HomeMy WebLinkAboutAgenda Packet 03/25/2014DATE: March 25, 2014
To: CITY COUNCIL
CITY MANAGER McKEEN
FRO, M: BYRON W. LSON, CHIEF FINANCIAL OFFICER
SUBJECT: LONG-RANGE FINANCIAL PLAN WORKSHOP
The City is moving forward on its Long -Range Financial Planning process, At to-
night's meeting, we will be reviewing:
• Draft Vision Statement for consideration;
• Draft Long -Range Financial Planning policies for consideration by the City Council; and
• Revised and amended the Financial Polices previously enacted by the City Council for con-
sideration prior to adoption.
A City Council -City Manager Sub -Committee has developed recommendations on draft Vision
a The Sub -Committee will be mak-
and Mission Statements for consideration by the City Council.
ing the presentation and leading the discussion on this topic. Sub -Committee members are:
0 Sissi Bruch, Councilmember
• Brad Collins, Councilmember
• Pat Downie, Councilmernber
• Dan McKeen, City Manager
In addition, staff will be reviewing the proposed Financial Policies for any final changes prior to an
anticipated April 15"' adoption date and taking a brief look at future proposed actions and timeta-
ble to complete the 2014 Long -Range Financial Plan,
Recommendation: Provide direction to the City Manager and staff regarding:
1. Vision Statement in preparation for future adoption by Council;
2. Final recommendations for change and revision to the Long -Range Financial Policies prior
to the proposed April 15, 20 14 adoption date;
3. Final recommendations for change and revision to the proposed Financial Policies prior to
Staff Report to CouncH Regarding March 25"' Workshop on die Long -Range Financial Nan
Page--2—
the
age--2—
the proposed April 15, 2014 adoption date; and
4. Changes in scheduling for remaining work on the 201.4 Long -Range Financial Plan,
Background / Analysis: 'The City Council has held a number of workshops related to developing
a Long -Range Financial Plan since the start of 2013. Initial work focused on, developing a prelim-
inary revenue and expenditure forecast for the period of 20114 -- 2018 that was utilized in the de-
velopment of the 20 14 Budget.
In 2014, the City Council began to focus on the Program and Services aspect of the Long -Range
Financial Plan, The goal was to:
I. Develop Long -Range Financial Policies to help guide future Councils in their decision-
making process;
2. Develop a. comprehensive series of Financial Policies to help guide the City Council, City
Manager and staff in providing for prudent financial management of the City;
3. Establish Program and Service priorities to allow for a rnore effective allocation of re-
sources to the City's highest priority needs; and
4. Develop plans and opportunities for different service delivery methods to encourage the
most efficient and effective use of City resources,
The January 28th Workshop focused its attention on the draft Long -Range Policy Statements and
the need for further review and guidance from Council on policies that may be included as part of
the City's Long -Range Financial Plan, During that review, Council achieved consensus on 24
Long -Range Financial Planning Statements that the City Council, wanted to consider for potential
adoption.
Staff has continued to, work on and refine both the Long -Range Financial Policies as well as the
City's other Financial Policies to aggregate the policies into a single document for use by Council,
staff and the public.
Part of that work included review of what financial policy statements are included in the Port An-
geles Municipal Code (PAMC). As part of the unified Financial Policy document, we are recom-
mending that the financial policies codified in Chapter 3.05 — Purchasing Policies and Procedures
and Chapter 3.06 -- Investment of Funds be deleted from the PANIC and included in the Financial
Policies that will be adopted by resolution by the City Council.
To make our Financial Policies more readily available and user-friendly, we think that having all
City Financial Policies in a single document adopted by the City Council makes more sense than
having some policies in the Port Angeles Municipal Code and some in separate policies. In addi-
tion, if policy statements are codified, every change will cost the City money to pay for the codifi-
cation by MCC---MunicipaI Code Corporation,
We want our Financial Policies to be a "living" document that is reviewed on an annual basis for
amendment and changes. In Section 13, Council spells out the requirement for the Chief Finan-
cial Officer to prepare and deliver an annual report to the City Council and City Manager detailing
the results of the review of the City's Financial Policies as well as any recommendations for modi-
fication or change.
StaffReport to Council Regarding March 25"' Workshop on the Long -Range Financial Plan
Page -- 3 —
In the draft Financial Policy docutrient, you will see references to particular Port Angeles Munici-
pal Code sections that have been duplicated in policy. You will also see selected sections high-
lighted in. yellow that represent portions of the financial policies contained in the Port Angeles
Municipal Code that we are recornmending be deleted from the policy draft because we have in-
cluded other policy language that is clearer and easier to understand,
Deletion of Port Angeles Municipal Code Sections 3.05 and 3.06 will require separate action by
Council through an ordinance to remove those sections from the PANIC, Those particular sections
are attached for your reference.
Going forward will see us needing to cover a lot of ground over the next few months so that we
can have Council adopted priorities that are in place prior to starting development of the 2015 Cip-
crating and Capital. Budget.
The tentative schedule, as of now, is:
• Tuesday, April 22nd (q,� 5:00 PM — 7:00 PM — (Workshop)
v Utility Rate Setting Review
Tuesday, April 29th,,,,r� 4:30 PM —7:00 PM — jAgecLalMeetingj
Finalize Mission & Vision Statements
Review Priority Rankings
V Prelinimary Revision of the Long -Range Financial Forecast
Thursday, May 22nd (u? 2:30 PM — 5:00 PM — (Special Meeting,)
Final Review & Discussion on Priority Rankings
Preliminary Resource Allocation/Ratiouing Review & Discussion
Tuesday, June 24th(y—,) 5:00 PM — 7:00 PM — (Workshop)
,/ Review -final" document for changes
Tuesday, July 1st @`, 6:30 PM -- (Regular Council Meeting)
-/ Ist Public Hearing on Long -Range Financial Plan
• Tuesday, July 15 rg), 6:3OPM -- (Regular Council Meeting)
2nd Public Hearing
Adoption of Long -Range Financial Plan via Resolution
If you have any questions prior to the meeting, please give me a call or send me an. e-mail,
[.,A,VDJM
Attachments:
Draft Financial Policies
Section 3.05 and 3.06 of' the Port Angeles Municipal Code
Staff'Report to CouncH Regarding March 25'� Workshop on die Long-Range Financial Plan
U A
Pat's brilliant suggestion - One word summary
--Excellence
--Innovative
Fun
o Environment
--Healthy
--Harmony
oRespect
o Balance
Meeting 1
First attempt at a vision:
In Zo years - Port Angeles is an innovative, healthy city
that lives in harmony with its environment, has a
diverse and vibrant economy, and lives in balance and
respect with all its citizens to create a high quality of
life leading to a community of excellence.
