THIS MEETI NG WILL NOT BE PHYS/CALLY OPEN TO THE PUBLI C In order to minimize the spread of the COV/O-19 virus, this meeting will be conducted pur suant to the provisions of the Governor's Executive Order s N-29-20, which suspended certain r equir ements of the Brown Act and will not be physically open to the public. You may observe a livestr eam of the meeting at www.atwater.org. If you wish to make eit her a gener al public comment or to comment on a specif ic agenda item, please submit your comment ( include Agenda Item Number in the sub ject line), to the Finance Dir ector at kiacobshunter@atwater.org . All comments will be shared with the Committee and placed in the r ecord. Every eff ort will be made to r ead your comment into the r ecord, but some comments may not be read, in whole or in part, due to the 3- minute time limitation or other time limitations. Email comments will be accepted on or before 1 :00PM of the meeting date. Assistance will be provided to those r equir i ng accommodations f or disabilities in compl iance with the Amer icans with Disabilities Act of 1990. Per sons r equesting accommodation should contact the Cit y in advance of the meeting, and as soon as possible, at (209)357-6310, Finance Dir ector, Kelli e Jacobs-Hunter. CITY OF ATWATER AUDIT AND FINANCE COMMITTEE AGENDA Council Chambers 750 Bellevue Road Atwater, California April 27, 2020 CALL TO ORDER: PLEDGE OF ALLEGIANCE TO THE FLAG: ROLL CALL: 4:30 PM Ambriz , Heller -- - - Vierra -- SUBSEQUENT NEED ITEMS: (The Chair shall announce any requests for items requiring immediate action subsequent to the posting of the agenda. Subsequent need items require a two-thirds vote of the members of the Audit and Finance Committee present at the meeting.) APPROVAL OF AGENDA AS POSTED OR AS AMENDED: (This is the time for the Audit and Finance Committee to remove items from the agenda or to change the order of the agenda.)
Transcript
THIS MEETING WILL NOT BE PHYS/CALLY OPEN TO THE PUBLIC
In order to minimize the spread of the COV/O-19 virus, this meeting will be conducted pursuant to the provisions of the Governor's Executive Orders N-29-20, which suspended certain requirements of the Brown Act and will not be physically open to the public. You may observe a livestream of the meeting at www.atwater.org.
If you wish to make either a general public comment or to comment on a specific agenda item, please submit your comment (include Agenda Item Number in the subject line), to the Finance Director at [email protected] . All comments will be shared with the Committee and placed in the record. Every effort will be made to read your comment into the record, but some comments may not be read, in whole or in part, due to the 3- minute time limitation or other time limitations.
Email comments will be accepted on or before 1 :00PM of the meeting date.
Assistance will be provided to those requiring accommodations for disabilities in compliance with the Americans with Disabilities Act of 1990. Persons requesting accommodation should contact the City in advance of the meeting, and as soon as possible, at (209)357-6310, Finance Director, Kellie Jacobs-Hunter.
CITY OF ATWATER AUDIT AND FINANCE COMMITTEE
AGENDA
Council Chambers 750 Bellevue Road Atwater, California
April 27, 2020
CALL TO ORDER:
PLEDGE OF ALLEGIANCE TO THE FLAG:
ROLL CALL:
4:30 PM
Ambriz , Heller -- -- Vierra --
SUBSEQUENT NEED ITEMS: (The Chair shall announce any requests for items requiring immediate action subsequent to the posting of the agenda. Subsequent need items require a two-thirds vote of the members of the Audit and Finance Committee present at the meeting.)
APPROVAL OF AGENDA AS POSTED OR AS AMENDED: (This is the time for the Audit and Finance Committee to remove items from the agenda or to change the order of the agenda.)
Audit and Finance Committee Agenda for Meeting of April 27, 2020 Page 2
Staff's Recommendation: Motion to approve agenda as posted or as amended.
MINUTES:
1. February 24, 2020 - Regular meeting
Staff's Recommendation: Motion to approve minutes as listed.
FUNDING AND BUDGET MATTERS:
2. Treasurer's Report for the months ending February 29, 2020 and March 31, 2020 (City Treasurer Heller)
Staff's Recommendation: Motion to recommend that the City Council accept the Treasurer's Report for the months ending February 29, 2020 and March 31, 2020.
