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Home My WebLink About2018-12-03 Agenda with BackupCit of Denton City Hall Y 215 E. McKinney St. Denton, Texas 76201 �'�, �u www.cityofdenton.com ��'��"�-�'� Meeting Agenda City Council Monday, December 3, 2018 11:30 AM Work Session Room After determining that a quorum is present, the City Council of the City of Denton, Texas will convene in a Work Session on Monday, December 3, 2018 at 11:30 a.m. in the Council Work Session Room at City Hall, 215 E. McKinney Street, Denton, Texas at which the following items will be considered: 1. Work Session Renorts A. II) 18�2015 Receive a report, hold a discussion, and give staff direction in the establishment of a governance process for the City Auditor's Depariment for the purpose of defining the City Auditor's authority and responsibilities for the City of Denton, Texas. Attachments: Exhibit 1. Acaenda Infarmatian Sheet - Gavernance Dacument Exhibit 2. Draft ardinance B. II) 18�2027 Receive a report, hold a discussion and give staff direction regarding an Audit of the Customer Service division of the Finance Department. Attachments: Exhibit 1. Acaenda Infarmatian Sheet Exhibit 2. Repart an Audit af Custamer Service C. II) 18�2098 Receive a report, hold a discussion, and give staff direction regarding nominations and the appointment of a Member to the Board of Directors of the Denton County Transportation Authority. Attachments: Exhibit 1- Aqenda Infarmatian Sheet 12-3 Exhibit 2 - Resalutian18-329 Exhibit 3 - �ylaws Exhibit 4 - Resalutian Exhibit 5 - Presentatian 12-3 2. Concluding Items A. Under Section 551.042 of the Texas Open Meetings Act, respond to inquiries from the City Council or the public with specific factual information or recitation of policy, or accept a proposal to place the matter on the agenda for an upcoming meeting AND Under Section 551.0415 of the Texas Open Meetings Act, provide reports about items of community interest regarding which no action will be taken, to include: expressions of thanks, congratulations, or condolence; information regarding holiday schedules; an honorary or salutary recognition of a public official, public employee, or other citizen; a reminder about an upcoming event organized or sponsored by the governing body; information regarding a social, ceremonial, or community event organized or sponsored by an entity other than the governing body that was attended or is scheduled to be attended by a member of the governing body or an official or employee of the municipality; or an announcement involving an imminent threat to the public health and safety of people in the municipality that has arisen after the posting of the agenda. Page 1 Printed on 12/5/2018 City Council Meeting Agenda December 3, 2018 NOTE: The City Council reserves the right to adjourn into a Closed Meeting on any item on its Open Meeting agenda consistent with Chapter 551 of the Texas Government Code, as amended, or as otherwise allowed by law. CERTIFICATE I certify that the above notice of ineeting was posted on the bulletin board at the City Hall of the City of Denton, Texas, on the day of , 2018 at o'clock (a.m.) (p.m.) CITY SECRETARY NOTE: THE CITY OF DENTON CITY COUNCIL WORK SESSION ROOM IS ACCESSIBLE 1N ACCORDANCE WITH THE AMERICANS WITH DISABILITIES ACT. THE CITY WILL PROVIDE SIGN LANGUAGE 1NTERPRETERS FOR THE HEARING IMPAIRED IF REQUESTED AT LEAST 48 HOURS 1N ADVANCE OF THE SCHEDULED MEETING. PLEASE CALL THE CITY SECRETARY'S OFFICE AT 349-8309 OR USE TELECOMMUNICATIONS DEVICES FOR THE DEAF (TDD) BY CALLING 1-800-RELAY-TX SO THAT A SIGN LANGUAGE 1NTERPRETER CAN BE SCHEDULED THROUGH THE CITY SECRETARY'S OFFICE. page Z Printed on 12/5/2018 City Hall City of Denton 215 E. McKinney St. Denton, Texas 76201 ��,� I�Illlll�uuuuuuu��ii www.cityofdenton.com ��'�� File #: ID 18-2015, Version: 1 Legislation Text AGENDA CAPTION Receive a report, hold a discussion, and give staff direction in the establishment of a governance process for the City Auditor's Department for the purpose of defining the City Auditor's authority and responsibilities for the City of Denton, Texas. City of Denton Page 1 of 1 Printed on 11/30/2018 I7c��w[��>i[>[i hy I [��>r;i�tf�ar��nv� City of Denton _ City Hall "��"�`� �� VI�I��I�IVI��IIIIIII�h 215 E. McKinney Street 11Y �� p�� ' Denton, Texas www. cityofdenton. com DEPARTMENT: DCM: DATE: SUBJECT AGENDA INFORMATION SHEET Internal Audit Bryan Langley December 3, 2018 Receive a report, hold a discussion, and give staff direction in the establishment of a governance process for the City Auditor's Department for the purpose of defining the City Auditor's authority and responsibilities for the City of Denton, Texas. BACKGROUND According to the City Charter section 6.04, "The City Internal Auditor is responsible for providing (a) an independent appraisal of City operations to ensure policies and procedures are in place and complied with, inclusive of purchasing and contracting (b) information that is accurate and reliable; (c) that assets are properly recorded and safeguarded; (d) that risks are identified and minimized; and (e) that resources are used economically and efficiently, and that the City's objectives are being achieved. The City Internal Auditor is responsible for directing all internal audit functions for the City of Denton to eliminate waste, fraud, and abuse." To enable the City Auditor to carry out the responsibilities involved in successfully accomplishing the above responsibilities, parameters for his authority and responsibilities needs to be established. The accompanying Internal Audit Governance document was prepared using industry best practices for internal auditing and will be helpful to the City Auditor to perform his duties. RECOMMENDATION Staff recommends approval of the Internal Audit Governance for the City Auditor's Department. PRIOR ACTION/REVIEW (,Council, Boards, Commissions1 N/A STRATEGIC PLAN RELATIONSHIP The City of Denton's Strategic Plan is an action-oriented road map that will help the City achieve its vision. The foundation for the plan is the five long-term Key Focus Areas (KFA): Organizational Excellence; Public Infrastructure; Economic Development; Safe, Livable, and Family-Friendly Community; and Sustainability and Environmental Stewardship. While individual items may support multiple KFAs, this specific City Council agenda item contributes most directly to the following KFA and goal: Related Key Focus Area: Organizational Excellence Related Goal: 1.1 Manage financial resources in a responsible manner EXHIBITS l. Agenda Information Sheet 2. Draft Ordinance Respectfully submitted: Umesh Dalal 349-8158 City Auditor S:ALegal\Our pocuments\Ordinances\18\Governance of City Auditor.docx ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, ESTABLISHING A GOVERNANCE PROCESS FOR THE CITY AUDITOR'S DEPARTMENT FOR THE PURPOSE OF DEFINING THE CITY AUDITOR'S AUTHORITY AND RESPONSIBILITIES; PROVIDiNG FOR A REPEALER; PROVIDING FOR A SEVERABILITY CLAUSE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, pursuant to Article VI, Section 6.04, the City Council of the City of Denton appointed a City Auditor to provide the City Council with independent, objective, and useful information regarding City operations to promote efiiciency and effectiveness in maximizing City resources in the public's interest; and WHEREAS, the City Council desires to establish a governance process for the City of Denton's internal audit function that defines the authority and the responsibilities of the City Auditor; and WHEREAS, the City Auditor has submitted an Internal Audit Governance document for City Council's review and approval; and WHEREAS, the City Council finds that this Ordinance is in the public interest; NOW; THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The recitals and findings contained in the preamble of this Ordinance are incorporated into the body of this Ordinance. SECTION 2. The City Council hereby approves the Internal Audit Governance document �hat describes the autharity an� res��r�s;b�lities af the City af Dent�n �udit�r depi�ted ir� it�e memorandum attached hereto as Exhibit "A". SECTION 3. This Ordinance shall become effective immediately upon its passage and approval. The motion to approve this Ordinance was made by and seconded by . This Ordinance was passed and approved by the following vote � - �: Aye N�a Abstain Absent Chris Watts, Mayor: Gerard Hudspeth, District 1: Keely G. Briggs, District 2: Don Duff, District 3: John Ryan, District 4: S:\Legal\Our pocuments\Ordina�ices\18\Govervance of Cit�� Auditor.doch Deb Armintor, At Large Place 5: Paul Meltzer, At Large Place 6: PASSED AND APPROVED this the day of . 2018. CHRIS WATTS, MAYOR ATTEST: JENNIFER WALTERS; CITY SECRETARY : APPROVED AS TO LEGAL FORM: AARON LEAL, CITY ATTORNEY : EXHIBIT A City of Denton INTERNAL AUDIT GOVERNANCE DOCUMENT City of Denton Internal Audit Authority and Responsibilities TABLE OF CONTENTS INTRODUCTION Page 2 ESTABLISHMENT Page 2 INTERNAL CONTROLS Page 2 AUDITING STANDARDS Page 2 OBJECTIVE Page 3 CITY CHARTER REQUIREMENTS Page 3 INTERNAL AUDIT AUTHORITY AND RESPONSIBILITY L INDEPENDENCE Page 3 2. AUTHORITY Pa e 5 3. PROPER USE OF GOVERNMENT INFORMATION, RESOURCES, AND Page 6 POSITIONS 4. REPORT STRUCTURE Pa e 6 5. RESPONSIBILITIES Pa e 6 6. ACCESS TO AUDITOR'S WORK PAPERS CITY MANAGEMENT Page 8 RESPONSIBILITY PEER REVIEW Pa e 8 ACCESS TO THE CITY AUDITOR'S WORK PAPERS Page 9 DISCIPLINARY ACTIONS Pa e 9 Page�l City of Denton 1 INTRODUCTION Internal Audit Authority and Responsibilities Auditing is a cornerstone of good public-sector governance and stewardship. The Association of Local Government Auditors supports the establishment and continuous improvement of independent financial and performance auditing in local government. Local governments establish, staff, and maintain independent audit functions to enhance accountability, earn and increase citizen confidence and respect for government, and provide an independent and objective perspective. 