Finance Division Report 12/16/2014

FINANCE DIVISION Annual Town Council Report December 16, 2014

TABLE OF CONTENTS

OVERVIEW……………………………….……………..……………………………………...1 TREASURY FUNCTION.…………….…………………..…………………………………...2 OPERATING BUDGET...….……………………………………………..…………………...4 REVENUES AND EXPENDITURES/TRACKING & REPORTING……...…………..6 BUSINESS LICENSE PROGRAM…………..…..………………………………………....9 CAPITAL ASSETS RECORDS..…………………..……………………………………...10 CABLE CUSTOMER SERVICE LIAISON……….………………………….……….....11 EMPLOYEE BENEFITS AND PAYROLL.…………….….……………………………..12

OVERVIEW

This report is presented to the Danville Town Council to provide an overview of financial activities, statistics, and accomplishments of the Finance Division during the past fiscal year.

The Finance Division provides ongoing accounting functions and financial reporting services to the Town Council, Town departments and Town residents. It manages and safeguards the Town’s financial resources and assets by: 

Preparing revenue forecasts and tracking all sources of Town funding;

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Preparing the annual operating budget and audit;

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Providing financial information to the Town Council, Town departments and the public;

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Processing cash receipts and accounts payable;

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Processing employee payroll;

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Providing benefits administration;

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Administering assessment districts and outstanding debt;

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Investing the Town’s funds;

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Ensuring accurate receipt, recording and Successor Agency revenues and expenditures;

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Continuing phased implementation of, and upgrades to, the enterprise wide MUNIS Finance and HR software system.

tracking

The Town is rated Aaa by Moody’s Investor’s services.

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TREASURY FUNCTION Objective Provide fiscal management services to preserve fiscal assets, maintain adequate liquidity to meet the Town’s cash flow requirements and achieve a rate of return that equals or exceeds the Town’s benchmark yield.

Strategy The Treasury coordinates with the Town’s independent investment advisor to ensure that funds are invested in securities permitted under California Government Code Section 53600 et seq. and under the Town’s Investment Policy to ensure compliance with all applicable laws. The maximum maturity of the Town’s investments is five years, unless specifically authorized by the Town Council.

The Town pursues a “buy and hold” strategy.

Activity One hundred and sixty-six (166) fund transfers were made between accounts to manage required liquidity and maximize yields during FY 2013/14.

On December 16, 2014, the annual review of the Town’s Investment Policy was completed and updated.

Days Cash

Working Capital Ratio

Ratio of Retirement Obligations to General Fund Revenue

401

8.02

0

Financial Indicators

Aaa Moody’s

AA+ S&P

The ratings represent the Town’s Average Short Term Treasury Pool Portfolio as of 6/30/2014.

Chandler Investment Reports

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TREASURY FUNCTION Monthly Treasurer Reports and Quarterly Investment Reports were provided to Town Council.

MILLIONS

Treasury Balances Dec. 2004 - Oct. 2014

100 COST BASIS

MARKET VALUE

Linear (COST BASIS)

Linear (MARKET VALUE)

95

90

85

80

75

70

65

60

Jun-14

Sep-14

Dec-13

Mar-14

Jun-13

Sep-13

Dec-12

Mar-13

Jun-12

Sep-12

Dec-11

Mar-12

Jun-11

Sep-11

Dec-10

Mar-11

Jun-10

Sep-10

Mar-10

Dec-09

Jun-09

Sep-09

Dec-08

Mar-09

Jun-08

Sep-08

Mar-08

Dec-07

Jun-07

Sep-07

Dec-06

Mar-07

Jun-06

Sep-06

Dec-05

Mar-06

Jun-05

Sep-05

Dec-04

Mar-05

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Cash and Investments (cost basis) Last 4 quarters

Town Funds Trust Funds Assessment & SA Total Cash and Investments

Dec-13

Mar-14

Jun-14

Sep-14

$86,505,964 $1,265,237 $2,290,389 $90,061,590

$86,484,832 $1,188,005 $2,536,988 $90,209,825

$92,364,845 $1,254,935 $3,196,185 $96,815,965

$81,552,563 1,203,912 2,896,926 $85,653,401

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OPERATING BUDGET Objective Provide the legally binding Operating Budget (Financial Plan) for the fiscal year beginning July 1.

The Financial Plan is to ensure approved allocation, utilization and control of Town resources in keeping with the Town’s operating priorities and policies. The Capital Improvement Program (CIP) is incorporated into the document to provide a comprehensive annual Financial Plan for the Town, as well as a 5 year capital improvement plan and a 10 year operating forecast.

Core Function Set the schedule, process and forms for creating the budget, provide accurate year-todate revenue and expenditure figures and budget instructions to key staff.