More words
Diversity, thriving, unforgettable, pristine
Brad's brilliant suggestion: Paint the picture
How would we define each of the words
How could we turn these definitions into something
that can be measured and
tracked - trends
ao Innovation
44so Quality of life
ao Diversity
Continuing to Paint the Picture
Sustainability
Excellent Community
Vibrant
Task
Re -write vision to fit "painting"
Re -write the "painting" into measures
Rank the measures for importance
A vibrant and innovative city, Port Angeles
continues to grow its
balanced and sustainable economy in harmony with
its pristine environment
creating a healthy and diverse community
IIO
Our vibrant & innovative
� Our Balanced & Sustainable Econ
h
Our Healthy Community
� Our Diverse Community
f(t'juv
7-
Our vibrant and
Schools with high graduation rates/good
education
The city and its services are ranked well
above average
Number of activities for all our citizens
(youth, adults, and elders)
a+, / ,4i.+✓++>....,,,...
Number of 4 year degrees and masters
offered at Peninsula College
Well equipped and maintained
infrastructure to support innovatic
Number of opportunities to
learn/experience innovation in action
(LEVX, composite)
Our vibrant and
innovative
Number and variety of restaura„+�
Number of residents that:
• Work from home
Recreate in our community
Our vibrant and
Number of partnership /businesses working
together with Canada/Victoria
Number of empty store fronts/vacant
commercial buildings
Lodging and occupancy rates
Making the best use our local resources
•The percentage of dollars spent locally /
Change in annual sales receipts sales taxes
• Number of new renewable sources used
(wind, wave, sun, rain, forests, marine, etc.)
• Number of symbiotic relationships between
businesses (waste stream to product)
Number of:
• Port Angeles grown -businesses (new)
•New outside businesses (in -migration)
Net percent change in local
lost jobs
jobs - new and
Number of diverse professional, technical,
medical, and union living wage jobs (in
balance)
Percentage of business that have been in the
city for 5 years or more.
Number of new businesses that are
considered innovative and/or run by
entrepreneurs/internet based
Number of residences, commercial and
industrial businesses (in balance)
Number of businesses creating / using or
related green power (wind,
and green infrastructure
Amount of City debt
wave, sun, etc.)
Our Health It
Measure the health of all our resources (our economy
is in harmony with our environment) (Forests, fish,
drinking water, harbor water, air quality, amount of
wilderness area)
Number of designs throughout the city that improve
health
Miles of bike lanes
Number of people using public transportation
Number of people living downtown
Number of bike racks located downtown/businesses
Our
Healthy, -C/ 1
Our environmental diversity
• Habitat
• Views
• Recreation
• Climate
Small town living
Number of people who know their neighbors
Number of miles to commute to work
Low consumption rates
Ease of getting around - number of congested intersections?
Our
Healthy, -C/ 1
Number of people that feel safe walking alone in
the evening downtown and in their neighborhoods
Updated plan and implementation to deal with
natural disasters and future climate change
Number of miles that our food travels - 50 miles of
less
Our carbon footprint is neutral
Pounds of garbage
Our
Healthy, -C/ 1
Quality of Medical Services
EMS response time
Level (rating) of hospital
Measure the health of our built environment
Number of roads needing update
Public buildings scored for health
Parks maintenance and acreage
Public utilities needing update (water, sewer, storm
drain, electric)
Our Diverse Communit
Number of services for all ages, races, ethnicity,
denominations, gender identity, etc.
Number of symbols, art, programs (teach or learn
cultural practices), or items that celebrate the Elwha
Klallam Tribe
Number and variety of art installations
and programs in the city
Our
Diverse
Number of services to help disabled,
homeless, and low income people
Number of events that celebrate diversity,
such as Esprit, Sister City, etc.
Housing opportunity index
homes sold that would have
- number of
attainable to median income
family
Number of low-income housing
Number of homeless
Number of residential options for all our
families (singles, families, elderly, etc.) - old
and new, housing stock in good shape
Our Diverse Communit
An equitable community is measured by:
• Number of services available to all
community members
• % of taxes to median income
• % of population unemployed or under
employed
• cost of living is x% of median income
UMM� I , I/sE,
A vibrant and innovative city, Port Angeles
continues to grow its
balanced and sustainable economy in harmony with
its pristine environment
creating a healthy and diverse community
C�ty of Port Angdes
TABLE OF CONTENTS
1. FINANCIAL POLICIES..................................................................................................................4
I.I.
Goals & Objectives: ........................................................................................................................................................................
4
1.2.
Fiduciary Responsibility: ................................................................................................................................................................
4
1.3.
Annual Review and Recommendations for Changes to Financial Policies: ...................................................................................
4
2.
LONG-RANGE FINANCIAL POLICIES..........................................................................................5
2.1.
Resolution of Conflict between Policies: .......................................................................................................................................
5
2.2.
Ability to Pay: .................................................................................................................................................................................
5
2.3.
Use of Reserves: .............................................................................................................................................................................
5
2.4.
Unassigned Fund Balance: .............................................................................................................................................................
5
2.5.
General Fund Subsidy to Street Fund and Medic I Utility Fund: ...................................................................................................
6
2.6.
Issuance of New Debt and Ability to Pay: ......................................................................................................................................
6
2.7.
Considerations for Debt Financing: ................................................................................................................................................
6
2.8.
Disposition of Unused Property.....................................................................................................................................................6
2.9.
Use of Highly Volatile Funding Sources: ........................................................................................................................................
7
2.10.