2 ESTABLISHMENT The City Internal Auditor's (City Auditor) Off'ice was established to provide the City of Denton (City) with a comprehensive program of internal auditing as an overall internal control measure and a service to the City. 3 INTERNAL CONTROLS The General Accounting Office (GAO) of United States define Internal control as a process effected by an entity's oversight body, management, and other personnel that provides reasonable assurance that the objectives of an entity will be achieved. These objectives and related risks can be broadly classified into one or more of the following three categories: Operations - Effectiveness and eff'iciency of operations Reporting - Reliability of reporting for internal and external use Compliance - Compliance with applicable laws and regulations Internal Controls — Existence of inechanism to verify accountability 4 AUDITING STANDARDS The Generally Accepted Government Auditing Standards (GAGAS) governs auditing in public sector. These standards embody the concept of accountability for public resources, which is fundamental to serving the public interest. GAGAS contains requirements and guidance dealing with ethics, independence, Auditor's professional judgment and competence, quality control, performance of the audit, and reporting. The City of Denton adopts these standards for the City Auditor's Off�ice's activities. The personnel of the City Auditor's Office shall be bound by the principles included in GAGAS. These principles include: a. Emphasis on the public interest; b. Integrity and objectivity in performance of work; c. Proper use of government information, resources, and positions; and d. Professional beha�ior. Page�2 City of Denton 5 OBJECTIVE Internal Audit Authority and Responsibilities City management and elected off'icials are entrusted with public resources. They are responsible for carrying out public functions and providing service to the public effectively, efficiently, economically, and ethically within the context of the statutory boundaries of the City's programs and operations. The primary objective of City Auditor's Office is to assist the City Council in achieving City's goals and objectives while minimizing undue risk. 6 CITY CHARTER REQUIREMENTS The provisions of section 6.04 of the City charter are: "The City Internal Auditor shall be appointed by the City Council, shall serve at the pleasure of the City Council, and shall perform such auditing duties herein described or as may be assigned by the Council. The position of the City Internal Auditor is to be held on a continuous, fulltime basis. On an interim basis, the City Council may engage external independent auditing resources to accomplish the Internal Audit function. The City Internal Auditor is responsible for providing (a) an independent appraisal of City operations to ensure policies and procedures are in place and complied with, inclusive of purchasing and contracting, (b) information that is accurate and reliable; (c) that assets are properly recorded and safeguarded; (d) that risks are identified and minimized; and (e) that resources are used economically and efficiently, and that the City's objectives are being achieved. The City Internal Auditor is responsible for directing all internal audit functions for the City of Denton to eliminate waste, fraud, and abuse." Definitions: • Fraud: An intentional distortion of truth, an act of deceiving or misrepresenting to induce another to part with something of value or to surrender a legal right. • Waste: to spend or use carelessly or use resources inefficiently or become dissipated. • Abuse: to put to a wrong or improper use or to use excessively. To enable the City Auditor to carry out the above responsibilities, the City Council approves the following: Page�3 City of Denton Internal Audit Authority and Responsibilities INTERNAL AUDIT AUTHORITY AND RESPONSIBILITY 1 INDEPENDENCE It is very important to be explicit in protecting Auditor's impartiality and objectivity in conducting their work, so the City Council and other stakeholders can rely on audit findings and recommendations. To be independent in fact and appearance, auditors must be free from conflicts of interest and free from interference in how the work is conducted and reported. In all matters relating to the internal auditing engagements, auditors and the City Auditor's Office shall be independent from the City Administration or the audited entity. In addition, the City Internal Auditor shall be apolitical and be free from political influence when performing his duties. Auditors must have systems in place to identify, safeguard against, or report threats to independence. The Government Auditing Standards identify seven types of threats to independence: ■ Self-interest threat - the threat that a financial or other interest will inappropriately influence an auditor's judgment or beha�ior; ■ Self-review threat - the threat that an auditor or audit organization that has provided nonaudit services will not appropriately evaluate the results of previous judgments made or services performed as part of the nonaudit services when forming a judgment significant to an audit; ■ Bias threat - the threat that an auditor will, as a result of political, ideological, social, or other convictions, take a position that is not objective; ■ Familiarity threat - the threat that aspects of a relationship with management or personnel of an audited entity, such as a close or long relationship, or that of an immediate or close family member, will lead an auditor to take a position that is not obj ective; ■ Undue influence threat - the threat that external influences or pressures will impact an auditor's ability to make independent and objective judgments; ■ Management participation threat - the threat that results from an auditor's taking on the role of management or otherwise performing management functions on behalf of the entity undergoing an audit; and ■ Structural threat - the threat that an audit organization's placement within a government entity, in combination with the structure of the government entity being audited, will impact the audit organization's ability to perform work and report results objectively. Page�4 City of Denton Internal Audit Authority and Responsibilities Internal Audit shall be free from control or undue influence in: ■ The selection and application of audit techniques, ■ Audit procedures and programs; ■ Determination of facts revealed by the examination or ■ The development of recommendations or opinions; and ■ The selection of areas, activities, and managerial policies to be examined. The City Auditor will have authority to decide timing, duration and scope of any audit project that must be conducted to mitigate management, compliance, financial, technological, and other risks faced by the City. • For the Internal Audit Department to operate effectively, the City Administration will provide adequate resources, office space, and other necessities such as computer equipment and access to the City's computer network, etc. • Decisions about funding for the auditor shall not be under control of City management. • In accordance with GAGAS, the City Auditor's reports shall be available publicly and will be posted on the City Auditor's webpage. 2 AUTHORITY Internal Audit shall ha�e the following authority: The City Auditor or designee shall have: Unrestricted access to all City functions, information, records including vendor contracts, grants subrecipient's records, and other documents related to City operations; City property; and personnel. The City employees sha11 comply with the City Auditor's request for records and information without delay. In addition, the City employees will comply with all the requests for interviews and other inquiries. The staff will not be influenced by supervisors and managers when providing information to the City Auditor. In addition, the City management must include a right-to audit provision in all contracts to gain access to relevant records to verify compliance. For this purpose, a"right to audit" clause shall be included in all City contracts. If access to information is restricted by laws or regulations, the City Auditor or designee will sign any suggested confidentiality agreement with the holder of the document or information to gain access for the audit purposes. Ability to allocate resources, set frequencies, determine timing and duration of projects, select subjects, determine scope of work and apply the techniques required to accomplish audit obj ectives. Access to review the findings and recommendations of examinations performed by regulatory agencies or other external entities. Page�S City of Denton Internal Audit Authority and Responsibilities • Ability to perform unplanned internal audit projects/reviews throughout the year when determined necessary by Internal Audit, Management or the City Council. However, if a proposed project has an impact on timing and accomplishment of audits included in the Annual Internal Audit Plan (Audit Plan): ■ For the projects requested by the City Council, at least three members of the City Council must agree to conduct the project. In this event, the annual audit plan will be altered to accommodate the new project. ■ All the projects requested by management or selected by Internal Audit must be approved by the majority of City Council members before it is included on the annual audit plan to replace an existing proj ect. 3 PROPER USE OF GOVERNMENT INFORMATION, RESOURCES, AND POSITIONS The City's information, resources, and positions are to be used for official purposes and not: • for the Auditor's personal gain or • in a manner contrary to law or • detrimental to the legitimate interests of the City. This concept includes the proper handling of sensitive or classified information or resources. In the government environment, the public's right to the transparency of government information must be balanced with the proper use of that information. In addition, many government programs are subject to laws and regulations dealing with the disclosure of information. Exercising discretion in using information acquired during Auditor's duties is an important part in achieving this balance. Improperly disclosing any such information to third parties is not an acceptable practice. 4 REPORTSTRUCTURE • The City Auditor is authorized to recruit staff with the resources appropriated by the City Council for personnel services. The staff recruited by the City Auditor shall report to and be managed by the City Auditor. Authority to select, retain, promote, reward and dismiss these personnel shall rest with the City Auditor without any influence from the City Management. 