HomeMy WebLinkAbout4.08 Police Ck Signing & Admin~~~~~
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CITY CLERK
File # ^~~~-~~
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: July 7, 2009
SUBJECT: Update of Procedures for Check Signing and Administration of Special
Police Investigation Account
Report Prepared by Paul S. Rankin, Administrative Services Director P~
ATTACHMENTS: 1. Resolution 91-99 Adopted May 18, 1999.
2. Resolution rescinding Resolution No. 91-99 and Adopting a listing
of City Officials and procedures for the processing of payments
requiring a signature.
Resolution 32-97 Adopted April 1, 1997.
4. Resolution rescinding Resolution No. 32-97 and authorizing the
establishment of an internal police special investigations account.
RECOMMENDATION: Staff recommends that the City Council adopt the following
resolutions: (1) a Resolution rescinding Resolution No. 91-99 and
adopting a listing of City Officials and procedures for processing of
payments requiring a signature and (2) A Resolution rescinding
Resolution 32-97 and authorizing the establishment of an internal
Police Special Investigations Account
FINANCIAL STATEMENT: There is no direct financial impact, however, the proposed changes will
streamline the process of administering payments, reducing staff time
required, while maintaining safeguards and making use of technology
features available in the new Finance system.
DESCRIPTION: The Administrative Services Department -Finance Division is implementing a new
computer software system (Eden System) which has allowed Staff to evaluate current business practices.
Where appropriate, administrative changes are being initiated at a Staff level. Because there are existing
resolutions related to signatures on checks as well as a bank account for police investigations, it is appropriate
for the City Council formally act on the changes proposed in those areas through the enactment of new
resolutions.
Check Signature Process -Accounts Payable
Currently all Accounts Payable checks are stamped with a facsimile of the Mayor's signature and then counter
signed with an original signature by the City Treasurer (Administrative Services Director). This process is
described in Resolution No. 91-99 (Attachment 1). Approximately 4,600 checks are issued per year. Prior to
a check being produced, the payment request is reviewed by at least three individuals to assure proper coding
and that it is an authorized expenditure.
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With the new Finance Software it is possible to apply signatures directly to the check, using security features
in the software as well as a specialized printer. Internal control is maintained by segregating duties and
providing limited access to those who can produce the checks. In addition, the City obtains special fraud
detection banking services to mitigate against the potential for someone to produce a fraudulent check and
have it funded by the City's bank.
In the proposed resolution (Attachment 2), Staff is recommending that only one signature be embedded by the
Finance system on checks. Consistent with the current practice it is proposed the electronically applied
signature will be the Mayor's facsimile signature. The resolution, as proposed, also provides a change from
the current practice of applying a second signature to all checks. It is recommended that only checks with a
value of $1,000 or more will be hand countersigned by the Treasurer, Deputy Treasurer, or City Clerk. A
random sample of four recent check runs found that 62% of the checks issued were for less than $1,000. The
Treasurer will continue to review the entire listing of checks that are presented as part of City Council
meetings.
Check Signature Process -Payroll
With the payroll process, Direct Deposit is strongly encouraged which eliminates the physical check signing
process. The City has successfully enrolled nearly all regular employees in payroll Direct Deposit. However,
particularly with seasonal part-time employees, a number of checks require a manual signature. Those checks
are signed by only one person, typically the City Treasurer and, as a back-up, the City Clerk.
The proposed change is to use the Eden Payroll System to apply the signature on the check. It is proposed to
be the City Manager's signature. The new payroll system is not scheduled to be in operation until mid
October 2009, so the current practice will continue for the next few months. This change is outlined in
section 2 of the proposed Resolution (Attachment 2).
Police Investigations Account
Since 1985 the City has maintained a small bank account for Special Police Investigations. In 1997
Resolution No. 32-97 (Attachment 3) was adopted by the City Council. This resolution accounted for a
change in the ownership of the bank at that time. The resolution also designated the Police Chief and City
Manager as the authorized signers on the account. The bank has subsequently changed names and Staff
needed to change account signers due to changes in both of the designated account signers under Resolution
No. 32-97. In order to efficiently administer the funds the account has been closed and the adoption of a new
resolution is appropriate.
As described in the proposed Resolution (Attachment 4) Staff is proposing that the account be managed
within the Police Department in a secure location. Suitable controls and procedures will be developed by the
City Treasurer in consultation with the Chief of Police. The maximum cash on hand would be no more than
$3,000. Adoption of the proposed Resolution (Attachment 4) will establish the authorization to establish the
account and will also rescind Resolution 32-97.
RECOMMENDATION: Staff recommends that the City Council adopt the following resolutions: (1) a
Resolution rescinding Resolution No. 91099 and adopting a listing of City Officials and procedures for
processing of payments requiring a signature and (2) A Resolution rescinding Resolution 32-97 and
authorizing the establishment of an internal Police Special Investigations Account.
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RESOLUTION N0.92 - 99
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN
RESCINDING RESOLUTION N0.488
AND ADOPTING A LISTING OF CITY OFFICIALS AND PROCEDURES
FOR THE PROCESSING OF CITY PAYMENTS REQUIRING A SIGNATURE
WHEREAS, on January 11, 1988 the City Council adopted Resolution No. 4-88 which identified
the signature process to be used for City payments; and
WHEREAS, with the gowth of financial transactions handled by the City it is appropriate to
consider amendments to the procedures currently used; and
WHEREAS, financial institutions have implemented new systems which improve the agency ability
to monitor payments made against City accounts; and
WHEREAS, changes in the can be accommodated while still maintaining adequate internal
controls.
