $ 8,865,157 $ 99,704,390 $ 3,861,406 The City does not receive reimbursement for debt service from any other governmental units. The City does not have any special assessment debt or defeased bonds as of June 30, 2020. In previous years, the City has used General Fund Revenues to liquidate Net Pension and Net OPEB Liabilities in the General Fund. 82 • 132

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. D. Debt Service Requirements The following are the debt service requirements to maturity on the City's general obligation bonds and revenue bonds. i. Gover nmental Act ivities: 2019 General Obligation Bonds Fiscal Year Principal Interest Total 2021 335,760 126,434 462,194 2022 342,624 118,222 460,846 2023 349,632 109,842 459,474 2024 356,556 101,565 458,121 2025 364,092 92,569 456,661 2026 371,544 83,664 455,208 2027 379,140 74,576 453,716 2028 386,760 65,478 452,238 2029 2,485,176 55,843 2,541,019 Total $ 5,371,284 $ 828,193 $ 6,199,477 ii. Business-type Activit ies Water, Wastewater and Electric Revenue Funds 2009 Municipal Revenue 2010 Municipal Revenue 2011 Municipal Revenue Fiscal Bonds (Wastewater) Bonds (Water) Bonds (Wastewater) Year Principal Interest Principal Interest Principal Interest 2021 277,437 69,611 123,646 37,643 38,905 19,219 2022 283,013 64,035 126,895 34,395 40,318 17,806 2023 288,702 58,346 130,228 31,061 41,783 16,341 2024 294,505 52,543 133,649 27,640 43,302 14,823 2025 300,424 46,624 137,160 24,129 44,875 13,250 2026 306,463 40,585 140,764 20,526 46,505 11,619 2027 312,623 34,425 144,461 16,828 48,195 9,930 2028 318,906 28,142 148,257 13,033 49,946 8,178 2029 325,316 21,732 152,151 9,138 51,761 6,364 2030 331,855 15,193 156,148 5,141 53,642 4,483 2031 338,526 8,522 79,607 1,039 55,592 2,534 2032 171,807 1,718 - - 28,548 514 Total $ 3,549,577 $ 441,476 $ 1,472,966 $ 220,573 $ 543,372 $ 125,061 (Continued) 83 • 133

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements Item 6. Business-type Activit ies (Cont inued) Water, Wastewater and Electric Revenue Funds 2013 Revenue Bonds 2018 Municipal Revenue 2018 Municipal Revenue 2018 Revenue Bonds Business- Fiscal Water and Wastewater Loan (Wastewater) Loan (Water) Electric Type Year Principal Interest Principal Interest Principal Interest Principal Interest Activities 2021 375,000 135,469 31,304 6,902 174,962 49,364 785,000 593,575 2,718,037 2022 385,000 124,069 31,617 6,589 178,479 46,766 820,000 553,450 2,712,432 2023 395,000 112,369 31,933 6,273 182,067 44,168 865,000 511,325 2,714,596 2024 410,000 100,294 32,252 5,954 185,726 41,570 910,000 466,950 2,719,208 2025 215,000 90,919 32,575 5,631 189,459 38,971 955,000 420,325 2,514,342 2026 220,000 84,256 32,901 5,305 193,267 36,373 1,005,000 371,325 2,514,889 2027 225,000 77,106 33,230 4,976 197,152 33,775 1,055,000 319,825 2,512,526 2028 235,000 69,281 33,562 4,644 201,115 31,177 1,110,000 265,700 2,516,941 2029 245,000 60,269 33,898 4,308 205,157 28,579 1,160,000 214,750 2,518,423 2030 255,000 50,269 34,237 3,969 209,281 25,981 1,200,000 173,550 2,518,749 2031 265,000 39,869 34,579 3,627 213,487 23,383 1,240,000 136,950 2,442,715 2032 275,000 29,069 34,925 3,281 217,779 20,785 1,275,000 99,225 2,157,651 2033 285,000 17,869 35,274 2,932 222,156 18,187 1,315,000 60,375 1,956,793 2034 295,000 6,084 35,627 2,579 226,621 15,589 1,355,000 20,325 1,956,825 2035 - - 35,983 2,223 231,176 12,990 - - 282,372 2036 - - 36,343 1,863 235,823 10,392 - - 284,421 2037 - - 36,706 1,500 240,563 7,794 - - 286,563 2038 - - 37,073 1,133 245,398 5,196 - - 288,800 2039 - - 76,195 1,150 250,332 2,598 - - 330,275 Total $ 4,080,000 $ 997,192 $ 690,214 $ 74,839 $ 4,000,000 $ 493,638 $ 15,050,000 $ 4,207,650 $ 35,946,558 84 • 134

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. E. Certain Asset Retirement Obligation The City implemented GASB Statement No. 83 Certain Asset Retirement Obligation (ARO) during the fiscal year ended June 30, 2019. An ARO is a legally enforceable liability associated with the retirement of a tangible asset. The McKee Run Generating Station is an electric generating facility owned and operated by the City since 1972 and is scheduled to be shut down on May 31, 2021. A legal obligation exists for the City to perform future retirement activities for the decommissioning of the McKee Run Generating Station, as the site contains hazardous and other materials that require special handling, based upon Federal Regulations and the Delaware Department of Natural Resources and Environmental Control (DNREC). McKee Run has an estimated remaining useful life of 10 months. The City engaged a specialist to estimate the cost of decommissioning the station, and accordingly recognized a liability of $11,915,849, and deferred outflow of resources of $486,361 which was amortized this year and is now $243,180, as of June 30, 2020. The City of Dover is utilizing the "Decommissioning Project Playbook" to begin planning the decommissioning activities and tasks. A Request for Proposal (RFP) is being developed to determine who and how decommissioning activities will occur under the direction of a contractor familiar with the decommissioning processes. This to ascertain all necessary federal and state regulations are followed and there is direct oversight of the project given the numerous variables. There were no legally required funding or assurance provisions and there were no assets restricted for payment as of June 30, 2020. 85 • 135

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 6. RESTRICTED NET POSITION In the government-wide financial statements the restricted net position of the governmental activities and business type activities are as follows: Governmental Activities Grants-capital projects This represents the State DOT grant $ 112,949 reported in the non-major special revenue funds. Grants-public safety These represent the Police grants, ERLSP 161,731 grant and Substance Abuse Prevention grant in the special revenue type funds. Other Purposes These represent all other funds reported in 72,146 the special revenue type, except the grants reserved for capital construction and public safety. Also included is the interest from an endowment from Mary Elizabeth Paton and the verizon reserve. Total Restricted Net Position $ 346,826 Business Type Activities Net restricted position for construction purposes - expendable Water and Wastewater Restrictions on investments $ 8,809,948 imposed by bond covenants Electric Restrictions on investments 62,188,346 imposed by bond covenants Total Restricted Net Position $ 70,998,294 7. FUND BALANCES & NET POSITION In the governmental fund financial statements, fund balances are reported based on a hierarchy of constraints on the specific purposes for which the funds can be spent. Non-spendable fund balances represent items that are not in spendable form and not expected to be converted to cash. This criterion also applies to the corpus of permanent funds, which would include the Mary Elizabeth Paton library endowment. Restricted fund balances represent amounts that have externally imposed restrictions by creditors, grantors, enabling legislation or laws and regulations of other governments. The fund balances of the City’s grant funds fall into this category, as well as a couple of accounts that have contractual restrictions imposed by a third party. Committed fund balances represent amounts that can be used only for specific purposes pursuant to constraints imposed by formal action of City Council through a motion or an adopted city ordinance. These amounts cannot be used for any other purpose unless the government removes or changes the specified use by taking the same type of action to which it previously committed the amount. Assigned fund balances represent amounts constrained by the City’s intent to be used for specific purposes. These amounts represent the City’s capital asset appropriations. The constraints placed on assigned fund balances are implemented through internal processes such as a budget ordinance or motion of City Council. Therefore, assigned fund balances do not have the same restrictive nature as a restricted fund balance. 86 • 136

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Unassigned fund balance is the residual amount that has not met the criteria for the previously mentioned classifications. The unassigned fund balance is available for expenditures as they are incurred. The General Fund is the only fund that reports a positive unassigned fund balance amount. However, in governmental funds other than the General Fund, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund. The composition of the City fund balances as of June 30, 2020 follows: Other General Governmental Fund Funds Total Fund balances: Nonspendable: Inventory & Prepaids $ 190,873 $ - $ 190,873 Patronage Stock 16,594 - 16,594 Library Endowment 5,000 - 5,000 Subtotal Nonspendable: 212,467 - 212,467 Restricted for: Library Endowment Interest 2,360 - 2,360 Verizon cable franchise 36,629 - 36,629 Highway resurfacing - 112,949 112,949 CDBG - 1,828 1,828 Substance Abuse Prevention - 88,443 88,443 Library Grants - 31,329 31,329 Police Grants - 73,288 73,288 Subtotal Restricted for: 38,989 307,837 346,826 Committed to: Contingency 788,189 - 788,189 Parkland 1,357,385 - 1,357,385 Subtotal Committed to: 2,145,574 - 2,145,574 Assigned to: Capital Projects 4,823,060 - 4,823,060 Unassigned 6,383,591 - 6,383,591 Total fund balances $ 13,603,681 $ 307,837 $ 13,911,518 As noted in the Introductory section of this report (page 7), the City has established the “City of Dover, Delaware Financial Policies” booklet, which is a standardized set of principles managed by the Finance Department to ensure that the City follows the minimum fund balance policies. 8. PROPERTY TAXES Property taxes are levied under the authority of the City Charter on all real property located within the City limits. The City Assessor oversees the property assessments and the City Council levies the property tax rate. The following table provides important dates with reference to property taxes. Beginning of fiscal year for taxes July 1 Tax rate levied 2nd Council Meeting in June Taxes billed July 1 87 • 137

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Taxes due and payable at par July 31 Penalty of one and one-half percent starts August 1 Lien established on property for property taxes July 1 Tax sales of property with unpaid taxes 2 years from date of billing As of June 30, 2020, there were no material delinquent taxes. 9. INTERFUND RECEIV ABLES, P AYABLES AND TRANSFERS The composition of interfund balances as of June 30, 2020 follows: A. Due to/from other funds – Charges and Allocations Receivable Fund Payable Fund Amount General Fund Non-Major Governmental Funds $ 200,424 Water Fund 225,702 Wastewater Fund 137,345 Electric Revenue Fund 707,283 1,270,754 Water Fund General Fund 69 Wastewater Fund General Fund 69 Electric Revenue Fund 11 80 Electric Revenue Fund General Fund 592 Non-Major Governmental Funds 8,410 9,002 Internal Service Fund General Fund 46,946 Total $ 1,326,851 B. Temporary Advances Receivable Fund Payable Fund Amount General Fund CDBG Fund $ 70,000 C. Interfund Transfers Transfers In - Electric Transfers Out General Fund Revenue Fund Total Non-Major Governmental Funds $ 3,277,336 $ 8,410 $ 3,285,746 Water/ Wastewater Fund 1,000,000 298,000 1,298,000 Electric Revenue Fund 10,000,000 - 10,000,000 General Fund - 250,000 250,000 Total $ 14,277,336 $ 556,410 $ 14,833,746 88 • 138

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Transfers are generally made to provide operating capital or debt service subsidies to the receiving fund in accordance with City policy. 10. RENTAL INCOME The City is the lessor in two active lease agreements related to its Garrison Oak Business & Technology Center that result in miscellaneous revenue reported in the General Fund. The first lease is with LS Power – White Oak Solar Energy LLC, which generated $67,850 in rental income, and the second lease is with Garrison Energy Center which generated $34,805 in rental income. The City’s Electric Revenue Fund owns a professional office building which houses the City’s Customer Service, Finance, Information Technology, Human Resources, and Public Works Departments. Lease revenue is $89,450 in the Electric Revenue Fund consisting substation rental of $30,000 and pole attachment rentals of $59,450. The City maintains several water tower leases for a group of telecommunications companies. The transactions are recorded as revenue in the Water Fund and totaled $374,868 in the fiscal year ended June 30, 2020. 11. MATERI AL COMMITMENTS A. The City entered into a long-term Renewable Generation Unit Power Purchase Agreement with FPS Raceway Solar, LLC effective August 24, 2020. FPS Raceway Solar, LLC will supply certain energy, REC's and capacity generated by the electric generation facility to be located in Harrington, DE. Once the project is completed it will provide power to the City of Dover for a period of 25 years. B. The City is the guarantor on one loan in the original amount of $635,300 for the Dover Fire Department; a separate entity from the City of Dover. The City also budgets financial contributions to assist the volunteer fire company with the acquisition of firefighting apparatus and maintenance of the building and other necessary equipment. The current fiscal year includes $30,500 in expenditures for the fire station roof, $37,522 for the HVAC unit, $16,117 for fire station improvements, and $77,672 for Engine No. 5. C. The City entered into a three-year management contract with The Energy Authority effective July 1, 2016 to provide a market-based approach for power supply management. The City has extended the contract through June 30, 2022. The Energy Authority manages energy purchases and utilizes the City’s generating assets to provide a level of rate stability and to mitigate the effects of volatility in the energy markets. D. The City also entered into a management contract with North American Energy Services (NAES) to operate and maintain the generating assets of the electric utility in May 2006. The City extended the contract with NAES through June 30, 2021. The City has incorporated the budgets and financial activity of the generating assets into its procedures used for all other divisions of the electric utility. These procedures include a line item budget and adherence to City policies. All personnel are employed by NAES and personnel costs are billed to the City bi-weekly. Any capital improvements are included in the City’s capital improvement plan. The contract also provides for a monthly management fee and a performance incentive based on budget and plant performance. The cost estimate for annual management fees and incentives totals $838,631 in fiscal year 2020 and is included in the plant operating budget. 89 • 139

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. E. The City is the guarantor on two $1.3 million loans held by the Downtown Dover Partnership. The loans are secured by two parcels in the downtown business district that the Downtown Dover Partnership is marketing for its redevelopment initiative. The principal and interest on both loans is paid monthly from rental receipts the Partnership receives from its current tenants on the properties. F. The City owes $75,000 to a former employee of the City due to a separation agreement. The former employee is owed this money over the next 2 years. G. There are no significant encumbered amounts where the resources have already been restricted. 12. FORW ARD CONTRACTS Pursuant to the July 1, 2011 Energy Management Agreement between the City and The Energy Authority (TEA), the City has formed an Executive Risk Management Committee (ERMC). The ERMC has adopted a Governing Policy for Energy Commodity Risk Management (Policy) aimed at addressing the energy commodity risks and the Procedures and Controls Manual for Energy Commodity Risk Management (Procedures Manual). The Procedures Manual further describes the risk management philosophy under which TEA, the City’s designated provider of energy risk management services conducts its activities. The Procedures Manual authorizes TEA to enter into physical forward transactions which shall be governed by Edison Electric Institute (EEI), North American Energy Standards Board (NAESB), or similar agreements with counterparties approved by the City. These agreements will enable the City to hedge the forward price of purchased power, natural gas or fuel oil for delivery as needed to meet its load requirements. No speculative transactions for volumes in excess of forecasted power and fuel needs are permitted. TEA also provides advisory services to the City to determine the extent to which financial hedges would mitigate market and credit risk to the benefit of the City. These contracts meet the definition of a derivative instrument as defined by GASB Statement No. 53, Accounting and Reporting for Derivative Instruments (GASB 53). However, these contracts meet the normal purchases and sales exemption of GASB 53 as the City intends to use the physical commodity in its normal utility operations to supply energy to its customers. Accordingly, these contracts are not within the scope of GASB 53 and are not recorded on the City’s Statement of Net Position. Under the Procedures manual the City will not extend credit to any potential counterparty that has a credit rating below investment grade (defined as BBB as rated by S&P Global Ratings or Baa2 as rated by Moody’s Investors Service). Any counterparty that is unrated by either S&P or Moody’s must be approved by the ERMC prior to the execution of any trading activities. Credit risk is mitigated using collateral thresholds, credit limits, maximum nominal exposure and term limitations. A collateral threshold is the amount of unsecured credit granted to the counterparty. Unsecured credit exposure includes amounts owed by the counterparty, whether billed or not, and the marked-to-market differences in value of any collateral held. Any net exposure above the collateral threshold will require the posting of collateral by the counterparty. Collateral thresholds, term limitations and credit exposure limits are subject to maximums as established by the ERMC. 90 • 140

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. A summary of the contracts outstanding as of June 30, 2020 are as follows: Counterparty Credit Risk (in 1,000’s) Maximum Amount Counterparty of Loss due to Counterparty Line Counterparty or Guarantor Credit Risk w/o Collateral Description Threshold Availability Credit Rating Respect to Collateral ($) AEP Energy Partners, Inc. BBB+ $10,000 $10,384 ($384) No Collateral if exposure under specified threshold Barclays Bank, PLC AA $15,000 $15,000 $0 No Collateral if exposure under specified threshold BP Energy Company A- $15,000 $15,772 ($772) No Collateral if exposure under specified threshold Calpine Energy Services, L.P. No threshold $341 ($341) No Specified threshold Citigroup Energy, Inc. BBB+ $7,000 $7,000 $0 $10,000 guaranty from Citigroup Global Markets Holdings, threshold is $7,000 Conectiv Energy Supply, Inc. NR No threshold $0 $0 No Specified threshold EDF Trading North America, LLC BBB $18,000 $18,000 $0 Threshold is $18 million unless guarantor's credit rating falls below Baa3 Exelon Generation Company, LLC BBB $30,000 $30,000 No Collateral if exposure under specified threshold Constellation Energy Services, Inc. NR No threshold $0 $0 No Specified threshold Macquarie Energy, LLC A $15,000 $15,000 $0 Up to $15,000 is guaranteed by Macquarie Bank Limited Morgan Stanley Capital Group Inc. BBB+ $10,000 $14,599 ($4,599) Unlimited guaranty from Morgan Stanley, threshold set by table in contract NextEra Energy Marketing, LLC. BBB+ $10,000 $25,018 ($15,018) Guaranty from NextEra Energy Capital Holdings, threshold set by table in contract NJR Energy Services Company No threshold $3 ($3) No Specified threshold PSEG Energy Resources & Trade, LLC BBB $5,000 $4,799 $201 $5,000 guaranty from PSEG Power LLC 91 • 141

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 13. INSURANCE A. Health Insurance – State of Delaw are The City participates in the State of Delaware Health Insurance Program. The State offers four health plan options. The administration of benefits is coordinated with Aetna and Highmark Delaware. Pre-determined premiums consisting of City and employee contributions are subsequently paid to the State of Delaware. B. Workers’ Compensation Fund – Self-Insurance On July 1, 1990, the City began self-insuring its Workers’ Compensation insurance. For this purpose, the City has established a separate fund. Claims are processed and administered by a third-party administrator. The City manages the revenue and expenditures in this fund and maintains all records. The City maintains a fund balance reserve to cover any claims incurred but not reported. AMI Risk Consultants completed an updated valuation in fiscal year 2014. As of June 30, 2020, $449,515 is reserved for open claims in this fund. An appropriate umbrella policy for the excess coverage has been purchased and is in effect as of June 30, 2020. Workers’ Compensation activity is recorded in the General Fund as follows: 2020 2019 Claims payable, beginning of year $ 490,800 $ 598,030 Claims incurred 49,300 369,231 Payment of claims (90,585) (476,461) Claims payable, end of year $ 449,515 $ 490,800 C. Other than Health or Workers’ Compensation Insurance The City purchases commercial insurance policies to cover risks not insured through self- insurance funds. The City has designated a contingency account to provide for uninsured losses (See Note 7). There have been no significant reductions or settlements exceeding coverage in the past five fiscal years. 14. COMPENS ATED ABSENCES The City grants a specific number of vacation days with pay to its employees. Upon termination or retirement, an employee is paid for accumulated vacation days. The City also grants one paid sick day per month to all employees, except for employees covered by the International Brotherhood of Electric Workers (IBEW) contract. The IBEW employees are granted eleven sick days per year. The City of Dover follows a terminal leave policy which varies with each of the four labor unions as well as the non-bargaining group. The maximum accumulated sick days paid upon retirement is 150 days for 25 years of service. No accrued sick leave is paid when an employee is terminated. 92 • 142

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. In the government-wide and proprietary fund financial statements, unpaid compensated absences are recorded as a liability as the vested employees' benefits accrue, to the extent it is probable that the employee will be paid for sick benefits at retirement. In governmental funds, compensated absences are recorded as expenditures as payments become due; accordingly, no liability is recorded in the Governmental Funds statement. Typically, the General Fund has been used in prior years to liquidate the liability for compensated absences recorded in governmental activities. 15. OTHER POST-EMPLOYMENT BENEFITS Plan Description On May 11, 2009, the City of Dover Other Post-Employment Benefits Trust (OPEB Trust) was established pursuant to Section 115 of the Internal Revenue Code. Policy for and management of the OPEB benefits provided to retirees are the responsibility of the City of Dover. No stand- alone financial report is issued for the OPEB Trust. The City of Dover OPEB Plan is a post-retirement employee benefit program established for the purpose of funding retiree health care as provided for in Chapter 80, Article IV, Division 5 of the City Ordinances. The OPEB Plan is a single-employer defined benefit plan. The OPEB Plan provides retirement medical coverage to pensioners and their eligible dependents in the City of Dover defined benefit and defined contribution pension plans. Plan Administration Management of the plan investments are fully vested with the City of Dover OPEB Board as established in the City Code, which consists of seven members - three elected by plan members, two Council members appointed by the Council President, the City Controller/Treasurer, and the City Manager. The City Controller/Treasurer serves as an ex-officio member. Milliman of Albany, New York provides asset management advisory and consulting services to the Board. The City purchases health insurance from the State of Delaware through a cooperative purchasing arrangement permitted by State Code. The State Office of Benefits provides the City with the medical insurance premiums by type of coverage and carrier during the budget cycle each year. The City also pays a five percent risk premium and contract administration fee for each contract in addition to the premium. Any premiums paid over or under the benefits paid out for City employees revert to the State. Membership of the plan consisted of the following at June 30, 2020: Retirees and beneficiaries receiving benefits 272 Terminated plan members entitled to but not yet receiving the benefits 10 Active plan members 313 Total 595 Substantially all City employees become eligible for post-retirement benefits if they reach retirement age while working for the City. The costs of providing these benefits are shared between the City and the retired employee. 93 • 143

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Employee Benefits and Contributions The City maintains contracts with each of the following collective bargaining units. • As of the issuance date of the CAFR, negotiations for renewal of the International Brotherhood of Electric Workers (IBEW) union contract is ongoing. • The American Federation of State, County, and Municipal Employees (AFSCME), Council 81 contract period is July 1, 2020 through June 30, 2023. • The Fraternal Order of Police Lodge #15 (FOP) union contract period is July 1, 2018 through June 30, 2021. • The Dover Organization of Employees (DOE) union contract period is July 1, 2018 through June 30, 2021. The eligibility provisions for early retirement are as follows: SUMMARY OF PRINCIPAL PLAN PROVISIONS Benefits for Civilians: A. Covered Groups: Full-time DOE (formerly IUE), IBEW, AFSCME and non-union employees and their dependents are covered. B. Eligibility: Satisfaction of either of the following eligibility requirements: 1. Unreduced Retirement: Attainment of the earlier of the following conditions: a. Later of attainment of age 65 and completion of 10 years of service. b. If hired prior to May 1, 1994, later of attainment of age 50 and completion of 20 years of service. c. If hired prior to May 1, 1994, completion of 25 years of service. d. If hired on or after May 1, 1994, later of attainment of age 55 and completion of 80 points (age plus service). 2. Reduced Retirement: For DOE, AFSCME and non-union members hired prior to July 1, 1994, attainment of age 55 and completion of 10 years of service. Other members who meet this condition have the option to pay 100% of the premiums for coverage. 3. Vested Termination: For DOE, AFSCME and non-union members hired prior to July 1, 1994, completion of 10 years of service. Coverage commences upon attainment of age 65. Coverage is not available to other members. 4. Active Death: Surviving spouses of members eligible for an unreduced pension upon death or for DOE and non-union members hired prior to July 1, 1994, completion of 10 years of service. (Continued) 94 • 144

