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Home My WebLink About01/17/2017 Work Session ,r ,,,,,,,e ,M„rte,/,c/,/,i//r,/,/,i„rr%„%r/rr/ /i,,,,,,r/ia��iii/iiiOi_rm/,,,�,/,,,,,,,✓ci//irm„tir///o//iimaaaaii�.,.. City of;Springfield 'nark Session Meeting MINUTES OFTHE WORK SESSION MEETING f INN OF TI IE SPRINGFIELD L CITY CCtUNCIT, l-TC:.T.wT:: rvl"'TJESDAY JANUARY 17„ 2017 The City of; prringfield.Council raact in a work session in the Jesse Maine Mecting Roorn,225 filth Street, Springfield, Oregon,on TuesdaN,,January 17, 2017 at 6:30 p.rn., with Council President "anGordarn presiding, ATTENDANCE Present were Councilor President Vaa.nGordon and Councilors Wylie, l oor , Woodrow and Pishioneri. Also present were City Manager Gino Grimaldi,City Attorney Mary Bridget Smith, City Recorder AmySowa and members rs ofthe staff'. Mayor Lundberg and Councilor Stochr were absent(excused). 1. Fiscal Year 2016 Comprehensive Annual Financial Report(C; T", ). Nathan Bell, AcCrraonting Manager, presented, the staff rep ou rl on this itein. In accordance:with Oregon Statues and the City's charter,the Citi is required to complete an annual audit and financial statement. Grove, Mueller& Swank, the City's indep en,tlont auditors,have cernpaleted their audit of the City's p:"iscarl Year 2016 CAFR and have issued their opinion thereon. Ryan 1Palsquarella,of Grove,Mueller 'a, Swank, will review the audit process,the Independent Auditor's Report, and the City's CAFR during the work session. As a preliminary summary for the Ctauaacil"s initwrtnaticn,the auditor's found no material weaknesses in the City's internal financial controls and they issued an "unmodified opinion"urn the City's financial statements.. This means that the City is properly accounting for its resources and using; adequate financial controls to helps prevent the improper use of"those resources. es. Mr. Bell acknowledged the many staff that helped with this report, with special thanks to Meg Allocco, senior accountant. M:r. Paswpuaarellaa reviewed the requirements for conducting,an audit. He noted that the audit relating Federal grant funds did not meed to he done this year because the threshold had risen from $500,000 to $750,000 and the City did not:reach that threshold.Fle referredto the Governance Letter which is a surni aa:r from the auditor of what occurred during the audit and during the year. There were not a lot of issues as noted in the letter. lie dict point out a recornruendation on page 2 of a few a 4justrnents tea the final numbers for the City. The, City did post that and those adjust agents are reflected lected in the document. 1-le reviewed the CAFR further. Councilor Moore asked about(lie corrected statement and wondered where that was referenced in the CAFR, Mr. Paasquaarella said there is no relerence to it in the CAFR because the adjustments were made prior to preparing the final CAFR, The adjustments,are impacting the consolidated numbers of the City, but r,,,,,,,,,, ,,,, ,,,,,,,, ......... ............ .............r..,,,,,,,r r//,,,///////////////////////// ///////1.,✓,,/,////////////,/�, City of Springfield Council'Work, Session Minutes January 17,24117 Page 2 not an individual fund. `l'"he,City's total assets are$309M at the;end of time year; therefore those adJustments are not large. Mr.Grimaldi said it is not like the City lost or gained those fluids. Mr, P'ascpuarella said they only refer to financing reporting and are not impacting the:budget or cash, Tlme rules for reporting set tip by the Ciovernnaental Accounting Standards Board (GASB)are vcry complicated and' many were added after the City had,done their budgetary work, Mr. Fuascpuarella said there are two sections of the CAFthat suurnmari e what:happened for the City during the year, "rhe transmittal letter created by mraanagenient outhnes what is going;on in (lie City, The other section is the Management Discussion and analysis, w=hich incorporates some of"glee numbers,and what was chine over the year. "l�'he C :FR not only meets the requirements of generally accepted accounting principles,but the City annually goes above and beyond and submits for the Governmentid Financial Clff%,cers association (Gf°OA)awards program, 'file City has received the f:FOA certificate fear the last 35 years. lle appreciates the level of effort by the City. It is a good award and shows the City is reporting correctly. fie referred to the independent auditor's repoft which said. the auditor is happy with what:they see in the doeuunient.. Mr. Pasepuarella referred to the Management Discussion and Analysis and the statement of net position. Basically, it is a balance sheet showing the City's assets, what the City ovves, and equity amount:. At the end of the year, the City its reporting album $309M in assets„$97M in liability,and the net position is about$213M. It is a decrease front the pricer year ofabout $7M, I'll is,is the highest level snapshot of where the City is at time ends of"year. Mr. pasclumarella discussed the total expenses this year conipared to the previous year. 'rile difference is about$26M. 'T'he increase/decrease in net positioua for the previous year is 27M and this year is $6.9M). The new p onouncenaent related to the City's portion ofPERS is creating this impact, lie described the changes,by the legislature which wvere overruled by the Supreme Court. "11iose changes caused the City's figures to be chaotic. The City's,portion cif"true PERS liabifity is about $17M at the end of the year. Last:year, the City lead about:a 7M asset, Mr. Pasquiarella said time City dlmd refinance a couple of bonds with an economic gain of about $2M, fle reviewed the PERS and City Retirement ligures. PERS should be more stable in the future, similar to that of"the City's Retirement flan. The number that will affect that number in the future will be rate of return on investments and payouts. if"nothing changes, the nuuaaber wvill remain fairly stable. Councilor Pishioneri asked for clarification and affect to the City costs. Mr. Grimaldi said some people predict PF"RS could be urfr to 30% of"salaries, which is an increase in the City's expenses. Mr, Pascluarella said the last two pages ofCAFR is the auditor's report over the City's compliance with Oregon Revised Statutes(ORS). They found one over expenditure(more money was spent than appropriated) in the SEDA Glenwood fundi, It was about 100,000 over. Mr. hell said they had a capitalproiect that spanned two fiscal years, although staff"spent what was within flee approved amount, the timing was off in terms of]low it was reflected ill the City's budget, which led to a legal level violation. A legal level violation is reported to the State and the City is required to put forward a resolution stating how the City will deal) with that violation, which is that we City of SpririglMd Council Work Session Minutes January 17,2017 Page.3 ww o n"t do it again. Ile will bring 1he resolution to the Council ncil inu the spring and Place it:cnnl the Consent Calendar i `C duan nil approves. The Council agreed that wVOUld be appropriate. .DJt. URNMEdsT The aneeting was au.jcwanrnecd al 6.55 pli, Minutes Recorder my Sowaa A Christin Lundberg Mayor Attest: Air,,)( Sow City Recorder