NOW, TI~REFORE, BE IT RESOLVED that the City Council does hereby rescind Resolution
No. 4-88.
BE IT FURTHER RESOLVED that the City Council does hereby adopt the following procedures
for authorization signatures on instruments of payment which require such signatures:
Section 1. Facsimile Signatures on Instruments of Pa, ent
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, maybe signed by the facsimile
signature of the Mayor. Provided that on such payments there shall also be appended one manual signature
from the: City Treasurer, or 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 one manual signature from the
City Treasurer, or Deputy Treasurer, or City Clerk.
Section 3. State Certification of Facsimile Si ature
In accordance with the requirements of Section 5501 of the Government Code a manual signature shall be
filed with the Secretary of State.
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. The facsimile signature shall be secured by a City employee who is
not regularly a City Offiicial designated as one of the manual signatures. Records shall be maintained
identifying checks issued with the facsimile signature, including the date of issuance, amount of payment,
payee, and the check number.
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PASSED, APPROVED AND ADOPTED this 18a' day of May, 1999.
AYES:
NOES:
ABSENT:
Councilmembers Howard, Lockhart, Zika and Mayor Houston
None
Councilmember McCormick
ABSTAIN: None
ATTEST:
i Cler
K2/G/5-18-99/reso-signcks
Mayor
'~;+
RESOLUTION NO. xx - 09
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
RESCINDING RESOLUTION N0.91-99
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 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 $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 Si nature
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.
ATTACHMENT 2
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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 7th day of July, 2009, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Mayor
ATTEST:
City Clerk
ATTACHMENT 2
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RESOLUTION NO.32 - 97
A RESOLUTION OF THE CITY COUNCII, OF THE CITY OF" DUBLIN
DESIGNATING THE PROVIDER OF BANKING SERVICES
FOR POLICE INVESTIGATION ACCOUNT
{Caliifarni~t F+ecleral Ba~tk)
WHEREAS, an August i2, I985, the Dublin City Council. authorized the establishment of a Police
Investigations Account; anal
WHZ:I2EAS, an irrterest bearing account was initially established at Homestead Savings which was
acquired by 1st Nationwide Bank in 1995; and
WHEREAS, 1st Nationwide Bank has recently acquired Cal Fed Bancorp in a transaction: which tvas
finalized on 3'anuary 3, 1997; and
WHEI~AS, 1st Nationwide Bahl: has elected to change their name to California Federal Bank; and
WHERJSAS, it is appropriate to have a resolution which clearly designates providers of banking services
to the City afDublin; and
WHEREAS, the City has adopted accounting procedures related to this account including a restriction on
the total balance; and
'~VFIEREAS, the account is interest bearing and will not incur service charges.
NCW, TkfEREF4RE, BE IT RESOLVED that the City Council of the City of Dublin does hereby
designate California Federal Bank as the provider of banking services for the City of Dublin Police
Invest~gatians Account.
BE IT FURTHER RESOLVED that the City Manager and the Police Ghief shat! be the authorized signers
on the account and these offiicials are hereby authorized to execute any documents on behalf of the City of
Dublin to establish or amend the banking services provided to the City of Dublin by California Federal
Bank, as they tray relate to this account.
PASSED, APPROVED AND ADAPTED this 1st day of April, 1997.
AYES: Cauncr"Imembers Burton, Lockhart andMayor,Houston
NOES: Nome
ABSENT: Councilmembers Barrier arid'Howard
ABSTAIN: None ~ .
~ ~.
ATTEST: ~} Mayor
C Clerk
ATTACHMENT 3
RESOLUTION NO. xx - 09
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
RESCINDING RESOLUTION N0.32-97 AND AUTHORIZING THE ESTABLISHMENT OF AN
INTERNAL POLICE SPECIAL INVESTIGATIONS ACCOUNT
WHEREAS, on April 1, 1997 the City Council adopted Resolution No. 32-97 which designated
California Federal Bank as the provider of banking services for the Police Investigations Account; and
WHEREAS, Resolution No. 32-97 also designated the signers on the account as the City Manager and
the Police Chief; and
WHEREAS, the banking institution designated in Resolution No. 32-97 no longer exists and the
account has been closed; and
WHEREAS, the administration of these funds can be effectively administered as an internal account
with implementation of appropriate reporting and control procedures; and
NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby rescind Resolution No.
32-97 in its entirety.
BE IT FURTHER RESOLVED that the City Council does hereby authorize the establishment of an
internal Police Investigation Account which shall adhere to the following guidelines:
Section 1. Balance: The balance retained in the account shall not exceed $3,000 (three thousand dollars).
Section 2. Pu ose: The purpose of the account shall be to provide Dublin Police Services with a source of
cash for investigative purposes under the direction and oversight of the Police Chief and/or his/her designee,
who shall be designated in writing.
Section 3. Procedures: The City Treasurer, in consultation with the Chief of Police, shall establish written
procedures related to: the periodic accounting of funds held; recording of the expenditures from the account; and
security for funds held in the account. Best practices including the segregation of duties shall be implemented
and reporting shall be as appropriate given the nature of the transactions, which can have elements of
confidentiality.
Section 4. Replenishment of the Account• The Police Chief or his /her designee shall be the Custodian and
checks to replenish the account shall be made payable to that individual as Account Custodian.
PASSED, APPROVED AND ADOPTED this 7th day of July, 2009, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Mayor
City Clerk
ATTACHMENT 4