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. SUMMARY OF PRINCIPAL PLAN PROVISIONS (Continued) C. Premium Cost Sharing: Cost-sharing varies by employee group, date of retirement and/or date of hire as follows: 1. Non-Union Employees: a. None if retired prior to July 1, 1991 b. 0% for individual coverage and 25% for spouse coverage if retired on or after July 1, 1991 and prior to July 1, 2012 c. 15% for individual and spouse coverage if retired on or after July 1, 2012 2. DOE Employees: a. None if retired prior to September 1, 1991 b. 0% for individual coverage and 25% for spouse coverage if retired on or after September 1, 1991 and prior to June 1, 2013 c. 15% for individual and spouse coverage if hired prior to December 22, 2015, upon direct retirement with an unreduced pension d. 20% for individual coverage if hired on or after December 22, 2015, upon direct retirement with an unreduced pension. The retiree will have the option to purchase dependent coverage under the City’s group rate plan at full cost to the employee/retiree. 3. IBEW Employees: a. 0% for individual coverage and 25% for spouse coverage if hired prior July 1, 1986 b. 0% for individual coverage and 100% for spouse coverage if hired on or after July 1, 1986 and prior to July 1, 2014 c. 20% for individual coverage and 100% for spouse coverage if hired on or after July 1, 2014 4. AFSCME Employees: a. 0% for individual coverage and 25% for spouse coverage if retire prior to July 1, 2015 b. 15% for individual and spouse coverage if hired prior to May 20, 2014 and retire on or after July 1, 2015 c. 20% for individual coverage and 100% for spouse coverage if hired on or after May 20, 2014 D. Benefit Duration: Retiree coverage is provided for lifetime. Spouse coverage is provided for the spouse’s lifetime. E. Medicare Part B Reimbursement: Eligible retirees receive reimbursement of the Medicare Part B premium. The Medicare Part B standard premium was $144.60 for 2020. Spouses are not eligible for the reimbursement. Eligible retirees are: 1. Non-union and AFSCME employees who were hired prior to July 28, 2009. 2. IBEW employees who retired prior to July 1, 2009. 3. DOE employees who retired prior to January 31, 2010. 95 • 145

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Benefits for Police Officers: A. Covered Groups: Full-time FOP employees and their dependents are covered. Only provisions for members hired on after September 1, 1982 are shown. B. Eligibility: Satisfaction of either of the following eligibility requirements: 1. Unreduced Retirement: Attainment of the earlier of the following conditions: a. Later of attainment of age 62 and completion of 10 years of service. b. Completion of 20 years of service. c. Later of completion of 10 years of service and 75 points (age plus service). 2. Reduced Retirement: Not applicable. 3. Vested Termination: None. 4. Active Death: Surviving spouses of members eligible for an unreduced pension upon death. C. Premium Cost Sharing: 1. None if retired prior to July 1, 1991 2. 0% for individual coverage and 25% for spouse coverage if retired on or after July 1, 1991 and prior to July 1, 2012 3. 15% for individual and spouse coverage if retire on or after July 1, 2012. 4. Employees hired on or after October 9, 2015, contribute 20% for individual coverage. The retiree will have the option to purchase dependent coverage under the City’s group rate plan at full cost to the employee/retiree. D. Benefit Duration: Retiree coverage is provided for lifetime. Spouse coverage is provided for the spouse’s lifetime. E. Medicare Part B Reimbursement: Eligible retirees receive reimbursement of the Medicare Part B premium. The Medicare Part B standard premium was $144.60 for 2020; for 2019, the standard premium was $135.50. Spouses are not eligible for the reimbursement. Eligible retirees are members who retired prior to September 30, 2006. Employer Contributions: The City of Dover funds the other post-employment benefits for current retirees on a pay-as-you- go basis along with funding for future benefits at a rate that is approved in the annual budget, but not actuarially determined. Additional funding has also been provided on an ad hoc basis. The employer contributions towards retiree health care premiums this fiscal year are as follows: General Government $ 3,221,602 Water and Wastewater Fund 300,756 Electric Revenue Fund 803,772 Total Contributions $ 4,326,130 Transactions are recorded in the OPEB Trust for the payment of administrative and investment expenses and financed through investment earnings. City appropriations and other employer contributions for health care are recorded in the OPEB Trust. The OPEB Board of Trustees is responsible for the management of the trust investments. 96 • 146

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Contributions The contribution rates for the employer are established annually by the budgeting process of the City. Those rates include an employer contribution based on projected pay-as-you-go financing requirements as a percent of premiums, with an additional amount to prefund benefits, which is not actuarially determined. For the year ended June 30, 2020, the City’s average contribution rate was 21.4% of covered payroll of $20,262,159. The components of the Net OPEB liability of the City at June 30, 2020, are as follows: Changes in Net OPEB Liability Increase Total (Decrease) OPEB Plan Fiduciary Net OPEB Liability Net Position Liability Changes in Net OPEB Liability (a) (b) (a) - (b) Balances as of June 30, 2019 $ 65,019,816 $ 39,240,131 $ 25,779,685 Changes for the year: Service cost 1,120,494 - 1,120,494 Interest 4,210,980 - 4,210,980 Differences between expected and actual exp (4,758,240) - (4,758,240) Changes of assumptions 483,313 - 483,313 Benefit payments (2,755,367) (2,755,367) - Employer contributions - 4,326,130 (4,326,130) Net investment income - 1,871,140 (1,871,140) Trust administrative expenses - (9,500) 9,500 Balances as of June 30, 2020 $ 63,320,996 $ 42,672,534 $ 20,648,462 Plan Fiduciary Net Position as % of total OPEB Liability 67.4% Rate of return. For the year ended June 30, 2020, the annual money-weighted rate of return on investments, net of investment expense, was 4.77%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts invested. Actuarial Methods and Significant Assumptions The total OPEB liability was determined by an actuarial valuation as of July 1, 2019, with liabilities projected to the June 30, 2020 measurement date on a “no loss / no gain” basis, using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified: Actuarial cost method Entry Age Normal Level % of Salary Amortization method Level Dollars Amortization period 28 years Asset valuation method Fair Market Value Actuarial assumptions: Investment rate of return 6.5% Discount rate 6.5% 97 • 147

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Inflation 2.5% per year included in payroll growth Healthcare cost trend rates Pre-65 Medical / Rx Initial rate of 7.5% decreasing by 0.5% annually to an ultimate rate of 4.5% Post-65 Medical / Rx Initial rate of 7.5% decreasing by 0.5% annually to an ultimate rate of 4.5% Mortality Total Dataset Headcount Weighted Mortality Table fully generational using scale MP-2019 a. Non-Police: SOA Pub-2010 General b. Police: SOA Pub-2010 Public Safety c. Surviving Spouses: SOA Pub-2010 Contingent Survivors Changes in Actuarial Assumptions or Methods The long term expected rate of return on OPEB plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as of June 30, 2020 are summarized in the following table: OPEB Trust Long-Term Expected Rate of Return Long-Term Target Expected Real Asset Class Allocation* Rate of Return Cash & Short-Term Bond 9.00% 0.50% Fixed Income 22.00% 3.55% Equity 64.00% 8.26% Real Estate 5.00% 7.96% Alternatives 0.00% 0.00% Long-Term Expected Rate of Return 6.51% *The best-estimate range for the long-term expected rate of return is determined by adding expected inflation to expected long-term real returns and reflecting expected volatility and correlation. The capital market assumptions are per Milliman's investment consulting practice. 98 • 148

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Discount Rate The discount rate used to measure the total OPEB liability was 6.5%. The projection of cash flows used to determine the discount rate assumed that City contributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The following presents the net OPEB liability as of June 30, 2020, calculated using the discount rate of 6.50%, as well as what the City’s net OPEB liability would be if it were calculated using a discount rate that is 1 percentage point lower (5.50%) or 1 percentage point higher (7.50%) than the current rate. Other Post-Employment Benefits 1% Current 1% Decrease Discount Rate Increase 5.50% 6.50% 7.50% Net OPEB liability $ 29,294,698 $ 20,648,462 $ 13,588,924 Sensitivity of the Net OPEB Liability to Changes in the Healthcare Cost Trend Rate The following presents the net OPEB liability as of June 30, 2020, calculated using the health care trend rates assumed and what it would be using 1% higher and 1% lower health care trend rates: Health Care Trend Rates Assumptions 1% Current 1% Decrease Trend Rate Increase Net OPEB liability $ 12,710,654 $ 20,648,462 $ 30,450,431 99 • 149

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB For the year ended June 30, 2020, the City recognized OPEB expense (credit) of ($2,067,327) as calculated in the following table: OPEB Expense Service cost $ 1,120,494 Interest 4,210,980 OPEB plan administrative expenses 9,500 Projected earnings on OPEB plan investments (2,600,551) Current period recognition of deferred outflows/(inflows) of resources Differences between expected and actual experience (3,880,358) Differences between projected and actual earnings on plan investments (178,864) Changes of assumptions (748,528) Total OPEB Expense $ (2,067,327) At June 30, 2020, the City reported deferred outflows (inflows) of resources related to OPEB from the following sources: Deferred Outflows Deferred Inflows Deferred Outflows (Inflows) of Resources Differences between expected and actual experience $ - $ (10,036,613) Changes in assumptions 1,173,728 (1,107,548) Net difference between projected and actual earnings on 250,850 - OPEB plan investments Total Deferred Outflows (Inflows) of Resources $ 1,424,578 $ (11,144,161) Amounts reported as deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Fiscal Year Ending June 30: 2021 $ (4,807,746) 2022 (2,752,595) 2023 (1,450,138) 2024 (709,104) 100 • 150

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Separate Other Postemployment Benefit fund financial statements have not been issued; accordingly, they are presented as required by GASB Statement No. 34, as follows: The City of Dover, Delaware Schedule of Other Post-Employment Benefits Trust Fund Net Position June 30, 2020 Other Post-Employment Benefit Trust Fund ASSETS: Cash and cash equivalents $ 1,347,503 Receivables - Investments at Fair Value - Mutual Funds 41,416,054 Total Assets 42,763,557 LIABILITIES: Accounts Payable 91,023 Total Liabilities 91,023 NET POSITION: Net Position Restricted for Retiree Health Benefits $ 42,672,534 Schedule of Changes in Other Post-Employment Benefits Trust Fund Net Position June 30, 2020 Other Post-Employment Benefit Trust Fund ADDITIONS: Net Investment Income $ 1,871,140 City's Contribution-Payroll Based 1,483,530 City's Contribution-Lump Sum 2,842,600 Total Additions 6,197,270 DEDUCTIONS: Benefit Payments 2,755,367 General Administration 9,500 Total Deductions 2,764,867 Change in Net Position 3,432,403 Net Position - Beginning 39,240,131 Net Position - Ending $ 42,672,534 101 • 151

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 16. DEFERRED COMPENS ATION PLAN Effective November 14, 1983, the City added a self-directed 457 Deferred Compensation Plan to its employee benefit options. The plan is administered by the International City Management Retirement Corporation (RC). The assets are held in the name of each participant with the ICMA (International City/County Management Associations) Retirement Trust. Employees are eligible to make contributions to the plan not to exceed the ceiling set by federal regulations. The City later added an alternative investment option for the Deferred Compensation Plan with Nationwide Retirement Solutions. In May 1994, the City offered the 457 Deferred Compensation Plan to employees as their pension plan in lieu of participation in the General Employee Pension Plan. At that time 41 employees opted out of the Defined Benefit Pension Plan and enrolled in the Deferred Compensation Plan. The ICMA 457 Deferred Compensation Plan has assets of $9,728,824 (market value) as of June 30, 2020, with 151 active employees contributing $543,558. The Nationwide plan has assets of $3,616,368 (market value) as of June 30, 2020 with 12 active employees contributing $97,126. Quarterly statements are mailed to each participant by the plan administrators. All administration fees are borne by the participants. All contributions are 100% vested upon election of the plan. Employees are eligible to withdraw or rollover to another plan the employer and employee benefits upon separation of service. Withdrawals prior to age 59½ could be subject to penalty. Employees who participate in the defined benefit plan are also eligible for the 457 Deferred Compensation Plan. No matching employer contribution is made to the 457 Deferred Compensation Plan. As of June 30, 2020, there are 385 employees eligible to enroll in the 457 Deferred Compensation Plan. All amounts of compensation deferred under the plans, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the individuals who participate in the deferred compensation plan, and are not subject to the claims of the City’s general creditors. 17. RETIREMENT PLANS The City participates and/or manages four retirement plans on behalf of its employees. Three of the pension plans are defined benefit plans and one is a defined contribution plan. Two of the defined benefit plans are closed to new hires. All full-time employees are required to enroll in a pension plan. During fiscal year 2020, the total wages were $24.3 million. The number of employees eligible for pension benefits as of June 30, 2020 is 385. Following is the total of the City of Dover’s pension liabilities, pension assets, deferred outflows of resources and deferred inflows of resources related to pensions, and the pension expense and expenditures for the fiscal year ended June 30, 2020: 102 • 152

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 2020 Police General DPERS Total Pension Assets $ 14,224,901 $ 44,907,544 $ 33,098,316 $ 92,230,761 Pension Liabilities 18,644,121 66,031,408 35,494,016 120,169,545 Net Pension Liabilities 4,419,220 21,123,864 2,395,698 27,929,801 Deferred Outflows of Resources 268,261 1,924,894 3,367,907 5,561,062 Deferred Inflows of Resources - (101,935) (777,753) (879,688) Pension Expense 1,134,899 3,503,678 1,602,072 6,240,649 A. Defined Contribution Plan Effective July 1, 2000, the City implemented an IRC 401a Money Purchase Plan “401a Plan,” a self-directed defined contribution plan, as an alternative for pension benefits. The contribution and funding requirements of the plan are both established and amended by the City. The plan is administered by the International City Management Retirement Corporation (RC). The assets are held in the name of each participant with the ICMA (International City/County Management Associations) Retirement Trust. Quarterly statements are mailed to each participant by RC. All administration fees are borne by the participants. All eligible employees not represented in a bargaining unit may contribute to the 401a Plan from the minimum of 3% to the maximum of 6% of pensionable wages. The City provides a dollar-for- dollar match of the contribution to the 401a Plan, not to exceed 6%. The City provides an additional dollar-for-dollar match into the 401a Plan if the employee contributes to their 457 Plan, up to a maximum of 3% for a total matching contribution not to exceed 9%. (see note 17 – Deferred Compensation Plan). The Dover Organization of Employees (DOE) union contract renewed effective July 1, 2018 through June 30, 2021. The contract changed the mandatory minimum employee contribution (MMEC) as well as the City’s minimum matching contribution as follows: Effective Date Minimum Employee Contribution City’s Match (Up to) March 27, 2016 4% 7% July 1, 2016 5% 8% July 1, 2017 6% 9% All other employees, except for FOP members, must contribute 3% of pensionable wages into the 401a Plan. The City matches the 3% contribution into the 401a Plan. The City provides an additional dollar-for-dollar match into the 401a Plan if the employee contributes to their 457 Plan, up to a maximum of 3% for a total matching contribution not to exceed 6%. (see note 16 – Deferred Compensation Plan). The 401a Plan and 457 Plan contributions are calculated on base wages plus on-call pay, pay adjustments, and scheduled overtime. All full-time regular employees are eligible, excluding law enforcement personnel. Personnel that have elected the defined contribution plan are not eligible for the defined benefit plan. All contributions are 100% vested upon election of the plan. To be eligible for benefit payments, the participant must meet the same eligibility requirements as the participants in the defined benefit plan. Employees are eligible to withdraw or rollover to another plan the employer and employee benefits upon separation of service. Withdrawals prior to age 59 ½ could be subject to penalty. 103 • 153

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. As of June 30, 2020, there were 180 full-time employees enrolled in the 401a plan. The City contributed a total of $485,175 on wages of approximately $7.6 million. Employees contributed $344,343 to the 401a Money Purchase Plan. The market value of the 401a plan assets totaled $8,210,594 as of June 30, 2020. B. Defined Benefit Plans The City participates in three defined benefit pension plans: City of Dover Police Pension Plan (closed), City of Dover General Employee Pension Plan (closed), and State of Delaware County and Municipal Police Pension Plan. The City of Dover Police Pension Plan, a single employer defined benefit plan, covers all uniformed police officers hired prior to September 1, 1982. The City of Dover General Employee Pension Plan, a single employer defined benefit plan, covers all eligible full-time permanent employees, other than police officers hired prior to September 29, 2009. The State of Delaware County and Municipal Police Pension Plan, a multi- employer cost sharing defined benefit plan, covers all uniformed police officers hired on or after September 1, 1982. The City makes employer contributions to all three plans. The City holds, on behalf of the Pension Boards of Trustees, the assets of the two single-employer defined benefit plans and, accordingly, is required to prepare pension trust fund financial statements using the accrual basis of accounting. Investments are reported at fair value based on quoted market prices. Receivables and payables represent year end accruals of short-term receipts or charges. The administration of plan assets for both the Police Pension Plan and the General Employee Pension Plan is conducted by the Pension Boards as described in the subsequent disclosures. Separate pension fund financial statements for the City Police Pension and General Employees’ Pension Plan have not been issued; accordingly, they are presented as required by GASB Statement No. 34, as follows: The City of Dover, Delaware Combining Schedule of Pension Trust Fund Net Position June 30, 2020 Police General Pension Pension Totals ASSETS: Cash and cash equivalents $ 1,347,732 $ 2,779,491 $ 4,127,223 Investments at fair value - Mutual Funds 12,614,269 42,025,958 54,640,227 Receivables 262,900 102,095 364,995 Total Assets 14,224,901 44,907,544 59,132,445 LIABILITIES: Accounts Payable - - - Net position held in trust for pension benefits $ 14,224,901 $ 44,907,544 $ 59,132,445 104 • 154

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. The City of Dover, Delaware Combining Schedule of Changes in Pension Trust Fund Net Position For the Year Ended June 30, 2020 Police General Pension Pension Totals Additions Net investment income $ 438,982 $ 1,550,450 $ 1,989,432 City's contribution - payroll based - 2,606,067 2,606,067 City's contribution - lump sum 519,600 - 519,600 Employee contribution - 183,146 183,146 State contributions 513,549 - 513,549 Total Additions to Net Position 1,472,131 4,339,663 5,811,794 Deductions Benefit payments 1,536,755 4,120,307 5,657,062 General administration 5,007 19,460 24,467 Total Deductions From Net Position 1,541,762 4,139,767 5,681,529 Change in net position (69,631) 199,896 130,265 Net Position - Beginning 14,294,532 44,707,648 59,002,180 Net Position - Ending $ 14,224,901 $ 44,907,544 $ 59,132,445 Plan member contributions are recognized in the period in which the contributions are due. Employer contributions to each plan are recognized when due, pursuant to formal commitments, to provide contributions. Benefits or refunds are recognized when due and payable in accordance with the terms of each plan. Investment management and consultant fees are paid from the Pension Trust Funds. All actuarial costs are paid from other City funds. i. Cit y of Dover Police Pension Plan Plan Description This contributory pension plan began on January 1, 1970 under the authority of the City Code, Chapter 62, Article III, Pension Plan, Section 62-71 through 62-84. The contribution and funding requirements of the plan are established by the City and may be amended by the City Council. It is a closed plan. The last active employee retired June 29, 2006. An officer’s pension right is vested upon the completion of 15 years of continuous service. As of June 30, 2020, there are 45 retirees and beneficiaries receiving benefits. Fully vested employees who have completed 20 to 25 years of continuous service are entitled to annual benefits equal to 2.5% of their average earnings for each year of continuous service. The maximum benefit is 62.5% of average earnings. If a participant terminates after completing 15 years of service, the participant will be eligible for a deferred benefit commencing at age 60 with a benefit accrued at the date of termination. In place of this vesting, participants may elect to receive their accumulated contributions. Disability benefits are paid to a participant who is totally or partially disabled in the performance of his or her duties. The total duty-connected disability benefit is payable monthly and equal to 105 • 155

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. 75% of the monthly rate of earning at the time of disability. The partial duty-connected disability benefit is the accrued benefit at the date of disability if not less than 50% of average earnings. Disability benefits cease if the participant recovers or dies. If the disabled participant reaches his normal retirement date, the benefit is reduced by one-third. Survivor’s benefits are payable monthly in an amount equal to 75% of the participant’s rate of earnings, for a duty related death. Survivor’s benefits are payable monthly in an amount not to exceed 25% of the participant’s rate of earnings, for a non-duty related death, if the participant has completed 10 years of service. If a retired participant dies, his or her spouse receives 50% of the benefit. All benefits under the plan, including survivor’s benefits, are increased 2% per annum. There have been no changes in benefits during the valuation period by City Council. Plan Administration Management of the plan investments are fully vested with the City of Dover Police Pension Board as established in the City Code, which consists of seven members – three elected by plan members, two Council members appointed by the Council President, the Chief of Police, and the City Manager. The City Controller/Treasurer serves as an ex-officio member. Milliman of Albany, New York provides asset management advisory and consulting services to the Board. Funding Policy The City intends to continue to fund the Actuarially Determined Contribution (ADC) as provided for in the actuarial valuation. The funding may be impacted by differences in actual experience and the actuarial assumptions. The employer contributions are considered by the actuaries in their determination of the ADC. In addition, the City has adopted in its financial policies to have any surplus in the budget balances of the prior year be transferred to the retirement benefit plans to further reduce the net pension liability. The State contributes to the pension fund on behalf of the City based on 1) an allocation to the City based on a 0.25% surcharge on insurance policies issued in the state and the number of officers employed and 2) 75% matching grant for the annual cost of living increase (COLA) granted to police retirees on January 1 each year. For the fiscal year ending June 30, 2020, the State contributed $513,549. The ADC conforms to the entry age method as defined in GASB Statement No. 67/68. The City has interim valuations completed each year between the required biennial valuations to monitor the funding progress. The City’s actuary is Nyhart of Indianapolis, Indiana. The ADC is being amortized using a level dollar method. The amortization period is 5 years for the 2020 fiscal year and will decline by 1 each year until 1 year. Total contributions to the plan for the fiscal year ending June 30, 2020 were $1.0 million, which is 107.2% of the ADC. The ADC is based on a closed 10-year level dollar amortization of the Unfunded Actuarial Accrued Liability (UAAL). The Schedule of Changes in the Net Pension Liability, and a Schedule of Employer Contributions are presented as Required Supplementary Information (RSI) following the notes to the financial statements. 106 • 156

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Net Pension Liability The total pension liability was determined by an actuarial valuation as of July 1, 2020 with liabilities projected to the June 30, 2020 measurement date. As of June 30, 2020, the plan was 76.30% funded. The total pension liability for benefits was $18.6 million, and the fiduciary net position was $14.2 million, which resulted in a net pension liability (NPL) of $4.4 million for the primary government. There are no active officers; therefore, there is no covered payroll or ratio of the net pension liability to cover payroll. Key methods and assumptions used in calculating the total pension liability in the latest actuarial valuation, are presented below: Rate of return. For the year ended June 30, 2020, the annual money-weighted rate of return on investments, net of investment expense, was 3.46%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts invested. Actuarial Methods and Significant Assumptions Valuation date July 1, 2020 Actuarial cost method Entry Age Method Amortization method Level Dollars Amortization period Closed Asset valuation method Fair Market Value Actuarial assumptions: Investment rate of return 6.5% Discount rate 6.5% Projected salary increases none, no remaining active participants Includes inflation at 2.3% Automatic Cost of living (retirees) 2.0% Mortality Rates Healthy Participants: PubS-2010 Public Safety Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Survivors: Pub-2010 Continuing Survivors Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Disabled PubS-2010 Public Safety Disabled Retiree Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Changes in Actuarial Assumptions or Methods The long term expected rate of return on pension plan investments was determined using a building block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These expected future real rates of return are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset 107 • 157

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. class included in the pension plan’s target asset allocation as of June 30, 2020 are summarized in the following table: Police Pension Fund Long-Term Expected Rate of Return Long-Term Target Expected Real Asset Class Allocation* Rate of Return Cash and Equivalents 7.00% 1.51% Fixed Income 27.00% 2.21% Real Estate 5.00% 7.43% Stocks 61.00% 8.18% Long-Term Expected Rate of Return 100.00% 6.50% *The best-estimate range for the long-term expected rate of return is determined by adding expected inflation to expected long-term real returns and reflecting expected volatility and correlation. The capital market assumptions are per Milliman's investment consulting practice. Police Pension Fund Changes in Net Pension Liability Increase Total (Decrease) Pension Plan Fiduciary Net Pension Liability Net Position Liability (a) (b) (a) - (b) Balances as of June 30, 2019 $ 18,207,829 $ 14,294,532 $ 3,913,297 Changes for the year: Service cost - - - Interest on total pension liability 1,133,564 - 1,133,564 Differences between expected and actual experience 206,546 - 206,546 Changes of assumptions 632,937 - 632,937 Benefit payments (1,536,755) (1,536,755) - Employer contributions - 1,033,149 (1,033,149) Net investment income - 438,982 (438,982) Administrative expenses - (5,007) 5,007 Balances as of June 30, 2020 $ 18,644,121 $ 14,224,901 $ 4,419,220 Discount Rate The discount rate used to measure the total pension liability was 6.5%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those 108 • 158

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity Analysis of Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability, calculated using the discount rate of 6.50%, as well as what the City’s net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (5.50%) or 1 percentage point higher (7.50%) than the current rate. Police Pension Fund 1% Current 1% Decrease Discount Rate Increase 5.50% 6.50% 7.50% Net pension liability $ 6,221,483 $ 4,419,220 $ 2,883,350 Pension Expense, Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2020, the City recognized pension expense of $1,134,899 calculated in the following chart: Police Pension Expense July 1, 2019 to June 30, 2020 Interest on total pension liability $ 1,133,564 Projected earnings on pension plan investments (912,615) Administrative expenses 5,007 Current period recognition of deferred outflows/(inflows) of resources Changes of assumptions 632,937 Differences between projected and actual earnings on plan investments 69,460 Differences between expected and actual experience in measurement of the total pension liability 206,546 Total Pension Expense $ 1,134,899 As of June 30, 2020, the City reported deferred outflows/(inflows) of resources related to pension from the following sources: Police Pension Plan Deferred Outflows of Resources Net difference between projected and actual earnings $ 268,261 Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: 109 • 159

