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HomeMy WebLinkAboutRes 006 - Sunriver SD Financial Mgt PolicyDeschutes County Board of Commissioners 1300 NW Wall St., Suite 200, Bend, OR 97701 -1960 (541) 388 -6570 - Fax (541) 385 -3202 - www.deschutes.or ; AGENDA REQUEST & STAFF REPORT For Board Business Meeting of February 25, 2009 Please see directions for completing this document on the next page. DATE: February 5, 2009 FROM: Sharon Smith Administrative Assistant 541 -593 -8622 TITLE OF AGENDA ITEM: Consideration of Board Signature of Sunriver Owners Association Resolution 2009 -006. Recommending Approval to Amend Sunriver Service District's Financial Management and Investmont Policy P003 -011. PUBLIC HEARING ON THIS DATE? NO BACKGROUND AND POLICY IMPLICATIONS: To amend policy P003 -11 to include the use of the District credit card for single purchases limited ti: $500. FISCAL IMPLICATIONS: Purchases limited to $500 maximum on the District's credit card. RECOMMENDATION & ACTION REQUESTED: Approve the Amending of Policy to include single purchase on the use of District Credit Card with Treasurer controls numbered P003 -11. ATTENDANCE: Jim Coe /Bob Wrightson DISTRIBUTION OF DOCUMENTS: Sharon L. Smith, Administrative Assistant, Sunriver Service District and Jim Coe, Chairman, Sunri\ er Service District. REVIEWED LEGAL COUNSEL For Recording Stamp Only BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON ACTING AS THE GOVERNING BODY OF THE SUNRIVER SERVICE DISTRICT A Resolution Revising current Policy on the Sunriver Service District Financial and Investment Policy. * RESOLUTION NO. 2009 -006 * WHEREAS, the Sunriver Service District Managing Board did on July 7, 2005 under Resolution 2005 -009 adopted a comprehensive Financial Management and Investment Policy (P003- 11) and, WHEREAS, the Board desires to amend this policy to further clarify District credit card authorization and usage under Section 11.1 D.7, WHEREAS, the Deschutes County Commissioners, acting as the Governing Board of tl.e Sunriver Service District on June 26, 2002 in Agreement No. 2002 -147 did specify that the Sunriver Service District (hereafter "District ") provide law enforcement, fire prevention and protection services., emergency medical services including ambulance, security services by contract; and WHEREAS, the Deschutes County Commissioners, acting as the Governing Body of ti e District on June 26, 2002 in the Memorandum of Understanding Contract No. 2002 -201 and Agreement No. 2002 -147 did delegate managing authority for the District to the District Managing Board (hereafter "Board ") created within these documents; and WHEREAS now, therefore, it is resolved by the Board that Policy P003 -11, Section 11.1 D.7 be included effective February 25, 2009 and to read as follows: "7. The Treasurer may delegate authority to specific employees to authorize single purchases of less than $500 using the District credit card. The Treasurer when authorizing the use of the District credit card may not sign the check resulting from such authorization, unless the Board authorizes the purchase(s) before the check is signed." BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTE3 COUNTY, OREGON, ACTING AS THE GOVERNING BODY OF THE SUNRIVER SERVICE: DISTRICT, as follows: Section 1. The District needs an additional card because expenditures for various events for the Board do not relate to either the Police Chief or the Fire Chief. The Treasurer may delegate authority to specific employees to authorize single purchases of less than $500 using the District credit card. The District's card limit is DATED this th day of February, 2009. PAGE 1 OF 2- RESOLUTION NO. 2009-006 (2/25/09) BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON, ACTING AS THI ; GOVERNING BODY OF THE SUNRIVER SERVICE DISTRICT TAMMY BANEY, Chair ATTEST: DENNIS R. LUKE, Vice -Chair Recording Secretary ALAN UNGER, Commissioner PAGE 2 OF 2- RESOLUTION NO. 2009-006 (2/25/09) SUNRIVER SERVICE DISTRICT GENERAL POLICIES POLICY 11.1: GENERAL FINANCIAL A. FINANCIAL AND ACCOUNTING SERVICES 1. Sunriver Service District (the "District ") does not employee staff to perform financial and accounting services. These services are provided by the Sunriver Owners Association (the "Association ") through an Agreement dated June 14, 2003. 2. These policies are intended to govern the actions of District Managing Board (the "Board ") members and District employees as well as Association employees engaged in carrying out the accounting services provided to the District by the Association. 3. References in these policies to the "Controller" means the Controller of the Association. The Controller functions as the Chief Financial Officer and Investment Officer for the District. References to "accounting staff" means employees of the Association Accounting Department. B. FINANCIAL TRANSACTIONS 1. Accounting for financial transactions shall be in accordance with generally accepted accounting principles (GAAP) and with the requirements of the Governmental Accounting Standards Board (GASB). 