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Home My WebLink AboutItem 5.5 Update of Procedures for Accounts Payable Check Signing STAFF REPORT CITY COUNCIL Page 1 of 3 Agenda Item 5.5 DATE: October 21, 2025 TO: Honorable Mayor and City Councilmembers FROM: Colleen Tribby, City Manager SUBJECT: Update of Procedures for Accounts Payable Check Signing Prepared by: Chris Rhoades, Financial Analyst EXECUTIVE SUMMARY: The City Council will consider updating the City’s check-signing procedures to raise the threshold for a required countersignature on accounts payable checks from $1,000 to $5,000. Established in 2009, the current limit no longer reflects present -day financial practices or transaction volumes. The proposed change will improve eff iciency while maintaining sound internal controls. STAFF RECOMMENDATION: Adopt the Resolution Amending the Listing of City Officials and the Procedures for the Processing of Payments Requiring a Signature. FINANCIAL IMPACT: There is no direct financial impact. The proposed change will reduce Staff time required to administer accounts payable processing. DESCRIPTION: Background Within the California Government Code, there are two primary sections that govern how the City may issue payments. 1. California Government Code Sections 5500–5506 (Uniform Facsimile Signatures of Public Officials Act) Established under Title 1 (General), Division 6 (Public Bonds and Obligations), Chapter 6, this Act authorizes City officials to use electronic or facsimile signatures on instruments of payment. This provision enables the secure electronic application of authorized signatures on checks and other negotiable instruments, streamlining payment processing while maintaining legal validity. 115 Page 2 of 3 2. California Government Code Section 37203 This section directs cities to establish, by resolution, the method by which warrants and checks are drawn. The statute does not prescribe any specific restrictions on the method used, nor does it establish any dollar thresholds for requiring multiple signatures. Instead, it grants each City Council the authority to determine its own procedures for payment authorization consistent with sound fiscal practices. On March 15, 1982 through Resolution No. 14-82, the City Council adopted its first check- signing procedures. Since then, Resolution Nos. 4 -88, 136-86, 14-82, 91-99, and 101-09 refined these procedures to reflect evolving administrative practices, accounting systems, and financial management standards. The City Council is now being asked to revise the City’s check-signing procedures to raise the threshold requiring a second manual signature (countersignature) on accounts payable checks from $1,000 to $5,000. The $1,000 threshold was established through Resolution No. 101-09 (Attachment 2). Current Procedures In 2009, the City authorized electronic application of the Mayor’s signat ure for accounts payable checks and required manual countersignatures only for checks exceeding $1,000. Prior to that, all checks required a manual Mayor’s signature plus countersignatures from the City Treasurer, Deputy Treasurer, or City Clerk. At that time, approximately 62% of checks were under $1,000 and required only one signature. In Fiscal Year 2024-25, Staff processed 3,215 checks, of which 38% (1,222) were for $1,000 or less, with the rest (62%) requiring a countersignature. This represents a reversal of the 2009 proportions. To restore the intended balance between efficiency and internal control, Staff recommends raising the countersignature threshold to $5,000. This adjustment would reduce the proportion of checks requiring a second signature to approximately 33%, aligning the procedure with its original purpose and current financial activity. Internal Controls Neither the Government Finance Officers Association (GFOA) nor the California Society of Municipal Finance Officers (CSMFO) specifies a dollar threshold for multiple signatures. Both organizations emphasize strong internal controls and segregation of duties. The City’s current authorization procedures include multiple layers of review:  Invoice Entry: Administrative staff from each Department input information into the financial system.  Departmental Approvals: Department Heads and/or Assistant Department Heads provide the first level of approval.  Finance Approvals: A Finance Technician provides the second level of approval, and the Accounting Manager or Financial Analyst provides the third level of approval.  Check Signing: The Finance Director reviews all checks and manually signs checks 116 Page 3 of 3 over $1,000 with a countersignature. Additional safeguards include:  Uploading a Positive Pay file for each check run to the City’s bank .  Storing check images in the City’s financial system.  Maintaining a monthly Warrant Register, presented to the City Council. These controls ensure transparency, accountability, and compliance with sound financial practices. STRATEGIC PLAN INITIATIVE: None. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted. ATTACHMENTS: 1) Resolution Amending the Listing of City Officials and the Procedures for the Processing of Payments Requiring a Signature 2) Resolution No. 101-09 Rescinding Resolution No. 91-99 and Adopting a Listing of City Officials and Procedures for the Processing of Payments Requiring a Signature 117 Attachment 1 Reso. No. XX-25, Item X.X, Adopted XX/XX/2025 Page 1 of 2 RESOLUTION NO. XX – 25 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN AMENDING THE LISTING OF CITY OFFCIALS AND THE PROCEDURES FOR THE PROCESSING OF PAYMENTS REQUIRING A SIGNATURE WHEREAS, on May 18, 1999, the City Council adopted Resolution No. 91 -99 which identified the signature process to be used for City payments , allowing a facsimile of the Mayor’s signature to be stamped on Accounts Payable checks and counter signed with a manual signature by the City Treasurer; and WHEREAS, on July 7, 2009, the City Council adopted Resolution No. 101-09 which updated the signature process to be used for City payments allowing the Mayor’s signature to be printed directly onto checks, providing that all payments in the amount of $1,000 or more, have one manual countersignature from the City Treasurer, Deputy City Treasurer, or City Clerk ; and WHEREAS, the quantity of accounts payable checks issued by the City and the average amount of those checks have increased since the last time the procedures for processing payments was amended; and WHEREAS, the City seeks to make optimal use of Staff time and resources spent on processing payments, while still maintaining adequate internal controls. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin amends the listing of City Officials and the procedures for the processing of payments requiring a signature. BE IT FURTHER RESOLVED, that the City Council does hereby adopt the following procedures for authorizing signatures on instruments of payment which require such signatures: Section 1. Facsimile Signatures on Instruments of Payment Except as provided for in Section 2 below, all instruments of payment as defined in Government Code Section 5500 (b) issued by the City of Dublin and requiring a signature, may be signed by the electronic facsimile signature of the Mayor. Provided that on any such payments in the amount of $5,000 or more there shall also be appended one manual signature from the: City Treasurer, Deputy City Treasurer, or City Clerk. Section 2. Signature on Payroll Checks All payroll checks drawn upon a City of Dub lin account shall be signed by electronic facsimile signature of the City Manager or one manual signature from the City Treasurer, Deputy Treasurer, or City Clerk. Section 3. State Certification Facsimile Signature In accordance with the requirements of Section 5501 of the Government Code a manual signature of the official signature shall be filed with the Secretary of State. 118 Reso. No. XX-25, Item X.X, Adopted 10/21/2025 Page 2 of 2 Section 4. Implementation Of Procedures Necessary For Internal Control The facsimile signature shall be used for those instruments of payment identified in this resolution. The City Treasurer shall prepare and implement written procedures which provide internal control and to the extent possible a segregation of duties. Records shall be maintained identifying checks issued with the facsimile signature, including the date of issuance, amount of payment, payee, and the check number. PASSED, APPROVED AND ADOPTED this 21st day of October 2025, by the following vote: AYES: NOES: ABSENT: ABSTAIN: ______________________________ Mayor ATTEST: _________________________________ City Clerk 119 RESOLUTION NO. 101-09 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN ******** RESCINDING RESOLUTION NO. 91-99 AND ADOPTING A LISTING OF CITY OFFICIALS AND PROCEDURES FOR THE PROCESSING OF PAYMENTS REQUIRING A SIGNATURE WHEREAS, on May 18, 1999 the City Council adopted Resolution No. 91-99 which identified the signature process to be used for City payments; and WHEREAS, the California Government Code in: Title 1 (General) -Division 6 (Public Bonds and Obligations) -Chapter 6 (Uniform Facsimile Signatures of Public Officials Act), establishes the process for using other than an original signature for City issued instruments of payment; and WHEREAS, with the implementation of a new computer financial system it is appropriate to consider amendments to the procedures currently used; and WHEREAS, the new finance computer system contains features that utilize the finance system security to apply signatures on payments; and WHEREAS, the changes in the process can be accommodated while still maintaining adequate internal controls. NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby rescind Resolution No. 91-99 in its entirety. BE IT FURTHER RESOLVED that the City Council does hereby adopt the following procedures for authorization si gnatures on instruments of payment which require such si gnatures: Section 1. Facsimile Signatures on Instruments of Payment Except as provided for in Section 2 below, all instruments of payment as defined in Government Code Section 5500 (b) issued by the City of Dublin and requiring a signature, may be signed by the electronic facsimile signature of the Mayor. Provided that on any such payments in the amount of $1,000 or more there shall also be appended one manual signature from the: City Treasurer, Deputy City Treasurer, or City Clerk. Section 2. Signature on Payroll Checks All payroll checks drawn upon a City of Dublin account shall be signed by electronic facsimile signature of the City Manager or one manual signature from the City Treasurer, Deputy Treasurer, or City Clerk. Section 3. State Certification Facsimile Signature In accordance with the requirements of Section 5501 of the Government Code a manual signature of the official signature shall be filed with the Secretary of State. Page 1 of 2 Attachment 2 120 121