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Police Pension Plan Fiscal Year Ending June 30: 2021 $ (32,825) 2022 97,601 2023 108,760 2024 94,725 ii . Cit y of Dover General Employee Pension Plan Plan Description The City of Dover General Employee Pension Plan started on July 1, 1967, under the authority of the City Council, Municipal Code, Chapter 2, Article IV, Division 7, General Employee Pension Plan, Sections 2-321 through 2-370, and was made contributory on July 1, 1983. Employees contribute 3.5% of gross salary, exclusive of unscheduled overtime. An employee’s pension right is vested upon completion of 10 years of continuous service. As of the valuation date, July 1, 2020, 91 employees and 214 retirees participate in the plan. The General Employee Pension Plan is comprised of the following: Retired and beneficiaries currently receiving benefits 215 Active employees Fully Vested 81 Deferred vested 18 The percentage of covered payroll which employees contribute is stated in the City Code and is considered by the actuaries in their determination of the actuarial determined contribution for service cost. For the year ended June 30, 2020, gross payroll earnings of $5.1 million were reported to and covered by this plan. An employee hired before May 1, 1994 is eligible for normal retirement benefits under this plan, when they attain the age of 65 with 10 years of continuous service. This same employee is eligible for early retirement when he/she attains the age of 50 with 20 years of continuous service or has completed 25 years of service. Employees hired on or after May 1, 1994 who attained age 55 and whose attained age plus years of continuous service is equal to or greater than 80 are eligible for early-unreduced retirement benefits under this plan. The monthly benefits are 1/50 of the average actual monthly earnings multiplied by years and months of credited service upon retirement (highest 36 consecutive months in his/her final 10 years of continuous service). The monthly benefit shall not be less than $200 per month. Benefits are paid for the lifetime of the participant. Upon the death of the participant, 50% of the payments to which the participant was or would have been entitled shall be made to their eligible survivor. An employee may also take an early-reduced retirement on any date following the attainment of age 55 and the completion of 10 years of continuous service. However, the early retirement benefit is calculated in the same manner as the normal retirement benefit, at a reduced rate of one-half percent for each month computed from the date of early retirement to age 65 years. If an employee terminated before becoming vested in the plan, they are eligible to withdraw this total contribution with interest compounded annually. 110 • 160

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Survivor's benefits are payable to eligible survivors of a participant who dies after completing 10 years of continuous service. The amount of the death benefit is equal to 50% of the retirement benefit the participant would have received had he retired the day before he died. A participant is vested in the pension plan after completing 10 years of continuous service, with survivor benefits commencing when the employee would have attained the age of 65. The benefit is calculated using the normal retirement benefit formula and service at date of termination. Effective September 29, 2009 the City Council voted to close the General Employees’ Pension plan to new hires. There have been no changes in benefits during the valuation period by City Council. Plan Administration Management of the plan investments are fully vested with the City of Dover Employees’ Pension Board as established in the City Code, which consists of three elected by plan members, two Council members appointed by the Council President, the City Controller/Treasurer, and the City Manager. Milliman of Albany, New York provides asset management advisory and consulting services to the Board. Funding Policy The City intends to fund the actuarial determined contributions (ADC) as provided for in the actuarial valuation. The City uses the percentage of payroll determined by the actuary for its contributions. The funding may be impacted by differences in actual experience and the actuarial assumptions. The employer contributions are considered by the actuaries in their determination of the actuarial determined contribution. In addition, the City has adopted in its financial policies to have any surplus in the personnel related budget balances of the prior year be transferred to the retirement benefit plans to further reduce the net pension obligation. The City makes payroll-based contributions for active members in the plan. The Actuarially Determined Contribution is based on a closed 15-year level dollar amortization of the Unfunded Actuarial Accrued Liability (UAAL). The Schedule of Changes in the Net Pension Liability, and a Schedule of Employer Contributions are presented as Required Supplementary Information (RSI) following the notes to the financial statements. Net Pension Liability The total pension liability was determined by an actuarial valuation as of July 1, 2020 with liabilities projected to the June 30, 2020 measurement date. As of June 30, 2020, the plan was 68.01% funded. The total pension liability for benefits was $66.0 million, and the fiduciary net position was $44.9 million, which resulted in a net pension liability (NPL) of $21.1 million for the primary government. The covered payroll (annual payroll of active employees covered by the plan) was $5.1 million and the ratio of the NPL to the covered payroll was 416.92%. Rate of return. For the year ended June 30, 2020, the annual money-weighted rate of return on investments, net of investment expense, was 3.64%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. 111 • 161

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Key methods and assumptions used in calculating the total pension liability are presented in the following chart: Actuarial Methods and Significant Assumptions Valuation date July 1, 2020 Actuarial cost method Entry Age Method Amortization method Level Dollar Amortization period Closed; 15-year of the Unfunded AAL Asset valuation method Fair Market Value Actuarial Assumptions: Investment rate of return 6.5% Discount rate 6.5% Projected salary increases 3.0% Includes inflation at 2.3% Mortality Rates Healthy Participants: PubG-2010 General Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Survivors: Pub-2010 Continuing Survivors Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Disabled PubNS-2010 Non-Public Safety Disabled Retiree Mortality Table with fully generational improvements from 2006 based on Society of Actuaries Scale MP- 2019 Changes in Actuarial Assumptions or Methods The long-term expected rate of return on pension plan investments was determined using a building block method in which expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These expected future real rates of return are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan’s target asset allocation as of June 30, 2020 are summarized in the following table: 112 • 162

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. General Employee Pension Plan Long-Term Expected Rate of Return Long-Term Target Expected Real Asset Class Allocation* Rate of Return Cash 6.00% 1.51% Fixed Income 28.00% 2.16% Stocks 61.00% 8.18% Real Estate 5.00% 7.43% Long-Term Expected Rate of Return 100.00% 6.50% *The best-estimate range for the long-term expected rate of return is determined by adding expected inflation to expected long-term real returns and reflecting expected volatility and correlation. The capital market assumptions are per Milliman's investment consulting practice. General Employee Pension Fund Changes in Net Pension Liability Increase Total (Decrease) Pension Plan Fiduciary Net Pension Liability Net Position Liability (a) (b) (a) - (b) Balances as of June 30, 2019 $ 63,058,424 $ 44,707,648 $ 18,350,776 Changes for the year: Service cost 395,443 - 395,443 Interest on total pension liability 3,990,591 - 3,990,591 Changes of benefit terms - - - Differences between expected and actual experience 1,447,222 - 1,447,222 Effect of assumptions changes or inputs 1,260,035 - 1,260,035 Benefit payments (4,120,307) (4,120,307) - Employer contributions - 2,606,067 (2,606,067) Member contributions - 183,146 (183,146) Net investment income - 1,550,450 (1,550,450) Administrative expenses - (19,460) 19,460 Balances as of June 30, 2020 $ 66,031,408 $ 44,907,544 $ 21,123,864 Discount Rate The discount rate used to measure the total pension liability was 6.5%. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 113 • 163

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Sensitivity Analysis of Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability, calculated using the discount rate of 6.50%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (5.50%) or 1 percentage point higher (7.50%) than the current rate. General Employee Pension Fund 1% Current 1% Decrease Discount Rate Increase 5.50% 6.50% 7.50% Net pension liability $ 29,038,423 $ 21,123,864 $ 14,542,388 Pension Expense, Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2020, the City recognized pension expense of $3,503,678 as calculated in the following chart: General Employee Pension Expense July 1, 2019 to June 30, 2020 Service cost $ 395,443 Interest on total pension liability 3,990,591 Changes of benefit terms - Administrative expenses 19,460 Member contributions (183,146) Projected earnings on pension plan investments (2,862,104) Current period recognition of deferred outflows/(inflows) of resources Differences between expected and actual experience 1,235,338 Differences between projected and actual earnings on plan investments 104,054 Changes of assumptions 804,042 Total Pension Expense $ 3,503,678 As of June 30, 2020, the City reported deferred outflows/(inflows) of resources related to pension from the following sources: General Employee Pension Plan Deferred Outflows of Resources Changes in assumptions $ 630,017 Differences between expected and actual experience 723,611 Net difference between projected and actual earnings 571,266 Total Deferred Outflows of Resources $ 1,924,894 Deferred Inflows of Resources Changes in assumptions $ (101,935) 114 • 164

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: General Employee Pension Plan Fiscal Year Ending June 30: 2021 $ 1,078,837 2022 228,700 2023 262,058 2024 253,364 iii . Delaware Public Employee Retirem ent System - Count y and Municipal Police and Firef ighters’ Pension Plan Plan Description and Contribution Information The City participates in the “County and Municipal Police and Firefighters’ Pension Plan” (the Plan) a cost sharing multiple-employer defined-benefit plan established in the Delaware code. The City’s uniformed police officers whose employment with the City started on or after September 1, 1982 under the authority of the City Code, Chapter 62, Article III, Pension Plan, Section 62-71 can participate in this plan. The General Assembly is responsible for setting benefits, contributions and amending plan provisions; administrative rules and regulations are adopted and maintained by the Board of Pension Trustees (the Board). The management of the Plan is the responsibility of the Board. The Board is comprised of five members appointed by the Governor and confirmed by the State Senate, plus two ex-officio members. The daily operation is the responsibility of the Office of Pensions. Although most of the assets of the plan are commingled with other Plans for investment purposes, the Plan’s assets may be used only for the payment of benefits to the members of the Plan in accordance with the terms of the Plan. The Plan’s service benefits calculation is 2.5% of final average monthly compensation multiplied by years of credited service up to 20 years, plus 3.5% of final average monthly compensation multiplied by years of service in excess of 20 years. For this plan, final average monthly compensation is the monthly average of the highest three consecutive years of compensation. Vesting is at five years of credited service and retirement age is 62 with five years of service; age plus credited service (but not less than 10 years) equals 75; or 20 years of credited service. As of June 30, 2020, city membership in this plan is comprised of the following: Retired and beneficiaries currently receiving benefits 72 Active employees: Fully Vested 5 years 80 Non-Vested 30 The following are brief descriptions of the Plan. For a more complete description, please refer to the Delaware Public Employees’ Retirement System CAFR on the web at https://open.omb.delaware.gov/FinancialReports/financials/fy-20-CAFR-FINAL.pdf. 115 • 165

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. Retirement Age 62 with 5 years of service; age plus credited service (but not less than 10 years) equals 75; or 20 years of credited service. Disability Benefits Duty – Total Disability – 75% of final average compensation plus 10% for each dependent not to exceed 25% for all dependents. Duty – Partial Disability – Calculated the same as Service Benefits, subject to minimum 50% of final average compensation. Non-Duty – Same as Service Benefits, total disability subject to a minimum 50% of final average monthly compensation plus 5% of each dependent not to exceed 20% for all dependents. Partial disability is subject to a minimum of 30% of final average monthly compensation. Survivor Benefits If employee is receiving a pension, then eligible survivor receives 50% of pension; if employee is active, eligible survivor receives 50% of pension the employee would have received at age 62. If the member is killed in the line of duty, the eligible survivor receives 75% of the member’s compensation. Contributions: Employer – Determined by Board of Pension Trustees. Employer contributions were 16.84%,16.68% and 13.6% of earnings for the Fiscal Year 2020, 2019 and 2018, respectively. The City’s contributions to the plan for years ended June 30, 2020, 2019 and 2018 were $1,276,048, $1,258,817 and $944,356, respectively, and were equal to the required contributions for each year. Total eligible full-time wages covered by the State plan were $7.8 million this fiscal year. Member – 7% of compensation. Basis of Presentation The DPERS financial statements are prepared on the accrual basis of accounting, whereby expenses are recorded when the liability is incurred, revenues are recorded in the accounting period in which they are earned and become measurable, and investment purchases and sales are recorded as of the related trade date. Plan member contributions are recognized in the period in which contributions are due. Employer contributions are recognized when due and the employer has a legal requirement to provide contributions. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the DPERS Plan and additions to/deductions from DPERS’s fiduciary net position have been determined on the same basis as they are reported by DPERS. Employer Allocation Percentage Methodology The amounts assigned to each employer in the Schedule of Pension Amounts by Employer is each employer’s proportional share of the net pension liability, deferred outflows of resources, deferred inflows of resources, and pension expense (the Collective Pension Amounts) determined in accordance with Governmental Accounting Standards Board No. 68, Accounting and Financial Reporting for Pensions (GASB 68). Management has elected to allocate the employer’s proportionate shares of the collective pension amounts based on the percentage of actual 116 • 166

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. employer contributions as documented in the Schedule of Employer Allocations. The City’s proportionate share percentage is 8.3407% for the current fiscal year, 8.4242% for the prior year and the change is a decrease of 0.0835%. Pension Liabilities, Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources related to Pensions At June 30, 2020, the City reported a net pension liability of $2,395,686 for its proportionate share of the collective net pension liability. The net pension liability was measured as of June 30, 2018, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of June 30, 2018, with update procedures used to roll forward the pension liability to June 30, 2019. The City’s proportion of the net pension liability was based on the percentage of actual employer contributions. The components of the proportionate share of the net pension liability of the Plan as of June 30, 2020 were as follows (dollar values expressed in thousands): County and Municipal Police & Firefighter's Pension Plan (dollar values expressed in thousands) (3) The Employers' (1) (2) proportionate Total Plan fiduciary share of the proportionate proportionate net pension share of the share of the liability (asset) Year pension liability net position (1)-(2) 2019 $ 35,494 $ 33,098 $ 2,396 2018 32,897 30,957 1,940 2017 29,103 28,230 873 117 • 167

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. The City recognized pension expense of $1,602,072 for the year ended June 30, 2020, associated with membership within the Delaware State Police Pension Plan. As of June 30, 2020, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: County and Municipal Police & Firefighter's Pension Plan Deferred Outflows of Resources Differences between expected and actual experience $ 1,464,732 Change in proportion 10,453 Changes of assumptions 552,150 Net differences between projected and actual earnings 23,046 City contributions subsequent to the measurement date 1,317,526 Total Deferred Outflows of Resources $ 3,367,907 Deferred Inflows of Resources Differences between expected and actual experience $ (468,503) Changes in assumptions (232,376) Change in proportion (76,874) Total Deferred Inflows of Resources $ (777,753) The City’s contributions of $1,317,526 are subsequent to the measurement date and therefore are reported as deferred outflows of resources and will be recognized as a reduction of the net pension liability in the year ending June 30, 2021. Amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: County and Municipal Police & Firefighter's Pension Plan Fiscal Year Ending June 30: 2021 $ 127,263 2022 127,263 2023 127,263 2024 127,263 2025 127,263 Thereafter 636,313 118 • 168

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. The components of collective pension expense for the year ending June 30, 2019 are as follows: County and Municipal Police & Firefighter's Pension Expense June 30, 2019 Service cost $ 1,462,625 Member contributions (536,891) Administrative expenses 12,177 Changes in benefit terms 10,259 Interest on the total pension liability 2,348,491 Projected earnings on plan investments (2,178,100) Recognition of deferred outflow and inflows of resources: Changes in assumptions in the measurement of total pension liability 40,119 Differences between expected and actual experience 121,274 Differences between projected and actual earnings on plan investments 322,118 Total Pension Expense $ 1,602,072 The proportionate share of the total pension liability for the June 30, 2019 measurement date was determined by an actuarial valuation as of June 30, 2018, with update procedures used to roll forward the total pension liability to June 30, 2019. These actuarial valuations used the following actuarial assumptions: Actuarial Assumptions Investment rate of return/Discount rate1 7.0% Projected salary increases1 2.5% + Merit Cost-of-living adjustments 0.0% Inflation is included at 2.5%; the total pension liabilities are measured based on assumptions pertaining to the interest rates, inflation rates, and employee demographic behavior in future years. It is likely that future experience will not exactly conform to these assumptions. To the extent that actual experience deviates from these assumptions, the emerging liabilities may be higher or lower than anticipated. The more the experience deviates, the larger the impact on future financial statements. Mortality assumptions are based on the RP – 2014 tables with gender adjustments for healthy annuitants and disabled retirees and an adjusted version on MP-2015 mortality improvement scale on a fully generational basis. Projected benefit payments do not include the effects of projected ad hoc cost-of-living adjustments (ad hoc COLAs) as they are not substantively automatic. The primary considerations relevant to making this determination include the historical pattern of granting the changes and the consistency in the amounts of the changes. The long-term expected rate of return on pension plan investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by an asset allocation percentage, which is based on the nature and mix of current and expected plan investments, and by adding expected inflation. Best 119 • 169

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part C – Notes to Financial Statements D Item 6. estimates of geometric real rates of return for each major asset class included in the Plan’s current and expected asset allocation are summarized in the following table: County and Municipal Police & Firefighter's Pension Plan Long-Term Expected Rate of Return Long-Term Expected Real Asset Rate of Return Allocation Asset class: Domestic equity 5.7% 29.5% International equity 5.7 13.5 Fixed income 2.0 27.1 Alternative investments 7.8 22.4 Cash and equivalents - 7.5 Discount Rate The discount rate for all plans used to measure the total pension liability was 7.0%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rates and that contributions from employers will be made at rates determined by the Board of Pension Trustees, actuarially determined. Based on those assumptions, the pension plans’ fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity Analysis of Net Pension Liability to Changes in the Discount Rate The following presents the City’s proportionate share of the net pension liability (asset) of the Plan, calculated using the discount rate of 7.0%, as well as what the Plans’ net pension liability (asset) would be if it were calculated using a discount rate that is one-percentage-point lower or one-percentage-point higher than the current rate (dollar values expressed in thousands): County and Municipal Police & Firefighter's Pension Plan (dollar amounts expressed in thousands) 1% Current 1% Decrease Discount Rate Increase 6.00% 7.00% 8.00% Proportionate share of the net pension liability (asset) $ 7,870 2,396 (2,069) Separately issued financial statements for DPERS are available from the pension office at: McArdle Building, Suite 1 860 Silver Lake Blvd Dover, DE 19904 Or at the following web address: www.delawarepensions.com 120 • 170

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section D Item 6. PART P D D REQUIRED SUPPLEMENTARY INFORMATION 121 • 171

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. SERVICES TO OUR RESIDENTS AND CUSTOMERS Animal Control Leaf Collection Beautification Building Library Bulky Trash Collection Parks & Recreation Community Development/Housing Planning & Zoning Community Policing Police Protection Snow Removal Elections Stormwater Electricity Street Maintenance/Cleaning Economic Development Trash Collection Emergency Preparedness Tree Maintenance Fire Protection Water & Wastewater Inspections & Code Enforcement 122 • 172

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. CITY OF DOVER, DELAWARE GENERAL FUND Schedule of Revenues, Expenditures and Changes in Fund Balances Budget and Actual (Non-GAAP Basis) For the Year Ended June 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance $ 5,548,900 $ 7,365,500 $ 7,374,818 $ 9,318 REVENUES: Fines & Police Revenue 577,400 577,400 470,993 (106,407) Library Revenues - General 109,800 104,100 99,089 (5,011) Kent County Book Reimbursement 275,000 238,700 230,412 (8,288) Business Licenses 1,470,000 1,407,200 1,408,226 1,026 Permits & Other Fees 1,724,000 1,254,000 1,059,660 (194,340) Miscellaneous Charges 70,000 10,000 8,245 (1,755) Police Extra Duty Fees 520,100 281,200 267,230 (13,970) Property Taxes 14,596,700 14,708,600 14,735,523 26,923 Recreation Revenue 144,500 95,500 84,970 (10,530) Franchise Fee 645,000 525,000 617,544 92,544 Sanitation Fees 3,076,600 3,076,600 3,080,960 4,360 Rent Revenue - Garrison Farm 98,000 102,700 102,655 (45) Court of Chancery Fees 1,475,000 1,475,000 1,602,360 127,360 Investment Income 120,000 80,000 291,186 211,186 Interfund Service Receipts 5,749,900 5,749,900 4,964,025 (785,875) Grants: Police Related/Extra Duty 145,000 145,000 222,821 77,821 Police Pension Grant 445,000 445,000 513,549 68,549 Green Energy Grant 98,500 98,500 98,500 - Miscellaneous Grants - 11,000 17,737 6,737 Transfer Tax 1,525,000 1,400,000 1,828,042 428,042 Transfer from Municipal Street Aid 665,300 796,000 796,168 168 Transfer from Civil Traffic Penalties 532,900 400,000 430,304 30,304 Transfer from Water/Wastewater Fund 1,000,000 1,000,000 1,000,000 - Transfer from Electric Fund 10,000,000 10,000,000 10,000,000 - Total Revenues 45,063,700 43,981,400 43,930,199 (51,201) TOTAL BEGINNING BALANCE & REVENUES $ 50,612,600 $ 51,346,900 $ 51,305,017 $ (41,883) (Continued) 123 • 173

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. (Continued) VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) EXPENDITURES: Tax Assessor $ 398,200 $ 390,600 $ 341,832 $ 48,768 Fire 763,700 763,700 728,989 34,711 Library 1,779,800 1,784,800 1,705,014 79,786 Recreation 1,156,600 1,088,600 1,356,978 (268,378) Life Safety 381,500 386,500 348,445 38,055 Code Enforcement 680,200 580,200 514,195 66,005 Planning 570,400 570,400 518,184 52,216 Public Inspections 644,700 544,700 543,640 1,060 Police 17,183,900 17,230,000 17,796,650 (566,650) Police Extra Duty 665,100 427,100 332,143 94,957 Streets 810,600 666,600 571,022 95,578 Stormwater 859,000 724,200 569,757 154,443 Sanitation 2,432,400 2,442,400 2,279,634 162,766 Engineering 368,800 345,800 209,197 136,603 Allocated Expenditures: City Clerk 432,600 362,600 354,327 8,273 Council 157,700 157,700 122,105 35,595 Grounds Maintenance 1,269,500 969,500 708,319 261,181 City Manager 1,007,900 982,900 910,082 72,818 Information Technology 747,000 747,000 741,136 5,864 Finance 935,800 929,800 948,723 (18,923) Public Works-Administration 802,300 736,700 691,841 44,859 Facilities Management 655,700 655,700 610,489 45,211 Procurement and Inventory 684,400 697,000 655,234 41,766 Fleet Maintenance 1,051,200 876,200 806,014 70,186 Customer Services 1,067,500 1,067,500 1,074,382 (6,882) Human Resources 523,300 526,800 480,675 46,125 Mayor 226,900 181,900 164,001 17,899 Insurance 750,000 840,000 866,507 (26,507) Budget Appropriations Contribution to Downtown Dover Partnership 150,000 150,000 150,000 - Miscellaneous Grant Expense - 800 (8,323) 9,123 Bank & Credit Card Fees 20,000 20,000 22,534 (2,534) Retirees Health Care 1,894,900 1,894,900 1,894,900 - Subtotal 41,071,600 39,742,600 39,008,626 733,974 Debt Service - Principal and Interest 500,000 500,000 463,568 36,432 Bond issue Costs - - 500 (500) Transfer to Capital Fund for Projects 3,261,600 3,261,600 3,261,600 - Transfer to Electric I & E Fund 250,000 250,000 250,000 - Appropriation to Police Pension Fund 519,600 519,600 519,600 - Transfer to Cable Franchise Reserve - - 11,758 (11,758) Appropriation to Police - State Grant 445,000 445,000 513,549 (68,549) Street Lights 815,000 815,000 807,794 7,206 Total Expenditures 46,862,800 45,533,800 44,836,995 696,805 Budget Balance 3,749,800 5,813,100 6,468,022 (654,922) Total Budget Balance & Expenditures $ 50,612,600 $ 51,346,900 $ 51,305,017 $ 41,883 Budget Balance - Working Capital $ 6,468,022 Perspective and GAAP (Non-GAAP) Differences: Fair Value of Investment Adjustment 145,108 Deferred Revenues - Non-spendable (38,666) Inventory & Prepaids - Non-spendable (190,873) Unassigned Fund Balance 6,383,591 124 • 174