Potential for Segmenting Public Works Projects: ..........................................................................................................................
7
2.11.
Capital Funding Priorities: ..............................................................................................................................................................
7
2.12.
Use of One-time Revenues: ...........................................................................................................................................................
7
2.13.
Property Tax and Future Budgets: .................................................................................................................................................
7
2.14.
Use of Banked Property Tax Capacity: ...........................................................................................................................................
8
2.15.
Utility Excise Tax Rates: .................................................................................................................................................................
8
2.16.
Setting of Fees and Charges for Building Permits: .........................................................................................................................
8
2.17.
Setting of Fees and Charges for Parks and Recreation Programs and Services: ...........................................................................
8
2.18.
Utility Rate Design: ........................................................................................................................................................................
8
2.19.
Economic Development Fund: .......................................................................................................................................................
9
2.20.
Implementation of Utility Rate Increases: .....................................................................................................................................
9
2.21.
Annexation and Cost of Service Analysis: ......................................................................................................................................
9
2.22.
Employee Salaries and Benefits: ....................................................................................................................................................
9
2.23.
Employee Contributions for Health Insurance: .............................................................................................................................
9
2.24.
Payments by the City to Vendors and Employees: ......................................................................................................................
10
3.
OPERATING POLICIES..............................................................................................................11
3.1.
Goals.............................................................................................................................................................................................11
3.2.
Revenue Policies..........................................................................................................................................................................11
3.3.
Expenditure Policies.....................................................................................................................................................................12
3.4.
Capital Improvement Policies......................................................................................................................................................13
3.5.
Reserve Fund Policies...................................................................................................................................................................
14
4.
ACCOUNTING & REPORTING POLICIES...................................................................................17
4.1.
Accounting Requirements: ...........................................................................................................................................................
17
4.2.
BARS — Budgeting, Accounting and Reporting System: ...............................................................................................................
17
4.3.
Requirements of the Finance Department: .................................................................................................................................
17
4.4.
External Auditing Requirement: ..................................................................................................................................................
17
5.
BUDGET POLICIES....................................................................................................................18
5.1.
Primary Budget Responsibility.....................................................................................................................................................18
5.2.
Operating Budget.........................................................................................................................................................................18
5.3.
Budgetary Control........................................................................................................................................................................19
6.
DEBT MANAGEMENT POLICIES..............................................................................................
20
6.1.
Goals.............................................................................................................................................................................................20
6.2.
Short -Term Debt..........................................................................................................................................................................
20
6.3.
Long -Term Debt............................................................................................................................................................................20
6.4.
General Obligation Bond Policy...................................................................................................................................................21
7.
INVESTMENT POLICIES............................................................................................................
22
7.1.
Goals.............................................................................................................................................................................................22
7.2.
Objectives.....................................................................................................................................................................................
22
8.
PURCHASING POLICIES...........................................................................................................
28
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C�ty of Port Angdes
8.1.
Goal..............................................................................................................................................................................................28
8.2.
Right to Establish, Amend or Repeal...........................................................................................................................................
28
8.3.
Financial Information Provided to Council..................................................................................................................................28
8.4.
Purchasing Policy Definitions.......................................................................................................................................................
29
8.5.
Policy Requirements....................................................................................................................................................................30
8.6.
Requisitioned Purchase Orders(PO)............................................................................................................................................30
8.7.
Blanket Purchase Order (BPO).....................................................................................................................................................
31
8.8.
Receipt of Goods..........................................................................................................................................................................
31
8.9.
FPO (Field Purchase Order)..........................................................................................................................................................31
8.10.
Invoicing.......................................................................................................................................................................................
31
8.11.
Check Signing...............................................................................................................................................................................
32
8.12.
Approval of Payment Claims........................................................................................................................................................32
8.13.
Contracts......................................................................................................................................................................................
32
8.14.
Bidding Requirements..................................................................................................................................................................32
8.15.
Lowest Responsible Bidder (PAMC 3.05.050).............................................................................................................................
32
8.16.
Bid Inspection (PAMC 3.05.055)..................................................................................................................................................34
8.17.
Authority to Enter into Contracts, Leases or Rental Agreements (PAMC 3.05.060)...................................................................
34
8.18.
Small Purchase Contracts (PAMC 3.05.070)................................................................................................................................
34
8.19.
MRSC Rosters (PAMC3.05.080)..................................................................................................................................................35
8.20.
Small Works Rosters (PAMC 3.05.085)........................................................................................................................................35
8.21.
Consulting Services Rosters (PAMC 3.05.090).............................................................................................................................
37
8.22.
Public inspection of purchase, small works roster, or limited public works awards (PAMC 3.05.100) .....................................
37
8.23.
Approval from the City Attorney on Change Orders: ..................................................................................................................
39
8.24.
Change orders on construction contracts and amendments to professional service agreements (PAMC 3.05.110) ................
39
8.25.
Definition of credit card (PAMC 3.05.120)..................................................................................................................................40
8.26.
Issuance, use and control of credit cards (PAMC 3.05.130)........................................................................................................
40
9.
POST ISSUANCE COMPLIANCE FOR GOVERNMENTAL BONDS..............................................41
9.1.
Scope: ...........................................................................................................................................................................................
41
9.2.
Purpose: .......................................................................................................................................................................................
41
9.3.
Schedule of Review: .....................................................................................................................................................................
41
9.4.
Requirements at Bond Closing: ....................................................................................................................................................
41
9.5.
Requirements after Bond Closing: ...............................................................................................................................................
41
9.6.
Officials or Employees Responsible for Review: ..........................................................................................................................
41
9.7.
Investment of Bond Proceeds: .....................................................................................................................................................
43
9.8.
Use of Bond -Financed Facilities: ..................................................................................................................................................
45
9.9.
Continuing Disclosure: .................................................................................................................................................................
45
9.10.
Material event notices: ................................................................................................................................................................
46
9.11.
Compliance with Bond Covenants: ..............................................................................................................................................