2. Financial statements shall be prepared on the accrual basis of accounting where revenues are recorded when earned and expenses are recorded when incurred. 3. The District has established two funds for accounting and reporting purposes. The General Fund is composed of accounts for resources and expenditures for general operations and administration. The Reserve Fund accumulates funds designated for future major repair and replacement of capital assets. 4. Financial institutions providing banking services must be insured by the Federal Deposit Insurance Corporation, must be able to provide Collateral Pool Certificates as required by Oregon Statutes, and must be able to facilitate transfers to and from the Local Government Investment Pool. 5. The District will invoice for all amounts due to the District on a current basis with amount due within 30 days of the invoice date. A finance charge of one and one -half percent per month will be charged on all balances due over 30 days. This section does not apply to billings for ambulance services. December 7, 2006 Page 1 P003 -11 6. The District will maintain good relations with vendors by paying bills in a timely manner to meet each vendor's terms for payment. Invoices will be paid to optimize District cash flows while taking advantage of available discounts. C. ACCOUNTING RECORDS 1. The fiscal year of the District shall be the same as that established for Deschutes County. 2. All accounting records shall be kept in such a manner that they may be easily audited at the conclusion of the fiscal year. 3. The general ledger and subsidiary ledgers will be balanced and posted monthly. All bank statements will be reconciled and posted monthly. 4. Monthly statements shall be approved by the Board. 5. Payroll records will be maintained in sufficient detail to produce statutorily required reports, leave of absence and overtime accruals and usage, and management of employee benefits and voluntary deductions. All payments shall be supported by properly authorized time sheets. No changes in pay rates or other payroll status shall be made without a properly executed Employee Status Report form signed by the Board Chairman. 6. Accounting records, especially computer files, shall be backed up regularly and copies shall be stored off site to ensure the safety of the files. D. INTERNAL CONTROLS 1. Duties will be assigned to individuals in such a manner that no one individual can control all phases of processing financial transactions in a way that permits errors or omissions to go undetected. 2. All District bank accounts must be authorized and approved by the Board. 3. All checks will be pre- numbered and accounted for. Voided checks will be retained and defaced. Checks will be stored in a safe place that is available only to accounting staff. Persons with signature authority will not have access to checks. 4. All checks must be manually signed and the Controller will be responsible for maintaining a current signature card with the appropriate financial institutions. Board members are the only persons authorized to sign District checks. Checks presented for signature must have all documentation attached. 5. The Fire and Police Departments may each maintain a District credit card with a credit limit not to exceed $5,000 for each department. Credit cards shall be December 7, 2006 Page 2 P003 -11 used only when normal purchasing procedures are not feasible. The Chiefs shall approve all credit card use in advance and review monthly invoices to ensure the cards are only used for legitimate District purchases. No personal expenses or cash advances may be charged to District cards. All credit card purchases must comply with regular purchasing authorization policy. Employees may be held personally liable for any purchases appearing on the credit card invoice which were not pre- approved. 6. Personal credit cards may only be used for travel related expenses (transportation, lodging and meals) when conducting District business. POLICY 11.2: AUDIT A. SELECTION OF AUDITOR The District Governing Body shall engage the services of a qualified Certified Public Accountant (CPA) to conduct an annual audit of the District's financial statements and supporting documentation. The District shall be audited annually by the same external auditor that performs the audit for Deschutes County. B. PURPOSE OF AUDIT The purpose of the audit is to insure that the financial statements are properly presented in accordance with generally accepted accounting principles and fairly present the financial position of the District. C. ADOPTION