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. Police Pension Fund Schedule of Changes in Net Pension Liability, Related Ratios (in Thousands) Fiscal Year Fiscal EndingYear June 30, Ending June 30, 2020 2019 2018 2017 2016 2015 2014 Total Pension Liability Interest on total pension liability $ 1,134 $ 1,173 $ 1,197 $ 1,211 $ 1,281 $ 1,311 $ 1,325 Effect of economic/demographic (gains) or losses 206 (157) - - (836) 286 25 Effect of assumption changes or inputs 633 (88) (44) 116 - 932 - Benefit payments (1,537) (1,517) (1,541) (1,528) (1,528) (1,557) (1,548) Net change in total pension liability 436 (590) (388) (201) (1,083) 972 (198) Total pension liability, beginning 18,208 18,798 19,186 19,387 20,471 19,499 19,697 Total pension liability, ending (a) $ 18,644 $ 18,208 $ 18,798 $ 19,186 $ 19,388 $ 20,471 $ 19,499 Fiduciary Net Position Employer contributions $ 1,033 $ 1,097 $ 1,295 $ 1,118 $ 1,093 $ 1,386 $ 1,229 Investment income net of investment expenses 439 820 908 1,433 279 283 1,583 Benefit payments (1,537) (1,517) (1,541) (1,528) (1,528) (1,557) (1,548) Administrative expenses (5) (5) (5) (4) (4) (6) (20) Net change in plan fiduciary net position (70) 394 657 1,019 (160) 106 1,244 Fiduciary net position, beginning 14,295 13,900 13,243 12,225 12,385 12,279 11,035 Fiduciary net position, ending (b) $ 14,225 $ 14,295 $ 13,900 $ 13,244 $ 12,225 $ 12,385 $ 12,279 Net pension liability, ending = (a) - (b) $ 4,419 $ 3,913 $ 4,898 $ 5,942 $ 7,163 $ 8,086 $ 7,220 Fiduciary net position as a % of total pension liability 76.30% 78.51% 73.95% 69.03% 63.05% 60.50% 62.97% This schedule is presented to illustrate the requirement to show information for 10 years. However, prior years are not available. Police Pension Fund Schedule of Employer Contributions Contribution as Fiscal Year Actuarially Actual Contribution a Percentage of Ended Determined Employer Deficiency Covered Covered June 30 Contribution Contribution (Excess) Payroll Payroll 2020 $ 964,518 $ 1,033,149 $ (68,631) $ - N/A 2019 1,050,375 1,097,151 (46,776) - N/A 2018 1,205,092 1,294,750 (89,658) - N/A 2017 1,176,462 1,118,346 58,116 - N/A 2016 1,212,000 1,093,278 118,722 - N/A 2015 1,176,422 1,385,789 (209,367) - N/A 2014 1,155,110 1,229,363 (74,253) - N/A 2013 1,155,796 1,074,599 81,197 - N/A 2012 979,132 668,274 310,858 - N/A 2011 1,082,956 633,636 449,320 - N/A Police Pension Plan Schedule of Investment Returns (1) Fiscal year 2017 through 2020 Fiscal year ending June 30 2020 2019 2018 2017 Money-weighted rate of return, net of investment expense 3.46% 6.43% 7.16% 12.34% (1) This schedule is presented to illustrate the requirement to show information for 10 years. However, information prior to June 30, 2017 is not available. 125 • 175

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. Police Pension Plan Net Pension Liability June 30, 2020 June 30, 2019 Total pension liability $ 18,644,121 $ 18,207,829 Fiduciary net position 14,224,901 14,294,532 Net pension liability 4,419,220 3,913,297 Fiduciary net position as a % of total pension liability 76.30% 78.51% Covered payroll - - Net pension liability as a % of covered payroll N/A N/A The total pension liability was determined by an actuarial valuation as of July 1, 2020 with liabilities projected to the June 30, 2020 measurement date using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified. Any significant changes during this period have been reflected as prescribed by GASB 67 and 68. Actuarial Methods and Significant Assumptions Valuation date July 1, 2020 Actuarial cost method Entry Age Method Amortization method Level Dollars Amortization period Closed Asset valuation method Fair Market Value Actuarial assumptions: Investment rate of return 6.5% Discount rate 6.5% Projected salary increases none, no remaining active participants Includes inflation at 2.3% Automatic Cost of living (retirees) 2.0% Mortality Rates Healthy Participants: PubS-2010 Public Safety Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Survivors: Pub-2010 Continuing Survivors Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Disabled PubS-2010 Public Safety Disabled Retiree Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 126 • 176

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. General Employee Pension Fund Schedule of Changes in Net Pension Liability, Related Ratios (in Thousands) 2020 2019 2018 2017 2016 2015 2014 Total Pension Liability Service cost $ 395 $ 424 $ 406 $ 433 $ 401 $ 459 $ 484 Interest on total pension liability 3,991 3,989 3,827 3,729 3,719 3,861 3,810 Changes of benefit terms - - 830 - - - - Differences between expected and actual experience 1,447 - 1,504 41 (267) (422) 111 Effect of assumption changes or inputs 1,260 (279) (99) 1,200 - 1,956 - Benefit payments (4,120) (4,033) (3,976) (3,746) (3,718) (3,700) (3,654) Net change in total pension liability 2,973 101 2,492 1,657 135 2,154 751 Total pension liability, beginning 63,058 62,957 60,465 58,808 58,673 56,519 55,768 Total pension liability, ending (a) $ 66,031 $ 63,058 $ 62,957 $ 60,465 $ 58,808 $ 58,673 $ 56,519 Fiduciary Net Position Employer contributions $ 2,606 $ 2,704 $ 4,777 $ 2,877 $ 3,090 $ 3,420 $ 3,473 Member contributions 183 190 195 202 202 209 212 Investment income net of investment expenses 1,550 2,765 2,757 4,351 850 955 4,153 Benefit payments (4,120) (4,033) (3,976) (3,746) (3,718) (3,700) (3,654) Administrative expenses (19) (19) (18) (18) (16) (19) (20) Net change in plan fiduciary net position 200 1,607 3,735 3,666 408 865 4,164 Fiduciary net position, beginning 44,708 43,100 39,364 35,699 35,291 34,426 30,263 Fiduciary net position, ending (b) $ 44,908 $ 44,708 $ 43,100 $ 39,365 $ 35,699 $ 35,291 $ 34,427 Net pension liability, ending = (a) - (b) $ 21,123 $ 18,350 $ 19,857 $ 21,100 $ 23,109 $ 23,382 $ 22,092 Fiduciary net position as a % of total pension liability 68.01% 70.90% 68.46% 65.10% 60.70% 60.15% 60.91% Covered payroll $ 5,067 $ 5,396 $ 5,561 $ 5,636 $ 5,504 $ 5,864 $ 5,971 Net pension liability as a % of covered payroll 416.92% 340.11% 357.06% 374.39% 419.88% 398.73% 370.03% This schedule is presented to illustrate the requirement to show information for 10 years. However, recalculations of prior years are not required, and if prior years are not reported in accordance with the current GASB standards, they should not be reported. 127 • 177

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. General Employee Pension Plan Schedule of Employer Contributions Contribution as Fiscal Year Actuarially Actual Contribution a Percentage of Ended Determined Employer Deficiency Covered Covered June 30 Contribution Contribution (Excess) Payroll Payroll 2020 $ 2,914,587 $ 2,606,067 $ 308,520 $ 5,066,622 51.44% 2019 2,885,737 2,703,583 182,154 5,395,564 50.11% 2018 3,016,283 4,777,466 (1,761,183) 5,561,300 85.91% 2017 2,824,098 2,876,657 (52,559) 5,635,987 51.04% 2016 3,025,982 3,089,409 (63,427) 5,504,387 56.13% 2015 2,983,776 3,419,512 (435,736) 5,864,089 58.31% 2014 2,628,694 3,472,736 (844,042) 5,970,703 58.16% 2013 3,217,964 9,788,571 (6,570,607) 7,076,322 138.33% 2012 3,130,022 3,142,951 (12,929) 7,974,057 39.41% 2011 3,149,493 3,347,728 (198,235) 8,256,751 40.55% General Employee Pension Plan Schedule of Investment Returns (1) Fiscal year 2017 through 2020 Fiscal year ending June 30 2020 2019 2018 2017 Money-weighted rate of return, net of investment expense 3.64% 6.76% 7.12% 12.50% (1) This schedule is presented to illustrate the requirement to show information for 10 years. However, information prior to June 30, 2017 is not available. General Employee Pension Plan Net Pension Liability June 30, 2020 June 30, 2019 Total pension liability $ 66,031,408 $ 63,058,424 Fiduciary net position 44,907,544 44,707,648 Net pension liability 21,123,864 18,350,776 Fiduciary net position as a % of total pension liability 68.01% 70.90% Covered payroll 5,066,622 5,395,564 Net pension liability as a % of covered payroll 416.92% 340.11% The total pension liability was determined by an actuarial valuation as of July 1, 2020 with liabilities projected to the June 30, 2020 measurement date using the following actuarial assumptions, applied to all periods included in the measurement, unless otherwise specified. Any significant changes during this period have been reflected as prescribed by GASB 67 and 68. 128 • 178

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. Actuarial Methods and Significant Assumptions Valuation date July 1, 2020 Actuarial cost method Entry Age Method Amortization method Level Dollar Amortization period Closed; 15-year – Unfunded AAL Asset valuation method Fair Market Value Actuarial Assumptions: Investment rate of return 6.5% Discount rate 6.5% Projected salary increases 3.0% Includes inflation at 2.3% Mortality Rates Healthy Participants: PubG-2010 General Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Survivors: Pub-2010 Continuing Survivors Mortality Table with fully generational improvements from 2010 based on Society of Actuaries Scale MP-2019 Disabled PubNS-2010 Non-Public Safety Disabled Retiree Mortality Table with fully generational improvements from 2006 based on Society of Actuaries Scale MP- 2019 129 • 179

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. County & Municipal Police and Firefighter's Pension Plan Schedule of the City of Dover's Proportionate Share of the Net Pension Liability Measurement Date 2019 2018 2017 2016 2015 2014 City's proportion of the net pension liability(asset) 8.3407% 8.4242% 8.6629% 9.0042% 9.6070% 9.6334% City's proportionate share of the net pension liability(asset) $ 2,395,686 $ 1,940,156 $ 873,337 $ 1,431,281 $ (524,958) $ (1,042,117) City's covered payroll $ 7,372,815 $ 6,843,159 $ 6,996,159 $ 7,117,770 $ 7,060,453 $ 6,582,053 City's proportionate share of the net pension liability(asset) as a 32.49% 28.35% 12.48% 20.11% (7.44%) (15.83%) percentage of its covered payroll Plan fiduciary net position as a percentage of the total pension liability 93.25% 94.10% 109.23% 105.59% 101.97% 104.47% GASB Statement No. 68 requires ten years of information to be presented in this table. However, until a full 10-year trend is compiled, the City will present information for those years for which information is available. County & Municipal Police and Firefighter's Pension Plan Schedule of City of Dover's Contributions Fiscal Year Ending 2020 2019 2018 2017 2016 2015 2014 Contractually required contribution $ 1,317,526 $ 1,276,048 $ 1,258,817 $ 944,356 $ 951,199 $ 977,587 $ 933,750 Contributions in relation to the contractually required contribution (1,317,526) (1,276,048) (1,258,817) (944,356) (951,199) (977,587) (933,750) Contribution deficiency (excess) $ - $ - $ - $ - $ - $ - $ - City's covered payroll $ 7,760,905 $ 7,372,815 $ 6,843,159 $ 6,843,159 $ 7,117,770 $ 7,060,453 $ 6,582,053 Contributions as a percentage of covered payroll 16.98% 17.31% 18.40% 13.80% 13.36% 13.85% 14.19% This schedule is presented to illustrate the requirement to show information for 10 years. However, information prior to June 30, 2014 is not available. 130 • 180

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. OPEB Trust Fund Schedule of Changes in Net OPEB Liability, Related Ratios Fiscal Year Ending June 30 2020 2019 2018 2017 Total OPEB Liability Service cost $ 1,120 $ 1,202 $ 1,222 $ 1,655 Interest 4,211 4,288 4,498 4,682 Net difference between expected and actual experience (4,758) (5,152) (6,202) (2,871) Effect of assumption changes or inputs 483 1,311 - (4,833) Benefit payments (2,755) (2,748) (2,704) (2,663) Net change in total OPEB liability (1,699) (1,099) (3,186) (4,030) Total OPEB liability, beginning 65,020 66,119 69,305 73,335 Total OPEB liability, ending (a) $ 63,321 $ 65,020 $ 66,119 $ 69,305 Fiduciary Net Position Employer contributions $ 4,326 $ 5,448 $ 5,722 $ 4,603 Investment income net of investment expenses 1,871 2,184 2,295 3,074 Benefit payments (2,755) (2,748) (2,704) (2,663) Administrative expenses (9) (3) (8) (3) Net change in plan fiduciary net position 3,433 4,881 5,305 5,011 Fiduciary net position, beginning 39,240 34,359 29,054 24,043 Fiduciary net position, ending (b) $ 42,673 $ 39,240 $ 34,359 $ 29,054 Net OPEB liability, ending = (a) - (b) $ 20,648 $ 25,780 $ 31,760 $ 40,251 Fiduciary net position as a % of total OPEB liability 67.40% 60.40% 52.00% 41.90% Covered payroll $ 20,262 $ 19,578 $ 19,101 $ 17,657 Net OPEB liability as a % of covered payroll 101.90% 131.70% 162.20% 210.70% This schedule is presented to illustrate the requirement to show information for 10 years. However, recalculations of prior years are not required, and if prior years are not reported in accordance with the current GASB standards, they should not be reported. 131 • 181

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. OPEB Trust Fund Schedule of City’s Contributions (In Thousands) For the year ended June 30 2020 2019 2018 2017 Actuarially determined contribution (ADC) $ 3,190 $ 4,044 $ 4,560 $ 4,644 Contributions in relation to the ADC (4,326) (5,447) (5,722) (4,603) Contributions deficiency / (excess) $ (1,136) $ (1,403) $ (1,162) $ 41 Covered payroll $ 20,262 $ 19,580 $ 19,578 $ 19,101 Contributions as a percentage of covered payroll 21.4 27.8 29.2 24.1% This schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, governments should present information for those years for which information is available. Post-Employment Other than Pensions Plan (OPEB) Schedule of Investment Returns (1) Fiscal year 2017 through 2020 Fiscal year ending June 30 2020 2019 2018 2017 Money-weighted rate of return, net of investment expense 4.77% 6.10% 7.87% 12.66% (1) This schedule is presented to illustrate the requirement to show information for 10 years. However, information prior to June 30, 2017 is not available. Actuarial Methods and Significant Assumptions Valuation date July 1, 2019 Actuarial cost method Entry Age Normal Level % of Salary Amortization method Level Dollars Remaining amortization period 28 years Asset valuation method Fair Market Value Actuarial Assumptions: Investment rate of return 6.5% Discount rate 6.5% Inflation 2.5% per year included in payroll growth Healthcare cost trend rates Pre-65 Medical / Rx Initial rate of 8.0% decreasing by 0.5% annually to an ultimate rate of 4.5% Post-65 Medical / Rx Initial rate of 8% decreasing by 0.5% annually to an ultimate rate of 4.5% Mortality Total Dataset Headcount Weighted Mortality Table fully generational using scale MP-2019 a. Non-Police: SOA Pub-2010 General b. Police: SOA Pub-2010 Public Safety c. Surviving Spouses: SOA Pub-2010 Contingent Survivors 132 • 182

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part D – Required Supplementary Information D Item 6. NOTES TO REQUIRED SUPPLEMENTARY INFORMATION GOVERNMENTAL BUDGETS Budgetary Basis of Accounting The City prepares its budget for the General Fund revenue on a modified accrual basis. The expenditures are accounted for when the purchase orders are issued. Encumbrances are established when purchase orders are issued and accounted for as a reservation of fund balance at year-end and are not on a modified accrual basis. The budget is amended in the subsequent year for the outstanding encumbrances of the prior year. The modified accrual basis of accounting is used for the fund financial statements. General Fund actual revenues were lower than the final budget by $51,201 with positive variances in investment Income, property taxes, court of chancery fees, franchise fees, transfer tax, business licenses, sanitation fees, police related/extra duty grants, police pension grant, miscellaneous grants, civil traffic penalties and municipal street aid grant. The sources of revenues with negative variances are fines and police revenue, library revenues – general & county reimbursement, permits and other licenses, police extra duty fees, recreation revenue and inter-fund services receipts. Expenditures were lower than budget by $696,805 due to lower than budgeted expense across almost all functions a result of personnel reductions through attrition and retirements. The net result is an increase of $654,922 to the General Fund ending fund balance. Budget Amendments During this fiscal year, the City Council amended the budget three times. These budget amendment or supplemental appropriation ordinances were primarily for the following purposes: 1. To re-appropriate budget balances for ongoing capital projects. 2. To amend the grant budgets, and reserve accounts for the actual results of the prior fiscal year, and all carried forward budget balances for the major operating funds from the prior fiscal year, as well as program revenues and expenses based on changes in program revenues, expenses based on actual amounts. 3. To amend revenue and expense accounts based on actual experience during fiscal year 2020. The differences for the year ended June 30, 2020 were as follows: Total revenues- budgetary basis $ 43,930,199 Total expenditures- budgetary basis 44,836,995 Net decrease in fund balance- budgetary basis (906,796) Perspective differences Transfer to Reserves 11,758 General Fund Subfund Expense Activity for the Capital Project Fund (3,126,173) Intrafund Transfers to the General Fund- Capital Projects Fund 3,261,600 General Fund Subfund Revenue Activity for the Capital Project Fund 1,330,243 Fair Value of Investments 175,752 Deferred Revenue Adjustment 108,411 Net increase in fund balance - GAAP Basis $ 854,795 133 • 183

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Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section2020 D Item 6. PART E SUPPLEMENTARY INFORMATION 135 • 185

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL STATEMENTS GENERAL FUND COMBINING SCHEDULES The General Fund contains a sub-fund for capital projects which is separately budgeted. The combining schedules are presented in the supplementary information. The budgetary comparison for the Governmental Capital Projects Fund has its own separate budget and is presented in this section to show legal compliance. The perspective difference between the basis of budgeting and GAAP is explained in the reconciliation of the basis of budgeting to GAAP. 137 • 187

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. The City of Dover, Delaware Combining General Fund Balance Sheet June 30, 2020 General Total General Capital Projects General Fund Fund Funds Assets: Cash and Cash Equivalents $ 3,808,567 $ 3,096,651 $ 6,905,218 Restricted Cash and Cash Equivalents - - - Investments 5,089,838 3,547,955 8,637,793 Restricted Investments 18,954 - 18,954 Receivables, net Accounts 88,556 410 88,966 Taxes 76,805 - 76,805 Due from Other Funds 1,270,754 - 1,270,754 Temporary Advances 70,000 - 70,000 Prepaid Items 80,639 - 80,639 Inventory, at Cost 110,234 - 110,234 Total Assets $ 10,614,347 $ 6,645,016 $ 17,259,363 Liabilities: Accounts Payable $ 2,789,753 $ 406,746 $ 3,196,499 Unearned Revenue (1,669) 57,825 56,156 Due to Other Funds 47,676 - 47,676 Other 255,654 - 255,654 Total Liabilities 3,091,414 464,571 3,555,985 Deferred Inflows of Resources: Unavailable revenue 99,697 - 99,697 Total Deferred Inflows of Resources 99,697 - 99,697 Fund Balances: Non-Spendable Inventory and Prepaids 190,873 - 190,873 Library Endowment 5,000 - 5,000 Patronage Stock 16,594 - 16,594 Restricted Library Endowment 2,360 - 2,360 Verizon Cable Franchise 36,629 - 36,629 Committed Contingency 788,189 - 788,189 Parkland Reserve - 1,357,385 1,357,385 Assigned Capital Projects - 4,823,060 4,823,060 Unassigned 6,383,591 - 6,383,591 Total Fund Balances 7,423,236 6,180,445 13,603,681 Total Liabilities and Fund Balances $ 10,614,347 $ 6,645,016 $ 17,259,363 138 • 188

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. The City of Dover, Delaware Combining Schedule of Revenues, Expenditures and Changes in Fund Balances of the General Fund (Non-GAAP Basis) For the Year Ended June 30, 2020 General Total General Capital Projects General Fund Fund Funds Revenues Fines $ 470,993 $ - $ 470,993 Library Revenue- General 99,089 - 99,089 Library Revenue County Reimbursement 230,412 - 230,412 Licenses and Permits 2,467,886 - 2,467,886 Sanitation Fees and Rebates 3,080,960 - 3,080,960 Miscellaneous Services 1,080,644 240,324 1,320,968 Property Taxes 14,735,523 - 14,735,523 Grants Received 629,786 1,067,474 1,697,260 Court of Chancery Fees 1,602,360 - 1,602,360 Investment Income 268,652 22,445 291,097 Total Revenues 24,666,305 1,330,243 25,996,548 Expenditures Current: General Government 2,882,883 - 2,882,883 Library Services 1,705,014 131,672 1,836,686 Public Safety and Law Enforcement 21,297,211 786,770 22,083,981 Public Works 2,580,406 593,100 3,173,506 Recreational Services 1,356,978 397,793 1,754,771 Streets and Sanitation Services 2,850,656 1,128,365 3,979,021 Engineering services 209,197 - 209,197 Financial Administration 2,764,241 19,874 2,784,115 Garage and Stores 1,461,248 68,599 1,529,847 Insurance 866,507 - 866,507 Retiree Health Care 1,894,900 - 1,894,900 Community and Economic Development 150,000 - 150,000 Street Lights 807,794 - 807,794 Debt Service: Principal Retirement 328,716 - 328,716 Interest and Fiscal Charges 135,352 - 135,352 Total Expenditures 41,291,103 3,126,173 44,417,276 Excess (deficiency) of Revenues over Expenditures (16,624,798) (1,795,930) (18,420,728) Other Financing Sources and Uses Reserve Transfers (11,758) (1,085,296) (1,097,054) Interfund Transfers 15,729,760 3,261,600 18,991,360 Total other Financing Sources and Uses 15,718,002 2,176,304 17,894,306 Net Change in Fund Balances (906,796) 380,374 (526,422) Fund Balances at Beginning of Year 7,374,818 2,841,105 10,215,923 Fund Balances at End of Year $ 6,468,022 $ 3,221,479 $ 9,689,501 Perspective and GAAP (Non-GAAP) Differences: Fair Value of Investment Adjustment $ 145,108 $ 101,103 $ 246,211 Deferred Revenues - Non-spendable (38,666) - (38,666) Inventory & Prepaids - Non-spendable (190,873) - (190,873) Capital Asset - Assigned - (3,322,582) (3,322,582) Unassigned Fund Balance $ 6,383,591 $ - $ 6,383,591 139 • 189

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE GOVERNMENTAL CAPITAL PROJECTS FUND Schedule of Revenues, Expenditures and Changes in Fund Balances Budget & Actual (Non-GAAP Basis) For the Year Ended June 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance - Working Capital $ 304,300 $ 2,841,100 $ 2,841,105 $ 5 REVENUES: Bond Proceeds 1,228,600 528,600 - (528,600) State Grant - Other 241,800 241,800 1,067,474 825,674 Library County Grant - 125,000 - Transfer from General Fund for Projects 3,261,600 3,261,600 3,261,600 - Transfer from Parkland Reserve - 191,800 - (191,800) Transfer from Capital Asset Reserve 172,000 445,300 - (445,300) Income from Sale of Assets - - 95,693 95,693 Interest Earnings - - 22,445 22,445 Miscellaneous Receipts - - 144,631 144,631 Total Revenues 4,904,000 4,794,100 4,591,843 (77,257) TOTAL BEGINNING BALANCE & REVENUES $ 5,208,300 $ 7,635,200 $ 7,432,948 $ (77,252) EXPENDITURES: Fire $ 281,100 $ 281,100 $ 161,810 $ 119,290 Library - 125,000 131,672 (6,672) Recreation 476,000 1,073,600 397,793 675,807 Life Safety 48,900 48,900 - 48,900 Code Enforcement 37,200 37,200 - 37,200 Inspections 18,600 18,600 - 18,600 Police 753,900 954,700 624,960 329,740 Streets 1,266,500 3,289,400 850,787 2,438,613 Sanitation 287,200 287,200 277,578 9,622 Grounds 128,400 153,400 149,903 3,497 Stormwater 365,000 365,000 211,504 153,496 Information Technology 45,600 45,600 19,874 25,726 Facilities Management 784,000 174,800 231,693 (56,893) Purchasing 390,000 390,000 50,000 340,000 Fleet Maintenance 21,600 21,600 18,599 3,001 Subtotal 4,904,000 7,266,100 3,126,173 4,139,927 TRANSFERS AND MISCELLANEOUS EXPENSES: Transfer to Parkland Reserve - - 1,085,296 (1,085,296) Total Expenditures 4,904,000 7,266,100 4,211,469 3,054,631 Budget Balance - Working Capital 304,300 369,100 3,221,479 (2,852,379) Budget Balance & Expenditures $ 5,208,300 $ 7,635,200 $ 7,432,948 $ 202,252 Budget Balance - Working Capital $ 3,221,479 Perspective and GAAP (Non-GAAP) Differences: Fair value of investment adjustment 101,103 Assigned to Capital assets 1,500,478 Committed to Parks & Recreation improvements 1,357,385 Total Fund Balances $ 6,180,445 140 • 190

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL STATEMENTS SPECIAL REVENUE FUNDS Special Revenue Funds include the group of funds classified as grant funds and a Realty Transfer Tax Fund. The proceeds from specific revenue sources are restricted to specified expenditure purposes. The City adopts budgets for selected Special Revenue Funds. Combining and individual statements appear in this section. POLICE GRANTS The City of Dover Police Department receives various grants from the State of Delaware for public and highway safety and the U.S. Department of Justice for local law enforcement. All grant transactions are recorded in this fund. LIBRARY GRANTS The City of Dover Public Library receives various grants from the State of Delaware, Kent County, and the Federal Government. Activities associated with these grants are recorded in this fund. MUNICIPAL STREET AID The State of Delaware has passed legislation to share a portion of Delaware’s motor fuel tax revenue with local municipalities through grants. The amount of the grant the City receives depends on its population and miles of streets maintained. The grant is used for street light expense within the City. CDBG HOUSING GRANTS & NEIGHBORHOOD STABILIZATION PROGRAM The City receives a U.S. Department of Housing and Urban Development Entitlement Grant for the Community Development Block Grant Program. This is to provide decent housing, a suitable living environment and expand economic opportunities primarily for people of low and moderate incomes. Combined with the CDBG Fund is the Neighborhood Stabilization Program (NSP) that provides assistance in the redevelopment of residential properties that have been abandoned and foreclosed upon to stabilize residential communities. 141 • 191