47
3 1 Pegs
Gty of Port Angdes
1. FINANCIAL POLICIES
1.1. Goals & Objectives:
1.1.1. The Financial Policies assemble all of the City's key financial policies in one document.
This comprehensive document provides the guidelines to ensure that the City is
financially able to meet its immediate and long-term service objectives. The individual
policies contained herein serve as guidelines for both the financial planning and internal
financial management of the City.
1.2. Fiduciary Responsibility:
1.2.1. The City of Port Angeles is accountable to its citizens for the use of public funds.
Municipal resources must be used prudently to ensure adequate funding for the
services, public facilities, and infrastructure to meet the present and future needs of the
community. These policies safeguard the fiscal stability required to achieve the City's
goals and objectives.
1.3. Annual Review and Recommendations for Changes to Financial Policies:
1.3.1. The Chief Financial Officer shall, on an annual basis, prepare and deliver a report to the
City Council and City Manager detailing the results of the review of the City of Port
Angeles Financial Policies. In the report, the Chief Financial Officer shall make
recommendations for revisions to existing policies, addition of new policies or the
deletion of existing policies to accommodate any changes in generally accepted
accounting principles (GAAP), changes in state regulations and laws or changes in
federal regulations and laws.
1.3.2. Should a change be required in the City's Financial Policies as a result of a court decision
or changes in state or federal laws before the City Council can review and take any
action, the City Manager, upon recommendation by the Chief Financial Officer, is
empowered to make any revisions to existing policies, creation of new policies or
deletion of existing policies to allow the City of Port Angeles to be in compliance with
governing authorities.
1.3.2.1. Provided that when the City Manager makes such change, the Chief Financial
Officer shall immediately inform the City Council in writing of the change, the
reason necessitating the change and the anticipated date the proposed revision
will come before Council for their consideration.
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LONG-RANGE FINANCIAL POLICIES
2.1. Resolution of Conflict between Policies:
2.1.1. Should there be any conflict between the Long -Range Financial Policies and an
individual financial policy contained elsewhere in this document, the Long -Range
Financial Policy shall govern. In such case, the Chief Financial Officer shall notify the City
Council and the City Manager in writing of the conflict together with recommendations
that will correct any conflict going forward.
2.2. Ability to Pay:
2.2.1. Council shall consider the overall impact on the community and its "ability to pay"
against the need to enact any tax, utility rate or fee/charge increase.
2.3. Use of Reserves:
2.3.1. Council shall not use reserves/fund balance as a funding source for on-going operations
except on an emergency, short-term basis.
2.3.1.1. The use of rate stabilization reserves to provide for a "phase-in" of a larger
utility rate increase shall be permitted provided that Council has adopted a
scheduled plan for the utility rate increases as well as a plan to replenish the
rate stabilization reserve account for funds previously advanced.
2.4. Unassigned Fund Balance:
2.4.1. Council shall direct that General Fund unassigned fund balance ("reserves") be
increased from its current minimum level of 10% of the current year General Fund
expenditures to 25% of the current year General Fund expenditures.
2.4.1.1. To meet the additional funding requirement, Council shall consider the
following actions in rank priority:
2.4.1.1.1. Allocation of any savings generated from prior year operations in
the General Fund;
2.4.1.1.2. Allocation of new or increased utility excise tax revenues as a
result of Council -adopted utility rate increase;
2.4.1.1.3. Allocation of new revenues to the General Fund resulting from
levying the 1.0% increase in property tax as allowed by state law;
2.4.1.1.4. Allocation of any new sales tax revenue projected in the
subsequent year operating budget for the General Fund; and
2.4.1.1.5. Reduction in overall spending in the General Fund necessary to
generate the resources to be allocated to the General Fund
unassigned fund balance as authorized by Council.
2.4.2. Council recognizes that the actions required to achieve a 25% unassigned fund balance
in the General Fund may take an extended period to achieve. Therefore, the Council
shall target a five-year horizon to achieve the desired funding level and Council shall
review the target funding level on an annual basis as part of its deliberations for the
next year's operating budget.
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2.5. General Fund Subsidy to Street Fund and Medic I Utility Fund:
2.5.1. Council shall consider implementing a "phase-out" of General Fund subsidy for the
Street Fund (Fund #102) and the Medic 1 Utility Fund (Fund #409).
2.5.2. The phase-out shall be over a period of not less than three (3) years nor more than five
(5) years.
2.5.3. Replacement of funding currently provided by the General Fund for the Street Fund
shall be coordinated with the creation and implementation of a Transportation Benefit
District (TBD).
2.5.4. Prior to consideration of either a Council -approved TBD or placement on the ballot for
voter -approval, the Chief Financial Officer together with the Director of Public Works
and Utilities shall prepare a report for consideration by the City Council and City
Manager that:
2.5.4.1. Analyzes the proposed method of funding for the TBD, provide an estimate
of the revenue for the next six (6) years to be generated if the TBD is
approved, and provide a specific list of projects to be funded along with a
timeline for completion of the identified projects.
2.5.5. Replacement funding for the Medic I Utility subsidy currently provided by General Fund
for the Medic I Utility Fund shall be coordinated with an upward adjustment to
applicable Medic I utility rates as provided in a Cost of Service Analysis (COSA). The
COSA shall also include a time -line for the utility rate increases intended to replace
funding support from the General Fund.
2.6. Issuance of New Debt and Ability to Pay:
2.6.1. Council shall consider, prior to the issuance of any new general government or utility
debt, the overall impact of the City's ability to repay the debt obligation from existing
taxes or utility rates.
2.6.2. If new taxes and/or increases in utility rates are necessary to generate revenue for the
new debt service, the Chief Financial Officer shall provide the City Council and the City
Manager a report detailing the annual and total estimated costs of the debt repayment
and the plan or schedule for future tax and/or utility rate increases required to pay for
the new debt.
2.7. Considerations for Debt Financing:
2.7.1. Council shall require the following for consideration of debt financing for projects:
2.7.1.1. If a long-term debt financing is proposed, a financial analysis shall be
required prior to any approval of the project that analyzes the long-term
sustainability of funding from City resources as well as the overall impact to
the City's total debt obligation.
2.7.1.2. Any maintenance and operation (M&O) costs associated with the completed
project must be identified along with the proposed source of funding for the
M&O costs prior to seeking Council approval of the capital project.
