LEGISLATIVE, FINANCE AND ADMINISTRATION COMMITTEE

The Legislative, Finance, and Administration Committee meeting was held on February 13, 2006, at 5:30 p.m. with Councilman Slavin presiding in the absence of Chairman Salters. Members present were Mr. Hogan and Mr. Shevock. Mr. Shelton was absent. Members of Council present were Mr. Carey, Mrs. Russell, Mr. Sadusky, Mr. Ritter, Mr. Ruane, and Mrs. Williams. Mayor Speed was also present.

AGENDA ADDITIONS/DELETIONS

Mr. Hogan moved for approval of the agenda, seconded by Mr. Shevock and unanimously carried.

Comprehensive Annual Financial Report (CAFR) for Fiscal Year Ended June 30, 2005

In accordance with Section 46 of the City Charter, the City's financial books are audited by independent auditors each year. The Assistant Finance Director/Treasurer, Mr. Howie, submitted the Comprehensive Annual Financial Report (CAFR) for Fiscal Year Ended June 30, 2005. It was noted that all financial transactions were audited by the selected C.P.A. firm of Faw Casson & Company, whose opinion has been included in the report. The City has received the Award of Excellence in Financial Reporting from the Governmental Finance Officers Association of the United States and Canada (GFOA) for the last 20 years. Mr. Howie gave a Power Point Presentation which highlighted the key points of this year’s CAFR.

Responding to Mr. Carey, Mr. Howie stated that he would provide further information on how the .20 cent increase has affected the budget. Mr. Carey noted that Public Safety revenue is listed at 4.4% and expenses are listed at 14.3% and requested further information on how the difference is being funded.

Staff recommended acceptance of the Comprehensive Annual Financial Report (CAFR) for Fiscal Year Ended June 30, 2005.

Mr. Hogan moved to recommend acceptance of the Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2005, as recommended by staff. The motion was seconded by Mr. Shevock and unanimously carried.

Analysis of Impediments - Addendum to 2005 Consolidated Plan (CDBG)

The U. S. Department of Housing and Urban Development (HUD) requires the City of Dover to submit a Consolidated Plan application in order to receive Community Development Block Grant funds. 24 CFR Part 91.225(1) that governs the Consolidated Plan application requires the City to conduct an analysis to identify impediments to fair housing choice within the jurisdiction and take appropriate actions to overcome the effects of any impediments identified through that analysis.

Mrs. Tracey Harvey, Director of Community Development, advised members that the Delaware State Housing Authority contracted the Center of Community Research at the University of Delaware to conduct an Analysis of Impediments (AI) study for the State of Delaware. The plan was completed in September of 2003 and an addendum to the AI was completed in January 2004. The City of Dover was incorporated in the development of the Analysis of Impediments and assisted in the development of the Fair Housing Plan to remedy the impediments that were identified during the study.

The HUD Office of Fair Housing and Equal Opportunity conducted an onsite technical assistance visit on July 21, 2004 during which it was agreed that the City would tailor the AI for Dover and make an addendum to the State’s AI. Once this is accomplished, the City would adopt the State’s AI Plan and incorporate the City’s addendum to the 2005 Consolidated Plan.

Members reviewed an addendum prepared by the Community Development Department which provides corrective actions to remedy the impediments of Lack of Affordable Housing General and for Persons with Disabilities; Lack of Fair Housing Education and Outreach; and Segregated Housing and Fair Housing Programs and Activities for the City of Dover.

Responding to Mr. Hogan, Mrs. Harvey stated that the lack of affordable housing for persons with disabilities can be addressed by requiring a certain number of handicapped accessible rental units with new construction.

Responding to Mr. Ruane, Mrs. Harvey stated that clustering is not an impediment to Section 8 housing since it is distributed throughout the City.

Mr. Ruane felt that in order to resolve the housing issue it would have to be addressed regionally, including County jurisdictions. Mrs. Harvey stated that the City is working with the State of Delaware and the Dover Housing Authority is trying to resolve the housing issues within the City of Dover. Council President Williams advised members that County housing issues are addressed in the Delaware State Housing Authority CDBG Plan. She also noted that the Homeownership Initiative is being enthusiastically embraced by all housing authorities and the Federal Government.

Staff recommended acceptance of the Addendum to the 2005 Consolidated Plan.

Mr. Shevock moved to recommend approval of the Addendum to the 2005 Consolidated Plan (Attachment #1), as recommended by staff. The motion was seconded by Mr. Hogan and unanimously carried.

Resolution of Outstanding Utility Billing (Schwartz Center)

For the past few years, the Schwartz Center for the Arts has had financial difficulties resulting in its incurrence of an outstanding utility bill in the amount of $33,782. The City Manager and Dr. Scott Miller, President of Wesley College, discussed this issue. Dr. Miller suggested that the City forgive one-half of the outstanding balance, and that the remaining one-half be paid over an 18-month period at $1,000 per month. The Schwartz Center has been paying current utility bills steadily since August 2004.

The proposal was discussed with both Mayor Speed and Council President Williams, and they as well as the City Manager, felt this would not be acceptable to Council. The City Manager wrote a letter to Dr. Miller dated September 22, 2005 outlining the following alternative which was felt would be more acceptable to Council:

■          The City of Dover would purchase $16,000 in services in advance from the Schwartz Center. The Schwartz Center staff would in turn take this cash payment and use it to pay off $16,000 of its outstanding debt. The City would then accept the $1,000 per month payment to pay off the remaining debt of $17,782 over approximately 18 months.