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL STATEMENTS SPECIAL REVENUE FUNDS (continued) STATE OF DELAWARE DEPARTMENT OF TRANSPORTATION GRANTS The State of Delaware Department of Transportation grants provide funds for specific street projects in the City. State law provides funds to the State’s elected officials for suburban street aid, which officials can then provide to their respective districts. The City receives these funds for designated street projects and records all transactions for this fund. SUBSTANCE ABUSE PREVENTION GRANT The State of Delaware General Assembly Grant-In-Aid Program provides funds to implement a substance abuse prevention program for at-risk and/or disadvantaged youths in the City of Dover. ELECTRONIC RED-LIGHT SAFETY PROGRAM (ERLSP) The State of Delaware Department of Transportation provides a grant to municipalities that implement the Electronic Red- L i g h t Safety Program. Under this program, the City is granted a portion of the fines collected from drivers who are ticketed for running red lights installed with electronic photo identification equipment within the City limits. REALTY TRANSFER TAX Delaware Code states that realty transfer tax realized by the City shall be segregated from the general fund and the funds shall be expended solely for the capital and operating costs of public safety services, economic development programs, public works services, capital projects and improvements, infrastructure projects and improvements and debt reduction. 142 • 192

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET JUNE 30, 2020 MUNICIPAL CDBG/NSP STATE SUBSTANCE REALTY POLICE LIBRARY STREET HOUSING D.O.T. ABUSE ERLSP TRANSFER GRANTS GRANTS AID GRANTS GRANTS PREV. GRANT TAX TOTALS ASSETS: Cash $ 200,485 $ 71,486 $ - $ 72,407 $ 109,714 $ 91,481 $ - $ 56,092 $ 601,665 Receivables 787 - - - - - - - 787 Due from other governments 249,822 - - - 3,725 - 43,743 - 297,290 TOTAL ASSETS $ 451,094 $ 71,486 $ - $ 72,407 $ 113,439 $ 91,481 $ 43,743 $ 56,092 $ 899,742 LIABILITIES AND FUND BALANCE: Liabilities: Vouchers Payable $ 116,011 $ 40,157 $ - $ 185 $ 490 $ 1,947 $ - $ - $ 158,790 Unearned Revenue 154,281 - - - - - - - 154,281 Due to other funds-charges 107,514 - - 394 - 1,091 43,743 56,092 208,834 Due to other funds-temporary advances - - - 70,000 - - - - 70,000 Total Liabilities 377,806 40,157 - 70,579 490 3,038 43,743 56,092 591,905 Fund Balances: Restricted 73,288 31,329 - 1,828 112,949 88,443 - - 307,837 Total Fund Balances 73,288 31,329 - 1,828 112,949 88,443 - - 307,837 TOTAL LIABILITIES AND FUND BALANCES $ 451,094 $ 71,486 $ - $ 72,407 $ 113,439 $ 91,481 $ 43,743 $ 56,092 $ 899,742 143 • 193

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES YEAR ENDED JUNE 30, 2020 MUNICIPAL CDBG/NSP STATE SUBSTANCE REALTY POLICE LIBRARY STREET HOUSING D.O.T. ABUSE PREV. ERLSP TRANSFER GRANTS GRANTS AID GRANTS GRANTS GRANT TAX TOTALS REVENUES: Grants received $ 560,237 $ 295,342 $ 793,731 $ 298,936 $ 473,317 $ 40,000 $ - $ - $ 2,461,563 Recreation revenue - - - - - 43,203 - - 43,203 Police fines - - - - - - 430,204 - 430,204 Transfer taxes - - - - - - - 1,825,438 1,825,438 Investment income (loss) 582 - 2,337 - 2,680 - - 2,604 8,203 TOTAL REVENUES 560,819 295,342 796,068 298,936 475,997 83,203 430,204 1,828,042 4,768,611 EXPENDITURES: Program expenditures 339,784 271,583 - 297,990 497,570 83,316 - - 1,490,243 TOTAL EXPENDITURES 339,784 271,583 - 297,990 497,570 83,316 - - 1,490,243 Excess (deficiency) of revenues over (under) expenditures 221,035 23,759 796,068 946 (21,573) (113) 430,204 1,828,042 3,278,368 OTHER FINANCING SOURCES (USES): Transfers-out (231,232) - (796,168) - - - (430,304) (1,828,042) (3,285,746) Net Change in fund balances (10,197) 23,759 (100) 946 (21,573) (113) (100) - (7,378) FUND BALANCE AT BEGINNING OF YEAR 83,485 7,570 100 882 134,522 88,556 100 - 315,215 FUND BALANCE AT END OF YEAR $ 73,288 $ 31,329 $ - $ 1,828 $ 112,949 $ 88,443 $ - $ - $ 307,837 144 • 194

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE POLICE GRANTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ 63,500 $ 79,000 $ 85,649 $ 6,649 Interest earned - - 582 582 Grants received 393,000 902,518 712,354 (190,164) TOTAL REVENUES & BEGINNING BALANCE 456,500 981,518 798,585 (182,933) EXPENDITURES: Personnel 13,500 159,510 - (159,510) Program expenses/supplies 317,000 507,000 264,227 (242,773) Telephone/fax 20,000 20,000 15,386 (4,614) Training/Conference/Food/Travel 15,000 30,000 2,164 (27,836) Consulting/audit fees 1,000 1,000 - (1,000) TOTAL EXPENDITURES 366,500 717,510 281,777 (435,733) Other financing uses: Operating transfers - out (90,000) (185,008) (289,239) (104,231) BALANCE CARRIED TO NEXT YEAR $ - $ 79,000 $ 227,569 $ 148,569 Fund Balance - Working Capital 227,569 GAAP Differences Deferred Revenue - non-spendable (5,703) Total Fund Balance 221,866 145 • 195

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE LIBRARY GRANTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ - $ 7,970 $ 7,570 $ (400) Grants received: State 287,900 289,842 289,647 (195) Grants received: Other - 6,000 3,000 (3,000) Grants received: Federal 2,500 2,500 2,695 195 TOTAL REVENUES & BEGINNING BALANCE 290,400 306,312 302,912 (3,400) EXPENDITURES: Program expenditures/supplies (Fed Grant) - 2,695 2,700 5 Program expenditures/supplies (Other Grant) - 6,563 685 (5,878) Program expenditures/supplies (State Grant) 28,600 28,200 22,373 (5,827) Office Supplies 25,000 25,700 24,592 (1,108) Printing/duplicating 12,500 13,800 9,720 (4,080) Postage 100 100 40 (60) Books 126,000 125,000 115,378 (9,622) Furniture/Fixtures 5,500 6,300 5,946 (354) Audio visual supplies 79,000 76,700 72,967 (3,733) Training/conference/food/travel 4,000 1,300 1,104 (196) Office equipment repairs 2,000 10,800 9,787 (1,013) Office equipment lease 2,200 2,200 2,098 (102) Cares Act COVID19 - 3,000 1,067 (1,933) Computer software 2,000 2,000 1,637 (363) Computer hardware 3,500 1,800 1,489 (311) TOTAL EXPENDITURES 290,400 306,158 271,583 (34,575) BALANCE CARRIED TO NEXT YEAR $ - $ 154 $ 31,329 $ 31,175 146 • 196

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE MUNICIPAL STREET AID FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ 100 $ 100 $ 100 $ - State Grant - Operations 665,300 665,300 793,731 128,431 Interest Earned - - 2,337 2,337 TOTAL REVENUES & BEGINNING BALANCE 665,400 665,400 796,168 130,768 Other financing uses: Operating transfers-out (665,300) (665,300) (796,168) (130,868) BALANCE CARRIED TO NEXT YEAR $ 100 $ 100 $ - $ (100) 147 • 197

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE HOUSING PROGRAMS - CDBG & NSP SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance CDBG $ 2,500 $ 2,013 $ 882 $ (1,131) Beginning balance NSP 6,300 - - - Federal grant received 282,400 728,785 297,805 (430,980) TOTAL REVENUES & BEGINNING BALANCE 291,200 730,798 298,687 (432,111) EXPENDITURES: Closing Cost/Down Payment Program 97,900 191,389 80,000 111,389 Dover Interfaith Ministry 30,000 35,069 29,395 5,674 MHDC Emergency Home Repair 33,000 68,385 35,473 32,912 Milford Housing H/O Rehab 25,000 80,522 15,781 64,741 Central DE Hosing Collaboration 40,000 75,284 75,284 - Cares Act COVID19 - 163,211 5,475 157,736 Administrative Expense 56,500 114,925 56,582 58,343 TOTAL EXPENDITURES 282,400 728,785 297,990 430,795 CDBG BALANCE CARRIED TO NEXT YEAR $ 2,500 $ 2,013 $ 697 $ 1,316 NSP BALANCE CARRIED TO NEXT YEAR $ 6,300 $ - $ - $ - Fund Balance - Working Capital 697 GAAPDifferences Deferred Revenue - non-spendable 1,131 Total Fund Balance 1,828 148 • 198

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE STATE OF DELAWARE DEPARTMENT OF TRANSPORTATION GRANTS SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ 70,900 $ 334,000 $ 134,522 $ (199,478) Grants received: State 500,000 500,000 473,317 (26,683) Interest earned - - 2,680 2,680 TOTAL REVENUES & BEGINNING BALANCE 570,900 834,000 610,519 (223,481) EXPENDITURES: Program expenditures grant related 550,000 834,000 497,570 (336,430) TOTAL EXPENDITURES 550,000 834,000 497,570 336,430 BALANCE CARRIED TO NEXT YEAR $ 20,900 $ - $ 112,949 $ 112,949 CITY OF DOVER, DELAWARE SUBSTANCE ABUSE PREVENTION PROGRAM SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ 52,000 $ 52,000 $ 81,064 $ 29,064 Grants revenue 28,000 28,000 40,000 12,000 Recreation revenue 33,000 33,000 50,695 17,695 TOTAL REVENUES & BEGINNING BALANCE 113,000 113,000 171,759 58,759 EXPENDITURES: Temporary help/benefits 68,500 68,500 60,120 (8,380) Program expenditures/supplies 35,000 35,000 23,196 (11,804) TOTAL EXPENDITURES 103,500 103,500 83,316 (20,184) BALANCE CARRIED TO NEXT YEAR $ 9,500 $ 9,500 $ 88,443 $ 78,943 149 • 199

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE ELECTRONIC RED LIGHT SAFETY PROGRAM SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN UNRESERVED FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ 100 $ 100 $ 100 $ - Grants received: State 532,900 532,900 430,204 (102,696) TOTAL REVENUES & BEGINNING BALANCE 533,000 533,000 430,304 (102,696) EXPENDITURES: Transfer to General Fund 532,900 532,900 430,304 (102,596) TOTAL EXPENDITURES 532,900 532,900 430,304 102,596 BALANCE CARRIED TO NEXT YEAR $ 100 $ 100 $ - $ (100) CITY OF DOVER, DELAWARE REALTY TRANSFER TAX FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN UNRESERVED FUND BALANCE - BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) REVENUES: Beginning balance $ - $ - $ - $ - Realty Transfer Taxes 1,525,000 1,525,000 1,825,438 300,438 Interest earned - - 2,604 2,604 TOTAL REVENUES & BEGINNING BALANCE 1,525,000 1,525,000 1,828,042 303,042 EXPENDITURES: Transfer to General Fund 1,525,000 1,525,000 1,828,042 303,042 TOTAL EXPENDITURES 1,525,000 1,525,000 1,828,042 (303,042) BALANCE CARRIED TO NEXT YEAR $ - $ - $ - $ - 150 • 200

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL SCHEDULES PROPRIETARY FUND TYPES ENTERPRISE FUNDS The following schedules pertaining to the major and non-major enterprise funds are not required under GAAP but are included for public review for budgetary compliance. Accordingly, no reconciliation to the GAAP financial statements is provided. MAJOR ENTERPRISE FUND ELECTRIC REVENUE FUND The Electric Revenue Fund accounts for all operating activity of the electric utility. This includes service revenues, investment earnings on operating accounts, direct and indirect operating expenses, purchased power cost, debt service, and transfers to other funds and the Improvement and Extension Fund. The Electric Improvement and Extension Fund is used to account for all capital project and equipment purchases. The City utilizes revenue and expenditure accounts to record capital project receipts, transfers from the operating fund, and project costs. The funds are combined for GAAP reporting purposes with assets capitalized. NON-MAJOR ENTERPRISE FUNDS WATER FUND The Water Fund accounts for all operating activity of the Water Utility. This includes service revenues, investment earnings on operating accounts, direct and indirect operating expenses, debt service, and transfers to other funds and the Improvement and Extension Fund. The Water Improvement and Extension Fund is used to account for all capital project and equipment purchases. The City utilizes revenue and expenditure accounts to record capital project receipts, transfers from the operating fund, and project costs. 151 • 201

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. WASTEWATER FUND The Wastewater Fund accounts for all operating activity of the Wastewater Utility. This includes service revenues, investment earnings on operating accounts, direct and indirect operating expenses, debt service, and transfers to the other funds and the Improvement and Extension Fund. The Wastewater Improvement and Extension Fund is used to account for all capital project and equipment purchases. The City utilizes revenue and expenditure accounts to record capital project receipts, transfers from the operating fund, and project costs. The funds are combined for GAAP reporting purposes with assets capitalized. 152 • 202

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE PROPRIETARY FUNDS COMBINING NON-MAJOR ENTERPRISE FUNDS BALANCE SHEET JUNE, 30 2020 Business-type Activities Water Wastewater Total Non-Major Fund Fund Enterprise Funds Assets Current Assets: Cash and Cash Equivalents $ 3,079,161 $ 19,626 $ 3,098,787 Investments 5,572,356 2,944,729 8,517,085 Receivables, Net 428,788 373,503 802,291 Due from Other Funds 69 80 149 Due from other funds- temporary advances 400,000 (400,000) - Inventory 72,806 (704) 72,102 Prepaid Items 147 147 294 Total Current Assets 9,553,327 2,937,381 12,490,708 Non-Current Assets: Restricted Assets Cash 348,742 148,876 497,618 Investments 2,503,490 5,808,840 8,312,330 Capital Assets, Not Being Depreciated 7,524,977 839,135 8,364,112 Capital Assets, Net of Depreciation 26,118,096 32,207,093 58,325,189 Total Non-Current Assets 36,495,305 39,003,944 75,499,249 Total Assets 46,048,632 41,941,325 87,989,957 Deferred Outflows of Resources: Pension Related Deferred Outflows 251,134 81,129 332,263 OPEB Related Deferred Outflows 52,216 38,560 90,776 303,350 119,689 423,039 Liabilities Current Liabilities: Accounts Payable and Accrued Expenses 887,741 680,848 1,568,589 Due to Other Funds - Charges 225,702 137,345 363,047 Accrued Interest Payable 65,752 31,181 96,933 Revenue Bonds Payable 561,596 459,658 1,021,254 Liability for Compensated Absences 80,542 32,760 113,302 Total Current Liabilities 1,821,333 1,341,792 3,163,125 Non-Current Liabilities: OPEB Liability 848,581 479,892 1,328,473 Net Pension Liability 2,386,355 1,463,537 3,849,892 Revenue Bonds Payable 7,772,674 5,542,200 13,314,874 Liability for Compensated Absences 98,660 22,844 121,504 Total Non-Current Liabilities 11,106,270 7,508,473 18,614,743 Total Liabilities 12,927,603 8,850,265 21,777,868 Deferred Inflows of Resources: Pension Related Deferred Inflows 28,476 - 28,476 OPEB Related Deferred Inflows 701,286 272,310 973,596 Total Deferred Inflows of Resources 729,762 272,310 1,002,072 Net Position Net Investment in Capital Assets 25,308,803 27,044,370 52,353,173 Restricted for Capital Construction 2,852,232 5,957,716 8,809,948 Unrestricted 4,533,582 (63,647) 4,469,935 Total Net Position $ 32,694,617 $ 32,938,439 $ 65,633,056 153 • 203

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE PROPRIETARY FUNDS COMBINING SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION - NON-MAJOR ENTERPRISE FUNDS JUNE, 30 2020 Business-type Activities Non-Major Water Wastewater Enterprise Fund Fund Funds Operating Revenues Charges for Services $ 5,557,797 $ 8,528,037 $ 14,085,834 Miscellaneous Services/Income 617,742 218,626 836,368 Total Operating Revenues 6,175,539 8,746,663 14,922,202 Operating Expenses Water 686,001 - 686,001 Wastewater - 1,013,053 1,013,053 Water Treatment Plant 1,724,238 - 1,724,238 Water/Wastewater Engineering 166,959 159,156 326,115 Kent County Wastewater Treatment - 3,769,636 3,769,636 General Administrative 998,537 714,508 1,713,045 Depreciation 956,295 1,407,385 2,363,680 Retirees Health Care 113,200 113,100 226,300 Total Operating Expenses 4,645,230 7,176,838 11,822,068 Operating Income/Loss 1,530,309 1,569,825 3,100,134 Non-Operating Revenues (Expenses) Interest Earned: Operating Funds 144,298 42,648 186,946 Reserve Funds 84,774 143,743 228,517 Net Increase in Fair Value of Investments 161,801 181,933 343,734 Interest and Fiscal Charges (227,243) (149,386) (376,629) Gain (Loss) on Sale of Assets (22,815) 7,651 (15,164) Total Non-Operating Revenue (expenses) 140,815 226,589 367,404 Income before Contributions and Transfers 1,671,124 1,796,414 3,467,538 Contractor Contributions - Infrastructure 811,744 597,401 1,409,145 Transfers Out (649,000) (649,000) (1,298,000) Total transfers (649,000) (649,000) (1,298,000) Change in Net Position 1,833,868 1,744,815 3,578,683 Total Net Position--Beginning 30,860,750 31,193,623 62,054,373 Total Net Position--Ending $ 32,694,618 $ 32,938,438 $ 65,633,056 154 • 204

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE COMBINING SCHEDULE OF CASH FLOWS - NON-MAJOR ENTERPRISE FUNDS JUNE, 30 2020 Business-type Activities Total Non-Major Water Wastewater Enterprise Fund Fund Funds Cash Flows from Operating Activities Receipts from Customers $ 6,150,611 $ 8,671,254 $ 14,821,865 Payments to Suppliers (including Purchased Power) (1,071,445) (5,385,544) (6,456,989) Payments to Employees (1,511,938) (834,176) (2,346,114) Payments of Personnel Related Costs (980,601) (465,777) (1,446,378) Internal Activity-Payments from (to) Other Funds (580,925) 129,847 (451,078) Other Receipts (Payments) including Claims Paid (283,246) (156,142) (439,388) Net Cash Provided by (used for) Operating Activities 1,722,456 1,959,462 3,681,918 Cash Flows from Noncapital Financing Activities Transfers Out (649,000) (649,000) (1,298,000) Net Cash Used for Noncapital Financing Activities (649,000) (649,000) (1,298,000) Cash Flows from Capital and Related Financing Activities Acquisition and Construction of Capital Assets (2,940,024) (1,537,032) (4,477,056) Proceeds of issuance of debt 1,401,901 578,057 1,979,958 Bond Issuance Costs - (4,582) (4,582) Principal Paid on Revenue Bond Maturities (372,949) (468,576) (841,525) Interest Paid on Capital Debt (227,271) (144,776) (372,047) Net Cash Used for Capital and Related Financing Activities (2,138,343) (1,576,909) (3,715,252) Cash Flows from Investing Activities Interest on Investments 144,298 42,648 186,946 Purchase of Investment Securities (456,908) (668,809) (1,125,717) Interest on Restricted Cash 84,774 143,743 228,517 Net Cash Provided by (used for) Investing Activities (227,836) (482,418) (710,254) Net Increase/Decrease in Cash and Cash Equivalents (1,292,723) (748,865) (2,041,588) Cash and cash equivalents July 1 (incl. $466,393 for Non-Major Enterprise Funds 4,720,626 917,367 5,637,993 Cash and cash equivalents June 30 (incl. $497,618 for Non-Major Enterprise Funds $ 3,427,903 $ 168,502 $ 3,596,405 Reconciliation of Operating Income to Net Cash Provided by (Used for) Operating Activities: Operating Income $ 1,530,309 $ 1,569,825 $ 3,100,134 Adjustments to Reconcile Operating Income to Net Cash provided by (Used for) Operating Activities: Depreciation Expense 956,295 1,407,385 2,363,680 Effect of Changes in Operating Assets and Liabilities: - Receivables (25,432) (75,902) (101,334) Due from other funds 504 493 997 Due from other funds - Advances (400,000) - (400,000) Inventory (3,586) 860 (2,726) Prepaid items 251 251 502 Deferred outflow of resources Pension (139,970) (51,041) (191,011) Deferred outflow of resources OPEB (18,640) (11,165) (29,805) Accounts payable and accrued expenses (147,343) (921,573) (1,068,916) Due to other funds 19,495 (272,095) (252,600) Due to other funds - Advances - 400,000 400,000 Liability for Compensated Absences 46,075 6,360 52,435 Net OPEB Liability (291,760) (160,543) (452,303) Net pension liability 338,039 126,636 464,675 Deferred inflow of resources Pension (88,651) (31,702) (120,353) Deferred inflow of resources OPEB (53,130) (28,327) (81,457) Net Cash Provided by Operating Activities $ 1,722,456 $ 1,959,462 $ 3,681,918 Non-Cash Investing, Capital and Financing Activities: Change in Fair Value of Investments $ 161,801 $ 181,933 $ 343,734 Capital Contributions - Infrastructure 811,744 597,401 1,409,145 155 • 205

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE WATER FUND SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance - Water $ 1,487,000 $ 1,854,500 $ 1,854,498 $ (2) TOTAL BEGINNING BALANCES 1,487,000 1,854,500 1,854,498 (2) REVENUES: Water Services 5,530,800 5,530,800 5,557,797 26,997 Miscellaneous service fees 23,000 23,000 26,950 3,950 Water tank space leasing 410,200 410,200 374,867 (35,333) Interest - Water 10,000 10,000 43,453 33,453 Water Impact Fees 570,000 570,000 215,925 (354,075) Total Revenues 6,544,000 6,544,000 6,218,992 (325,008) TOTAL BEGINNING BALANCES & REVENUES $ 8,031,000 $ 8,398,500 $ 8,073,490 $ (325,010) EXPENSES: Engineering & Inspection $ 371,400 $ 372,600 $ 190,116 $ 182,484 Water Department 638,400 637,200 630,729 6,471 Water Treatment Plant 2,080,900 2,080,900 1,898,280 182,620 Interfund Service Fees 1,052,700 1,052,700 929,918 122,782 Retirees Health Care 113,200 113,200 113,200 - Debt Service - Water 760,000 760,000 591,117 168,883 Bank & Credit Card Fees 14,000 14,000 22,544 (8,544) Transfer To: Water Improvement and Extension 1,500,000 1,500,000 1,500,000 - General Fund from Water 500,000 500,000 500,000 - Electric Improvement and Extension 149,000 149,000 149,000 - Total Expenses 7,179,600 7,179,600 6,524,904 654,696 Budget Balance - Water 851,400 1,218,900 1,548,586 (329,686) Total Budget Balances - Working Capital 851,400 1,218,900 1,548,586 (329,686) TOTAL BUDGET BALANCES & EXPENSES $ 8,031,000 $ 8,398,500 $ 8,073,490 $ 325,010 156 • 206

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE WATER IMPROVEMENT & EXTENSION FUND SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance -Water $ 4,366,100 $ 5,349,000 $ 5,348,927 $ (73) TOTAL BEGINNING BALANCES 4,366,100 5,349,000 5,348,927 (73) REVENUES: State Loan Fund - Water - 1,401,900 1,401,901 1 Interest earnings 10,000 10,000 93,974 83,974 Income from sale of assets - - 2,772 2,772 Transfer from Operating Fund - Water 1,500,000 1,500,000 1,500,000 - Transfer from Water Impact Fee Reserve 30,900 30,900 (30,900) Total Revenues 1,540,900 2,942,800 2,998,647 55,847 TOTAL BEGINNING BALANCES & REVENUES $ 5,907,000 $ 8,291,800 $ 8,347,574 $ 55,774 EXPENSES: Water $ 960,400 $ 1,142,400 $ 694,857 $ 447,543 Water Treatment Plant 559,700 3,355,200 2,360,153 995,047 Total Expenses 1,520,100 4,497,600 3,055,010 1,442,590 Budget Balance - Water 4,386,900 3,794,200 5,292,564 (1,498,364) Total Budget Balances - Working Capital 4,386,900 3,794,200 5,292,564 (1,498,364) TOTAL BUDGET BALANCES & EXPENSES $ 5,907,000 $ 8,291,800 $ 8,347,574 $ (55,774) #REF! #REF! #REF! #REF! 157 • 207