2.8. Disposition of Unused Property.
2.8.1. Council shall consider selling of the Niichel property and other unused City properties to
allow the City to have the resources to meet the debt service obligations of the 2005
Limited Term General Obligation Bond and its $1,000,000 balloon payment in 2021.
Gty of Port Angdes
2.9. Use of Highly Volatile Funding Sources:
2.9.1. Council shall prohibit the use of highly volatile funding sources such as Lodging Tax
("hotel -motel tax"), Real Estate Excise Tax I (REET-1), or Real Estate Excise Tax II (REET-11)
for debt service or other long-term commitments. Preference for use of such volatile
funding sources should be given to one-time capital expense, short-term funding
commitments for a capital expense or saving to create a funding pool that can "cash -
out" a capital project.
2.10. Potential for Segmenting Public Works Projects:
2.10.1. Council shall require an analysis of the potential impact of a policy directive to allow for
segmenting a public works project into economically feasible smaller segments or
phases that may be targeted to encourage local contractors to bid on projects that are
more in line with their company's economic resources and/or bonding capabilities.
2.11. Capital Funding Priorities:
2.11.1. Council shall require that first priority for funding of capital projects should be given to
those projects designed to preserve and maintain existing infrastructure.
2.11.1.1. Council has established the rank order the following:
2.11.1.1.1. Legal and statutory requirements and mandates provided realistic
and affordable sources of fund are available to the City.
2.11.1.1.2. Continuation of multi-year projects provided realistic and
affordable sources of funding are available to the City.
2.11.1.1.3. Capital funding should be given to those projects that leverage
City funding with grants from the State and/or federal agencies.
2.11.1.1.4. Capital funding should be given to public-private partnership
projects whereby the City can leverage its contribution with
private dollars to enable a more economically diverse project with
the primary risk for the long-term financing is transferred to a
private partner.
2.12. Use of One-time Revenues:
2.12.1. Council shall require that one-time revenues or revenues significantly above the
budgeted revenue target be used for one-time expenses and not be utilized to fund
recurring expenses such as salaries and wages or debt service.
2.13. Property Tax and Future Budgets:
2.13.1. Council shall require that in the development of all future annual operating budgets, the
Chief Financial Officer should include a 1.0% property tax revenue increase as
authorized under state law.
2.13.2. The Chief Financial Officer shall forward to the City Council and City Manager prior to
any approval from Council for the 1.0% property tax increase a report that details the
estimated revenue that may be generated if the 1.0% increase would be approved by
Council. In addition, the report shall also include an analysis of the potential impact on
the General Fund if Council decided not to levy the 1.0% increase.
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2.14. Use of Banked Property Tax Capacity:
2.14.1. Council shall not consider levying of any "banked" property tax levy capacity unless the
following conditions exist:
2.14.1.1. The Council is considering adopting an annual budget that requires a
reduction in core services as identified by Council; and
2.14.1.2. Council has voted to authorize the implementation of the 1.0% in property
tax collections.
2.15. Utility Excise Tax Rates:
2.15.1. Council shall not consider any increase to the City's utility excise tax rates through at
least the end of the 2019 fiscal year.
2.15.2. Prior to any proposal to Council for an increase in a utility excise tax rate, the Chief
Financial Officer shall prepare a report the City Council and the City Manager noting the
amount of the proposed tax increase, an estimate of new or additional annual revenues
for the next six (6) years and the need for the additional funding to be derived from the
increased utility excise tax rate.
2.16. Setting of Fees and Charges for Building Permits:
2.16.1. Council shall consider that the fees and charges for building permits shall include a total
cost recovery of direct and indirect costs.
2.16.2. Should council desire to consider potential reduction in the fees and charges for a
building permit it shall only do so if a project created long-term family wage jobs and/or
identifiable increase in sales tax as a result of the project's construction.
2.16.3. The Chief Financial Officer together with the Director of Community and Economic
Development shall prepare an annual report to the City Council and City Manager prior
to consideration of the next year's annual operating budget or any proposed fee and
charge increase that compares the City's building permit fee and charges in comparison
to fees and charges from other comparable cities together with an analysis of the net
subsidy required of the General Fund to off -set any shortfall in revenues associated with
the total building permit operating costs.
2.17. Setting of Fees and Charges for Parks and Recreation Programs and Services:
2.17.1. Council shall require that fees and charges imposed for parks and recreation shall be
based on a cost recovery hierarchy.
2.17.2. The cost recovery hierarchy shall give consideration for potential subsidy from other
parks and recreation fees and/or the General Fund for programs based on targeted
audiences such and children and youth, special populations or broad-based community
programs.
2.18. Utility Rate Design:
2.18.1. Council shall require that utility rates be designed to reflect the underlying nature of the
costs for each respective utility.
2.18.2. Council may consider establishing differential utility rates for specified utility classes to
achieve specific, identifiable goals such as reduced rates to encourage recycling of used
tires or construction materials.
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2.19. Economic Development Fund:
2.19.1. Council shall consider creation and/or identification of a long-term, dedicated funding
source for the Economic Development Fund (Fund #103) which, allows for funding of
on-going maintenance and operating (M&O) costs associated with the City's Economic
Development Program as well as a reserve fund to allow for the collection of resources
that could be used as a grant match and/or source of local government direct project
funding.
2.20. Implementation of Utility Rate Increases:
2.20.1. Council shall give preference to more frequent but smaller, incremental increases to
rates, fees, and charges rather than less frequent but larger increases.
2.20.2. In all cost of service analysis (COSA) efforts, preference should be given to utilizing a
"phased -in" approach for all future rate increases even if it may be necessary to slow-
down or delay planned capital project implementation as part of an overall "ability to
pay" analysis within the COSA.
2.21. Annexation and Cost of Service Analysis:
2.21.1. Council should require a Cost of Service Analysis (COSA) prior to any consideration of a
potential annexation. Included in the COSA will be an estimation of costs associated
with providing the current level of City services to an area under consideration for
annexation as well as an estimate of all revenue that may be derived from the area
included in the proposed annexation.