5 RESPONSIBILITIES • The City Auditor is responsible for providing the City Council and Management assurances about the adequacy and effectiveness of its systems of internal controls and quality of operating performance when compared to established goals or performance measurement standards. Page�6 City of Denton Internal Audit Authority and Responsibilities In doing so, Internal Audit will conduct audits and other projects to determine if: ■ Risks are appropriately identified and managed. ■ Significant financial, managerial and operational information is accurate, reliable and timely. ■ Employees' and City's actions follow policies, procedures and applicable laws and regulations. ■ Resources are acquired and used economically and eff'iciently, and adequately protected. ■ Programs, plans and objectives are achieved in an effective manner. ■ The City operations are conducted efficiently and economically for effective delivery of public service. ■ Significant legislative or regulatory issues affecting the City are recognized and addressed. The City Auditor will be responsible for developing and implementing a flexible annual Audit Plan to include any risks or control concerns identified by City Auditor's risk assessment, Management or the City Council. The Audit Plan will be submitted to the Audit and Finance Committee for review and approval. The City Auditor will have authority to examine appropriate evidence to audit all expenditures, appropriations, and revenues of the City. A professional audit staff will be maintained with sufficient knowledge, skills, experience, and professional certifications to ensure the requirements of this Charge are achieved. Within the budgetary limitations, proper funding will be available for the auditors to recruit competent staff'ing and perform their duties. The City Auditor will perform follow-up reviews to monitor and ensure that management has appropriately and effectively implemented recommended actions by internal audits, external audits and external consultants. At times, management will accept risk identified by audit. The City Auditor will advise City Council if the management is accepting unreasonable risk. The City Auditor will assist the Audit Committee in their responsibility to hire, direct and provide oversight of the External Audit and administer contracts related to services provided by the External Auditor. The City Auditor shall be primarily responsible for investigating fraud, waste, and abuse, complaints. For this purpose: Page�7 City of Denton Internal Audit Authority and Responsibilities ■ The City Auditor shall manage the City's Fraud, Waste, and Abuse hotline. The City Auditor will ensure that significant suspected fraudulent activities within the City and complaints received on are investigated and the results are notified. ■ The City Auditor will determine with whom the information related to the complaints received are shared. ■ The City employees, supervisors, and managers are responsible for communicating and seek assistance from the City Auditor no longer than twenty-four hours after the employee becomes aware of the suspected fraud. ■ Department directors or supervisors will promptly report allegations or suspicions of fraud to the City Auditor immediately following notification of the allegations or suspicions. This will be done prior to taking personnel action toward the employee(s) involved. ■ City employees who are contacted by citizens with evidence or written allegations of fraud shall immediately report it to the City Auditor along with their department director, an Assistant City Manager or the City Manager. ■ The City Auditor may ask for assistance from the City Attorney's Off'ice, the Human Resources Department, and/or the Police Department for investigations as necessary. ■ Proper records of investigative procedures and evidence will be maintained by Internal Audit. ■ The City employees shall be protected under Federal Whistle blower Protection Act of 1989 and City policies and Ordinances protecting City employees against retaliations for reporting fraud against the City, waste and/or abuse of City resources, mismanagement, or non-compliance with laws. • The City Auditor shall provide administrative su�port to the Citv's Ethics Board Citv's Ethics Ordinance. 6 CITY MANAGEMENT RESPONSIBILITY City management_is responsible for addressing issues noted during any Internal Audits and investigations. They must implement procedures and processes necessary to ensure the eff'icient, effective and accountable operation of City. Management must respond to the audit and investigative recommendations in writing, within a time specified. Management must explain what actions are planned along with relevant time period for implementation or if actions ha�e been taken to deal with issues identified in audit reports. 7 PEER REVIEW The City Auditor's Office will undergo periodic peer reviews of the audit function in accordance with GAGAS. Page�8 City of Denton Internal Audit Authority and Responsibilities 8 ACCESS TO AUDITOR'S WORK PAPERS According to the Section 552.116 of the Texas Public Information Act, the City Auditor's work papers are not subject to disclosure requirements. The final reports issued by the City Auditor is subject to disclosure and must be available to the public. 9 DISCIPLINARY ACTIONS Any City employee that does not comply with the provisions of this governance document relating to cooperating with the City Auditor or provide requested records or information shall face disciplinary action up to termination of their employment. Page�9 City Hall City of Denton 215 E. McKinney St. Denton, Texas 76201 ��,� I�Illlll�uuuuuuu��ii www.cityofdenton.com ��'�� File #: ID 18-2027, Version: 1 Legislation Text AGENDA CAPTION Receive a report, hold a discussion and give staff direction regarding an Audit of the Customer Service division of the Finance Department. City of Denton Page 1 of 1 Printed on 11/30/2018 I7c��w[��>i[>[i hy I [��>r;i�tf�ar��nv� City of Denton _ . City Ha11 �� 5 215 E. McKinney Street tiY �� " Denton, Texas www. cityo fdenton. com AGENDA INFORMATION SHEET DEPARTMENT: Internal Audit DCM: DATE: Bryan Langley December 3, 2018 SUBJECT Receive a report, hold a discussion and give staff direction regarding an Audit of the Customer Service Division of the Finance Department. BACKGROUND The Customer Services Division of the Finance Department accepts payments for the City's utility departments. Annually, the Division collects revenue totaling approximately $268 million. In addition, the Division handles billing for all City utilities. The audit evaluated internal controls and efficiencies in the Division's operations. The audit found certain vulnerabilities and made recommendations to mitigate them. The City Administration promptly implemented, thus improving internal controls over significant City resources. The purpose of this item is to present the audit report, discuss the report and receive direction from the City Council. RECOMMENDATION Staff recommends approval of the report on the Audit of the Customer Service Division of the Finance Department. PRIOR ACTION/REVIEW (Council, Boards, Commissions) September 18, 2018 — Audit/Finance Committee received a report on the Audit of the Customer Service Division of the Finance Department and requested additional information. November 6, 2018 — The Audit/Finance Committee received a report from staff providing the clarification and additional information requested. The Committee followed by directing staff to forward the report on the Audit of the Customer Service Division of the Finance Department, to the City Council for their consideration. STRATEGIC PLAN RELATIONSHIP The City of Denton's Strategic Plan is an action-oriented road map that will help the City achieve its vision. The foundation for the plan is the five long-term Key Focus Areas (KFA): Organizational Excellence; Public Infrastructure; Economic Development; Safe, Livable, and Family-Friendly Community; and Sustainability and Environmental Stewardship. While individual items may support multiple KFAs, this specific City Council agenda item contributes most directly to the following KFA and goal: Related Key Focus Area: Organizational Excellence Related Goal: 1.1 Manage financial resources in a responsible manner EXHIBITS 1. Agenda Information Sheet 2. Report on the Audit of Customer Service Respectfully submitted: Umesh Dalal 349-8158 City Auditor AUDIT OF CUSTOMER SERVICE DIVISION l �- U;;� °,; ,,��,, �� l%- �k ;, "„��,,. Controls over $26� Million resources were generally adequate, but improvements were needed. This audit helped administration to make the needed ir°�provernents. ��ii «��zl�� 11„�,��IIP�� ii��;�� w��''�ii��;��ir� %,,,,,i�, �iiii `%/�� i%/ ,/ / ii; %/////� �%i� ,.. %ii% � "I i ��;� , � i '�1��"@��°� ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� Table of Contents Description Pa�e Executive Summary 2 What Works Well? 4 Opportunities for Improvement Safeguarding of cash 5 Access Control 7 Access to Employee's Accounts 8 Interest and Fees on Delinquent Accounts 9 Manual Check Processing 10 Policies and Procedures 11 Interdepartmental Cash Deposits 13 PCI Compliance 14 Timeliness of Referral of Delinquent Accounts 15 Large Receivable needs follow-up 17 Collection Agency's Contract Compliance 18 Time to Pay Delinquent Balance 19 '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� Executive Summary Honorable Mayor and members of the City Council, The City auditor's office has completed an audit of the Customer Service Division. This operation collects approximately $268 million in City's revenues and bills customers for all City utilities. The objective of the audit was to verify internal controls over City resources and billing procedures, and evaluate efficiencies in the Division's processes. The following are the salient findings of the audit: • Overall, the Division had good operation to effectively process the revenues billed, accounted and collected. The staff was receptive and prompt in addressing discrepancies identified by this audit. The staff must be commended for their diligence. • Value contributed by the audit: o The controls over $32 million in cash and checks were improved due to implementation of better procedures for accessing cash and processing revenues. o The computer access controls were strengthened due to segregation of duties. This change improved controls over the entire $268 million annual collection by the Division. o Formal policies and procedures will be developed that will document processes already working well. This documentation is necessary for consistent and ongoing compliance with management direction. o Compliance with credit card industry requirements was achieved, which was in progress at the beginning of the audit. o Recommendations will improve efficiencies in collection of closed, delinquent accounts by timely referring them to the collection agency. This change will improve efficiency in collection function and free up staff time currently committed to collection. o The audit identified more than $1.4 million owed by five accounts that needed follow-up. Recommendation was made to pursue collection on these accounts, which may result in the City receiving large amount of revenue. N � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� The attached detailed report includes additional information. The City Auditor's Office appreciates cooperation of the Division and Technology Services staff. This audit made 14 recommendations. The Division has concurred with all of them. Implementation of 11 recommendations is already completed. Two of the remaining recommendations will be implemented upon the City Council's guidance and approval. The implementation of one recommendation was in progress at the time of issuance of this report. Management responses are included after each set of recommendations. Ifyou have any questions or comments, please contact me at (940) 349-8158 or at umesh.dalal@cityofdenton.com. Umesh Dalal, City Auditor '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� m��'.