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE WASTEWATER FUND SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance - Wastewater $ 1,038,700 $ 345,400 $ 345,399 (1) TOTAL BEGINNING BALANCES 1,038,700 345,400 345,399 (1) REVENUES: Wastewater Services 3,654,700 3,654,700 3,615,733 (38,967) Wastewater Treatment Services 3,267,000 3,267,000 3,108,340 (158,660) Groundwater inflow adjustment 1,841,900 1,841,900 1,803,964 (37,936) Miscellaneous service fees 23,200 23,200 7,142 (16,058) Interest - Wastewater 10,000 10,000 5,630 (4,370) Wastewater Impact Fees 480,000 480,000 211,484 (268,516) Total Revenues 9,276,800 9,276,800 8,752,293 (524,507) TOTAL BEGINNING BALANCES & REVENUES $ 10,315,500 $ 9,622,200 $ 9,097,692 $ (524,508) EXPENSES: Engineering & Inspection $ 195,100 $ 195,100 $ 187,426 $ 7,674 Wastewater Department 1,153,900 1,153,900 1,009,088 144,812 Debt Service - Wastewater 672,500 672,500 610,870 61,630 Retirees Health Care 113,100 113,100 113,100 - Kent County Treatment Charge 5,101,900 5,101,900 3,769,635 1,332,265 Interfund Service Fees 759,800 759,800 700,605 59,195 Bank & Credit Card Fees 14,000 14,000 7,543 6,457 Bond Issue Cost 15,000 15,000 4,582 10,418 Transfer To: General Fund from Wastewater 500,000 500,000 500,000 - Wastewater Improvement and Extension 900,000 900,000 900,000 - Electric Improvement and Extension 149,000 149,000 149,000 - Wastewater Impact Fee reserves - - 57,327 (57,327) Total Expenses 9,574,300 9,574,300 8,009,176 1,565,124 Budget Balance - Wastewater 741,200 47,900 743,117 (695,217) Total Budget Balances - Working Capital 741,200 47,900 743,117 (695,217) TOTAL BUDGET BALANCES & EXPENSES $ 10,315,500 $ 9,622,200 $ 8,752,293 $ 869,907 158 • 208

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE WASTEWATER IMPROVEMENT & EXTENSION FUND SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance -Wastewater $ 1,110,700 $ 906,600 $ 906,640 40 TOTAL BEGINNING BALANCES 1,110,700 906,600 906,640 40 REVENUES: State Loan Fund - Wastewater 643,000 1,564,700 578,057 (986,643) Transfer from Operating Fund - Wastewater 900,000 900,000 900,000 - Transfer from Wastewater Impact Fee Reserve 4,800 404,900 - (404,900) Interest earnings 10,000 10,000 34,304 24,304 Income from sale of assets - - 7,651 7,651 Total Revenues 1,557,800 2,879,600 1,520,012 (1,359,588) TOTAL BEGINNING BALANCES & REVENUES $ 2,668,500 $ 3,786,200 $ 2,426,652 $ (1,359,548) EXPENSES: Wastewater $ 2,638,100 $ 3,544,100 $ 1,676,497 $ 1,867,603 Total Expenses 2,638,100 3,544,100 1,676,497 1,867,603 Budget Balance - Wastewater 30,400 242,100 750,155 (508,055) Total Budget Balances - Working Capital 30,400 242,100 750,155 (508,055) TOTAL BUDGET BALANCES & EXPENSES $ 2,668,500 $ 3,786,200 $ 2,426,652 $ 1,359,548 #REF! #REF! #REF! #REF! 159 • 209

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information CITY OF DOVER, DELAWARE ELECTRIC REVENUE FUND D Item 6. SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance - Working Capital $ 13,548,100 $ 16,550,700 $ 17,811,265 $ 1,260,565 Distribution of Earnings - PCA Credit (2,873,800) (2,873,800) (2,727,377) 146,423 10,674,300 13,676,900 15,083,888 1,406,988 REVENUES: Direct base sales 82,686,400 82,686,400 78,675,456 (4,010,944) Rental income 110,000 110,000 400 (109,600) Miscellaneous services 528,000 528,000 1,152,902 624,902 Utility tax 1,322,000 1,322,000 1,223,240 (98,760) Green Energy 127,400 127,400 128,841 1,441 Interest earned - operating 195,000 195,000 279,055 84,055 Total Revenues 84,968,800 84,968,800 81,459,894 (3,508,906) TOTAL BEGINNING BALANCE & REVENUES $ 95,643,100 $ 98,645,700 $ 96,543,782 $ (2,101,918) EXPENSES: Power Supply & Generation Hedged Energy $ 22,115,400 $ 22,115,400 $ 21,967,340 $ 148,060 Power Supply Management 835,000 835,000 634,800 200,200 Capacity Charges 11,101,900 11,101,900 10,796,427 305,473 Dover Sun Park Energy 2,703,900 2,703,900 2,637,035 66,865 Solar Renewal Energy Credits 395,200 395,200 290,927 104,273 Renewable Energy Credits 411,000 411,000 785,167 (374,167) RGGI 67,500 67,500 - 67,500 PJM Charges - Energy 5,678,600 5,678,600 (435,824) 6,114,424 PJM Charges - Transmission & Fees 7,792,400 7,792,400 6,664,703 1,127,697 Total Power Supply 51,100,900 51,100,900 43,340,575 7,760,325 Plant Operations 5,530,700 5,530,700 5,582,727 (52,027) Generation Fuels 956,300 956,300 330,694 625,606 Capacity Credits (8,422,000) (8,422,000) (8,421,958) (42) PJM Spot Market Energy (1,163,100) (1,163,100) (153,978) (1,009,122) PJM Credits (516,900) (516,900) (324,034) (192,866) Total Generation (3,615,000) (3,615,000) (2,986,549) (628,451) Utility Tax 1,322,000 1,322,000 1,223,240 98,760 Administration 615,500 573,100 509,678 63,422 Transmission/Distribution 3,802,800 3,802,800 3,426,896 375,904 Electrical Engineering 1,372,900 1,372,900 1,239,821 133,079 Systems Operations 853,100 853,100 693,451 159,649 Meter Reading 401,900 444,300 406,497 37,803 Contractual Services - Power Supply 200,000 200,000 105,028 94,972 Legal Expenses 100,000 100,000 65,955 34,045 Provision for Uncollectible 250,000 250,000 250,000 - Retirees Health Care 721,400 721,400 721,400 - Green Energy Payment to DEMEC 137,000 137,000 60,839 76,161 Bank & CC Fees 327,000 327,000 339,468 (12,468) Interest on Deposits 17,500 17,500 22,143 (4,643) Interfund Service Fees 3,912,900 3,912,900 3,333,502 579,398 Other Appropriations: Electric Capital Project Fund 6,816,000 6,816,000 6,816,000 - General Fund 10,000,000 10,000,000 10,000,000 - Debt Service 1,379,500 1,379,500 1,398,954 (19,454) Green Energy Grant - - 98,500 (98,500) Rate Stabilization Fund - 3,700,000 3,700,000 - Depreciation Reserve 5,000,000 5,000,000 5,000,000 - Transfer to Green Energy Reserve - - 120,389 (120,389) TOTAL EXPENSES 84,715,400 88,415,400 79,885,787 8,529,613 Budget Balance - Working Capital 10,927,700 10,230,300 16,657,995 (6,427,695) TOTAL BUDGET BALANCE & EXPENSES $ 95,643,100 $ 98,645,700 $ 96,543,782 $ 2,101,918 210 160

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE ELECTRIC IMPROVEMENT AND EXTENSION FUND SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) Beginning Balance - Working Capital $ 12,120,900 $ 15,157,800 $ 15,157,728 $ (72) TOTAL BEGINNING BALANCES 12,120,900 15,157,800 15,157,728 (72) REVENUES: Transfer from Electric Operating Fund 6,816,000 6,816,000 6,816,000 - Transfer from Water Fund 149,000 149,000 149,000 - Transfer from Wastewater Fund 149,000 149,000 149,000 - Transfer from General Fund 250,000 250,000 250,000 - General Service Billing 400,000 400,000 265,808 (134,192) Miscellaneous Receipts - - 131,809 131,809 Interest Earnings 150,000 150,000 188,258 38,258 Total Revenues 7,914,000 7,914,000 7,949,875 35,875 TOTAL BEGINNING BALANCES & REVENUES $ 20,034,900 $ 23,071,800 $ 23,107,603 $ 35,803 EXPENSES: Electric Administration $ 1,643,200 $ 1,643,200 $ 72,140 $ 1,571,060 Electric Generation 115,000 376,000 255,298 120,702 Transmission and Distribution 1,255,000 1,182,000 989,272 192,728 Electrical Engineering 3,293,000 3,366,000 658,950 2,707,050 Meter Reading 21,800 21,800 18,599 3,201 ERP System 488,000 842,800 142,626 700,174 Total Expenses 6,816,000 7,431,800 2,136,885 5,294,915 Budget Balance - Improvement & Extension Fund 13,218,900 15,640,000 20,970,718 (5,330,718) Total Budget Balances - Working Capital 13,218,900 15,640,000 20,970,718 (5,330,718) TOTAL BUDGET BALANCES & EXPENSES $ 20,034,900 $ 23,071,800 $ 23,107,603 $ (35,803) 161 • 211

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL SCHEDULES PROPRIETARY FUND TYPES INTERNAL SERVICE FUNDS WORKERS’ COMPENSATION INSURANCE FUND The City has created this fund to account for the revenues and expenses related to a self- insured Workers’ Compensation Fund. The revenues are received from the City's various funds. These funds contribute to the Workers’ Compensation Fund an amount based on salaries at a pre-determined assessment rate. Claims paid, reinsurance cost and third-party administrator's fees are charged to this fund. Budgetary schedule is included for public review of budgetary compliance. 162 • 212

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE INTERNAL SERVICE FUND - WORKERS' COMPENSATION SCHEDULE OF REVENUES AND EXPENSES BUDGET (NON-GAAP BASIS) AND ACTUAL YEAR ENDED JUNE 30, 2020 VARIANCE ORIGINAL FINAL POSITIVE BUDGET BUDGET ACTUAL (NEGATIVE) OPERATING REVENUES: Beginning Balance $ 1,444,700 $ 1,444,700 $ 1,801,810 $ 357,110 Interest Earned 22,500 22,500 42,320 19,820 City Contribution 989,900 908,500 963,295 54,795 Insurance Refund - - 3,530 3,530 TOTAL REVENUES $ 2,457,100 $ 2,375,700 $ 2,810,955 $ 435,255 OPERATING EXPENSES: Program Expenses $ 550,000 $ 550,000 $ 184,374 $ 365,626 Contractual Services 25,000 25,000 13,448 11,552 Insurance 110,000 110,800 127,940 (17,140) State of Delaware - Self-Insurance Tax 39,000 39,000 34,707 4,293 TOTAL EXPENSES $ 724,000 $ 724,800 $ 360,469 $ 364,331 BUDGET BALANCE - CARRY FORWARD $ 1,733,100 $ 1,650,900 $ 2,450,486 $ (799,586) 163 • 213

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. FINANCIAL STATEMENTS FIDUCIARY FUND TYPES AGENCIES DOWNTOWN DOVER PARTNERSHIP The City established the Downtown Dover Partnership as an agency for the development of the downtown urban area. FOURTH OF JULY CELEBRATION COMMITTEE The Fourth of July Celebration Committee is designed to provide recreation enjoyment and educational events commemorating the birth of our nation. DOVER DAYS CELEBRATION COMMITTEE The Dover Days Celebration Committee was established to fund the annual Old Dover Days Festival; one of Delaware’s largest and longest-running free events dedicated to promoting our state’s heritage and culture. 164 • 214

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Financial Section – Part E – Supplementary Information D Item 6. CITY OF DOVER, DELAWARE COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS YEAR ENDED JUNE 30, 2020 BALANCE BALANCE JUNE 30, 2019 ADDITIONS DEDUCTIONS JUNE 30, 2020 DOWNTOWN DOVER PARTNERSHIP ASSETS: Cash $ 846,387 $ 688,630 $ 666,440 $ 868,577 Receivables - 4,016 - 4,016 Prepaid Items 2,274 - 2,274 - Total Assets $ 848,661 $ 692,646 $ 668,714 $ 872,593 LIABILITIES: Vouchers Payable $ 27,495 $ 353,506 $ 360,958 $ 20,043 Deposit Payable 27,432 - - 27,432 Due to Agencies 793,734 31,384 - 825,118 Total Liabilities $ 848,661 $ 384,890 $ 360,958 $ 872,593 4TH OF JULY CELEBRATION COMMITTEE ASSETS: Cash $ 12,060 $ 3,329 $ 8,898 $ 6,491 Receivables - 5,000 - 5,000 Prepaid items 18,000 - 18,000 - Total Assets $ 30,060 $ 8,329 $ 26,898 $ 11,491 LIABILITIES: Vouchers Payable $ - $ 8,645 $ 8,849 $ (204) Due to Agencies 30,060 - 18,365 11,695 Total Liabilities $ 30,060 $ 8,645 $ 27,214 $ 11,491 DOVER DAYS CELEBRATION ASSETS: Cash $ - $ 18,500 $ 5,227 $ 13,273 Total Assets $ - $ 18,500 $ 5,227 $ 13,273 LIABILITIES: Vouchers Payable $ - $ 319 $ - $ 319 Due to Agencies - 12,954 - 12,954 Total Liabilities $ - $ 13,273 $ - $ 13,273 TOTAL-ALL AGENCY FUNDS ASSETS: Cash & Investments $ 858,447 $ 710,459 $ 680,565 $ 888,341 Receivables - 9,016 - 9,016 Prepaid Items 20,274 - 20,274 - Total Assets $ 878,721 $ 719,475 $ 700,839 $ 897,357 LIABILITIES: Vouchers Payable $ 27,495 $ 362,470 $ 369,807 $ 20,158 Deposit Payable 27,432 - - 27,432 Due to Agencies 823,794 44,338 18,365 849,767 Total Liabilities $ 878,721 $ 406,808 $ 388,172 $ 897,357 165 • 215

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware D Item 6. STATISTICAL SECTION This section of the City of Dover’s Comprehensive Annual Financial Report represents detailed information as a context for understanding what the statements, note disclosures, and required supplementary information says about the Government’s overall financial health. 167 • 217

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. STATISTICAL SECTION This part of the City of Dover’s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government’s overall financial health. FINANCIAL TRENDS These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time. REVENUE CAPACITY These schedules contain information to help the reader assess the City’s most significant local revenue source, property tax. DEBT CAPACITY These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. DEMOGRAPHIC AND ECONOMIC INFORMATION These schedules offer demographic and economic indicators to help the reader understand the environment within which the City’s financial activities take place. OPERATING INFORMATION These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year. 169 • 219

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 1 City of Dover, Delaware Net Position by Component Last Ten Fiscal Years (Accrual basis of accounting) Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Governmental Activities Net investment in capital assets $ 56,266,299 $ 54,309,740 $ 53,239,906 $ 54,350,984 $ 54,325,174 $ 51,485,408 $ 50,738,483 $ 49,577,021 $ 49,642,124 $ 38,839,995 Restricted 346,826 342,285 961,101 306,474 932,728 556,553 612,054 721,682 482,780 1,774,167 Unrestricted (23,727,242) (29,348,340) (36,772,282) (44,105,399) (22,214,284) (27,947,709) (7,142,570) (4,791,553) (6,759,433) (99,435) Total governmental activities net position 32,885,883 25,303,685 17,428,725 10,552,059 33,043,618 24,094,252 44,207,967 45,507,150 43,365,471 40,514,727 Business-type activities Net investment in capital assets 104,913,375 109,497,296 111,894,357 110,779,002 110,647,045 108,565,514 101,670,949 100,079,972 98,303,263 97,270,906 Restricted 70,998,294 54,353,211 46,693,086 44,176,110 37,026,527 36,751,850 36,123,755 34,665,736 33,836,315 34,148,330 Unrestricted 20,778,570 17,850,066 22,683,806 21,086,446 26,876,166 21,732,221 36,098,998 39,534,763 33,947,753 23,286,232 Total business-type activities net position 196,690,239 181,700,573 181,271,249 176,041,558 174,549,738 167,049,585 173,893,702 174,280,471 166,087,331 154,705,468 Primary government Net investment in capital assets 161,179,674 163,807,036 165,134,263 165,129,986 164,972,219 160,050,922 152,409,432 149,656,993 147,945,387 136,110,901 Restricted 71,345,120 54,695,496 47,654,187 44,482,584 37,959,255 37,308,403 36,735,809 35,387,418 34,319,095 35,922,497 Unrestricted (2,948,672) (11,498,274) (14,088,476) (23,018,953) 4,661,882 (6,215,488) 28,956,428 34,743,210 27,188,320 23,186,797 Total primary government net position $ 229,576,122 $ 207,004,258 $ 198,699,974 $ 186,593,617 $ 207,593,356 $ 191,143,837 $ 218,101,669 $ 219,787,621 $ 209,452,802 $ 195,220,195 NOTE The fiscal years prior to 2015 show fund balances as they were reported prior to GASB No. 68. The Change in Net Position for fiscal 2017 includes a prior period adjustment for the OPEB Liability associated with GASB No. 74 & 75. 170 • 220

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 2 City of Dover, Delaware Changes in Net Position Last Ten Fiscal Years (Accrual basis of accounting) Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Expenses Governmental activities: General government $ 4,190,000 $ 3,296,331 $ 3,443,595 $ 3,456,943 $ 4,648,999 $ 3,374,955 $ 1,288,977 $ 1,474,045 $ 1,180,327 $ 1,248,124 Public safety 19,670,023 17,597,828 17,441,023 14,947,553 19,919,050 21,336,042 19,219,986 17,989,463 17,638,304 16,848,343 Public works 4,464,952 6,183,329 7,736,355 6,942,760 7,381,557 3,848,402 6,594,829 6,099,484 8,135,172 6,257,946 Library and recreation 3,736,306 3,211,586 3,106,031 2,866,441 2,183,802 3,079,426 2,942,800 2,313,048 2,377,363 2,731,492 Community and economic development 531,306 461,983 513,857 449,356 551,879 444,474 676,554 939,966 773,208 1,173,546 Central services 626,259 521,020 589,846 473,498 483,426 443,072 512,586 454,816 469,385 599,498 Financial administration 886,495 894,670 964,051 746,714 1,249,012 1,247,976 1,368,048 1,122,830 1,146,524 2,463,426 Other post-employment benefits - - - - - - 3,348,267 5,119,778 6,534,630 6,142,627 Interest on long-term debt 132,711 178,514 129,723 118,275 118,565 174,912 122,812 114,785 90,161 75,397 Total governmental activities expenses 34,238,052 32,345,262 33,924,481 30,001,540 36,536,290 33,949,259 36,074,859 35,628,215 38,345,074 37,540,399 Business-type activities Water and sewer 12,198,697 12,604,448 11,728,740 11,416,394 11,925,299 11,322,958 11,397,992 10,905,358 11,068,607 10,912,722 Electric 64,054,118 68,459,581 72,553,319 62,992,850 61,054,151 67,562,077 74,481,048 74,595,585 77,625,673 90,296,244 Total business-type activities 76,252,815 81,064,029 84,282,059 74,409,244 72,979,450 78,885,035 85,879,040 85,500,943 88,694,280 101,208,966 Total primary government expenses 110,490,867 113,409,291 118,206,540 104,410,784 109,515,740 112,834,294 121,953,899 121,129,158 127,039,354 138,749,365 Program Revenues Governmental activities: Charges for services: General government 2,571,127 2,520,022 2,456,576 2,362,123 2,336,389 2,116,233 2,137,574 2,463,437 4,043,168 1,503,243 Public safety 3,636,312 4,510,464 5,367,450 5,171,989 4,920,783 4,558,200 4,676,162 4,240,847 4,803,827 4,682,687 Public works 3,080,960 3,068,399 3,714,187 2,514,645 2,527,478 2,578,892 2,595,648 2,624,877 1,903,623 2,173,434 Library and recreation 457,674 612,737 640,061 602,873 667,996 696,179 699,622 656,001 632,824 632,861 Operating grants and contributions 3,587,007 2,441,900 2,190,146 2,025,522 2,759,367 2,298,936 2,159,616 2,914,696 2,654,051 5,032,926 Capital grants and contributions 571,817 372,136 344,561 360,538 675,784 166,379 1,226,559 2,107,444 6,292,303 856,338 Total governmental activities program revenues 13,904,897 13,525,658 14,712,981 13,037,690 13,887,797 12,414,819 13,495,181 15,007,302 20,329,796 14,881,489 (Continued) 171 • 221

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. (Table 2 Continued - Changes in Net Position) Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Program Revenues Business-type activities: Charges for services: Water and sewer 14,907,038 16,017,306 16,319,193 16,054,096 14,976,213 14,875,806 13,268,213 13,387,706 13,775,833 14,033,678 Electric 81,488,206 83,709,415 83,883,757 83,655,870 80,695,910 79,802,674 79,489,192 90,685,693 93,529,401 101,902,619 Capital contributions 1,409,145 - - 1,201,963 44,955 1,516,932 401,947 - 441,285 997,750 Total business-type activities program revenues 97,804,389 99,726,721 100,202,950 100,911,929 95,717,078 96,195,412 93,159,352 104,073,399 107,746,519 116,934,047 Total primary government program revenues 111,709,286 113,252,379 114,915,931 113,949,619 109,604,875 108,610,231 106,654,533 119,080,701 128,076,315 131,815,536 Net (expense)/revenue: Governmental activities (20,333,155) (18,819,604) (19,211,500) (16,963,850) (22,648,493) (21,534,440) (22,579,678) (20,620,913) (18,015,278) (22,658,910) Business-type activities 21,551,574 18,662,692 15,920,891 26,502,685 22,737,628 17,310,377 7,280,312 18,572,456 19,052,239 15,725,081 Total primary government net revenue (expense) 1,218,419 (156,912) (3,290,609) 9,538,835 89,135 (4,224,063) (15,299,366) (2,048,457) 1,036,961 (6,933,829) General Revenues and Other Changes in Net Position Governmental activities: Property taxes 14,796,554 13,448,025 13,065,098 12,895,597 12,846,774 11,176,763 11,094,479 11,126,395 11,050,198 10,904,908 Transfer taxes 1,825,438 1,637,194 2,022,165 1,634,707 2,191,915 1,713,505 1,543,626 1,107,686 1,373,103 1,461,983 Investment earnings 551,771 809,345 100,903 132,228 263,667 92,479 142,390 36,793 141,925 137,218 Transfers 10,741,590 10,800,000 10,900,000 10,875,000 16,295,503 10,500,000 8,500,000 10,491,718 8,300,796 8,856,000 Total governmental activities 27,915,353 26,694,564 26,088,166 25,537,532 31,597,859 23,482,747 21,280,495 22,762,592 20,866,022 21,360,109 Business-type activities: Investment earnings 4,179,682 3,752,939 208,800 379,160 1,058,028 544,624 832,919 112,402 630,420 554,787 Transfers (10,741,590) (10,800,000) (10,900,000) (10,875,000) (16,295,503) (10,500,000) (8,500,000) (10,491,718) (8,300,796) (8,856,000) Total business-type activities (6,561,908) (7,047,061) (10,691,200) (10,495,840) (15,237,475) (9,955,376) (7,667,081) (10,379,316) (7,670,376) (8,301,213) Total primary government 21,353,445 19,647,503 15,396,966 15,041,692 16,360,384 13,527,371 13,613,414 12,383,276 13,195,646 13,058,896 Change in Net Position Government activities 7,582,198 7,874,960 6,876,666 8,573,682 8,949,366 1,948,307 (1,299,183) 2,141,679 2,850,744 (1,298,801) Business-type activities 14,989,666 11,615,631 5,229,691 16,006,845 7,500,153 7,355,001 (386,769) 8,193,140 11,381,863 7,423,868 Total primary government $ 22,571,864 $ 19,490,591 $ 12,106,357 $ 24,580,527 $ 16,449,519 $ 9,303,308 $ (1,685,952) $ 10,334,819 $ 14,232,607 $ 6,125,067 NOTE The Change in Net Position for fiscal 2015 includes a prior period adjustment for the Net Pension Liability associated with GASB No. 68. The Change in Net Position for fiscal 2017 includes a prior period adjustment for the OPEB Liability associated with GASB No. 74 & 75. 172 • 222