REPORTS AND PRESENTATIONS FROM STAFF:
3. Report summarizing Proposals received from City of Atwater RFP (Request for Proposal) of Professional Auditing Services, final filing date of 3/31/20. (Finance Director Jacobs-Hunter)
Staff's Recommendation: Motion to recommend that the City Council seek an additional one-year agreement with JJACPA to provide professional audit services for the Fiscal Year 2019/20 accounting period, due to submitting the lowest cost proposal and other extenuating factors.
COMMENTS FROM THE PUBLIC:
NOTICE TO THE PUBLIC
At this time any person may comment on any item which is not on the agenda. You may state your name and address for the record; however, it is not required. Action will not be taken on an item that is not on the agenda. If it requires action, it will be referred to staff and/or placed on a future agenda. Please limit comments to a maximum of three (3) minutes.
COMMITTEE MEMBER MATTERS:
Committee Member comments
ADJOURNMENT:
Audit and Finance Committee Agenda for Meeting of April 27, 2020 Page 3
CERTIFICATION:
I, Kellie Jacobs-Hunter, Finance Director of the City of Atwater, do hereby certify that a copy of the fore ·ng a enda was post t City Hall a minimum of 72 hours prior to the
t SB 343 NOTICE In accordance with California Government Code Section 54957.5, any writing or document that is a public record, relates to an open session agenda item and is distributed less than 72 hours prior to a regular meeting will be made available for public inspection in the Finance Department at City Hall during normal business hours at 750 Bellevue Road.
If, however, the document or writing is not distributed until the regular meeting to which it relates, then the document or writing will be made available to the public at the location of the meeting, as listed on this agenda at 750 Bellevue Road.
In compliance with the federal Americans with Disabilities Act of 1990, upon request, the agenda can be provided in an alternative format to accommodate special needs. If you require special accommodations to participate in a Committee meeting due to a disability, please contact the Finance Department a minimum of three (3) business days in advance of the meeting at (209) 357-6310. You may also send the request by email to [email protected].
CITY OF ATWATER
REGULAR MEETING AUDIT AND FINANCE COMMITTEE
ACTION MINUTES
February 24, 2020 CALL TO ORDER:
The City of Atwater Audit and Finance Committee met in Regular Session this date at 4:32 PM in the City Council Chambers located at the Atwater Civic Center, 750 Bellevue Road, Atwater, California; Committee Chair Vierra presiding.
PLEDGE OF ALLEGIANCE TO THE FLAG:
ROLL CALL:
Present:
Absent: Staff Present:
Committee Member Heller, Committee Vice Chair Ambriz, Committee Chair Vierra None Finance Director Jacobs-Hunter, City Manager Waterman
SUBSEQUENT NEED ITEMS:
None to report.
APPROVAL OF AGENDA AS POSTED OR AS AMENDED:
MOTION: Committee Member Heller moved to approve Agenda as posted or as amended. The motion was seconded by Vice Chair Ambriz and the vote was: Ayes: Heller, Ambriz, Vierra; Noes: None; Absent: None. The motion passed.
MINUTES:
January 27, 2020 - Regular Meeting
Audit and Finance Committee Minutes for February 24. 2020 Page 2
MOTION: Committee Chair Vierra moved to approve the minutes as listed. The motion was seconded by Committee Member Heller and the vote was: Ayes: Heller, Ambriz, Vierra; Noes: None; Absent: None. The motion passed.
FUNDING AND BUDGET MATTERS:
Treasurer's Report for month ending January 31, 2020. (City Treasurer Heller)
MOTION: Vice Chair Ambriz moved to approve the Treasurer's Report for the month ending January 31, 2020 as listed. The motion was seconded by Committee Chair Vierra and the vote was: Ayes: Ambriz, Vierra; Noes: None; Absent: None; Abstain: Heller. The motion passed.
REPORTS AND PRESENTATIONS FROM STAFF:
Verbal report regarding the proposed budget calendar for development of the Fiscal Year 2020/2021 Budget (Finance Director Jacobs-Hunter)
Finance Director Jacobs-Hunter distributed the Draft 2020-21 Budget Calendar for review by the Audit & Finance Committee.
