2018-046 Implementation of Recommendations with Parks FoundationDate: April 20, 2018 Report No. 2018-046
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Update on the implementation of recommendations related to the City of Denton’s contractual
relationship with the Parks Foundation.
BACKGROUND:
In October 2017, the City of Denton suspended our activities with the Parks Foundation so that a
comprehensive review of the contractual relationship and business practices could be examined.
The City also requested that the Parks Foundation cease any fundraising activities until this review
could be completed. The City hired the law firm of Lynn, Ross, and Gannaway, LLP, and the
accounting firm of BKD, LLP, to conduct the review, and the findings of this assessment were
presented to the City Council in February 2018. Attached in Exhibit 1 is a summary of the
recommendations that were identified in the review.
Following the completion of the above described review, the City of Denton resumed discussions
with the Parks Foundation regarding their fundraising activities, and staff has held several
productive meetings with the leadership of the Foundation on these efforts. Attached as Exhibit 2
is a copy of the letter that was sent to the Parks Foundation in March to resume these discussions.
The purpose of this report is to update the City Council on the status of our conversations with the
Parks Foundation and to outline future discussions we intend to have with the Council. On May
1st, staff is planning to present a summary of the progress that the City and Parks Foundation has
made in implementing the attached recommendations. Additionally, staff will discuss some
fundraising requests the Foundation has proposed, and we will outline options for the Council to
consider at that time.
EXHIBITS:
1 - Summary of Recommendations
2 - Letter to Parks Foundation in March 2018
STAFF CONTACT:
Bryan Langley
Deputy City Manager/COO
940-349-8224
bryan.langley@cityofdenton.com
#AGYSACODPF Responsible
Party Deliverable Status Priority Concern Recommendation Management Response
1 X City Financial agreement In-process High Represent financial transactions fairly
Periodically evaluate the City's arrangements and financial relationship with the Foundation.
Agreements should include time period, amounts allocated for salaries, office supplies, etc. or
if City wants to give Foundation money to be used at Foundation's discretion.
Management agrees with recommendation.
Provided a new agreement is established,
this recommendation will be outlined as part
of formal agreement.
2 X City Memorandum of
Understanding In-process High Clearly define business conduct A Memorandum of Understanding outlines scope of relationship between the City and the
Foundation. Document a clear operating relationship between the entities.
Management agrees with recommendation.
Provided a new agreement is established,
this recommendation will be outlined as part
of formal agreement.
3 X City Policies and Procedures In-process High Clearly define business conduct
Create policies and procedures to guide interactions between City and Foundation. Financial
policies and procedures specifically related to monies that flow from one entity to the other.
Employee policies and procedures to guide interactions between entities. Address in-kind
services for Foundation events and projects.
Management agrees with recommendation.
Provided a new agreement is established,
this recommendation will be outlined as part
of formal agreement.
4 X City ROI Calculation
methodology In-process Moderate Represent financial transactions fairly Define how ROI calculation should be computed and any other metrics of measuring the
success of the Foundation by the City.
Management agrees with recommendation.
Provided a new agreement is established,
this recommendation will be outlined as part
of formal agreement.
5 X City Reporting In-process Low Clearly define business conduct Define a reporting mechanism for the Executive Director of the Foundation to report to someone at the City.
Management agrees with recommendation. Provided a new agreement is established, this recommendation will be outlined as part
of formal agreement.
6 X Foundation Payment under current
agreement In-process High Represent financial transactions fairly Payments remitted for "Enhancement fees" to City under current agreement with Youth
Sports Association. City to be responsible for administering funds.
Foundation agrees with recommendation.
City will be responsible for administering
funds.
7 X City Terminate existing
agreement with YSA Complete Moderate Clearly define business conduct Terminate existing agreement between the City and the Youth Sports Association.
Ordinance 18-246
Approved February 6, 2018
Agreement in effect from January 2018 to
December 2018
8 X City New agreement with YSA Complete Moderate Clearly define business conduct Establish an agreement between the City and the Youth Sports Association. Document a clear operating relationship between the entities.
Ordinance 18-246
Approved February 6, 2018
Agreement signed January 8, 2018 by Heather Gray, Athletics Manager Agreement in effect from January 2018 to December 2018
9 X Foundation Account of fees collected In-process Moderate Represent financial transactions fairly City to ask Foundation to provide its own accounting of the funds collected and disbursed for
Youth Sports Association fees.
Foundation will provide a ledger of this
budget line item from January 2017 through
present to Parks and Recreation Director.
10 X City Advertising policy Complete Low Clearly define business conduct Advertisement on city property, approval authority by City Council Ordinance 18-246
Approved February 6, 2018
11 X City Code of Conduct Complete Moderate Clearly define business conduct Implement a code of conduct policy for City employees.Ethics policy adopted April 17, 2018
12 X City Reimbursement In-process Low Represent financial transactions fairly
Reimbursement dispute of two expenditures for Eureka 2 Project. Ordinance does not contain
explicit language regarding repayment of funds from Foundation to City. Expenditures of
$95,811 for playground equipment and $84,892.60 for Pour and Play.
Management will meet with the Foundation to
discuss options and alternatives.
13 X City Disclosure forms Complete High Identify potential conflicts of interest Annual conflict of interest disclosures for City Council and department heads that identify
business relationships and family. Ethics policy adopted April 17, 2018
14 X Foundation Financial controls In-process High Represent financial transactions fairly Implement control processes for cash handling and procurement.
Donor Policy and Accounting procedures will
be voted on at Foundation Board meeting on
April 26.
Area
Parks Foundation Summary Report Recommendations
AG = Agreement with Foundation/Clarification of Boundaries COD = City of Denton Operations
YSA = Accounting for Youth Sports Association fees PF = Denton Parks Foundation Operations
Area Legend
1 of 2
Exhibit 2
#AGYSACODPF Responsible
Party Deliverable Status Priority Concern Recommendation Management Response
Area
Parks Foundation Summary Report Recommendations
AG = Agreement with Foundation/Clarification of Boundaries COD = City of Denton Operations
YSA = Accounting for Youth Sports Association fees PF = Denton Parks Foundation Operations
Area Legend
15 X Foundation Policies and Procedures Complete High Represent financial transactions fairly Develop a Conflicts of Interest policy and a Code of Conduct policy to assist with the
identification of potential conflicts of interest.
Foundation agrees with recommendation. A
conflict of interest and code of conduct policy
have been completed.
16 X Foundation Policies and Procedures In-process High Accuracy of accounting records Entry of financial transactions within one to two weeks in the bookkeeping records to provide
more accurate reporting and record keeping.
Foundation policy to enter financial
transactions within 3 business days of
receipt.
17 X Foundation Track pledges In-process Moderate Accuracy of accounting records Set up procedures to ensure the recording and tracking of pledges, preferably by utilizing the
accounting software.
Donor Policy and Accounting procedures will
be voted on at Foundation Board meeting on
April 26.
18 X Foundation Vendor addresses In-process Low Identify potential conflicts of interest Enter the addresses of vendors in the accounting software to further help identify potential conflicts of interest.
Donor Policy and Accounting procedures will
be voted on at Foundation Board meeting on
April 26.
19 X Foundation Review of controls Completed Low Accuracy of accounting records Conduct a review of internal and accounting controls to ensure proper, accurate and timely accounting is done.
Donor Policy and Accounting procedures will
be voted on at Foundation Board meeting on
April 26.
2 of 2
Exhibit 2