�"��µ��.��':iu��i�m The City Auditor's Office has completed an audit of the Customer Service Division of the Finance Department. The objectives of the audit were to evaluate internal controls in the Division's procedures. The audit was conducted in accordance with the Generally Accepted Government Auditing Standards promulgated by the Comptroller General of the United States. Those Standards require that the auditors plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for their findings and conclusions based on the audit objectives. The auditors believe that the evidence obtained duringthis audit provides a reasonable basis fortheirfindings and conclusions based on the audit objectives. &'��"� II��III &'�� II� III III'4��»� III III"�� "� ��,�� "14III°i�� III ��"W III IU�m�� III III III�� The City management is responsible for ensuring resources are managed properly and used in compliance with laws and regulations; programs are achieving their objectives; and services are being provided efficiently, effectively, and economically. � II�'m��" �':�Ilr"II�� IIIIIIm�� Overall the controls over billing, recording, and collection of revenues are working well. The auditors found that Division's staff was knowledgeable and had good understanding of the processes they were responsible for handling. They were receptive and willing to make improvements in controls where needed. The auditors found the following: � Current Bank reconciliation process had sound controls. The available procedural guidance was complied with by the Division staff. Accordingly, the reconciliations were up to date and were independently reviewed by another employee for accuracy. All outstanding matters were followed-up in a timely manner. � Billing process is well organized and timely. � Billing rates for electric and water utilities in NorthStar computer system comply with the City Council's approved rates. This means, these customers are billed appropriately using correct � v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� rates. In addition, penalties and other fees applicable for late payments were assessed and collected appropriately in accordance with the City policies and City ordinances. � End-of-the-day process was working well and had proper controls. � Duties of Cashiering and Collection personnel were properly segregated and well controlled to prevent the risk of misappropriation. � Cash was received and banked regularly. No errors or other discrepancies were found. � Access controls to the NorthStar system were properly configured. However, further improvements were needed in this area as discussed subsequently in this report. � The City has proper fidelity insurance to cover risk of losses that can result from: o Employee Dishonesty, o Forgery or Alteration, and o Computer Fraud. ��.�Il�ll��:�ii��i ii� i1 ��i1 �� iir � ii�� Il��iir �:� ��i�� ii�m �:� � �;��a��.��iir��fii�� m �:::��Ilh� The Division Manager took prompt action to enhance controls and improving security of cash. Annually, the Division receives over $8 million (3%of $268 million) in currency. Safeguarding of this cash is critical. Accepted best practices require limiting access to cash to one or two employees. This requirement helps identify responsible individual in the event cash is missing. II�m��V: �� .��:��.�iir°u�� m� � At Customer Service, the cash is stored in safes kept in the vault. The keys to the vault were hung on the wall in front of the vault allowing easy access to anyone who had security access to the lobby area. �� ;� iii.�.: ��u��.�.:�:�;�iir�:� Due to these conditions, in the event cash is missing from any of the three storage safes, the employee responsible for the loss will not be identified easily. The City has a Fidelity/Crime policy that will cover a loss resulting from theft or employee dishonesty. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� The vault door was kept open during business hours. However, if it is demonstrated that the City did not follow reasonable security � The small safe was also kept open to procedures, the insurance company may facilitate change transactions for cashiers. dispute the claim. � The large safe contained a portable metal box in which cash is stored for other departments waiting for transportation to bank. Internal deposits received from other departments were stored in a basket next to the metal box awaiting pick-up by the armored truck for transportation to the bank. The safe was kept open during business hours. � The vault had another drop safe in which the cashiers periodically dropped cash for safekeeping. A record is created with two cash tapes that are ran during the drop of the deposit. � The keys to the drop safe were hung on the wall within the vault, accessible by all Customer Service employees in lobby area who had access to the vault. � Clearly written policy and procedure for access to safes and keys were not available. Recommendations (High Priority): The audit did not find any incident where cash was missing. However, additional controls are necessary to prevent the possibility of a future incident of cash loss. 1. Assign duties of accessing cash to one employee to be the primary custodian of keys. Assign an alternate or backup custodian for periods of the primary custodian's absence. 2. Keep all the safes and vault locked. 3. Require the cashiers to keep a record of cash dropped in the safe. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� City management Response: All aforementioned recommendations were addressed effective June 27, 2018. .. �� .w�"�I�"'��`��"�"�I� � System access controls need to be improved to avoid risk of abuses. The auditors reviewed security tables for the NorthStar computer system used by the Division for billing and collection purposes. The security appeared to be properly configured and access was properly controlled for the employee processing cash, having ability to update records and reconciling books. III��; �� uirri��"µ� The Systems and Operations Administrator had an "Administrator or super user" level access and is responsible for allowing and managing Division employees' access to NorthStar computer system. She had the ability to perform all the functions in the system without other employee's involvement. This is an acceptable practice provided the Administrator did not have access to cash. However, due to relatively weak controls over safeguarding of cash, this situation may represent a weakness in internal controls. The System and Operations Administrator indicated that when a Customer Service staff member approaches her to enhance their access, she questions them about the need. If she is satisfied, she uses her discretion to grant additional access. Occasionally, she would consult with the supervisor of the employee �"'�� W"��%.��";:�"� lil"�': �"'��'ll��l"W'W'�',iillr.m�' The Division is a very large cash operation. Having ability to change access levels in an operations where a relatively small number of employees work, could lead to a possibility of collusion. This could be a significant risk that can be easily avoided by segregating access controls for certain key system functionalities to Technology Services Department. It should be noted that the auditors did not observe any indication of actual collusion occurring. The control measures are necessary for avoiding potential for such occurrence. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� requesting additional access about the enhancement. The auditor observed that the Systems and Operations Administrator changed some of the employees' access privileges without consulting any superiors as the access was not necessary for those employees to perform their respective job duties. This would indicate that the employee access levels are not reviewed periodically for appropriateness. Recommendation (High Priority): 4. The Customer Service Manager, after consulting Technology Services Director, needs to move access control for certain key system functionalities to Technology Services Department. City management response: The aforementioned recommendation was addressed effective July 31, 2018. .. ��'o�:��:��"'µ�''µ "�;�:� �'::Ilf��l�l„:�I�I��'� ��:��'»'�°�� :��'o��'��.�IIP"��":`°� Some Customer Service employees have ability to access their own account. II��: ��KK ��°.��.uiu��l"m� The Customer Service employees living in Denton have utility accounts with the City. According to the Division personnel, 21 Customer Service employees lived in Denton and have ability to access and make changes to their own account. From the available records, it appears that at least three employees �� I�''��u III"�'� ��"�'��'��w'Ilr'�° The ability of an employee to access and make changes to their own account represents a conflict. There is a potential for abuse of this situation. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� accessed their own account and made changes. However, these changes did not represent any act of misconduct. Recommendation: 5. Customer Service needs to have a formal, written policy for prohibiting employees to access and make changes to their own account. City management response: The aforementioned recommendation was addressed effective July 30, 2018, and Standard Operating Procedure are being created. Illiiw.iu�.�Miir�M�� iir�� IU::�M�M�� i�m �::��MlUfiiir��°��.��Miirm�. .. �M��:��.