OF AUDIT The annual audit shall be presented to the Board prior to presentation to the County Audit Committee. Summary results of the audit shall be published in the "Sunriver Scene" within ninety days following receipt of the audit report and the entire audit will be made available to members of the public on request. POLICY 11.3: AUTHORIZATION A. PURCHASING Purchase Orders or Check Request forms shall be approved as follows: 1. The Chiefs may delegate authority to specific employees to authorize single purchases of $250 or less, without approval of the Chief; 2. The Chiefs may authorize single purchases of less than $1,500, without approval of a Board Officer; December 7, 2006 Page 3 P003 -11 3. The Chiefs may authorize single purchases greater than $1,500 in emergencies with verbal authorization of one Board Officer for purchases up to $5,000 and two Board Officers for purchases of $5,000 or more; 4. A Board Officer may authorize purchases of up to $5,000; however, said Board Officer may not sign the check resulting from such authorization, unless the Board authorizes the purchase before the check is signed; 5. The Board must authorize purchases of more than $5,000 and capital purchases of $1,500 or more, including purchases of individual items costing less than $1,500 if such items are aggregated and treated as a capital asset for reserve purposes (Section 11.4 C.2.). B. SIGNATURES Checks shall be signed as follows: 1. Checks in the amount of less than $5,000 will be signed by a Board member other than the member who originally authorized the purchase, unless the Board authorizes the purchase before the check is signed (Section 11.3 A.4.); 2. Checks in the amount of $5,000 or more will be signed by a Board member with prior authorization of the Board; 3. Payments of budgeted payroll and payroll- related checks, and payroll - related expenses by electronic funds transfers in any amount will be signed by a Board Officer. Payroll related checks and expenses are defined as any requirement's where the last four digits of the fourteen digit account number begin with the number one or two and are posted in the personal services budget category. 4. Manually generated checks will be signed by two Board members; 5. Any check payable to a Board member must be signed by a Board member other than the payee. C. EXPENSE REIMBURSEMENT 1. The Board shall enforce the Deschutes County Expense Reimbursement Policies for each Board member and District employee. 2. The Chiefs may approve all requests for reimbursement of employee expenses that do not exceed the Chiefs' purchasing authorization (Section 11.3 A.). 3. All requests for reimbursement of Board member expenses, Chiefs' expenses and employee expenses that exceed the Chiefs' purchasing authorization shall December 7, 2006 Page 4 P003 -11 be approved by the Chairman. Requests for reimbursement of expenses incurred by the Chairman shall be approved by the Vice - Chairman. D. CONTRACTS 1. All contracts must be approved by the Board and signed by the Board Chairman or other Board Officer. 2. All other contract policies are contained in Policy P003 -6 — Purchasing Policy and Contracting. POLICY 11.4: ASSET MANAGEMENT A. INVESTMENTS 1. Investment objectives are preservation of capital, liquidity and rate of return, in that order. 2. All surplus District funds shall be invested with the Local Government Investment Pool managed by the Oregon State Treasurer unless the Board specifically directs the Investment Officer otherwise. 3. In such cases, investments shall be in compliance with ORS 294.035. B. ACCOUNTING FOR CAPITAL ASSETS 1. Any item of a capital nature (item individually or valued as a unit) with a fair market value of at least $1,500 and is expected to have a useful life of three years or more shall be capitalized as a fixed asset. The total acquisition cost should include delivery, taxes and costs to prepare the item for service. 2. The Chiefs shall keep an inventory of all capitalized fixed assets, adding assets as they are acquired and removing assets as they are disposed of. The inventory will contain the following information: asset identification number, description of asset, date of acquisition, acquisition cost, accounting life, and accumulated depreciation. 3. It is the responsibility of the person acquiring a fixed asset to inform the Chief of its acquisition and to provide inventory information. 4. It is the responsibility of the person disposing of a fixed asset to inform the Chief. Proceeds from the disposal of an asset should accrue to the fund used to acquire the asset and be credited to the appropriate department. 