■          The City of Dover, at its convenience, would use the pre-purchased services of the Center over time. The services the City would be interested in would be room rental for meetings and tickets for distribution. Tickets would be distributed to employees and volunteers for incentives and gifts of appreciation. Another option would be to distribute them to children through our recreation, library, and community development programs. Ticket distribution would have the added benefit of bringing people to the Center who would not otherwise be exposed to the outstanding performances offered.

Mr. DePrima stated that approval of the concept outlined in his letter would be a "win-win" for both parties. The City does have a need to hold off-site meetings at times, and we already provide incentives to employees through our Bonus Program. Providing tickets to children for various performances would serve as an outreach effort and allow many children who would be unable to experience cultural activities to do so. The City recruits many volunteers for different activities -especially through our Parks, Recreation and Library Department; and providing tickets to the Schwartz Center would be one more way of showing how much the City appreciates their services.

Mr. Wayne Holden, Vice President of the Schwartz Center Board of Directors, stated that the Board could have taken legal recourse, such as bankruptcy, to avoid paying the outstanding debt; however, they preferred to eliminate their debt responsibly. He also noted that the Board was interested in refinancing or paying off the mortgage and it would be beneficial to have the previous debt resolved.

Dr. Scott Miller advised members that a consortium of The Friends of the Capital Theater, Delaware State University, and Wesley College was formed to address the day-to-day operations and, as a result, the Center has been doing well since July 2004.

Mr. Donald Parks, Director of Programming, advised members of the value of the community’s volunteer involvement in the Center and the projects and programs benefitting local organizations and students.

Staff recommended allowing the City to purchase $16,000 in services and allow the Schwartz Center to pay off the balance of $17,782 at the rate of $1,000 per month.

Responding to Mr. Hogan, Mr. DePrima stated that there would be no time limit on the use of the pre-purchased services; however, the Board has requested that no more than 100 tickets be used at one time.

With regard to concerns that there may be other requests for similar agreements, Mr. DePrima stated that he did not anticipate other requests. Mayor Speed noted that the Schwartz Center is an asset to the community and it would be beneficial if the City could provide this assistance.

Responding to Mr. Slavin, Mr. DePrima stated that he did not believe this arrangement would effect the City’s bond issues.

Mr. Hogan moved to recommend allowing the City to purchase $16,000 in services and allow the Schwartz Center to pay off the balance of $17,782 at the rate of $1,000 per month, as recommended by staff. The motion was seconded by Mr. Shevock and unanimously carried.

Proposed Ordinance Amendment - Requirement to Audio Tape Meetings

Members were provided a proposed amendment to Division 2, Section 2-51of the Dover Code which would codify the current practice of audio taping meetings in order to ensure transcription accuracy, enhance accountability and deliver information efficiently to the public.

Mrs. Green, City Clerk, advised members that the recent purchase of new recording equipment has enabled recording in remote locations and the ability to provide the recordings to interested citizens and Council or committee members so that they may listen from their computers. As a result, the length of the meeting minutes has also been reduced.

Staff recommended adoption of the proposed Ordinance amending Division 2, Section 2-51 of the Dover Code.

Mr. Shevock moved to recommend adoption of the proposed ordinance amendment (Attachment #2), as recommended by staff. The motion was seconded by Mr. Hogan and unanimously carried.

Discussion - Increase of Bond Limit

During the Council Retreat held January 27, 2006, Council members suggested that consideration be given to an increase in the debt limit. Members reviewed Article IV - Financial Affairs, Section 50 - Debt limit, of the City of Dover Charter which authorizes the City to finance public storm sewers, streets and appurtenances up to $1,000,000.00 without a referendum.

Mr. Hogan noted that several local communities have recently increased their debt limits and members felt it was time to discuss increasing the City of Dover’s $1,000,000 limit. Mr. Ruane noted that the City of Laurel increased their debt limit from $2,000,000 to $5,000,000 and the Town of Smyrna is authorized to borrow $13.5 million in General Obligation bonds without a referendum.

Mayor Speed suggested that, rather than a fixed amount, the debt limit be based on an index. Mr. Ruane recommended that the debt limit be coordinated with the Capital Improvement Program. He also suggested that consideration be given to raising the City’s ceiling on the bonded indebtedness, which is a percentage of assessed value.

Responding to Mr. Slavin, Mr. Ruane stated that one of the reasons the City is not being considered for the library funding is its lack of matching funds. He felt that passage of an amendment to the debt limit would provide the City with the capability of acquiring the necessary matching funds.

Mr. Carey stated that under normal circumstances this item would be referred to the 2005 Charter Review Committee for their consideration; however, he felt it was important to submit a recommendation to the General Assembly prior to September 2006, when the Charter Review Committee will present its recommendations.

Members requested staff to provide the dollar amount that the debt limit of $1,000,000 would be if it were adjusted for inflation from the time the limit was set and a schedule of the debt limits of other municipalities in Delaware for consideration at the next meeting.

Mr. Shevock moved for adjournment, seconded by Mr. Hogan and unanimously carried.

Meeting Adjourned at 6:48 P.M.

                                                                                    Respectfully submitted,

                                                                                    Timothy Slavin

                                                                                    Acting Chairman

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S:ClerksOfficeAgendas&MinutesCommittee-Minutes20062-13-2006 LF&A.wpd

Attachments to Original Minutes and File Copy:

Attachment #1 - Addendum to the 2005 Consolidated Plan

Attachment #2 - Proposed Ordinance Amendment - Section 2-51 of the Dover Code