�iii��. Interest and fees on delinquent accounts were waived without appropriate authority. According to the City Attorney's Office the Denton City Code Section 26-6 (k) addresses interest charges on past due accounts. It states, "Interest shall be assessed on any past due account balance (excluding late payment charges) that remains unpaid prior to the current month's billing calculation. Interest shall be assessed based on the customer's monthly billing schedule and the due date of the customer's past due bill. The interest charge shall be due and payable on the due date of the current month's billing. The interest charge will be established by the city council and on file in the office of the city secretary." Currently, Ordinance No. 18-332 sets the interest rate on past due account balances at 1% per month on all past due charges and account balances unpaid at the time of the current month's billing calculation. II��: ��KK .�"�°.��u��.m� • A customer owed $55,809.74 for unpaid utility bills, accrued interest and late payment fees. A municipal lien was filed against the property to which this account belonged for the balance due. The lien was released after payment was made for the ��1�1 ��I�''��u lil"�'� ��"��"�'��'��w'Ilr'�° According to the City Attorney, "Waiving fees or reducing fees owed constitutes an illegal gifting of public funds that violates the Texas Constitution, specifically Article 111, Section 52. Unless the Legislature has adopted a law authorizing it, we cannot waive or reduce fees. In fact, Section 26-12(f) below prohibits '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� principal amount on the utility bills and the Customer Service representative waived interest in an amount of $26,038.56 and (ate fees of $2,610. Customer Service do not assess interest on delinquent accounts after they have issued a final bill on an account. Recommendation: the City Manager from releasing a municipal utility lien unless all delinquent charges, penalties, interest and collection costs have been fully paid. If the City Manager is prohibited from doing this at this stage, it stands to reason that he likewise cannot waive or reduce fees prior to imposing a municipal utility lien." Accordingly, the City employees do not have an authority to waive either interest or late fees on any account. In addition, the Customer Service does not appear to have authority to stop charging interest on delinquent account until the balance owed on the account is paid. 6. Customer Service needs to comply with the City Code and other legal provisions related to interest and late fees applicable for utility account delinquencies. City mana�ement response: Staff plans to discuss this matter with the City Council during the August 21, 2018 meeting in conjunction with the City's Council's review of the related rate ordinance and seek direction. �iirmm�.�i�lll �:.�II��III� �:�iir��iiiiir�� Controls over the processing of collection through mail and drop box need improvement. The auditor observed processing of checks received through mail and those deposited in the drop box located on the premises. The auditor's observations and inquires indicated the following: '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� I��; �� m��"w� Customer service receives about 6% or about $16 million revenue through mail and drop box located at the Customer Service. The collection, mainly in the form of checks or cashier's checks, are retrieved from drop box by a single employee. In addition, checks received in mail and drop box are delivered to an employee, who processes the checks without any witness. This employee is also responsible for supervising other cashiers and making correcting entries if a payment posting error is found on a customer's account. A complete record of all complaints received from customers is not easily retrievable. Recommendation: II�'�� W"��'��;�"i� lil"�'; IIw11�'ll��l"�''�':�',iilll"�' Checks retrieved from drop box by an employee is vulnerable to abuse. Processing a significant amount of checks by an unsupervised, single employee also presents the same threat. The actual processing of checks by this employee is recorded using a camera. However, unless someone is watching the tapes periodically, it does not represent a good control. If a customer complains about not getting credit for payment made, the employee processing these payments has the ability to make adjustments to the customer's account. In this situation, any misuse of city resources may not be detected in a timely manner. 7. Customer Service needs to require two employees' presence to retrieve payments from drop box and process payments received in mail as well as drop box. City management response: The aforementioned recommendation was addressed effective July 2, 2018. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� :��IIIIII�.�III��w a��II�'��"'� III':�II��"'��.�I�'°�� An opportunity for improving the Customer Service Division's policies and procedures exists. Il�m��. �� .�'�:��.�iir°u��:�"�m�� The auditors found the available guidance to be desk procedures that provided detailed steps for performing tasks assigned. However, not all procedures provided explanation of purpose of performing the relevant tasks. Also, the available procedures did not provide employees with a clear guidance about the relevant policies and did not have date of issuance or revisions. In this event, employees may not know if the procedures available to them are outdated. The procedures did not have any evidence of management review or approval. In addition, the available desk procedures did not have performance expectations. IIW�� ;�� il�: iiw�ru��:�:�,�,iir� Without properly understanding the purpose and importance of conducting a task, employees' work could become monotonous. This may also deter meaningful employee contribution in improving City processes. Also, it is important for employees to have knowledge of management expectations on which their work is going to be evaluated. Currently, it may be difficult to detect if the current procedures adhere to the relevant City policies. Lack of knowledge of performance expectations may impact employee performance. The Customer Service Manager stated that the Division has had plans to compile a formal policies and procedures manual, which she shared with the auditors. However, the Division has yet to compile the manual. Recommendation (High Priority): 8. The Customer Service Manager needs to compile a formal policies and procedures manual and make it available to all employees. The policies and procedures should contain: • The authority such as legal requirements, City policy, etc. • Effective and revision dates; N r—I v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� • A clear and consistent guide for employees to understand the purpose and method to perform (detailed steps) the assigned tasks, if possible, with examples; • Expectations and performance measurement criteria; • Language that is understandable and accessible by employees; and • Evidence of management's review and approval. City management response: The aforementioned recommendation was addressed and a Standard Operating Procedures manual will be in place effective December 1, 2018. Illiiw.iu�.�Miir�m��ll��i�°.�:iiwm��i�m��lll �:"��II�� :'��MII�� Better assurance of delivery of cash deposits to Division is needed. Customer Service has a contract with an armored car company for delivering cash to bank. In order to minimize charges, several departments deliver cash collected by them to Customer Service in sealed envelopes. II�°u��.�.: �� .�.�:�u.�iurm��.m� Il�m� ��u�;�� : iir�°u��:�:�:��..m� Currently, 41 business units are utilizing the There is a potential for abuse in this interdepartmental deposit service. In FY 17-18, situation. In the event the cash is not the Division received approximately $18 million deposited in the banks account, it will be in deposits from these departments. Therefore, difficult to assign the responsibility for a loss having better controls on these deposits is to a single individual. essential. The Division's procedures require the Cash Operations Specialist to inspect the bag for proper seal and acknowledge the receipt on a specific form. However, this acknowledgement is not given to the department. Therefore, the department delivering the deposit does not have assurance of Division's receiving the deposit until after about three days if they verify the bank statement for deposit. The errors in deposits will be detected only if the departments have good reconciliation processes: .... .... .... .... .... .... .... .... .... .... .... m r—I v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� Recommendation: 9. Require the Division to forward acknowledgement of the deposit to the relevant department independently of the courier of the deposit. 10. Require the departments depositing cash through Customer Service to reconcile the receipted deposits with their records. City management response: The aforementioned recommendations were addressed effective June 27, 2018. �:��:"MIII �:"M��iu��I��lUfi�i�m��M� The City has been diligent but needs to make additional efforts to become fully compliant with data security standards related to credit card payments. Every entity storing, processing, or transmitting credit cardholders' information are required to follow Payment Card Industry Data Security Standards, more commonly known as PCI compliance requirements. These requirements are established to protect the cardholders' information from abuse. Based on the level of credit card transactions activity, the City is required to conduct self- assessment to verify existence of information security infrastructure and procedures. II�°u��.�.: �� .�.�:�u.�iurm��.,� The Division accepts credit cards payments for utility charges and is a merchant for the purposes of the above requirements. The Division and Technology Services are aware of the risks and have been working to become PCI compliant. Technology Services personnel have rectified all of the discrepancies identified during their Il�m� ��u�;�� : iir�°u��:�:�:��..m� The penalties for noncompliance are significant. The bank processing transaction can be fined up to $5,000 to $100,000 per month, which the bank will pass through to the merchant. In addition, a merchant can lose the privilege of accepting card payment. This is an intolerable risk. assessment, except one. Technology � .... .... .... .... .... .... .... .... .... .... .... .... .... .... � v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� Services is working on rectifying this discrepancy. Based on the information obtained, it appears that the Technology Services has processes in place to address the above risk. Recommendation (High Priority): 11. The Division needs to continue working with Technology Services to become fully compliant with Credit Card Data Security Standards. City management response: The aforementioned recommendation was addressed and PCI compliance was achieved on July 26, 2018. ��..fiii��lllfiiir�� :��' IIC:�r��.