2.22. Employee Salaries and Benefits:
2.22.1. Council shall require a salary and benefit survey to assess that comparability of salaries,
wages, and benefits paid by the City of Port Angeles in comparison to the market place
for prospective City employees. Included in that analysis shall be the following:
2.22.1.1. The survey shall be done no more often than every three (3) years nor less
often than every five (5) years.
2.22.1.2. The survey shall take into account internal comparability for responsibility
and critical importance to the City for short and long-term decision-making.
2.22.1.3. The survey shall take into account external factors including comparable
cities, private -sector jobs and other factors that influence the City's ability to
recruit and retain qualified employees.
2.22.1.4. The Chief Financial Officer shall prepare and deliver a report in writing to the
City Council and City Manager prior to any consideration of a change in
salary, wages, or benefit levels for unionized and/or non -represented
employees that details the estimated costs of any proposals that are under
consideration for approval by Council.
2.22.1.5. The Mayor, with approval of the Council, may appoint a special, ad hoc
Council Committee to work with the City Manager in the development of any
proposals regarding salaries, wages, and benefits for employees of the City.
2.23. Employee Contributions for Health Insurance:
2.23.1. Council shall require that all employees contribute to the cost of their health insurance
coverage for both the employee as well as any family coverage that may be required.
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2.23.2. Council recognizes that implementation of this policy statement may require
amendments to collective bargaining agreements covering various groups of City
employees and will need to be negotiated as part of a collective bargaining process.
2.24. Payments by the City to Vendors and Employees:
2.24.1. Council shall require that all payments made by the City be accomplished via electronic
funds transfer wherever possible as a means of reducing costs to the City.
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3. OPERATING POLICIES
3.1. Goals
3.1.1. To ensure delivery of an exceptional level of municipal services by assuring reliance on
ongoing resources and by maintaining a stable financial base.
3.1.2. To ensure that the City is in a position to respond to changes in the economy or new
service requirements without an undue amount of financial stress.
3.1.3. To maintain an excellent credit rating in the financial community and assure taxpayers
that the City is well managed financially and maintained in sound fiscal condition.
3.1.4. To adhere to the highest accounting and management policies as set by the
Government Finance Officers' Association (GFOA), the Governmental Accounting
Standards Board (GASB), and other professional standards for financial reporting and
budgeting.
3.1.5. To ensure the legal use of financial resources through an effective system of internal
controls.
3.2. Revenue Policies
3.2.1. The City will strive to maintain a diversified mix of revenues in order to maintain needed
services during periods of declining economic activity.
3.2.2. General Fund revenue estimates should be prepared on a conservative basis in order to
minimize fluctuations in service levels during periods of economic downturn.
3.2.3. As much as is reasonably possible, City services that provide private benefit shall be
supported by fees and charges in order to provide maximum flexibility in the use of
general revenues to meet the cost of services of broader public benefit. The City shall
establish user charges as follows:
3.2.3.1. Building Permits: Fees shall be based on total cost recovery of direct and
indirect expenses.
3.2.3.2. Parks & Recreation: Fees shall be based on a cost recovery hierarchy
whereby adult programs help to subsidize programs for children, youth, and
special populations.
3.2.3.3. Rental of City Facilities: Fees shall be based on 100% of total direct and
indirect costs, plus an amount to be reserved for future major maintenance
of assets utilized by the rental if the rental is for private business purposes.
As a general requirement, the rental fees shall, at a minimum, cover the
direct expenses associated with permitting and facilitating the rental unless
the event is sponsored by the City of Port Angeles.
3.2.3.4. In the event that fees and charges to not achieve their targeted cost recovery
benchmarks, the City Manager shall recommend a plan for consideration by
Council that either reduces programs and services to be offered or provides
for a one-time subsidy from the General Fund for the current fiscal year's
operation.
3.2.3.5. Consideration of any future subsidy from the General Fund shall be included
in discussions by Council prior to the adoption of the next fiscal year's
budget.
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3.2.4. Fees and user charges for services provided by the City's enterprise funds should
recover full costs, including all direct costs, indirect costs, and capital costs in the form
of annual depreciation of capital assets.
3.2.5. The City shall systematically review user fees and rates and consider adjustments as
necessary to take into account the effects of additional service costs and inflation. Rate
studies shall be conducted to ensure that the rates will continue to support direct and
indirect costs of operations, administration, plant maintenance, debt service,
depreciation of capital assets, and other related costs.
3.2.6. Proceeds of specific revenue sources that are legally restricted to expenditures for
specified purposes will be accounted for in separate special revenue funds unless the
Chief Financial Officer issues a finding that directs the revenue to be accounted for in a
different fund for a specific reason. Budgeted special revenue funds will be included
and reviewed in the City's annual budget process.
3.2.7. The City will follow an aggressive policy of collecting all monies due, to the extent that
the collection efforts are cost effective.
3.2.7.1. The City may elect to not collect minor amounts due the City if the costs of
collection equal or exceed the amount of money to be collected. The Chief
Financial Officer shall determine on an annual basis what constitutes a minor
amount referenced above.
3.2.8. Economic downturns and anticipated funding shortfalls will be analyzed by the Chief
Financial Officer and City Manager for potential solutions. Deficit financing and
borrowing to support on-going expenditures is not the policy of the City as a response to
long-term revenue shortfalls. Revenue forecasts will be revised, and expenditures will
be reduced to conform to the revised forecast.
3.2.9. All potential grants shall be carefully examined for matching requirements and other
City obligations prior to grant acceptance. Some grants may not be accepted if local
matching funds cannot be justified. Grants may also be rejected if programs must be
continued with local resources after grant funds are exhausted or place an unacceptable
strain on local resources.
3.2.10. Significant preference shall be given to rate and fee increases are smaller and applied
more frequently than intermittent but significantly larger increases.
3.3. Expenditure Policies
3.3.1. The City will only propose operating expenditures, which can be supported from on-
going operating revenues. Before the City undertakes any agreements that would
create fixed on-going expenses, the cost implications of such agreement will be fully
determined for current and future years. Capital expenditures may be funded from
one-time revenues, but the operating budget expenditure impacts of capital purchases
will be reviewed for compliance with this policy provision.