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 3 City of Dover, Delaware Fund Balances of Governmental Funds Last Ten Fiscal Years (Modified accrual basis of accounting) Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 General fund Non-spendable $ 212,467 $ 234,974 $ 259,258 $ 187,294 $ 195,134 $ 202,620 $ 207,884 $ 227,457 $ 198,175 $ 191,567 Restricted 38,989 27,070 10,572 7,979 173,769 127,706 129,476 131,237 83,356 85,070 Committed 2,145,574 1,047,987 1,111,182 2,441,641 1,059,197 1,041,130 723,300 936,899 920,475 3,484,203 Assigned 4,823,060 4,320,615 2,865,373 1,956,061 2,735,602 3,839,571 3,163,431 3,519,012 658,890 614,559 Unassigned 6,383,591 7,118,240 7,722,505 5,528,605 4,995,522 3,991,442 3,435,079 3,391,714 3,007,983 3,385,209 Total general fund 13,603,681 12,748,886 11,968,890 10,121,580 9,159,224 9,202,469 7,659,170 8,206,319 4,868,879 7,760,608 All other governmental funds Special revenue funds Non-spendable - - 9,990 3,993 350 181 2,447 - 13,099 4,203 Restricted 307,837 315,215 950,529 298,495 758,959 428,847 482,578 590,445 399,424 764,512 Assigned - - - - - - - 123,349 171,381 289,221 Total all other governmental funds 307,837 315,215 960,519 302,488 759,309 429,028 485,025 713,794 583,904 1,057,936 Total fund balances $ 13,911,518 $ 13,064,101 $ 12,929,409 $ 10,424,068 $ 9,918,533 $ 9,631,497 $ 8,144,195 $ 8,920,113 $ 5,452,783 $ 8,818,544 173 • 223

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 4 City of Dover, Delaware Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (Modified accrual basis of accounting) Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Revenues Fines $ 901,197 $ 1,020,920 $ 1,121,135 $ 1,142,722 $ 1,128,211 $ 1,161,876 $ 1,011,156 $ 912,004 $ 1,202,615 $ 1,665,496 Library revenue 329,501 410,154 392,108 380,561 419,677 480,823 498,553 471,065 475,822 444,455 Licenses and permits 2,554,826 2,866,796 3,786,167 3,548,401 3,525,992 2,893,990 2,952,015 2,548,913 2,816,866 2,417,363 Sanitation fees and rebates 3,080,960 3,068,399 3,133,360 2,514,645 2,527,478 2,578,892 2,595,648 2,624,877 1,903,623 2,173,434 Recreation 43,203 61,147 87,125 53,301 65,145 66,038 49,144 40,446 44,522 44,292 Miscellaneous services 1,319,371 1,672,401 2,210,980 1,679,390 1,874,534 1,650,153 1,831,683 2,470,200 3,940,294 1,480,845 Taxes 16,584,028 15,103,449 15,125,329 14,564,304 15,085,481 12,930,532 12,655,035 12,333,520 12,462,532 12,366,891 Grants 4,158,823 2,814,036 2,534,707 2,386,060 3,449,238 2,489,239 3,416,319 5,119,089 8,909,758 5,551,175 Court of chancery fees 1,602,360 1,588,140 1,496,520 1,343,020 1,239,300 1,118,680 1,034,460 917,700 863,220 766,340 Investment income 475,051 730,797 93,751 123,234 234,885 77,769 122,490 45,198 117,405 112,722 Total revenues 31,049,320 29,336,239 29,981,182 27,735,638 29,549,941 25,447,992 26,166,503 27,483,012 32,736,657 27,023,013 Expenditures General government 1,770,930 1,760,851 1,710,100 2,026,568 2,116,749 1,425,786 1,271,523 1,107,122 1,093,772 1,348,911 Library services 2,108,269 1,971,773 1,981,201 1,926,561 1,720,021 1,675,989 1,697,982 5,514,217 13,518,569 4,369,578 Public safety 22,423,765 22,558,701 21,018,381 21,248,561 21,240,506 20,218,519 19,130,832 18,048,642 17,001,619 16,139,953 Public works 3,064,579 2,855,382 1,918,473 2,119,186 2,146,917 1,708,658 2,572,965 1,758,405 2,074,061 2,535,060 Recreational services 1,754,771 1,087,393 821,613 733,961 783,976 865,938 683,363 651,341 827,230 834,124 Streets and sanitation services 3,979,021 4,458,329 4,637,145 4,275,648 6,081,813 6,574,262 4,634,091 2,990,430 3,280,165 3,383,465 Engineering services 209,197 266,332 263,930 219,198 166,579 26,996 - - - - Financial administration 815,956 754,400 762,860 764,622 919,086 979,112 1,002,539 909,877 902,009 866,314 Garage and stores 742,353 492,111 499,289 501,559 465,843 419,597 415,593 431,542 503,036 490,113 Insurance 376,584 276,689 302,258 295,923 280,901 278,682 272,895 241,395 198,241 203,343 Retiree health care lump sum 1,894,900 1,894,900 2,063,000 2,039,700 1,567,700 1,636,500 1,636,500 1,620,600 1,614,241 1,297,509 Employee pension unfunded liability - - 619,000 - 594,300 543,000 121,000 1,693,500 1,545,000 1,544,978 Street lights 807,794 805,185 803,924 811,992 804,246 775,197 774,533 878,760 986,430 968,562 Community and economic development 531,306 461,983 513,857 449,356 551,879 444,474 676,554 939,966 773,208 1,173,546 (Continued) 174 • 224

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 4 (Continued) - Changes in Fund Balances of Governmental Funds Fiscal Year Fiscal Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Expenditures Debt service Principal 328,716 322,745 332,355 573,497 553,824 848,069 429,239 296,003 275,000 270,000 Interest 135,352 34,773 128,455 118,771 118,565 114,243 122,812 73,071 52,734 65,225 Other charges (issuance of debt) - - - - - 60,668 - 1,029 27,255 - Total expenditures 40,943,493 40,001,547 38,375,841 38,105,103 40,112,905 38,595,690 35,442,421 37,155,900 44,672,570 35,490,681 Excess of revenues over(under) expenditures (9,894,173) (10,665,308) (8,394,659) (10,369,465) (10,562,964) (13,147,698) (9,275,918) (9,672,888) (11,935,913) (8,467,668) Other financing sources (uses) Bond proceeds - 5,700,000 - - - 4,135,000 - 2,648,500 851,500 - Transfers in 14,277,336 13,953,381 14,220,407 13,885,445 14,339,821 13,500,366 11,458,445 12,666,208 10,959,204 12,420,329 Transfers out (3,535,746) (3,153,381) (3,320,407) (3,010,445) (3,489,821) (3,000,366) (2,958,445) (2,174,490) (2,658,408) (3,564,329) Payments to refunded bond escrow agent - (5,700,000) - - - - - - - - Total other financing sources (uses) 10,741,590 10,800,000 10,900,000 10,875,000 10,850,000 14,635,000 8,500,000 13,140,218 9,152,296 8,856,000 Net change in fund balances $ 847,417 $ 134,692 $ 2,505,341 $ 505,535 $ 287,036 $ 1,487,302 $ (775,918) $ 3,467,330 $ (2,783,617) $ 388,332 Debt service as a percentage of noncapital expenditures 1.34% 0.99% 1.27% 1.97% 1.96% 3.09% 1.74% 1.14% 1.07% 0.85% Capital outlay included in total expenditures (1) $ 6,190,215 $ 3,993,940 $ 2,066,950 $ 2,973,131 $ 5,753,588 $ 7,500,186 $ 3,777,578 $ 4,872,122 $ 13,927,288 $ 5,296,536 NOTES (1) Capital outlay has been included in functional expenditures. Debt service as a percentage of non-capital expenditures excludes capital outlay expenditures. 175 • 225

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 5 City of Dover, Delaware Governmental Activities Tax Revenues by Source Last Ten Fiscal Years (accrual basis of accounting) Fiscal Property Transfer Year Tax Tax Total 2020 $ 14,758,590 $ 1,825,438 $ 16,584,028 2019 13,448,025 1,637,194 15,085,219 2018 13,065,098 2,022,165 15,087,263 2017 12,895,597 1,634,707 14,530,304 2016 12,846,772 2,191,915 15,038,687 2015 11,176,763 1,713,788 12,890,551 2014 11,094,479 1,543,626 12,638,105 2013 11,126,395 1,107,686 12,234,081 2012 11,050,198 1,373,103 12,423,301 2011 10,904,908 1,461,983 12,366,891 NOTES 1. Property Tax rate of $.4400 per $100 of 100% assessed value (See Table 6 for tax rates). Revenues include payments in lieu of taxes, farm land roll back and penalties. 176 • 226

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 6 City of Dover, Delaware Assessed and Estimated Actual Value of Taxable Property Last Ten Fiscal Years REAL PROPERTY Ratio of Direct Less: Total Taxable Tax Fiscal Total Assessed Exempt Total Taxable Estimated Value to Total Rate Year Value Properties Assessed Value Actual Value Assessed Value Per $100 2020 $ 4,617,529,500 $ 1,343,536,900 $ 3,273,992,600 $ 4,617,529,500 70.90% $ 0.4400 2019 4,600,542,300 1,342,452,800 3,258,089,500 4,600,542,300 70.82% 0.4050 2018 4,553,536,100 1,338,792,000 3,214,744,100 4,553,536,100 70.60% 0.4050 2017 4,493,113,000 1,336,802,000 3,156,311,000 4,493,113,000 70.25% 0.4050 2016 4,443,188,600 1,335,276,500 3,107,912,100 4,443,188,600 69.95% 0.4050 2015 4,584,108,050 1,376,954,490 3,207,153,560 4,584,108,050 69.96% 0.3378 2014 4,525,547,960 1,365,654,100 3,159,893,860 4,525,547,960 69.82% 0.3378 2013 4,510,303,860 1,328,807,500 3,181,496,360 4,510,303,860 70.54% 0.3378 2012 4,469,369,160 1,300,061,400 3,169,307,760 4,469,369,160 70.91% 0.3378 2011 4,363,518,360 1,226,879,300 3,136,639,060 4,363,518,360 71.88% 0.3378 Source: Tax Assessor's Office, City of Dover. NOTES 1. There is no tax on personal properties. Therefore, no figures are presented. 2. In 2015, the City property values were reassessed, effective for tax year 2016. The tax rate was increased from $ .3378 to $ .4050 per $100. Had the tax rate been rolled back to a revenue neutral rate, the rate would have been $ .3499 per $100. The revised rate represents a $ .0672 increase. 3. In 2020, the City property tax rate was increased from $.4050 to $.4400 per $100. The revised rate represents a $.0350 increase. 177 • 227

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 7 NOTES City of Dover, Delaware 1. Section 48 of the City of Property Tax Rates - All Direct and Overlapping Dover charter provides that Governments with the Capital School District the amount of money to be (Per $100 of Assessed Value) raised through property Last Ten Fiscal Years taxes shall not exceed 2% of the total taxable assessment. 2. Kent County Property tax Direct Overlapping rates reflect the 1987 City Capital Vo-Tech Total reappraisal of properties in Fiscal of Kent School School Direct & Kent County. Year Dover County District District Overlapping 3. In 2015, the City property 2020 0.4400 0.3000 2.1897 0.1578 3.0875 values were reassessed, 2019 0.4050 0.3000 1.8307 0.1541 2.6898 effective for tax year 2016. 2018 0.4050 0.3000 1.7942 0.1522 2.6514 Tax rate increased to 2017 0.4050 0.3000 1.8065 0.1484 2.6599 $.4050. 2016 0.4050 0.3000 1.8115 0.1415 2.6580 2015 0.3378 0.3000 1.8215 0.1372 2.5965 4. In 2020, the City Tax rate 2014 0.3378 0.3000 1.8500 0.1372 2.6250 increased to $.4400. 2013 0.3378 0.3000 1.9090 0.1372 2.6840 2012 0.3378 0.3000 1.8320 0.1351 2.6049 2011 0.3378 0.3000 1.8320 0.1351 2.6049 Sources: Tax Assessor's Office - City Receiver of Taxes Office - Kent County Property Tax Rates - FY 2020 All Direct & Overlapping Governments I· City of Dover . Kent County •Capital School • Vo-Tech School 178 • 228

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 8 Principal Tax Payers Current Year and Nine Years Ago PERCENTAGE PERCENTAGE OF TOTAL OF TOTAL 2020 TAXABLE 2011 TAXABLE ASSESSED ASSESSED ASSESSED ASSESSED TAX PAYERS VALUATION RANK VALUATION VALUATION RANK VALUATION Dover Downs Prop, Inc. $148,109,700 1 3.21% $146,847,600 1 4.68% Dover Mall LP/Dover Commons 71,706,800 2 1.55% 80,921,800 2 2.58% Dover Medical Center 39,892,800 3 0.86% 27,270,100 3 0.87% Blue Hen Apt LLC 30,895,300 4 0.67% - - - Leander Lakes LLC 27,484,300 5 0.60% - - - CW Dover LLC FKA Dover South Coast 23,071,400 6 0.50% 25,035,100 4 0.80% Kraft-General Foods Corp. 21,534,700 7 0.47% 19,565,300 5 0.62% Onix Dover LLC 16,617,800 8 0.36% - - - GM Country Club LLC 15,788,600 9 0.34% 13,176,500 10 0.42% Multi Residential M LLC 14,415,500 10 0.31% - - - Millers Dover Downs - - - 13,463,600 9 0.43% Dover Bay Court Plaza - - - 17,291,300 6 0.55% Berks City Real Estate LLC - - - 13,492,400 8 0.43% East Country Village - - - 15,691,800 7 0.50% Source: Tax Assessor's Office, City of Dover $409,516,900 Total assessed valuation for current year is 4,617,529,500 Total assessed valuation for ten years ago is 3,136,639,060 179 • 229

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 9 City of Dover, Delaware Property Tax Levies and Collections Last Ten Fiscal Years Total Collected Within Collection Collected in Total Collection Fiscal Tax the Fiscal Year as Percentage Subsequent Collections as Percentage Year Levy of the Levy of Levy Years to Date of Levy 2020 $ 14,136,787 $ 13,799,173 97.6% $ - $ 13,799,173 97.61% 2019 12,887,417 12,870,997 99.9% 18,713 12,887,417 100.00% 2018 12,669,581 12,628,024 99.7% 37,746 12,664,805 99.96% 2017 12,478,630 12,401,338 99.4% 78,577 12,478,630 100.00% 2016 12,437,857 12,204,948 98.1% 232,909 12,437,857 100.00% 2015 10,737,703 10,612,272 98.8% 125,431 10,737,703 100.00% 2014 10,696,886 10,493,954 98.1% 202,932 10,696,886 100.00% 2013 10,594,623 10,398,888 98.2% 195,735 10,594,623 100.00% 2012 10,549,631 10,280,930 97.5% 268,701 10,549,631 100.00% 2011 10,481,734 10,166,681 97.0% 315,053 10,481,734 100.00% Source: City of Dover Assessor & Customer Service Reports. Property Taxes Levied Last Ten Fiscal Years $15 $13 - Millions $11 $9 $7 $5 $3 $1 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 NOTES 1. Section 48 of the City of Dover charter provides that the maximum budget to be raised through property taxes shall not exceed 2% of the total taxable assessment. 2. Total Tax Levy represents the annual tax billings, quarterly billings, penalties, and adjustments from tax appeals. 3. The table excludes payments in lieu of taxes and farm land roll back taxes. 180 • 230

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 10 City of Dover, Delaware Ratios of Outstanding Debt by Type Last Ten Fiscal Years Governmental Activities Business-type Activities General Water Wastewater Electric Total Percentage Fiscal Obligation Revenue Revenue Revenue Primary of Personal Per Year Bonds Bonds Bonds Bonds Government Income Capita Population 2020 $ 5,371,284 $ 8,334,270 $ 6,001,858 $ 16,115,093 $ 35,822,505 2.8% 934 38,349 2019 5,700,000 7,305,318 5,892,377 16,854,752 35,752,447 3.8% 916 37,790 2018 5,877,013 5,690,715 5,621,684 17,890,000 35,079,412 4.1% 921 38,422 2017 6,209,368 6,078,504 6,032,584 18,620,000 36,940,456 4.3% 978 37,686 2016 6,782,865 6,455,126 6,433,665 19,315,000 38,986,656 4.6% 1,041 37,941 2015 7,336,689 6,824,206 6,826,581 21,680,000 42,667,476 5.4% 1,137 37,560 2014 4,049,758 6,571,627 7,840,720 23,940,000 42,402,105 5.4% 1,130 37,540 2013 4,478,997 4,335,713 6,591,004 26,110,000 41,515,714 5.1% 1,138 36,492 2012 2,085,815 3,918,005 6,947,349 27,995,025 40,946,194 5.0% 1,129 36,267 2011 1,499,143 2,125,228 5,788,156 30,033,446 39,445,973 4.9% 1,070 37,341 Source: City of Dover Financial Records Population Source: City Count Beginning in FY19, Electric Revenue Bonds includes a premium of $1,154,752. Fiscal Year 2020 Electric Revenue Bonds includes a premium of $1,065,093. 181 • 231

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 11 Ratio of Net General Obligation Bonded Debt To Assessed Value and Net Bonded Debt Per Capita Last Ten Fiscal Years Ratio of Net Net Net Bonded Bonded Taxable Gross Net Debt To Debt Fiscal Assessed Bonded Bonded Assessed Per Year Population Value Debt Debt Value Capita 2020 38,349 $3,273,992,600 $ 5,371,284 5,371,284 0.16% 140.06 2019 37,790 3,258,089,500 5,700,000 5,700,000 0.17% 150.83 2018 38,422 3,214,744,100 5,877,013 5,877,013 0.18% 154.24 2017 37,686 3,156,311,000 5,877,013 5,877,013 0.19% 154.24 2016 37,941 3,107,912,100 6,782,865 6,782,865 0.22% 179.51 2015 37,560 3,207,153,560 7,336,689 7,336,689 0.23% 195.03 2014 37,540 3,159,893,860 4,049,758 4,049,758 0.13% 107.88 2013 36,492 3,181,496,360 4,478,997 4,478,997 0.14% 121.97 2012 36,267 3,169,307,760 4,478,997 4,478,997 0.14% 122.74 2011 37,341 3,136,639,060 2,085,815 2,085,815 0.07% 57.51 Source: City of Dover Financial Records, Tax Assessor’s Office and Delaware Population Consortium Annual Population Projections (City Count). NOTES 1. This table includes all long-term general obligation bonded debt only. The Enterprise Funds have no general obligation debt. 2. Assessed value reflects the net billable tax base and does not include the exempt value, exemption for Senior Citizens and exemption for disability. 182 • 232

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 12 City of Dover, Delaware Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Expenditures Last Ten Fiscal Years Ratio of Debt Service Total Total to Total Fiscal Debt General General (1) Year Principal Interest Service Expenditures Expenditures 2020 $ 328,716 $ 134,852 $ 463,568 $ 49,048,464 0.95% 2019 322,745 132,829 455,574 46,907,709 0.97% 2018 332,355 128,455 460,810 44,049,712 1.05% 2017 573,497 118,771 692,268 44,378,544 1.56% 2016 553,824 118,565 672,389 46,477,667 1.45% 2015 848,069 114,243 962,312 45,484,211 2.12% 2014 429,239 122,812 552,051 39,646,120 1.39% 2013 296,003 73,071 369,074 40,517,512 0.91% 2012 275,000 52,734 327,263 47,743,864 0.69% 2011 270,000 65,225 335,225 38,898,945 0.86% Source: City of Dover Financial Records. NOTES 1. The General Expenditures include all operating items, capital items and debt service. 183 • 233

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 13 City of Dover, Delaware Computation of Direct and Overlapping Debt with the Capital School District June 30, 2020 Percentage Amount Net Debt Applicable to Applicable to Jurisdiction Outstanding City of Dover City of Dover City of Dover $ 5,371,284 100% $ 5,371,284 Kent County (1) 55,985,303 0% N/A (2) Capital School District 47,905,405 N/A N/A TOTAL $ 109,261,992 $ 5,371,284 Sources: City of Dover Financial Records, Kent County Levy Court - Accounting Department and Capital School District - Administration Department. NOTES 1. Kent County: Total debt for Kent County is $55,985,303 as of June 30, 2020. Although Kent County's bonds are general obligation bonds, $52,631,348 is payable from the Kent County Sewer Fund(s) or other committed sources. 2. Capital School District: As of June 30, 2020, the net outstanding debt was $47,905,405. Percentage and amount is not applicable to the City of Dover. 184 • 234

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 14 Computation of Legal Debt Margin Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year 2020 2019 2019 2018 2017 2016 2015 2014 2013 2012 2011 Debt Limit $ 163,700 $ 162,904 $ 160,737 $ 157,816 $ 155,396 $ 158,485 $ 157,995 $ 159,075 $ 158,465 $ 156,832 $ 145,351 Net (Taxable) Assessed Value on Books 3,273,993 3,258,090 3,214,744 3,156,311 3,107,912 3,207,154 3,159,894 3,181,496 3,169,308 3,136,639 2,907,011 Total net debt applicable to limit 5,371 5,700 5,877 6,209 6,783 7,337 4,050 4,479 1,550 1,820 2,080 Legal Debt Margin $ 158,328 $ 157,204 $ 154,860 $ 148,613 $ 151,149 $ 153,945 $ 154,596 $ 156,915 $ 155,012 $ 143,271 $ 142,520 Total Net Debt applicable to limit as a percentage of debt limit 3.28% 3.50% 3.59% 4.36% 4.63% 2.56% 2.82% 0.98% 1.16% 1.43% 1.69% Legal Debt Margin Calculation for Fiscal Year 2016 Net (Taxable) Assessed Value on Books $ 3,273,993 Debt Limit - 5 Percent of Total Assessed Value $ 163,700 DEBT (For which the City's full faith and credit has been pledged) Gross Bonded Debt 5,371 LEGAL DEBT MARGIN $ 158,328 Source: City of Dover Financial Reports, City of Dover Charter, Section 50(b), and Tax Assessor's Office July 2009 the Charter was amended and the debt limit was reduced from 25% of the total assessed value to 5%. 185 • 235

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 15 City of Dover, Delaware Revenue Bond Coverage - Electric Revenue Bonds Last Ten Fiscal Years Available Fiscal Gross Operating For Debt Debt Service Requirements of Each Fiscal Year Year Revenue Expenses Service Principal Interest Total Coverage 2020 $ 81,880,477 $ 52,849,253 $ 29,031,224 $ 650,000 $ 613,200 $ 1,263,200 22.98 2019 84,195,248 56,720,895 27,474,353 765,000 669,785 1,434,785 19.15 2018 84,235,174 60,595,349 23,639,825 730,000 847,454 1,577,454 14.99 2017 83,943,882 54,748,915 29,194,967 695,000 883,954 1,578,954 18.49 2016 80,846,658 54,418,343 26,428,315 2,365,000 918,704 3,283,704 8.05 2015 79,769,994 66,521,873 13,248,121 2,260,000 1,036,954 3,296,954 4.02 2014 79,476,865 68,594,189 10,882,676 2,170,000 1,131,854 3,301,854 3.30 2013 90,876,162 68,546,508 22,329,654 2,110,000 1,205,554 3,315,554 6.73 2012 93,650,277 71,607,021 22,043,256 2,060,000 1,260,054 3,320,054 6.64 2011 102,734,764 84,195,802 18,538,962 2,370,000 1,609,192 3,979,192 4.66 Source: City of Dover Financial Records. NOTES 1. Coverage required by the bond resolution is 1.25. 4. Figures presented in this table compare the net revenue available for debt service to the debt service requirements 2. Calculation of gross revenue for fiscal year 2020 is as follows: of the same fiscal year. Gross Revenue: 5. In November 2011, the City issued Electric Revenue Operating Revenues $ 81,413,160 Refunding Bonds in the amount of $8,810,000 to refund the Interest Earned-Operating Funds 467,317 2014 Series. This refunding reduced the principal payable Total Gross Revenue $ 81,880,477 6. In August 2018, the City issued Electric Revenue 3. Direct operating expenses do not include depreciation Refunding Bonds in the amount of $15,700,000 to refund expense. the 2008 Series. This refunding reduced the principal 186 • 236

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 16 City of Dover, Delaware Revenue Bond Coverage - Water Bonds Last Ten Fiscal Years Maximum Requirements Net Revenue Maximum Direct Available Debt Fiscal Gross Operating For Debt Service Actual Year Revenue Expenses Service Requirement Coverage 2020 $ 6,319,837 $ 3,688,935 $ 2,630,902 $ 543,630 4.84 2019 6,529,019 3,203,880 3,325,139 524,242 6.34 2018 6,447,543 2,909,073 3,538,470 524,242 6.75 2017 6,609,242 3,125,243 3,483,999 524,242 6.65 2016 6,172,107 3,515,886 2,656,221 524,242 5.07 2015 5,601,248 2,977,707 2,623,541 524,242 5.00 2014 5,170,210 3,146,564 2,023,646 524,242 3.86 2013 5,191,780 3,087,102 2,104,678 403,438 5.22 2012 5,292,750 3,150,679 2,142,071 404,349 5.30 2011 5,596,330 3,294,827 2,301,503 249,562 9.22 Source: City of Dover Financial Records. NOTES 1. Coverage required by bond resolution is 1.20. 2. The maximum debt service requirement presented above covers all revenue bond requirements. Rates were increased in 2011 for debt service coverage on multi-year projects. 3. Direct operating expenses do not include depreciation expense for coverage purposes as per the bond indenture. 4. In Fiscal year 2013, various capital projects were completed. These capital projects were financed by three state revolving fund loans issued in 2009, 2010 & 2011 in the amount of $5.9 million, $2.4 million and $0.8 million, respectively, resulting in an increase in debt service. 5. In Fiscal year 2014, the City issued Water and Sewer Revenue Bonds in the amount of $6,125,000. These bonds were issued to refund the Series 2003 Water and Wastewater Revenue bonds and provided $4,005,960 for two capital projects. 6. Gross revenue is derived by taking gross revenue plus operating interest less the transfer to the water impact fee reserve. 187 • 237