�'�iiriir°�III �:�� `��Illiii��.��.�ii�iir�� .. ��.�iir�� :"��:�Ill��;��:��,iii�:�iir�� .. .��;��iir��m�� Timely referral of delinquencies for collection may improve collection efficiencies. The City uses a collection agency to collect its delinquent accounts. Generally, the Customer Service procedures require referral of delinquencies to the collection agency after the account is turned off soon after 44t" day of it first becoming delinquent. Therefore, the accounts referred to the collection agency most likely belong to former residents of the City. The collection agencies charge 15% and 18% of the amount collected depending on whether the delinquent accounts were under or over 120 days past due. The auditors observed: Ilp��.�.: �� :��.�iir��:�"w� IIW7u� ��.��,��u lii�: iiw�m��r�:.�:�:�iir"�° • The Division performs debt collection in- • An analysis of the collection agency L(� house averaging for 160 days of an account efforts revealed that they are successful `� .... .... .... .... .... .... .... .... .... .... .... .... .... .... .... � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� becoming past due. Subsequently, delinquencies are turned over to the collection agency. The delinquent accounts included about $83,000 belonging to drainage accounts. These accounts are incurring recurring charges but the City is not receiving payment. The City does not have any leverage to compel these accountholders to pay. In this event, efforts made in collecting these accounts could be wasting City resources. • An analysis of all payments received on closed accounts during the first nine months in FY 18 indicated that 70% of the payments were received within 30 to 60 days after the accounts becoming delinquent. The collection effectiveness significantly drops subsequently as depicted below: o.�o�oo �all�ct�can an Clcag�c� F�cccat�nis �::��4inc�u�n��yr 70% Amc��nl: o.00�oo �� o ��'� �� 12% ��0 11% � f) �o-F;o �,ys �;o-�o �,ys �o-:o.zo �,ys :o.zo+ �,ys �oo� � Dedicating internal staff resources does not appear to be cost effective for this purpose. Referring these accounts to the collection agency sooner may free up staff time to focus on other Customer Service functions. Please in collecting more recent delinquencies. Therefore, referring past due accounts to them sooner may result in additional collection. In this situation, the City will pay lower fees only on the amount collected. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� note that the recommendation mostly impacts former City residents. Recommendation: 12. Refer delinquent accounts to the collection agency after they have become at least 60 days past due (90 days from the date of invoice). City management response: Current direction from the City Council is to send delinquent accounts to collection after 120 days from disconnection. Staff will implement whatever change, if any, that the City Council will direct in this process. ��i�°�M �;;�'�'�:�iir�� III'�I��M��M�:� �:�� :��:�IIIIU�M��. Ill....�i�°��M IU:��M�m��fi��Il�IU�M�� The auditors noticed that four accounts totaling $452,120 were not being pursued by the Customer Service. The auditors were informed that they have sought the City Attorney's help in pursuing these accounts. These accounts are depicted in the following table: Name Total Frontier communication YES companies exp. Leverett Collins Astra Carmel LLC Total $ 206,299 $ 187,639 $ 34,132 $ 24,050 $ 452,120 Frontier Communication acquired the City of Denton Account from Verizon Communication. The Auditors noticed that Verizon owed $977,446 to the City. This amount is written off in the City's financial records. The two companies owed this amount for the charges related to attachment of their cables to the poles belonging to the City. Federal regulations determine a minimum charge payable to the City for providing this service. However, the City has not � been paid for a total receivable of approximately $1.2 million on this account. � v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� During a meeting with Finance and City Attorney's personnel, it was determined that there may have been a dispute related to the amount owed by this company to the City. The first Assistant City Attorney agreed to follow up on this issue. Similar issues exist on the remaining accounts. Recommendation: The City Attorney and Finance Director need to collaborate to pursue collection on the above four accounts and the Verizon account. City mana�ement response: The Finance Director will continue to consult with the City Attorney's Office regarding collection options for these large receivables and follow-up with the Internal Auditor once a collection option is identified. �:"M�:�IIIIU�M��.fi�:�iirm .. ,,��iiriu�M �� :��:�iiw.iu�.i�°��. �:"',�:�iiruru�Ilf�III��M�� Collection agency did not fully comply with their contractual obligation related to insurance requirement. II�°u��.�.: �� .�.�:�u.�iurm��.,� The contract with the collection agency required performance and insurance requirements. Evaluating the collection agency's performance was beyond the scope of this audit. The contract required the following insurance coverage: • General liability insurance with combined single limit of not less than $1 million. • Commercial automobile liability insurance with combined single limit of not less than $5 million. Il�m� ��u�;�� : iir�°u��:�:�:��..m� This observation indicates that the vendor has not fully complied with contractual requirements. The City's risk may not be covered adequately due to lack of adequate insurance coverage. '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� • Workers compensation insurance which, in addition to meeting the minimum statutory requirements for issuance of such insurance, has Employer's Liability limits of at least $100,000 for each accident, $100,000 per each employee, and a$500,000 policy (imit for occupational disease. • Professional liability insurance with limits not (ess than $2,000,000 annual aggregate with respect to negligent acts, errors or omissions in connection with professional services is required under this Agreement. • Coverage for the theft or disappearance of cash or checks, robbery inside/outside the premises, burglary of the premises, and employee fidelity. The employee fidelity portion of this coverage should be written on a"blanket" basis to cover all employees, including new hires. The City Auditor sought the City's Risk Manager's expertise for evaluating the insurance certificate submitted by the collection agency. The Risk Manager opined as follows: • No evidence of workers' compensation was provided; and • No evidence of Commercial Crime/Employee Dishonesty was provided. Recommendation: � � v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� 13. The Customer Service needs to require the collection agency to fully comply with the contract requirements related to insurance. City management response: City Management worked with Risk Management and the Collection Agency provided the required documents to achieve compliance on August 7, 2018. ..IIC..fiii��m�� :�� :��Illfiiir�°m�°��.,ui��iir�°m.�: ��iir��:�� Customer service staff allows customers more time to pay exceeding the Division's policy. The auditor was informed by the Revenue Assurance Supervisor that the Division has a policy to allow up to six months for customers to pay their delinquent balance. II�°u��.�.: �� .�.�:�u.�iurm��.,� The auditor found that call center representatives and the Internal Credit and Collections Specialist routinely allowed time exceeding six months to pay past due accounts. Nine of the 21 selected payment arrangements (43%) confirmed this information. The Customer Service Manager informed the auditors that a total of 77 accounts for FY 2016-17 were allowed time to pay exceeding three months for the reasons that include assisting customers going through challenging situations. The records did not indicate authorization of this action by superiors of the employees. Il�m� ��u�;�� : iir�°u��:�:�:��..m� Granting additional time to pay may be beneficial for collection activity. However, such action must be reviewed and authorized by appropriate supervisory personnel prior to granting it. Allowing employees to exceed established policies could be abused. O N v � � � '�1��"@��°�, ��"�� II��I��°��u:��u �f.��u��°��uA�mi��l ;�. ��u��ll��: �f a°��111��: . :�.�i�NIII��V� ��I`��"��^��V��uu�� m �IC��^��i� . :��i��i��V °��IIII�� Recommendation: 14. Customer Service needs to have a formal policy including establishing necessary authority related to time to pay delinquent balance. City management response: The aforementioned recommendation was addressed and a Standard Operating Procedures manual will be in place effective December 1, 2018. City Hall City of Denton 215 E. McKinney St. Denton, Texas 76201 ��,� I�Illlll�uuuuuuu��ii www.cityofdenton.com ��'�� Legislation Text File #: ID 18-2098, Version: 1 AGENDA CAPTION Receive a report, hold a discussion, and give staff direction regarding nominations and the appointment of a Member to the Board of Directors of the Denton County Transportation Authority. City of Denton Page 1 of 1 Printed on 11/30/2018 I7c��w[��>i[>[i hy I [��>r;i�tf�ar��nv� City of Denton City Ha11 ""�� 215 E. McKinney Street � i, � ��, ,"� � �""�"��,; Denton, Texas www.cityofdenton.com DEPARTMENT: ACM: DATE: AGENDA INFORMATION SHEET City Manager's Office Mario Canizares December 3, 2018 SUBJECT Receive a report, hold a discussion, and give staff direction regarding nominations and the appointment of a Member to the Board of Directors of the Denton County Transportation Authority. BACKGROUND On March 20, 2018, the Denton City Council approved Resolution 18-329 reappointing Richard Huckaby as the City of Denton's primary appointee to the Denton County Transportation Authority (DCTA) Board of Directors. Mr. Huckaby's term was scheduled to last through November 12, 2019. Mr. Huckaby resigned from his DCTA Board seat on Tuesday, November 27. Donna Bloom, the City of Denton's alternate representative to the DCTA Board, resigned from her position in early November. With the resignation of Ms. Bloom and Mr. Huckaby, the City of Denton does not currently have a representative on the DCTA Board. The next DCTA Board Meeting is scheduled for Thursday, December 13, 2018. Due to the timing of the next board meeting, a work session to discuss board nominations has been placed on the December 3 City Council Luncheon agenda. An action item has been placed on the December 4, 