3.3.2. Department directors are responsible for managing their budgets within the total
appropriation for their department.
3.3.3. The City will assess charges for services provided internally by other funds. The
estimated direct and indirect costs of service will be budgeted and charged to the fund
receiving the service. Interfund service fees charged to recover these costs will be
recognized as revenue to the providing fund. The allocation method will be reviewed
annually.
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3.3.4. Emphasis is placed on improving individual and work group productivity rather than
adding to the work force. The City will invest in technology and other efficiency tools to
maximize productivity. The City will hire additional staff only after the need of such
positions has been demonstrated and documented.
3.3.5. All compensation planning and collective bargaining will focus on the total costs of
compensation, including direct salary, healthcare benefits, pension contributions,
educational and longevity pay, and other non -salary benefits which are a cost to the
City.
3.4. Capital Improvement Policies
3.4.1. It is the City's policy to ensure that adequate resources are allocated to preserve
existing infrastructure and other capital assets before targeting resources toward
construction or acquisition of public facilities or major equipment.
3.4.2. The City will develop a multi-year Capital Facilities Plan (CFP) to identify and coordinate
infrastructure, facility, and equipment needs in a way that maximizes the return to the
community. All capital improvements will be made according to the adopted CFP.
3.4.3. The Capital Facilities Plan will be formulated using an analysis of long-term, overall
resources and will include projected funding sources and ongoing operations and
maintenance costs. Future changes in economic or demographic factors identified in
the financial forecasting process will be incorporated in the capital budget projections.
The plan will be updated annually. Any planned use of debt financing shall include an
analysis of debt service costs and funding resources available to pay the associated
debt.
3.4.4. The first year of the Capital Facilities Plan will constitute the capital budget for the
ensuing budget year. The capital budget and the base operating budget will be
reviewed at the same time to assure that the City's capital and operating needs are
evaluated in a balanced manner.
3.4.5. A long-range Transportation Improvement Plan (TIP) will provide the framework for the
City's future investment in transportation related infrastructure. This ensures that
infrastructure projects incorporated into the Capital Facilities Plan (CFP) will be the
embodiment of the officially stated direction of the City's Comprehensive Plan and
supporting documents.
3.4.6. The City may administer a Local Improvement District (LID) program. For capital
projects whose financing depends in part or wholly on an LID, interim financing may be
issued to support the LID's portion of the project budget. The amount of the interim
financing shall be the current estimate of the final assessment roll as determined by the
administering department.
3.4.7. The City will determine the most cost effective financing method for all new projects.
Whenever possible, the City will use intergovernmental assistance and other outside
resources to fund capital projects. Additional funding may come from designated
surpluses in the General Fund and certain special revenue funds as outlined in the
operating budget policy.
3.4.8. An operating cost projection, including all funding sources, will be required for all
projects proposed for funding within six (6) years.
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3.5. Reserve Fund Policies
3.5.1. Part of financial stability is to maintain adequate reserves and fund balances. The
definition of Fund Balance is the net worth of a fund, measured by total assets minus
total liabilities.
3.5.2. In the governmental funds, the City recognizes the following hierarchy of fund balance
classifications, which are based primarily on the extent to which the City is bound by
constraints placed on resources:
3.5.3. Nonspendable -- Amounts that cannot be spent due to form (such as inventories and
pre -paid amounts), and amounts that must be maintained intact legally or contractually
(including the corpus or principal of a permanent fund). In addition, long-term loan and
notes receivables, and property held for resale would be reported here unless the
proceeds are restricted, committed, or assigned.
3.5.4. Restricted -- Amounts constrained for a specific purpose by external parties,
constitutional provision, or enabling legislation.
3.5.5. Committed -- Amounts constrained for a specific purpose as authorized by the City
Council. Additional action by the Council is required in order to remove or change the
constraints placed on the resources. The action to constrain resources must occur prior
to year-end; however, the amount can be determined in the subsequent period.
3.5.6. Assigned -- For all governmental funds other than the general fund, any remaining
positive amounts not classified as nonspendable, restricted, or committed. For the
general fund, the City Manager has been delegated authority to assign amounts
intended to be used for a specific purpose. All assigned fund balance requests from
departments must be approved in writing by the City Manager and provided to the
Finance Department by year-end in order to be officially considered assigned. Amounts
reported as assigned should not result in a deficit in unassigned fund balance.
3.5.7. Unassigned -- For the general fund, amounts not classified as nonspendable, restricted,
committed, or assigned and are available to use for any purpose. The general fund is
the only fund that would report a positive amount in unassigned fund balance. For all
other governmental funds, unassigned fund balance is the amount expended in excess
of resources that are nonspendable, restricted, committed, or assigned. If this results in
a deficit in unassigned fund balance, then assigned fund balance shall be reduced.
3.5.8. Special Revenue Funds will maintain sufficient fund balances to provide adequate cash
flow and to withstand downturns in the economy. These fund balances will be analyzed
annually.
3.5.9. The General Fund's targeted unassigned fund balance will be a minimum of 25% of
expenditures, excluding capital expenditures. This fund balance will be established and
maintained to:
3.5.9.1. Offset unanticipated economic downturns;
3.5.9.2. Provide a sufficient cash flow for daily financial needs at all times;
3.5.9.3. Establish adequate level of reserves to provide for the timely replacement of
equipment; and
3.5.9.4. Sustain City services in the event of a catastrophic event such as a
natural/manmade disaster or a major downturn in the economy.
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3.5.9.5. If unassigned fund balance falls below the required minimum level, the City
Manager shall notify the Council immediately. The Council must adopt a plan
to restore this balance to the target level within 60 months.
3.5.10. In addition, the general fund will maintain a committed fund balance to be used as a
contingency as specified in PAMC 3.04.040. There are no minimum requirements on the
level of contingency fund balance.
3.5.11. There are no specific requirements on the level of assigned fund balance in the general
fund, unless future revenue streams are specified by the donor or source of funding.