Vice Chair Ambriz commented that Council would be very pleased if we can adopt the budget at the June 22, 2020 Regularly Scheduled Meeting as indicated on the draft budget calendar. No action was taken, informational item only.
COMMENTS FROM THE PUBLIC:
Notice to the public was read.
No one came forward to speak.
COMMITTEE MEMBER COMMENTS:
None
ADJOURNMENT:
MOTION: Committee Chair Vierra moved to adjourn meeting.
The meeting adjourned at 4:43 PM.
CINDY VIERRA COMMITTEE CHAIR
By: Kellie Jacobs-Hunter Finance Director
STATEMENT OF CHANGES IN CASH BALANCE, UNAUDITED BY FUND
AS OF 2/29/20
FUND BEG.BALANCE CASH DEBITS CASH CREDITS ENDING BAL.
0001 General Fund 3,588,194.57 954,538.50 1,518,995.44 3,023,737.63 0003 General Fund Capital (143,526.40) 0.00 16,581.01 (160,107.41) 0004 Public Safety Trans & Use Tax 66,484.02 220,020.55 79,308.19 207,196.38 0005 Ferrari Ranch Project Fund 20,776.09 0.00 0.00 20,776.09 0007 Measure V Fund 1,477,450.63 94,257.98 44,201 13 1,527,507.48 0008 Measure V 20% Alternative Modes 293,698.83 12,700.15 0.00 306,398.98 0009 Abandoned Veh Abatement Fund 5,779.26 0.00 1,149.08 4,630.18 0010 Measure V Regional Fund 0.00 0.00 0.00 0.00 1005 Police Grants Fund 67,713.65 0.00 685.55 67,028.10 1011 Gas Tax/Street Improvement 475,804.57 1,246.20 78,723.49 398,327.28 1013 Local Transportation Fund 538,500 38 17,911.52 68,833.41 487,578.49 1015 Traffic Circulation Fund 1,070,250.90 2,175.00 0.00 1,072,425.90 1016 Applegate Interchange 752,574 21 0.00 0.00 752,574.21 1017 RSTP-Regional Surface Transp Prag 687,805.01 0.00 2,148.24 685,656.77 1018 SB1-Road Maint & Rehab RMRA 997,049.95 49,227.74 139,763.63 906,514.06 1019 LPP-Local Partnership Prg Fund (11773) 0.00 0.00 (117.73) 1020 Parks and Recreation Fund 2,011,615.22 7,146.00 0.00 2,018,761.22 1050 Buhach Colony High School 227,689.57 0 00 0.00 227,689.57 1055 Neighborhood Stabilization 217,308.08 0.00 0.00 217,308.08 1059-78 Housing Grant Funds 353,413.06 0.00 0.00 353,413.06 1091 Police Facility Impact Fee 127,794 51 1,203.00 0.00 128,997.51 1093 Fire Facility Impact Fee 82,648.94 1,560.00 0.00 84,208.94 1095 Government Building Facility 190,083.19 1,136.28 0.00 191,219.47 3064-67 Redevelopment/Successor Agency Funds 1,318,17607 998.85 0.00 1,319,174.92 4020 Performance Bond Trust 216,029.54 0.00 0.00 216,029.54 4030 Narcotics Program Trust 2,040.40 0.00 0.00 2,040.40 4060 Section 125 Medical 1,486.51 195.00 0 00 1,681.51 4070 Section 125 Dependent Care 0.00 0.00 0.00 000 4090 CFO No. 1 Trust 97,715.40 0 00 0.00 97,715.40 5001-55 All Maintenance Districts 1,434,317 36 0.00 6,190.17 1,428,127.19
STATEMENT OF CHANGES IN CASH BALANCE, UNAUDITED BYFUND
FUND
5050 CFD Districts 6000 Water Enterprise Fund 6001 Water Fund Capital Replacement 6002 DBCP Settlement 6004 Water Well- Buhach Colony 6005 Water Capital Impact Fees 6006 Water Operating Reserve Fund 6007 1,2,3-TCP Fund 6010 Sewer Enterprise Fund 6011 Sewer Fund Capital Replacement 6020 Sanitation Enterprise 7000 Internal Service Fund 7010 Employee Benefits Fund 7020 Risk Management 7030 Information Technology 9090 Accrued Interest Fund
(The following statements are required by California Govt. Code Section 53646 (b) (2,3))
Investments are made pursuant to the City Council approved Investment Policy and Guidelines.