2018, Denton City Council agenda to formally appoint the Council's nominee. Board appointees will become effective immediately and continue through November 12, 2019. The length of the board term could be affected if the DCTA bylaws are modified as a result changes being proposed in state legislation. According to Section 3 of the DCTA Bylaws (included as attachment 3), candidates need to meet the following eligibility requirements to serve on the DCTA Board: "(a) To be eligible for appointment to the Board of Directors, a person must: (i) have professional experience in the field of transportation, business, government, engineering or law; and (ii) reside: (A) within the territory of the Authority; or (B) outside the territory of the authority in a municipality that is located partly in the territory of the Authority." STRATEGIC PLAN RELATIONSHIP The City of Denton's Strategic Plan is an action-oriented road map that will help the City achieve its vision. The foundation for the plan is the five long-term Key Focus Areas (KFA): Organizational Excellence; Public Infrastructure; Economic Development; Safe, Livable, and Family-Friendly Community; and Sustainability and Environmental Stewardship. While individual items may support multiple KFAs, this specific City Council agenda item contributes most directly to the following KFA and goal: Related Key Focus Area: Safe, Liveable & Family-Friendly Community Related Goal: 1.6 Collaborate with local, regional, state, and federal partners EXHIBITS 1. Agenda Information Sheet 2. Resolution 18-329 3. DCTA Bylaws 4. Proposed Resolution 5. Presentation Respectfully submitted: Rachel Wood Chief of Staff S:\Legal\Our pocuments\Resolutions\18\Resolution-DCTA Board Appointment - rev 1(no alt nom).docx RESOLUTION NO. 18-329 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, RE- APPOINTING RICHARD HUCKABY TO THE BOARD OF DIRECTORS OF THE DENTON COUNTY TRANSPORTATION AUTHORITY; PROVIDING A REPEALER; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, Section 460.054(b)(1) of the Transportation Code authorizes the governing body of the City of Denton to appoint one member to the Board of Directors (the "Authority Board") of the Denton County Transportation Authority (the "Authority"); and WHEREAS, the term of Richard Huckaby as the City of Denton, Texas member of the Authority Board expired as of November 12, 2017 and the City Council of the City of Denton deems it in the public interest to reappoint Richard Huckaby to the Authority Board to serve the term to expire on November 12, 2019. NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: SECTION 1. The findings and recitations contained in the preamble of this Resolution are incorporated herein by reference, SECTION 2. Richard Huckaby is hereby reappointed as a member to the Authority Board as a representative for the City of Denton, Texas to serve in such a capacity for the term expiring November 12, 2019. Mr. Huckaby remains qualified to serve on the Authority Board as having professional experience in the field of transportation, business, government, engineering, or law. SECTION 3_. The City Manager is hereby authorized to send a certified copy of this Resolution to appropriate officials of the Authority. SECTION 4. All previous resolutions and orders or parts of resolutions or orders in force when the provisions of this Resolution became effective which are inconsistent or in conflict with the terms or provisions contained in this Resolution are hereby repealed to the extent of any such conflict. TION 5. This Resolution shall become effective immediately upon its passage and �S.E.C.w.......... ......................�. approval. PASSED AND APPROVED this the ��'��. day of _��r� �,��M� �'`�� r , 2018. �; �� , � � .��. � �:.. � ........ „��... � . _ � _ _._ .. . : .... � � �. .. _ CHRIS '�?VATTS, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY �, �� BY: �� :�-'��- �. �m.� � ��,� " �:�� " .... .. �. ��:��T �1::^�� a�"�`�l�"�:�� LEGAL FORM: AARON LEAL, CITY ATTORNEY �� . � � �� .,� , �.. �„ BY: �'�� " "� �' ��, " � .,� �� ..�_ _�,� �� - —�= ...........mm �� EXHIBIT 4 DENTON COUNTY TRANSPORTATION AUTHORITY BYLAWS Adopied January 3, 2002 (rev. February 13, 2004, Ociober 26, 2006, Sepiember 27, 2007, December 17, 2009, November 17, 2011, Apri125, 2013, Sepiember 26, 2013, February 16, 2016, and Sepiember 22, 2016) EXHIBIT 4 DENTON COUNTY TRANSPORTATION AUTHORITY BYLAWS, ARTICLE I NAME Section l. Name. The name of the authority shall be the Denton County Transportation Authority ("Authority"). Section 2. Authorization. These Bylaws are adopted pursuant to authority granted in Section 460.204(c)(2) of the Texas Transportation Code ("Code"). In the event of any conflict between these Bylaws and the Code or other applicable laws of the State of Texas, such laws shall be controlling. In the event any provision of these Bylaws shall be determined to be invalid, the remainder of these Bylaws shall nevertheless remain in force and effect. Section 3. Definitions. (a) Alternate Member. Alternate Board Member shall mean a person appointed to serve in the absence of the regular appointed member of the Board of Directors representing such city. (b) Board Member. Board Member means and includes appointed or elected members of the Board of Directors, as well as alternate board members serving in the absence of appointed board members. (c) Capital Asset. Land, a fixture attached to land, or an item of personal property that meets all of the following criteria: (1) the cost of acquisition or the cost of improvement of such property exceeds $5,000; (2) the expected useful life of the property when acquired is more than 1 year or the extension of the useful life of the property as a result of the improvement is more than 1 year; (3) the property retains its original shape and appearance with use; and (4) the property is nonexpendable (meaning that if the property is damaged or some of its constituent parts are lost or worn out, it is usually more economical to repair the property than to replace it with an entirely new unit). (d) Capital Expenditure. Expenditure made to acquire or improve one or more Capital Assets and includes the acquisition and/or improvement of real property. (e) Executive Committee. Executive Committee shall mean the committee appointed by the DCTA Chair consisting of the Directors as set forth in Article III, Section 9 (c). (f) Financial Participating Member. A Financial Participating Member shall mean a municipality that has imposed the transit sales and use tax authorized by Chapter 460 of the Transportation Code or which has contracted with DCTA for financial participation through tax increment payments as provided by Subchapter I, Chapter Page 1 EXHIBIT 4 460 of the Transportation Code, and which is entitled to ha�e a Director on the DCTA Board of Directors. ARTICLE II OFFICES Section l. Principal Office. The principal office of the Authority shall be in Denton County, Texas. Section 2. Additional Offices. Authority also may have offices at such other places as the Authority from time to time may determine or as the activities of Authority may require. ARTICLE III BOARD OF DIRECTORS Section l. General Powers. The responsibility for the management operation and control of the Authority and its properties is vested in the Board of Directors. [Section 460.401]. Section 2. Number and Composition. The Board of Directors is composed of: (a) One member appointed by the governing body of each municipality with a population of 17,000 or more that is located in the county; (b) Three members appointed by the Commissioner's Court of Denton County, two of whom must reside in the unincorporated area of the county; and ��," � Three members to be designated by the remaining municipalities with a population of more than 500 but less than 17,000 located in the Denton County. These three members will be selected according to provisions of the Code. [Section 460.054(c)] . (d) One member annointed bv the �overnin� bodv of each municinalitv in the countv with a t�ot�ulation of more than 500 but less than 17.000 that: (i) desi�nates a t�ublic transt�ortation financin� area under Section 460.603: (ii) enters into an a�reement with the Authoritv to nrovide nublic transt�ortation services in the t�ublic financin� area under Subchat�ter I Chapter 460: and (iii) did not at�t�rove the desi�,nation of anv member desi�nated under Section 2 (cl above. Page 2 EXHIBIT 4 (e) Member appointed by the governing body of a municipality that was entitled to appoint a member under Section 460.054 (b)(1) of the Code before the effective date of an increase in the population threshold. (Section 460.2015) The Board of Directors may increase the population threshold amounts stated in Section 460.054(b)(1) in increments up to 5,000 each year. A municipality that appointed a member to the Board of Directors according to the provisions of Section 460.054(b)(1) of the Code prior to any increase in population threshold is grandfathered and may continue to appoint a member to the Board of Directors. (� Appointing entities may appoint a member to the Board of Directors and may also provide for the appointment of one alternate to serve in the absence of the appointed member. An Alternate Member may attend Board and committee meetings but shall not vote on any matter before the Board or committee or participate in any discussion in matters before the Board or a committee except when serving in place of the regular Board of Directors member [Section 460.054(b)(1)]. Appointing entities shall notify the Authority in writing of the appointment, reappointment, resignation or removal of an Alternate Member. Section 3. Eligibility. (a) To be eligible for appointment to the Board of Directors, a person must� have professional experience in the field of transportation, business, government, engineering or law: and (iil reside: (Al within the territory of the Authority� or B outside the territorv of the authoritv in a municibalitv that is located bartiv in the territorv of the Authoritv. [Section 460.202]. (b) Three consecutive unexcused absences of a Director at a noticed Board of Directors meeting or the death, resignation or inability to serve shall create a vacancy. Section 4. Vacancy. A vacancy on the Board of Directors is filled in the same manner as the original appointment to the Board of Directors. [Section 460.201(c)]. Section 5. Terms. The term of office for a member of the Board of Directors is two years. A vacancy on the Board of Directors is filled in the same manner as the original appointment to the Board of Directors to fill the unexpired