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 17 City of Dover, Delaware Revenue Bond Coverage - Wastewater Bonds Last Ten Fiscal Years Maximum Requirements Net Revenue Maximum Direct Available Debt Fiscal Gross Operating For Debt Service Actual Year Revenue Expenses Service Requirement Coverage 2020 $ 8,731,984 $ 5,769,453 $ 2,962,531 $ 739,193 4.01 2019 8,749,309 6,916,935 1,832,374 608,563 3.01 2018 8,528,281 6,137,754 2,390,527 608,563 3.93 2017 8,745,021 5,781,479 2,963,542 608,563 4.87 2016 8,833,588 6,105,790 2,727,798 608,563 4.48 2015 8,784,378 6,272,640 2,511,738 608,563 4.13 2014 8,137,044 6,179,842 1,957,202 608,563 3.22 2013 8,091,003 5,754,656 2,336,347 615,877 3.79 2012 8,354,396 5,912,874 2,441,522 589,488 4.14 2011 8,161,718 5,927,278 2,234,440 166,860 13.39 Source: City of Dover Financial Records. NOTES 1. Coverage required by bond resolution is 1.20. 2. The maximum debt service requirement presented above covers all revenue bond requirements. Rates were increased in 2011 for debt service coverage on multi-year projects. 3. Direct operating expenses do not include depreciation expense for coverage purposes as per the bond indenture. 4. In Fiscal year 2013, various capital projects were completed. These capital projects were financed by three state revolving fund loans issued in 2009, 2010 & 2011 in the amount of $5.9 million, $2.4 million and $0.8 million, respectively, resulting in an increase in debt service. 5. In Fiscal year 2014, the City issued Water and Sewer Revenue Bonds in the amount of $6,125,000. These bonds were issued to refund the Series 2003 Water and Wastewater Revenue bonds and provided $4,005,960 for two capital projects. 6. Gross revenue is derived by taking gross revenue plus operating interest less the transfer to the wastewater impact fee reserve. 188 • 238

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 18 City of Dover, Delaware Top 10 Water and Wastewater Utility Customers Fiscal Year Ended June 30, 2020 Water % of % of Consumption Total Revenue Total Customer (Tgal) Consumption Billed Revenue Garrison Energy Center 346,586 20.59% $ 1,039,818 18.93% Procter and Gamble 56,184 3.34% 168,612 3.07% Delaware State University 47,941 2.85% 144,011 2.62% Dover Downs 45,111 2.68% 135,393 2.46% Kent General Hospital 28,359 1.69% 85,347 1.55% Dover Housing Authority 22,364 1.33% 69,599 1.27% Kraft Foods Global 21,940 1.30% 65,880 1.20% Bayhealth Medical Center 21,195 1.26% 63,870 1.16% Sovereign Property Management 20,093 1.19% 61,292 1.12% Tidewater Utilities 19,167 1.14% 76,428 1.39% Totals for Top 10 Customers 628,940 37.37% 1,910,248 34.78% All Other 1,054,021 62.63% 3,582,642 65.22% Total for System 1,682,961 100.00% $ 5,492,890 100.00% Wastewater % of % of Consumption Total Revenue Total Customer (Tgal) Consumption Billed Revenue Kraft Foods Global 36,463 2.99% $ 245,426 2.93% Dover Downs 34,138 2.80% 229,809 2.74% Procter and Gamble 33,280 2.73% 224,064 2.67% Kent General Hospital 28,359 2.33% 191,126 2.28% Delaware State University 27,013 2.22% 181,947 2.17% Dover Housing Authority 22,337 1.83% 152,765 1.82% Bayhealth Medical Center 21,195 1.74% 142,927 1.71% Sovereign Property Management 20,093 1.65% 136,238 1.63% Garrison Energy Center 15,781 1.29% 107,074 1.28% Dover East Estates 15,571 1.28% 104,823 1.25% Totals for Top 10 Customers 254,230 20.86% 1,716,200 20.48% All Other 964,805 79.14% 6,665,709 79.52% Total for System 1,219,035 100.00% $ 8,381,909 100.00% NOTES: 1. Both the Water and Wastewater revenue billed amounts for each vendor, do not include the monthly flat rate of $2.50. 2. The total Revenue amounts for both Water and Wastewater include the monthly flat rates. 189 • 239

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section Table 19 D Item 6. City of Dover, Delaware Top 10 Electric Utility Customers Fiscal Year Ended June 30, 2020 % of Total Revenue % of Total Customer Kwh Kwh Billed Revenue Dover Air Force Base 63,102,208 8.8% $ 3,926,470 5.1% Kraft 47,560,937 6.6% 2,939,266 3.8% Edgewell Personal Care Products 42,621,711 5.9% 2,787,460 3.6% Delaware State University 29,344,095 4.1% 1,922,706 2.5% Bay Health/Kent General 25,504,054 3.6% 1,671,676 2.2% Dover Downs 23,670,424 3.3% 1,548,141 2.0% State of Delaware 14,513,056 2.0% 945,806 1.2% Procter & Gamble 13,323,802 1.9% 824,711 1.1% Capital School District 10,962,442 1.5% 714,977 0.9% Eden Hill Medical Center 5,265,000 0.7% 344,331 0.4% Totals for Top 10 Customers 275,867,729 38.5% 17,625,544 22.8% All Other 441,169,637 61.5% 59,836,225 77.2% Total for System 717,037,366 100.0% $ 77,461,770 100.0% Note: The revenue billed includes direct base sales and utility tax. 190 • 240

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 20 City of Dover, Delaware Demographic and Economic Statistics Last Ten Calendar Years Per Capita Personal Personal Median School Unemployment Year Population Income Income Age Enrollment Rate 2020 38,349 $ 1,297,385,019 $ 33,831 38.2 6,250 6.7% 2019 37,790 921,244,620 24,378 29.9 6,519 5.7% 2018 38,422 865,182,114 22,707 29.5 6,494 5.8% 2017 37,686 827,207,700 21,950 30.0 6,523 6.2% 2016 37,941 842,783,433 22,213 30.2 6,486 5.7% 2015 37,560 730,354,200 19,445 31.3 6,665 7.4% 2014 37,540 788,039,680 20,992 29.8 6,527 6.4% 2013 36,492 821,361,936 22,508 31.1 6,344 9.6% 2012 36,267 828,258,924 22,697 33.2 6,984 9.3% 2011 37,341 818,158,759 22,379 31.3 7,185 9.9% Population Source: City Count Personal Income Source: Estimation based on Population times Per Capita Personal Income Per Capita Personal Income Source: U.S. Census Bureau, 2012-2016 American Community Survey 5-Year Estimates Median Age Source: 2012-2016 American Community Survey 5-Year Estimates Capital School Enrollment Source: Includes kindergarten through 12th grade, as of Summer 2018 Unemployment Rate Source: Delaware Department of Labor Statistics Not Seasonally Adjusted, June 2018 191 • 241

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 21 City of Dover, Delaware Major Employers by Industry Current Year and Nine Years Ago 2019 4th Quarter 2010 4th Quarter Percentage of Percentage of Number of Total County Number of Total County Industry Description Employees Rank Employment Employees Rank Employment Government 19,237 1 28.0% 18,882 1 30.9% Retail trade 9,401 3 13.7% 9,002 2 14.7% Health care & social assistance 10,601 2 15.5% 7,669 3 12.6% Accommodation & food services 6,733 4 9.8% 5,075 4 8.3% Manufacturing 4,913 5 7.2% 3,225 5 5.3% Arts, entertainment, & recreation 1,471 10 2.1% 2,747 6 4.5% Construction 2,703 6 3.9% 2,123 8 3.5% Transportation & warehousing 2,691 7 3.9% 1,981 9 3.2% Admin and waste services 2,606 8 3.8% 2,623 7 4.3% Professional & technical services 1,817 9 2.6% 1,302 10 2.1% 62,173 90.6% 54,629 89.5% Total - All Industries 68,592 61,033 Source: Delaware Department of Labor/Office of Occupational and Labor Market Information/Payroll Data/Quarterly Census of Employment and Wages (Geography information is available by County only, not by City) Note: The names of the top employers & number of employees is confidential and may not be disclosed to the public pursuant to 20 CFR (Code of Federal Regulations) Part 603. As a result, the employment information provided is by industry. 192 • 242

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section Table 22 D Item 6. City of Dover, Delaware Full-time Equivalent City Government Employees by Function - Budgeted Last Ten Fiscal Years 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Assessor 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 City Clerk 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 City Manager 5.0 5.0 5.0 4.0 4.0 4.0 4.0 3.0 5.0 5.0 Customer Services 16.0 16.0 16.0 13.0 14.0 14.0 15.0 14.0 14.0 15.0 Facilities Management 5.0 5.0 5.0 5.0 7.0 7.0 7.0 9.0 12.0 13.0 Finance 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 Fire 5.0 5.0 5.0 5.0 5.0 6.0 8.0 6.0 6.0 6.0 Fleet Maintenance 7.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 6.0 Human Resources 4.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 Information Technology 4.0 4.0 4.0 4.0 4.0 5.0 5.0 5.0 5.0 7.0 Library 14.0 13.0 13.0 13.0 13.0 14.0 13.0 13.0 12.0 17.5 Mayor 2.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 Parks and Recreation 9.0 9.0 5.0 5.0 5.0 5.0 5.0 5.0 6.0 8.0 Police Civilian 34.0 33.0 33.0 33.0 33.0 31.0 31.0 29.0 29.0 29.0 Police Law Enforcement 101.0 101.0 101.0 101.0 101.0 93.0 93.0 93.0 93.0 91.0 Procurement & Inventory 4.0 5.0 3.0 3.0 3.0 3.0 4.0 4.0 6.0 6.0 Public Works, Administration 7.0 6.0 6.0 6.0 6.0 5.0 5.0 6.0 5.0 4.0 Planning, Inspections 7.0 6.0 6.0 6.0 6.0 6.0 6.0 7.0 7.0 7.0 Planning, Life Safety 4.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 4.0 Economic Development - - - - 3.0 3.0 3.0 3.0 3.0 3.0 Public Works, Engineering 2.0 3.0 3.0 3.0 3.0 3.0 - - - - Planning 6.0 6.0 6.0 6.0 6.0 5.0 4.5 4.5 5.0 5.0 Planning, Code Enforcement 5.0 5.0 5.0 5.0 5.0 5.0 5.0 4.0 4.0 4.5 Community Development - - - - - - 0.5 0.5 1.0 1.0 Public Works, Grounds Maintenance 14.0 13.0 13.0 13.0 13.0 13.0 14.0 14.0 14.0 15.0 Public Works, Sanitation 10.0 10.0 10.0 10.0 10.0 11.0 11.0 11.0 13.0 12.0 Public Works, Streets 7.0 8.0 8.0 8.0 8.0 8.0 8.0 10.0 11.0 11.0 Public Works, Stormwater 7.0 - - - - - - - - - General Fund Total 294.0 281.0 275.0 271.0 277.0 269.0 270.0 269.0 279.0 289.0 Public Utilities, Electric Administration 2.0 3.0 5.0 5.0 4.0 3.0 3.0 3.0 4.0 4.0 Public Utilities, Electric Engineering 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 Public Utilities, Electric System OPS 7.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 Public Utilities, Electric Meter Reading 4.0 4.0 4.0 4.0 4.0 3.0 3.0 3.0 3.0 3.0 Public Utilities, Electric Transmission & Distribution 23.0 24.0 24.0 24.0 24.0 24.0 24.0 24.0 25.0 25.0 Electric Fund Total 46.0 46.0 48.0 48.0 47.0 45.0 45.0 45.0 47.0 47.0 Public Utilities, Construction - - - - - 3.0 3.0 5.0 6.0 6.0 Public Utilities, Wastewater Engineering 2.0 5.0 5.0 5.0 5.0 5.0 5.0 6.0 6.0 6.0 Public Utilities, Wastewater Management 11.0 10.0 11.0 11.0 11.0 11.0 11.0 10.0 10.0 9.0 Public Utilities, Water Engineering 3.0 Public Utilities, Water Management 6.0 7.0 6.0 6.0 6.0 4.0 4.0 5.0 4.0 4.0 Public Utilities, Water Treatment Plant 14.0 13.0 13.0 13.0 13.0 11.0 11.0 10.0 10.0 10.0 Water Meter Reading - - - - - - - - - - Water/Wastewater Fund Total 36.0 35.0 35.0 35.0 35.0 34.0 34.0 36.0 36.0 35.0 Total Full-Time Equivalents 376.0 362.0 358.0 354.0 359.0 348.0 349.0 350.0 362.0 371.0 Source: City of Dover Budget 193 • 243

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 23 City of Dover, Delaware Operating Indicators and Capital Assets Used in Operations Last Ten Fiscal Years June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2014 June 30, 2013 June 30, 2012 June 30, 2011 Land area - Acres 15,276.80 15,193.00 15,191.70 15,191.70 15,191.70 14,914.50 14,909.33 14,909.33 14,909.33 14,909.33 Land area - Square Miles 23.87 23.74 23.74 23.74 23.74 23.30 23.29 23.29 23.29 23.29 Total Miles of Street 172.35 170.52 170.33 169.08 168.01 167.78 164.49 164.08 162.81 158.94 City Maintained Miles of Streets 113.00 111.17 110.98 109.73 108.66 108.43 105.14 104.73 103.46 101.59 State Maintained Miles of Streets 59.35 59.35 59.35 59.35 59.35 59.35 53.35 59.35 59.35 57.35 Dover Population - U. S. Census data 36,047 36,047 36,047 36,047 36,047 36,047 36,047 36,047 36,047 36,047 Dover Population - City Count 38,349 37,790 38,422 37,686 37,941 37,560 37,540 36,492 36,267 37,341 Registered Voters 25,535 25,131 24,513 23,942 24,170 22,837 22,779 21,998 22,362 21,454 Electric Utility: Generating Units 2 2 2 2 4 4 4 4 4 4 Co-Generating Unit 0 0 0 0 0 1 1 1 1 1 Total Units 2 2 2 2 4 5 5 5 5 5 Generating Capacity 147 mw 147 mw 147 mw 147 mw 175 mw 175 mw 175 mw 175 mw 175 mw 175 mw Co-Generating Capactiy 0 mw 0 mw 0 mw 0 mw 0 mw 175 mw 175 mw 175 mw 175 mw 175 mw Area of Service 74.8 sq. mi. 74.8 sq. mi. 74.8 sq. mi. 67.77 sq. mi. 67.77 sq. mi. 67.77 sq. mi. 68 sq. mi. 68 sq. mi. 68 sq. mi. 68 sq. mi. Substations 15 15 15 15 15 15 15 15 15 15 High Peak Load 164.38 165.16 mw 162.87 mw 165.9 mw 158.5 mw 158 mw 164.162 mw 171 mw 172 mw 162.6 mw Customers: Residential 20,899 20,899 20,545 20,155 20,065 20,143 19,900 19,990 19,908 19,782 Commercial 3,541 3,541 3,577 3,424 3,310 3,343 3,412 3,412 3,354 3,386 Primary 36 36 36 37 37 36 37 37 39 38 69 KV Industrial 5 5 5 5 5 4 5 4 4 4 Municipal - Total number of meters 0 0 0 0 0 0 0 0 0 0 Total Customers Sales $ $77,461,770 $79,501,247 $80,295,500 $79,413,094 $76,657,592 $78,406,554 $78,187,300 $88,329,610 $91,947,980 $99,513,157 Total Customers Sales kWh 717,037,366 745,562,770 742,240,636 737,014,329 705,214,632 715,001,017 714,150,305 723,106,532 710,327,722 734,102,972 PowerSupply $ (Including Plant Operations) $40,459,054 $44,018,591 $46,928,628 $43,406,314 $42,292,251 $49,645,951 $57,003,103 $55,367,147 $58,758,032 $68,852,937 kWh 749,653,000 785,285,000 775,661,000 773,550,000 740,871,000 756,867,000 762,254,000 752,869,000 738,190,000 768,254,000 Fire Department: Stations 2 2 2 2 2 2 2 2 2 2 Officers 8 8 8 8 8 8 8 8 8 8 Firemen - Membership (Volunteers-Active) 80 125 125 125 125 125 160 100 100 100 Equipment 16 14 14 10 10 16 15 15 15 14 Parks and Recreation: Major Parks 3 3 3 3 3 3 3 3 3 3 Small Parks 25 25 25 25 24 24 24 24 24 22 (Continued) 194 • 244

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 23 (Continued) June 30, 2020 June 30, 2019 June 30, 2018 June 30, 2017 June 30, 2016 June 30, 2015 June 30, 2014 June 30, 2013 June 30, 2012 June 30, 2011 Police Department: Station 1 1 1 1 1 1 1 1 1 1 Uniformed Personnel 94 97 98 99 100 89 94 93 93 93 Automobiles 77 77 81 80 80 76 77 75 78 67 Motorcycles 7 7 7 7 7 7 7 7 7 7 Motor Boats 0 0 0 0 0 0 0 0 0 1 Bicycles 8 8 8 7 7 12 12 12 12 4 Specialty Vehicles 7 7 7 7 7 7 7 7 7 7 Trailers 4 5 4 3 2 2 2 2 2 3 Golf Carts 6 6 6 6 6 5 0 0 0 0 * Rental Vehicles 5 Public Library: Books 93,009 108,763 113,253 103,187 106,493 106,125 100,262 97,801 93,050 103,091 Audiovisual Materials (VCRs, DVDs, CDs, Cassettes, Recorded Books) 29,699 23,626 24,021 26,158 22,345 22,366 21,008 16,929 15,265 14,409 Computer Usage* 38,003 49,591 Wireless Usage* 13,785 19,355 Members 30,253 31,997 32,256 40,412 41,221 41,348 37,531 34,308 32,717 33,466 Magazine Subscriptions 129 138 140 147 161 174 191 187 217 178 Newspaper Subscriptions 11 11 11 11 12 10 10 11 11 19 Circulation of Materials 256,783 376,380 364,849 377,314 412,969 449,746 463,113 444,333 407,611 400,130 Electronic Downloads (E-Books) 41,892 38,467 32,856 28,397 30,811 24,801 17,219 11,770 2,635 0 Water Utility: Supply - Wells 21 21 21 21 21 22 22 22 22 22 Storage Tanks 7 7 7 7 7 6 6 6 6 6 Total Storage Capacity (Gallons) 5,250,000 5,250,000 5,250,000 5,250,000 5,250,000 3,750,000 3,750,000 3,750,000 3,750,000 3,750,000 Water Mains (miles) 229.79 228.85 226.41 225.15 225.15 224.50 223.15 222.30 217.50 215.70 Average Day (Gallons Pumped) 4,991,444 5,198,288 5,021,299 5,288,271 4,521,047 4,521,047 4,197,984 4,245,153 4,405,923 4,656,334 Peak Day (Gallons) 7,286,000 7,671,000 7,695,000 8,605,000 7,466,000 7,048,000 6,305,000 7,169,000 8,620,000 8,620,000 Total Water Production (Gallons Pumped) 1,821,877,000 1,897,375,000 1,832,774,000 1,930,219,000 1,833,877,000 1,650,329,000 1,532,264,000 1,553,727,000 1,608,161,895 1,699,562,000 Total Water Consumption (Gallons Billable) 1,682,961,000 1,722,634,000 1,692,407,000 1,766,064,000 1,648,819,000 1,441,559,000 1,374,855,000 1,410,424,000 1,459,923,000 1,539,590,000 Avearge Day (Gallons Billable) 4,610,852 4,719,545 4,636,732 4,838,531 4,517,312 3,949,476 3,766,726 3,864,175 3,988,861 4,218,055 Number of Metered Customers 12,952 12,904 12,729 12,556 12,376 12,365 12,341 12,373 12,385 12,330 Number of New Connections 48 175 173 180 11 24 0 0 55 0 Wastewater Utility: Pumping Stations 44 44 44 42 45 41 40 40 40 42 Sanitary Sewer Mains (Miles) 196.08 195.31 192.41 191.00 191.00 191.00 187.59 186.87 186.87 185.00 Average Day (Gallons Pumped) 4,082,055 5,795,360 4,785,079 4,592,821 4, 706,133 4,897,731 4,893,424 4,312,742 4,379,033 4,230,819 Wastewater Discharge (Gallons Pumped) 1,489,950,000 2,115,306,558 1,746,554,000 1,676,379,600 1,717,738,575 1,787,672,000 1,786,100,000 1,574,151,000 1,602,726,000 1,544,249,000 Wastewater Discharge (Gallons Billable) 1,219,035,000 1,244,808,000 1,224,105,000 1,274,087,000 1,258,961,000 1,264,140,000 1,246,804,000 1,242,238,000 1,316,656,000 1,303,587,000 Average Day (Gallons Billable) 3,339,822 3,410,433 3,353,712 3,490,649 3,449,208 3,463,397 3,415,901 3,403,392 3,607,277 3,571,471 Number of New Connections 38 185 169 179 0 22 0 5 55 0 Water Treatment Plant: Capacity 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD 4.6 MGD Sales to Customers: Water Fees $5,557,797 $5,682,005 $5,584,474 $5,776,109 $5,457,061 $4,889,046 $4,459,808 $4,551,840 $4,707,918 $4,945,385 Wastewater Fees $3,615,733 $3,720,797 $3,612,194 $3,718,736 $3,745,497 $3,735,855 $3,562,400 $3,564,615 $3,722,985 $3,694,020 Wastewater Treatment Fees $3,108,340 $2,902,852 $2,813,867 $2,912,660 $2,936,831 $2,952,857 $2,930,333 $2,926,616 $3,050,127 $3,058,656 Inflow & Infiltration Surcharge $1,803,964 $1,858,169 $1,800,156 $1,863,151 $1,878,057 $1,831,784 $1,316,209 $1,314,033 $1,290,968 $1,171,376 Sources: Various City departments • * Newly added reporting 195 245

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2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 24 City of Dover, Delaware Summary of Insurance As of June 30, 2020 PROTECTION TYPE OF COVERAGE LIMIT IN DOLLARS Property Blanket Building & Contents (Special Form, RC, Agreed Amount) $166,109,615 $25,000 Deductible Personal Property of Others $ 250,000 Earthquake $2,000,000 $50,000 Deductible Flood Zones X or C $2,000,000 $50,000 Deductible Flood Zones (Zones unidentifiable) $100,000 Deductible Zones located A, B Shaded X, V & D are excluded Blanket Business Earnings & Expense $1,000,000 72 Hours Business Income from Dependent Properties $250,000 $25,000 Deductible Accounts Receivable $250,000 Civil Authority - 30 days Claims Data Expense $25,000 Covered Leasehold Interest $100,000 Debris Removal (Additional Amount) $250,000 Deferred Payments $25,000 EDP Data & Media Included Employee Tools Included $250 Deductible Expediting Expenses $250,000 Exhibitions (Property Damage) $50,000 Extra Expense $25,000 Fine Arts $250,000 Fire Dept. Services Charge Included Fire Protective Equipment Discharge Included Fungus, Wet Rot, Bacteria $25,000 Green Bldg Alternatives 1% / Max. $100,000 each building Green Bldg Reengineering & Recertification $25,000 Loss of Master Key $25,000 Newly Acquired or Constructed -Buildings Each $2,000,000 each building -Personal Property at each loc. $1,000,000 Non-Owned Detached Trailers $25,000 Ord & Law Coverage $250,000 Outdoor Property $250,000 Outside Signs –Described – Prem. $100,000 Personal Effects $50,000 Personal Property at Undescribed Premises $50,000 Personal Property in Transit out of Coverage Territory $50,000 197 • 247

2020 Comprehensive Annual Financial Report for the City of Dover, Delaware Statistical Section D Item 6. Table 24 - Continued PROTECTION TYPE OF COVERAGE LIMIT IN DOLLARS Pollution Cleanup & Removal $100,000 Preservation of Property-Direct $250,000 -Direct loss or damage to moved Prop. Included Reward Coverage- Up to 25% $25,000 Stored Water $25,000 Theft or Damage to Rented Property Included Undamaged Parts of Stock in Process $50,000 Valuable Papers on Premises $100,000 Valuable Papers off Premises $100,000 Appurtenant Buildings and Structures $100,000 Utility Service Direct Damage $50,000 Confiscated Property $100,000 Street Lights – Each Item $2,500 Street Lights – Max Per Occur $50,000 Street Signs – Each Item $2,500 Street Signs – Max Per Occur $50,000 Traffic Signs and Lights –Each $2,500 Traffic Signs and Lights - Max Per Occur $50,000 Stadium Lights – Each Item $2,500 Stadium Lights – Max Per Occur $50,000 Spoilage Coverage Extension $50,000 Sewer or Drain Backup $250,000 Boiler & Machinery/Equipment Breakdown Coverage Limit Property Limit Deductible $25,000 Expediting Expenses $250,000 Hazardous Substance $250,000 Spoilage $250,000 Ammonia Contamination $250,000 Inland Marine Contractors Equipment – Replacement Cost - 90% Co-Insurance Unlisted Items/equipment $100,000 Not to exceed $5,00