2017-03-07 Audit/Finance Committee MinutesAUDIT/FINANCE COMMITTEE
March 07, 2017
After determining that a quorum is present, the Audit/Finance Committee of the City of Denton,
Texas, met in a regular meeting on March 7, 2017, at 10:31 a.m., in the City Hall Conference Room,
at City Hall, 215 E. McKinney Street, Denton, Texas at which the following items were considered:
PRESENT: Committee Chair, Joey Hawkins; Committee Member, Mayor, Chris Watts;
Council Member, Sara Bagheri
STAFF PRESENT: Todd Hileman, City Manager; Bryan Langley, Deputy City
Manager/COO; Jon Fortune, Assistant City Manager; Chuck Springer,
Director of Finance; Antonio Puente, Assistant Director of Finance; Phil
Williams, General Manager; Tim Fisher, General Manager of Water;
Galen Gillum, Executive Manager of Administration; Kenneth Banks,
Director of Utilities; Emerson Vorel, Director of Parks and Recreation;
Scott Lebsack, Business Development Manager; Roger White, Police
Deputy Chief; Robin Paulsgrove, Fire Chief; Kenneth Hedges, Assistant
Fire Chief; Keith Gabbard, Streets Superintendent; Terry Kader, Fleet
Superintendent; Craig Hametner, City Auditor; Frank Payne, City
Engineer; and Kristy Odom, Recording Secretary.
OTHERS PRESENT: Nicole Bradshaw and John Manning with Patillo, Brown, & Hill L.L.P.
The following items were considered:
OPEN MEETING:
1. Consider approval of Audit/Finance Committee Minutes of September 27, 2016.
Mayor, Chris Watts made a motion to approve the minutes. Council Member Sara Bagheri
seconded the motion. Motion carried unanimously.
2. Management Report- Annual Debt Report as of September 30, 2016.
Chuck Springer informed the Committee that the Debt Summary Report as of September 30,
2016 is available on the City's website. The report for this year includes some additional
information required under a new state law that is located at the end of the report.
3. Receive a report, hold a discussion, and give staff direction regarding the upcoming
issuance of General Obligation Bonds and Certificates of Obligation.
Assistant Director of Finance, Tony Puente, gave a presentation on the planned General
Obligation Bond sale and Certificates of Obligation sale in the current fiscal year. He explained
that there are two notices of intent for the Certificate of Obligation planned issuance, one for the
utility fund projects and a second notice for general government projects. All of the planned
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utility fund projects and a second notice for general government projects. All of the planned
projects were approved in the FY 2016-17 budget. He explained that some bond proceeds have
been shifted from Fire Station three reconstruction to Fire Station four reconstruction due to the
cost of this station. There were concerns from the committee about the cost overrun of Station 4.
Puente also mentioned that the planned debt issuance also includes an opportunity to refund
some outstanding city debt for savings. City Manager, Todd Hileman, stated the 2014 bond
election was a six year program, but we are currently about one year behind on completing these
projects. He stated that he should have a plan to bring these projects back to schedule within six
months. Deputy City Manager Bryan Langley mentioned that while the 2014 bond election
estimated a three-cent debt service tax rate increase, there is currently no plan for a debt service
tax rate increase,
Council Member Sara Bagheri made a motion to recommend to take the Certificates of
Obligation notices of intent to council for full approval. Mayor, Chris Watts seconded the
motion. Motion carried unanimously.
4. Receive a report, hold a discussion, and give staff direction regarding the FY 2015-16
Comprehensive Annual Financial Report and annual audit.
John Manning and Nicole Bradshaw with Patillo, Brown, & Hill L.L.P, gave a presentation
regarding the results of the City's external audit for FY ending September 30, 2016. They
covered the auditor's opinion, single audit report and ihe required auditor's communication.
5. Receive a report, hold a discussion, and give staff direction regarding issues, assignments
and services that affect the City Auditor.
City Auditor, Craig Hametner, presenting items to be considered in Internal Audit Work Plan,
He discussed items such as a fraud, waste and abuse hotline, different types of auditor reports
and a risk assessment plan. Mayor, Chris Watts, recommended that his recommendations for the
audit plan be presented to the full City Council for consideration.
6. Under Section 551.042 of the Texas Open Meeting Act, respond to inquiries from the
Audit/Finance Committee 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
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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.
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