portion of such term of office, except as provided by Section 460.2015 of the Code for grandfathered municipalities. Section 6. Meetings. The Board of Directors shall hold at least one regular meeting each month. [Section 460.055(c)]. Special meetings of the Authority may be called by the Chair or Vice-Chair as necessary. [Section 460204(b)]. Section 7. Quorum. Five members constitute a quorum for purpose of conducting business. [Section 460205(a)]. Section 8. Notice. All meetings of the Authority and its committees shall be in compliance with Texas Open Meetings Act. [Section 460.102(a)(1)]. Page 3 EXHIBIT 4 Section 9. Committees (a) The Chair of the Board may appoint such committees as from time to time may be deemed necessary and appropriate. The committee shall not have any power or authority to act on behalf of the Denton County Transportation Authority. The Chair will designate the chair of each committee, which will be comprised of at least three Board of Directors members, and will serve as an ex officio member of each committee. (b) The committee shall report its discussions or recommendations, subsequent to its meeting, to the next Board of Directors meeting. [Section 460.401]. (c) The Executive Committee shall consist of the four (4) officers of the Board of Directors, and the Chair may appoint one additional eligible Director of the Board of Directors to the Executive Committee. Notwithstanding the foregoing, no member of the Board of Directors, who is an employee of the governmental unit appointing such a person to the Board of Directors, may serve on the Executive Committee. Section 10. Voting. (a) An action of the Board of Directors requires an affirmative vote of a majority of the Directors, but not less than five (5) Directors present and voting, except for a vote pursuant to paragraph (b) of this section. [Section 460.205(b)]. (b) An affirmative vote of the majority of the entire Board of Directors, including two- thirds (2/3) vote of Directors representing Financial Participating Members is required for: (6) ��) a capital expenditure; operating or maintenance expenditure for a capital asset; material change of the service plan; amendment of the bylaws; the approval of a comprehensive development agreement ("CDA") or similar financial contractual obligation for a purpose not an express commitment of the DCTA Service Plan; the approval of a contract or other agreement between the DCTA and a municipality or other governmental authority located within the A-train Corridor for participation in DCTA; or the formation of a local government corporation, contracting with, joining or becoming a member or owner of a local government corporation. (c) Alternate Members. An alternate Board Member may only serve in the absence of the regular board member. An alternate Board Member may vote in place of the regular Board Member when the regular Board Member is absent. Page 4 EXHIBIT 4 Section 11. Procedure of Meetings. Notice of all meetings and hearings of Authority shall be given, and such meetings and hearings shall be held and conducted in accordance with the following order: applicable law, these Bylaws, the Board of Directors Rules of Procedure and Robert's Rules of Order, newly revised, to the extent not in conflict. The General Counsel of the Authority shall serve as parliamentarian to the Authority. Section 12. Conflicts of Interest. Members of the Board of Directors and officers are subject to Chapter 171 Local Government Code. [Section 460203]. Section 13. Population Changes. (a) At least annually but before any vote authorizing confirmation of the Authority or imposition of a sales and use tax, the Authority shall determine if any municipality located in the county that has not appointed a member to the Board of Directors as provided by Section 460.054(b)(1) of the Code, has grown to a population of 17,000 or more. (b) A determination of population growth to 17,000 or more will be documented by "Annual Population Estimates" for municipalities located in Denton County published by North Central Texas Council of Governments. The population of the municipality submitted to the Authority for approval may be challenged by a member of the Board of Directors. (c) The Board of Directors may certify. (i) that a municipality has a current population of 17,000 or more; and (ii) does not have a member appointed to the governing body as provided by Section 460.054(b)(1). Subsequent to the certification vote, a municipality so certified may forthwith appoint one member to the Board of Directors as provided by the Code. ARTICLE IV OFFICERS Section l. Election. The Board of Directors shall elect four (4) of its members to serve as the Chair, Vice-Chair, Treasurer, and Secretary. [Section 460.055(a)]. The Chair or Vice Chair shall be a Director representing a Financial Participating Member. Section 2. Chair. The Chair shall preside at all regular and special meetings of the Authority. Section 3. Vice-Chair. The Vice-Chair shall preside at any meeting of the Authority on the request of the Chair, or at which the Authority Chair is absent. Section 4. Treasurer. The Treasurer shall worlc with the Chief Financial Officer in preparing the budget and supervising the annual audit. Page 5 EXHIBIT 4 Section 5. Secretary. The Secretary shall review the minutes of all Board proceedings, malce any necessary revisions, and attest to the accuracy of the minutes. Section 6. Term. The officers of the Authority shall be elected from among the members of the Board of Directors and shall hold office for one (1) year. The term of office for each officer shall be for a period of one year and shall run from January 1 through and including December 31 of the calendar year. ARTICLE V BUDGET AND FINANCE Section l. F�scal Year. The Fiscal Year of the Authority shall end on September 30 of each year. Section 2. Annual Budget. The Authority shall prepare an Annual Budget. [Section 460.403]. Section 3. Audit. The Authority shall have an annual audit of the affairs of the Authority prepared by an independent certified public accountant. Any deficiencies noted in the audit report shall be addressed at a regular meeting of the Authority and addressed on the record [Section 460.402]. ARTICLE VI RULES, POLICIES AND PROCEDURES The Board of Directors is responsible for the management, operation, and control of the authority and its properties. [Section 460.401]. ARTICLE VII INDEMNIFICATION The Denton County Transportation Authority shall indemnify any member of the Board of Directors involved in any litigation including any civil, criminal or administrative action suit or proceeding, for reason of such member's alleged negligence or misconduct in the performance of his or her duties as a Board of Directors Member to the extent funds are lawfully available and subject to any other limitations that exist by law against liability, and reasonable expenses, including attorneys' fees, actually and necessarily incurred, except where it is adjudged that such Board of Directors member acted with gross negligence or willful misconduct in the performance of their duties. ARTICLE VIII AMENDMENT TO BYLAWS Page 6 EXHIBIT 4 These Bylaws may be altered, amended or repealed, or new Bylaws may be adopted pursuant to Article III, § 10(b) at any regular, properly posted meeting of the Authority, or any properly posted special meeting of the Authority, at which a quorum is present; provided that prior to consideration and vote by the Authority, any proposed revisions to the Bylaws may be reviewed and commented on by the Board of Directors and shall be provided in writing to all Authority Board of Directors members at least two weeks prior to action on the amendments. Page 7 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON APPOINTING A REPRESENTATNE TO THE DENTON COUNTY TRANSPORTATION AUTHORITY BOARD OF DIIZECTORS; PROVIDING A REPEALER; AND PROVIDING AN EFFECTNE DATE. WHEREAS, Section 460.054(b)(1) of the Transportation Code authorizes the governing body of the City of Denton to appoint one member to the Board of Directors of the Denton County Transportation Authority (the "Authority Board"); and WHEREAS, Richard Huckaby, the City of Denton's Authority Board representative resigned his position on November 27, 2018; and WHEREAS, Mr. Huckaby's Authority Board term was scheduled to last through November 12, 2019; and WHEREAS, the Denton City Council deems it in the public interest to appoint a new City of Denton representative to serve the term to expire on November 12, 2019; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: SECTION l. The findings and recitations contained in the preamble of this Resolution are incorporated herein by reference. SECTION 2. is hereby appointed as a member to the Authority Board as a representative for the City of Denton, to serve in such a capacity for the term expiring November 12, 2019. This person is qualified to serve on the Authority Board as having professional experience in the field of transportation, business, government, engineering, or law. SECTION 3. The City Manager is hereby authorized to send a certified copy of this Resolution to appropriate officials of the Authority. SECTION 4. All previous resolutions and orders, or parts of resolutions or orders, in force when the provisions of this Resolution became effective which are inconsistent or in conflict with the terms or provisions contained in this Resolution are hereby repealed to the extent of any such conflict. SECTION 5. This Resolution shall become effective immediately upon its passage and approval. The motion to approve this ordinance was made by and seconded by , the ordinance was passed and approved by the following vote [ - �: Aye Nay Abstain Absent Chris Watts, Mayor: Gerard Hudspeth, District 1: Keely G. Briggs, District 2: Don Duff, District 3: John Ryan, District 4: Deb Armintor, At Large Place 5: Paul Meltzer, At Large Place 6: PASSED AND APPROVED this the day of , 2018. CHRIS WATTS, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY : APPROVED AS TO LEGAL FORM: AARON LEAL, CITY ATTORNEY :• � � V � Primary Representative: i -o\\ Richard Huckaby oo, Donna Bloom Both Appointees resigned in November 2018 Next DCTA Board Meeting is December 13, 201 � io\\ May serve until replaced last until November • Eligibility: Professional experience in the field of transportation, business, government, engineering or law Discuss interested. potentialPrimary Representative to the and no AIMORMO!- W -O ! 9 o o ! December4: Consider adoption- . December 13: New City of Denton Representative t attend the DCTA Board of Directors Meeting i