5. The District will conduct a physical inventory of all capitalized fixed assets every three years as part of the reserve study update. The results of this inventory shall be reported to the Board. December 7, 2006 Page 5 P003 -11 C. REPLACEMENT RESERVES 1. The District shall maintain a reserve fund for replacement or major repair of District fixed assets which normally require replacement in whole or in part between three and twenty years. Capital expenditures will be made by the General Fund and reimbursed by the Reserve Fund. 2. The Reserve Study estimates the funds necessary for replacement and major repair of current assets in future years. This estimate is based on the current replacement or major repair cost of each asset, the useful life of the asset, and assumptions concerning inflation and earnings. Individual items that do not meet the capital asset definition with a useful life of at least three years may be aggregated with similar items that are scheduled for replacement at the same time and included in the Reserve Study. 3. To meet reserve goals, the District will contribute General Fund revenues to the Reserve Fund in an amount established by the Governing Body during adoption of the annual budget. The District will use a cash flow model to test the reserve contribution level. The cash flow model will take into account increased costs due to inflation and interest earnings on fund balances. 4. The Reserve Study will be updated every three years to ensure that current replacement costs, life cycles and model assumptions are as accurate as possible. The Chiefs will prepare recommended revisions for Board approval. 5. The Board shall authorize additions to the Reserve Study as part of the Reserve Study update. The Board may authorize additions at other times during the budget preparation process. POLICY 11.5: BUDGET PREPARATION AND CONTROL A. BUDGETING 1. District budgeting shall be in compliance with Oregon's Local Budget Law (ORS 294.305 — ORS 294.565). 2. The Board, or a sub - committee appointed by the Board, shall prepare a preliminary budget including a base budget request, requests for modifications to the base budget, and requests for minor equipment and capital outlay items. 3. After review and modification, the preliminary budget will be approved by the Board as the District's requested budget. The requested budget shall be presented to the District Budget Committee established pursuant to ORS 294.336 after review and approval by the Sunriver Owners Association Board of Directors. December 7, 2006 Page 6 P003 -11 4. The Budget Committee shall review the proposed budget and approve it for submittal to the District Governing Body. Deschutes County shall assume responsibility for compliance with all publication, notice and hearing requirements for the budget process. 5. The District Governing Body shall adopt the approved budget prior to June 30 of each year. B. BUDGET CONTROL 1. Expenses in major budget categories (e.g. Salaries & Benefits, Materials & Services, Capital Outlay) in each department shall not exceed the appropriated budget for the fiscal year. 2. The Board shall monitor monthly financial statements to ensure that expenditures are tracking the year -to -date budget. The Board may require the Chiefs to explain variances, and/or to provide revenue and expenditure projections. 3. A Notice of Intent to apply for grant funds must be approved by the Board before application is made. The notice must explain the grant program, its benefits to the District, the amount and source of required matching funds, impacts of the grant - funded program on operating costs and additions to reserve requirements, potential impacts when grant funds run out, potential impacts of "strings and red tape" attached to the grant, and staff time requirements to administer the grant. 4. When grant application deadlines do not provide time for Board approval, the Chairman may approve application for a grant as long as the Notice of Intent is brought to the Board as soon as possible. Such grant applications will be withdrawn if the Board does not approve the Notice of Intent. 5. The Board will recommend mid -year budget adjustments, such as appropriation transfers, interfund transfers, or supplemental budgets to the Governing Body. REVISIONS: Adopted under Resolution 2005 -009 by the Board on July 7, 2005. Revised under Resolution 2005 -013 by the Board on November 10, 2005 to add "(item individually or valued as a unit)" to 11.4.B(1) Revised under Resolution 2005 -016 by the Board on December 8, 2005 to clarify that payments of budgeted payroll - related expenses in any amount will be signed by a Board Officer. Revised under Resolution 2006 -006 by the Board on November 9, 2006 to clarify the definition of payroll related checks and expenses, Section 11.3 B.3. Revised under Resolution 2006 -009 by the Board on December 7, 2006 to further clarify the definition of payroll related checks and expenses, Section 11.3 B.3. December 7, 2006 Page 7 P003 -11