Provide revenue projections, produce a 10-year forecast, monitor all program information for reasonableness and appropriateness, assemble information from all departments into an accurate budget draft, coordinate with the Town Manager and bring the draft budget to Council for review and comments. By July 1 produce and distribute the final budget document as adopted by Council.

2014/15 Operating Budget & CIP

Activity Four Budget Study Sessions were held in May 2014, for the FY 2014-15 Operating and Capital budgets.

Public comments were taken, Council’s changes were incorporated into the draft budget, and the Operating and Capital Budgets for Fiscal Year 2014-15 were adopted June 17, 2014. Bound copies are on file in the Town Library and at the Town Offices. An electronic copy is available on the Town’s website.

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MUNIS Budget Workshop

OPERATING BUDGET Budget—Fiscally Sound—General Fund FY 2014/15 Total General Fund Revenue: Property Tax

$10,767,190

Other Local Taxes

8,200,182

Other Local Taxes: State Sales Tax

$3,826,113

Franchise Tax (Cable/Gas/Waste) $ Sales Tax Triple Flip

2,030,055

Licenses and Permits

-

Charges for Services

45,995

Fines and Forfeitures

227,860

Property Transfer Tax

508,960

Revenue from Use of Money and Property

504,496

Business License

350,200

Transient Occupancy Tax

110,677

Recreation Charges for Services Miscellaneous Revenue Total

Percentage of general fund revenue provided by sales tax

2,297,158 127,821

1,345,492

Motor Vehicle License Fees Tax

18,486

$ 22,170,702

$8,200,182

Operating Reserve

23%

The Town’s Operating Reserve Policy requires 20% of the operating budget be reserved for unforeseen disasters or emergencies. The operating reserve has been at $11,111,504 for the past six (6) years.

FY 2014/15 Total General Fund Expenditures: General Government

$ 3,428,813

Police Services

8,438,663

Community Development Services/IT

1,571,155

Fiscal Year

Operating Budget

Operating Reserve (20%)

2010

$25,332,931

43.9%

2011

$26,205,198

42.4%

2012

$26,761,060

41.5%

Development Services

825,802

Maintenance Services

2,107,593

Recreation Services

3,334,683

2013

$26,124,886

42.5%

$ 19,706,709

2014

$27,196,963

40.9%

2015

$28,562,610

38.9%

Total

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REVENUES & EXPENDITURES Tracking & Reporting Objective Exercise fiduciary responsibility in the collection and use of all the Town’s funds.

Core Function Accurately record revenues and expenditures, including the source and use of all funds. Produce reports that provide internal controls, including project management, budget monitoring, fraud detection, and requests for information. Produce reports that meet statutory requirements.

Maintain the integrity of the accounting process, including policies and procedures. Maintain the accounting software, including upgrades and enhancements.

2013/14 CAFR

Activity Reports submitted to the Town Council and Staff: 

The FY 2013-14 Comprehensive Annual Financial Report (CAFR) was presented to Council for adoption in November 18, 2014.

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Notification was received from the Government Finance Officers Association (GFOA) that the Danville CAFR has earned its 13th consecutive award for outstanding financial reporting for FY 2012-13.

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REVENUES & EXPENDITURES Tracking & Reporting (cont’d.) 

The Midyear Financial Report was presented to Council at the January 31, 2014 Annual Workshop and adopted at the February 18, 3014 Town Council Meeting.

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Summary and detailed operating revenue and expenditure reports are available to staff online and real time.

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Capital Improvement Project Reports are available to staff online and real time.

Reports submitted to outside agencies: 

Comprehensive Annual Financial Report

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Lighting and Landscape Audit

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Gann Appropriation Calculation Report

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Public Financing Authority Audit

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State Controllers Report; Streets and Roads Annual Report

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Disclosure Reports to the Municipal Securities Rulemaking Board for the Town’s Certificate of Participations (COPs) and Taxable Revenue Bonds (TRB)

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Disclosure Reports to California Debt and Investment Advisory Council (CDIAC) for the Assessment Districts and Successor Agency Debt issuances

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Measure J Return to Source Funds

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REVENUES & EXPENDITURES Tracking & Reporting (cont’d.)

Monthly Reconciliations for FY 2014: 1) Bank statements for 7 accounts (5 general checking, payroll and LAIF); 2) Retirement funds: two 401(a) money purchase plan accounts and three 457(b) deferred compensation accounts; 3) Investment accounts (investment manager, safekeeping); 4) Four (4) trustee accounts: 2005 and TRB);

Fiscal Year

Cash Management FY 2014: 

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409 bank deposits were made for cash and checks received at the Town Offices and Community Center.

Demand Registers were prepared for all Town Council meetings. Last fiscal year 4,160 checks were issued to pay 6,008 invoices.