The City of Atwater has the ability to meet its pooled expenditure requirements for the next six months.
City LAIF Chandler Asset Mgt.
75,000,000.00 1,108,755.00
R,mk Acr.nunt netail
Chase General Checking Chase Wastewater Checking Chase Redevelopment Checking
9,583,889.13 3,253,609.03 949,307.65
STATEMENT OF CHANGES IN CASH BALANCE, UNAUDITED BY FUND
AS OF 3/31/2020
FUND BEG.BALANCE CASH DEBITS CASH CREDITS ENDING BAL.
0001 General Fund 3,023,737.63 1,276,929.01 1,386,945.46 2,913,721.18 0003 General Fund Capital (160,107.41) 66,535.00 0 00 (93,572.41) 0004 Public Safety Trans & Use Tax 207,196.38 138,00272 157,343.39 187,855.71 0005 Ferrari Ranch Project Fund 20,776.09 65.79 0 00 20,841.88 0007 Measure V Fund 1,527,507.48 126,458.45 19,772.50 1,634,193.43 0008 Measure V 20% Alternative Modes 306,398.98 31,391.24 0.00 337,790.22 0009 Abandoned Veh Abatement Fund 4,630.18 5,412.41 1,929.67 8,112.92 0010 Measure V Regional Fund 0.00 0.00 0.00 0.00 1005 Police Grants Fund 67,028.10 186.02 8,285.43 58,928.69 1011 Gas Tax/Street Improvement 398,327.28 47,537.85 115,348.61 330,516.52 1013 Local Transportation Fund 487,578.49 3,868.93 7,514.14 483,933.28 1015 Traffic Circulation Fund 1,072,425.90 33,091.36 0.00 1,105,517.26 1016 Applegate Interchange 752,574.21 2,383.27 0.00 754,957.48 1017 RSTP-Regional Surface Transp Prag 685,656.77 2,171.35 0.00 687,828.12 1018 SB1-Road Maint & Rehab RMRA 906,514.06 46,171.85 276.25 952,409.66 1019 LPP-Local Partnership Prg Fund (117 73) 0.00 000 (117.73) 1020 Parks and Recreation Fund 2,018,761.22 35,016.87 16,016.18 2,037,761.91 1050 Buhach Colony High School 227,689 57 721.05 0.00 228,410.62 1055 Neighborhood Stabilization 217,308.08 688.17 0.00 217,996.25 1059-78 Housing Grant Funds 353,413.06 1,119.18 0.00 354,532.24 1091 Police Facility Impact Fee 128,997.51 5,235.75 0.00 134,233.26 1093 Fire Facility Impact Fee 84,208.94 6,526.43 0.00 90,735.37 1095 Government Building Facility 191,219.47 5,165.07 0.00 196,384.54 3064-67 RedevelopmenUSuccessor Agency Funds 1,319,174.92 26,845.77 52,922.50 1,293,098.19 4020 Performance Bond Trust 216,029.54 684.12 0.00 216,713.66 4030 Narcotics Program Trust 2,040.40 6.46 0.00 2,046.86 4060 Section 125 Medical 1,681.51 195.00 0.00 1,876.51 4070 Section 125 Dependent Care 0.00 000 0.00 0.00 4090 CFO No. 1 Trust 97,715.40 309.44 0.00 98,024.84 5001-55 All Maintenance Districts 1,428,127.19 4,906.05 122,245.66 1,310,787.58
STATEMENT OF CHANGES IN CASH BALANCE, UNAUDITED BY FUND
AS OF 3/31/2020
FUND BEG.BALANCE CASH DEBITS CASH CREDITS ENDING BAL
5050 CFO Districts 33,300.91 0.00 33,382.08 (81.17) 6000 Water Enterprise Fund 2,351,164.42 481,589.28 499,332.90 2,333,420.80 6001 Water Fund Capital Replacement 4,563,481.14 14,443.55 2,594.09 4,575,330.60 6002 DBCP Settlement 212,447.05 661.62 3,522.96 209,585.71 6004 Water Well- Buhach Colony 177,720.79 1,108.37 0.00 178,829.16 6005 Water Capital Impact Fees 1,842,459.42 39,007.47 0.00 1,881,466.89 6006 Water Operating Reserve Fund 177,333.44 561.58 0.00 177,895.02 6007 1,2,3-TCP Fund 43,137,601.88 185,366.52 38,223.41 43,284,744.99 6010 Sewer Enterprise Fund 14,373,131.93 914,535.59 759,890.64 14,527,776.88 6011 Sewer Fund Capital Replacement 2,767,778.67 53,710.97 0.00 2,821,489.64 6020 Sanitation Enterprise 2,783,961.63 354,400.78 638,760.10 2,499,602.31 7000 Internal Service Fund 232,286.51 291,234.89 118,375.35 405,146.05 7010 Employee Benefits Fund 784,966.64 193,964.83 54,147.15 924,784.32 7020 Risk Management 386,924.97 247,206.04 18,151.73 615,979.28 7030 Information Technology 92,451.88 151,257.68 49,705.90 194,003.66 9090 Accrued Interest Fund 283,686.50 2,104.00 285,790.50 0.00
