03-27-1989 - Special
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CITY COUNCIL OF EDGEWATER
SPECIAL MEETING
MARCH 27, 1989
MINUTES
Mayor Mitchum called the meeting to order at 7:00 P.M. in the
Community Center. He stated the purpose was to receive the
financial report for the fiscal year ended September 30, 1988.
ROLL CALL
Mayor David Mitchum
Councilman Dan Hatfield
Councilwoman Gigi Bennington
Councilman Russell Gold
Councilman Thomas Fish
City Attorney Jose' Alvarez
City Manager William Powers
Acting City Clerk Susan Wadsworth
Chief Lawrence Schumaker
Present
Excused
Excused
Present
Present
Excused
Present
Present
Present
Also present were: Mr. Brent Millikan and Mr. Alex
auditing firm of Brent Millikan & Co. and Ms. Karen
Finance Officer.
Kish of the
Ricke1man,
Mr. Kish stated there are 80 pages of financial data and reports
and the report is made up of four major sections. He pointed out
that the statistical section contains historical trends and the
last 10 years of the City's growth. He noted there is a new
section regarding the State and Federal grants participation to
comply with their requirements. He stated the letter of
transmittal is included in the report because of the
participation in the GFOA certificate of achievement in financial
reporting program.
Mr. Kish read excerpts of the financial report, noting the total
assets had a $1.556 million dollar increase, or lOX, and
liabilities were a $625,000 decrease. He said the equities had
an increase of $2.1 million dollars. He added that it's a very
strong financial picture. Mr. Millikan stated the financial
picture improved by about $2 million.
Mr. Kish read the revenues and expenditures for the various funds
and the transfers for the self-insurance fund. Mr. Millikan
reviewed how prior years had the utility taxes in a separate
fund. Mr. Kish pointed out that was changed and it's now in the
general fund as of October 1, 1988. He noted that the new rates
for water and sewer are not out of line with other
municipalities, and they are now self-supporting.
Mr. Kish stated they'd negotiated a settlement with Farmers Home
and recognized an extraordinary gain on the redemption of bonds
and a present value saving on the issue throughout the term.
Mr. Kish stated that the pension trust funds are for general and
Police employees and that's restricted for employee payout for
pension and disability.
Mr. Kish explained that note 2 to the financial statement
provided for collateral of the funds. He reviewed the other
notes. He briefly reviewed a part of the statistical data, and
the compliance report which is required by the Auditor General.
Mr. Kish stated that the management letter comments on the self-
insurance fund are that the City has acquired a large amount of
risk and they feel for the City's protection and benefit they
should assess what risks they're assuming. He read excerpts from
the Governmental Accounting policies and the definition of self-
insurance. He pointed out they don't know the reserve levels
.equired and they~ecommend looking at it an, upplementing with
an umbrella or threshold limit and explor"'he amounts. He
stated that the bond ordinance 400 requires they maintain certain
levels of insurance for reserve, and they need actuaries to be
sure the reserves are sufficient to cover the minimum
requirements of the bond ordinance.
He reviewed under the internal control comments the pre-numbered
service orders and utility receipts that come over the counter
and the customers don't always pay the entire amount and the
cashiers mark through the computer amount on the stubs. He
suggested they look ~ some type of validation equipment and with
the purchase of the computer equipment, that will provide
validation.
Mr. Kish stated the water and sewer
extremely complex accounting problem
maintaining these separate ledgers
understands these were merged together
to eliminate the problem.
development funds are an
that exists because of
for these funds but he
effective October 1, 1988,
Mr. Millikan stated the area of most concern is risk retention
and they have $600,000 for the first two years but there are
certain risks they want to assume and retain but they shouldn't
assume all the risks and some aren't feasible to retain. He
again stated it's extremely important to look at the risks the
City should assume. Mayor Mitchum stated the statement regarding
the liability assumption for Ordinance 400 is misleading. Mr.
Kish explained they still have to be maintained separately but
they can take care of the separate funding accounts and he feels
that it's something that will save a lot of effort but is not a
violation of the existing bond covenants.
Mr. Kish expressed pleasure working with the City, the City
Manager, Ms. Rickelman and the staff who provided the information
and the City Council.
Councilman Gold moved
seconded the motion.
they accept the report.
Motion CARRIED 3-0
Councilman
Fish
Mayor Mitchum suggested a motion to adjourn. Councilman Fish so
moved. Councilman Gold seconded the motion. Meeting was
adjourned at 7:55 P.M.
Lura Sue Koser
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MAYOR ~
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Minutes submitted by:
ATTEJT:
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ACTING CI CLERK ---
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MAYOR
Council Regular Meeting Minutes
-2- March 27, 1989