937 LLAD Senior Rebate notices were mailed out and 668 LLAD Senior Rebates were processed.

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Invoices # of POs Processed Issued

# of Checks Issued

2010

5,782

1,596

4,529

2011

6,216

1,639

4,501

2012

5,482

1,590

4,378

2013

5,041

1,480

4,474

2014

6,008

1,463

4,160

12 months of bank deposits by the Community Center and Village Theatre were recorded and reconciled.

12 months of credit card receipts by the Community Center and Village Theatre were recorded and reconciled.

NERIAD, COP 2001, COP

Fiscal Year

Senior Rebate Notices

Senior Rebates Processed

2010

940

743

2011

945

712

2012

945

657

2013

916

731

2014

937

668

BUSINESS LICENSE PROGRAM Objective To register businesses, trades, occupations and professions conducting business, whether or not for gain or profit, in the Town for purposes of revenue and regulation.

Core Functions Notify all businesses, that are conducting business in the Town, of the need to register their business.

Activity Annual business license fees are due on July 1. Collections for FY 2013-14 netted $385,031, a 2.9% increase of $10,678 from FY 2012-13.

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Fiscal Year

Active Businesses

2010

3,154

2011

3,231

2012

3,310

2013

3,287

2014

3,233

FIXED ASSETS Objective Safeguard the Town’s assets by monitoring, recording and reporting information on the Town’s fixed and capital assets from the time of acquisition to the time of disposal.

Core Functions Provide control of fixed assets (valued at $5,000 or greater with a life span of two or more years), infrastructure and capital improvements (roads, traffic lights, bridges and drainage systems), by verifying physical location and book value. Coordinate a physical inventory count and calculate depreciation to meet GASB 34 reporting requirements.

Activity Two hundred thirty-one (231) new assets were tagged and recorded. Three Hundred Ten (310) assets were retired/disposed of; Seven (7) assets were transferred and one (1) asset was sold. All of these assets, which were approved in the budget, replaced obsolete items, provide required equipment for Town programs, or reflected the capital improvements made to the Town.

Following last year’s conversion to barcode asset tags, future physical inventories will be more efficient and accurate.

Town Assets

Tagged Assets

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CABLE CUSTOMER SERVICE LIAISON Objective Enforce cable television customer service standards, through enforcement of the franchise agreements.

Core Functions Elevate unresolved customer service issues to upper management at the cable company and maintain a log of customer service issues.

Activity Three (3) Comcast cable subscribers required assistance from the Town to resolve billing and service issues during FY 2013-14.

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EMPLOYEE PAYROLL & BENEFITS Objective Pay regular and temporary employees accurately and on time for services provided to the Town.

Administer the Town’s 401(a) and 457(b) retirement plans for employees.

Core Functions Submit accurate monthly, quarterly and annual payroll filings to the State and Federal governments. Provide compensation every two weeks according to each individual’s employment or contract agreement.

Ensure that the Town’s retirement plans remain in compliance with State and Federal statute changes.

Activity 

Processed 2,523 timesheets; 1,242 leave requests and 239 personnel forms.

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Prepared 641 payroll checks for temporary staff and 3,691 direct deposit notifications for regular and temporary employees for FY 2013-14.

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Distributed 26 payrolls via electronic transfer or mailed by noon each payday. (100% of regular staff now has direct deposit.)

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Prepared and filed 26 Federal & State payroll taxes bi-weekly.

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Prepared and submitted to Municipal Pooling Authority, the breakdown of employee wages by worker compensation code by September 1.

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Filed compensation information with the State Controller’s Office.

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Provided compensation information to third party requestors.

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Maintained two platforms for the Town funded 401(a) defined contribution plans, as well as the 457(b) employee funded deferred revenue plans.

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Provided ten (10) on site educational seminars on investing and preparing for retirement. All employees, whether newly enrolled or nearing retirement, have ongoing access to Lincoln Financial representatives for personal meetings to discuss career stage appropriate retirement investing and planning.

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Our Values We enhance the quality of life in the Community through our commitment to the following principles: High Ethical Standards Effective Use of Public Funds Excellent Customer Service Personal Responsibility and Accountability Teamwork Honest Communication Mutual Respect Individual Innovation and Creativity Personal and Professional Growth Enjoying what we do!

Contact Information Elizabeth Hudson Finance Director/Treasurer

925.314.3371 ehudson@danville.ca.gov

Lani Ha Accounting Manager

925.314.3358 lha@danville.ca.gov

Carol Ashburn Accounting Analyst/ Payroll/CIP/Bank Reconciliation

925.314.3357 cashburn@danville.ca.gov

Renee Waluch Accounting Technician Accounts Payable

925.314.3359 rwaluch@danville.ca.gov

Janice Gray Account Clerk Business License/Senior Rebates/ Cash Receipts/Fixed Assets

925.314.3326 jgray@danville.ca.gov

Jacqueline Hill Administrative Secretary

925.314.3321 jhill@danville.ca.gov

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