TOTAL 89,787,191.00 4,798,777.78 4,390,476.60 90, 195,492.18
Prepared by /J.7"i,,j-,;,da., Patricia Tejeda~perations Manager
Approved
Statement of Changes in tAsh Balanee by Bank
As of 3/31/2020
Beg. Period Balance
City - LAIF City- RMA Long-Term Investment Fund US Bank/Chandler Asset Mgt. City Checking & Investment Accounts Wastewater Checking RA Obligation Retirement Fund
(The following statements are required by California Govt. Code Section 53646 (b) (2.3))
Investments are made pursuant to the City Council approved Investment Policy and Guidelines.
The City of Atwater has the ability to meet its pooled expenditure requirements for the next six months.
City LAIF Chandler Asset Mgt. us Bank/Chandler Asset Mgt.
75,000,000.00 1,110,859.00 7,040,523.81
Bank Account Detail
Chase General Checking Chase Wastewater Checking
. . Chase Redevetoprnent Checking
3,070,219 53 2,882,637.68 949,457.41
AUDIT & FINANCE COMMITTEE AGENDA REPORT
Audit & Finance Committee
Chairperson Vierra Vice Chair Ambriz
City Treasurer Heller
MEETING DATE: April 27, 2020
TO:
FROM:
SUBJECT:
Audit & Finance Committee
Kellie Jacobs-Hunter, Finance Direc~
Summary of Proposals received from City of Atwater Request for Proposal (RFP) for Professional Auditing Services
RECOMMENDED AUDIT & FINANCE COMMITTEE ACTION:
It is recommended that Audit & Finance Committee:
Motion to recommend that the City Council seek an additional one-year agreement with JJACPA to provide professional auditing services for the Fiscal Year 2019/20 accounting period, due to submitting the lowest cost proposal and other extenuating factors.
I. BACKGROUND:
The City issued a Request for Proposal (RFP) for Professional Auditing Services on March 6, 2020 with a filing deadline of March 31, 2020. The City invited over twenty certified public accounting (CPA) firms to submit proposals along with posting the RFP on City's website for any other interested firms that wanted to submit proposals. The RFP sought qualified CPA's interested in entering into a three (3) year contract to audit and prepare the financial statements for the City of Atwater with an option to extend the contract for two (2) additional one-year periods, at the City's sole discretion.
II. ANALYSIS:
The City received four proposals by the filing deadline. One of the four proposals received is from the current auditor of record, JJACPA. Please see "Exhibit A" for a summary of the four proposals received.
During the RFP process, the Finance Director received many inquiries from CPA firms. The COVID-19 pandemic occurred right in the middle of the process and the Finance Department believes that affected the number of submittals that were received by the filing deadline.
Agenda Report - Proposals received for Professional Auditing Services Page 2
The firm that the City has engaged the past six years is JJACPA. They have done a thorough job providing the deliverables as required by the Audit Engagement Contract. GFOA guidance suggests changing auditors from time to time to have a new "set of eyes" on an organization's accounting records.
The COVID-19 pandemic has prevented the City of Atwater from bringing on the much needed part-time Accountant position, which has been vacant for over one year, and was previously a fulltime position in the Finance Department. This vacancy has caused existing staff to consistently work overtime to keep the City's accounting records current.
The COVID-19 pandemic is also having a severe effect on all levels of the economy, local, state, and federal. The City is anticipating declines in revenue both in the short-term and long-term. The true impacts remain unknown at this time. Forecasts are being completed that will help unfold the potential negative impact the COVID-19 pandemic will have on the City of Atwater's finances and will be presented to both the Audit & Finance Committee and the City Council in the coming weeks.
Based upon the staffing shortage in Finance Department of accounting staff and the unknown financial impact of COVI D-19, Staff is recommending that the City retain the CPA Firm of JJACPA for one additional Fiscal Year, 2019/2020, as they are the lowest bidder and staff is familiar with their processes and will be able to complete the required audit procedures by the March 31st deadline set by the State Auditor's and Controller's Office at the State of California.
Should the Committee and/or Council recommend a new CPA firm to perform the Fiscal Year 2019/2020 audit process, it needs to be understood that it will be highly unlikely that the March 31st deadlines will be met in accordance with state guidelines as with all new auditors they will have different processes and expectations of how accounting records are presented to them for review which will take additional staff time to conform to new procedures.
If Council seeks to extend the current contract with JJACPA for Fiscal year 2019/2020, Staff will issue another RFP in January 2021 seeking a three-year contract with two one year optional extensions with the anticipation of having the part-time Accountant in place to work with the auditors on the Fiscal Year 2020/2021 Audit Process.
Ill. FISCAL IMPACTS: JJACPA submitted the lowest cost bid for all deliverables. See "Exhibit A"
Prepared by: Kellie Jacobs-Hunter, Finance Director
Attachment: Exhibit A
Exhibit A SUMMARY - Proposals for ProfessionalAu!iitir,g Services Final Submittal Date: 3/31/20
Fechter & Co. CPA JJACPA M.U.N. CPA's VLF LLP Proposal Received by Filing Deadline X X X X
Evaluation Criteria: Independent & Licensed to Practice in CA X X X X
No Conflict of Interest X X X X
Adhered to Instructions in RFP X X X X
Included Max Price Proposal X X X X
Past Experience with Similar Engagements X X X X
Qualifications of Key Staff Members X X X X
Overall Specific Audit Approach X X X X
Required Content Contained in Proposal X X X X
Meet timeline/deadline requirements: X X X X
Deliverables/ Cost Proposal: FY 19/20 FY 19/20 FY 19/20 FY 19/20 Audit/ Financial Stmts $32,000 $35,500 $38,400 $35,500 Internal Control Review Inc Inc Inc Inc GANN Limit LTR Inc Inc $600 Inc SCO Report Prep $3,000 $2,100 $3,900 $2,200 ASR (Annual Street Report) Inc Inc $1,800 $1,500 Debt Service Cov Schedule - WW Bonds $1,000 Inc $2,200 $600 Other Expenses (Max out of pocket) $2,000 Inc Inc Inc Total of Required Deliverables FY 19/20 $38,000 $37,600 $46,900 $39,800
Cost 2nd year - FY 20/21 $38,950 $37,600 $48,307 $39,800 Cost 3rd year - FY 21/22 $39,924 $37,600 $49,756 $40,994
Optional Items: Single Audit (if threshold is met) $2,900 $8,000 $2,200 $3,000 Debt Serv Cov Sch - SA Bonds $1,000 Inc $4,100 $2,800 % inc proposed for subsequent years 2.5% per yr 0%, until Yr 4, 2.5% inc 3.0% per yr 0%, until yr 3, 3.0% inc
CITY OF ATWATER
SUMMARY - Proposals for Professional Auditing Services Final Submittal Date: 3/31/20
Hours on Engagement by Personnel: Partner 30 Manager 140 Supervisory/Prof Staff 160 Clerical 20 Total Hours on Engagement: 350 Approx 400 Not Inc in Proposal Not Inc in Proposal