3.5.12. The City will maintain the following reserves for the utility funds identified below:
3.5.12.1. An operating reserve will be established and maintained to provide sufficient
cash flow to meet daily financial needs as recommended by the City's
financial advisor. The reserve requirements will be reviewed every three
years and will be based upon:
3.5.12.2. 60 days operating expenses: Electric, Water, and Wastewater Funds.
3.5.12.3. 90 days operating expenses: Solid Waste and Stormwater Funds.
3.5.12.4. Operating expenses exclude ending fund balances, capital purchases,
construction costs, debt service payments, and transfers.
3.5.12.4.1. A rate stabilization reserve will be established and maintained for
the Electric Fund to provide a means to mitigate wholesale power
purchase cost increases. A rate stabilization reserve will be
established and maintained for the Wastewater Fund to provide a
means to mitigate retail rate increases based on unforeseen cost
increases. These accounts will be analyzed annually to ensure an
adequate amount is placed in reserves.
3.5.12.4.2. A post -closure maintenance reserve within the Solid Waste
Transfer Station/Landfill fund will be established and maintained
to provide sufficient cash flow to meet the anticipated cost of
maintenance in accordance with State law. This reserve
requirement will be reviewed annually.
3.5.12.4.3. Bond reserves will be created and maintained as required in utility
funds in accordance with the provisions set forth in the bond
covenants.
3.5.12.4.4. A contingencies and replacement reserve for the Electric fund will
be established and maintained in accordance with bond
covenants.
3.5.12.4.5. A water treatment plant operation and maintenance reserve will
be established and maintained to offset its operating costs to the
Water Fund.
3.5.12.4.6. The City will maintain reserve funds to meet requirements for the
guarantee of debt service in compliance with bond indenture
agreements.
3.5.12.4.7. The City will maintain the self-insurance funds at a sufficient level
to provide health care and workers' compensation benefits and
avoid catastrophic loss.
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3.5.12.4.8. The City will maintain equipment replacement reserves as
specified in the City's Equipment Replacement and Vehicle Use
Policy.
3.5.13. The City will maintain an actuarially funded Firemen's Pension Fund as determined by
actuarial study.
3.5.14. The City will maintain adequate reserves in the Information Technology Fund to ensure
timely replacement, upgrade, and/or additions to the City's technology infrastructure.
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4. ACCOUNTING & REPORTING POLICIES
4.1. Accounting Requirements:
4.1.1. The City's accounting and financial reporting systems will be maintained in conformance
with current accepted principles and standards of the Governmental Accounting
Standards Board (GASB), Generally Accepted Accounting Principles (GAAP), and the
Government Finance Officers Association (GFOA). As a commitment to this policy, the
Finance Department will periodically submit its Comprehensive Annual Financial Report
(CAFR) for the GFOA Certificate of Achievement for Excellence in Financial Reporting.
4.2. BARS — Budgeting, Accounting and Reporting System:
4.2.1. The State Auditor's Office provides a standard account classification system through its
Budgeting, Accounting and Reporting System (BARS). The City will maintain its records
on a basis consistent with BARS and current BARS manuals will be maintained in the
Finance Department.
4.3. Requirements of the Finance Department:
4.3.1. The Finance Department will maintain financial systems to monitor expenditures,
revenue, and performance of all municipal programs on an ongoing basis. Regular
monthly financial reports will present a summary of financial activity for the period and
the cumulative data for the budget year.
4.3.2. All applicable standard governmental accounting practices will be used to maintain the
City's financial records, including the appropriate uses of accrual and modified accrual
methods of accounting, encumbrance accounting, current financial resources and
economic resources focus for statement presentation, and the proper classification of
funds.
4.3.3. The Finance Department will maintain fixed asset and depreciation records for all capital
assets owned by the City. The threshold for capitalization of non -infrastructure assets is
$7,500.
4.3.4. Under GASB Statement No. 34, infrastructure will be included as capital assets in the
financial reports. The City will develop and follow a methodology of maintaining
infrastructure records, including appropriate depreciation, under the guidelines of the
statement.
4.4. External Auditing Requirement:
4.4.1. The State Auditor's Office will annually perform a financial and compliance audit and
issue an audit report. Results of the annual audit will be provided to the City Council
and public.
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5. BUDGET POLICIES
5.1. Primary Budget Responsibility
5.1.1. The City Council has final responsibility for approving the annual Operating Budget and
Capital Budget.
5.1.2. The City Manager is responsible for preparing and submitting to the Council a tentative
budget for the fiscal year. The City Manager is also responsible for keeping the Council
fully advised of the financial condition of the City and its future needs.
5.1.3. Department directors, under the direction of the City Manager, are responsible for
proposing programs, recommending funding levels, and formulating budget proposals
for implementing service programs in accordance with established goals and directives.
5.1.4. The Finance Department is responsible for coordinating the overall preparation and
administration of the City's budget in compliance with applicable State of Washington
statutes governing local government budgeting practices.
5.1.5. The Finance Department provides revenue budget estimates, assists department staff in
identifying budget problems and formulating alternative solutions, and prepares and
distributes the final budget document.
5.1.6. To facilitate and implement the budget process, the Chief Financial Officer will provide
the Council with an annual budget calendar in accordance with State law.
5.2. Operating Budget
5.2.1. The operating budget will define the City's annual financial plan as developed by the
City Council in establishing goals and objectives for the ensuing year.
5.2.2. Ongoing revenues should be equal to or greater than ongoing expenditures. Each City
fund budget shall identify ongoing resources that at least match expected ongoing
annual requirements. One-time cash transfers and non-recurring ending fund balances
will be applied to reserves or to fund one-time expenditures; they will not be used to
fund ongoing programs.
5.2.3. In accordance with State law, the City Manager is authorized to transfer budgeted
amounts within any fund; however, any revisions that alter the total expenditure
authority (appropriation) of a fund must be approved by the City Council.
5.2.4. Additional staff positions should be recommended only after the need has been fully
substantiated. An increase in the number of full-time equivalent position must be
approved by the City Council. The City Manager has the authority to approve additions
and/or changes to temporary, seasonal, and part-time positions. Nothing in this
paragraph is intended to diminish or interfere with the City Manager's right to control
the appointment and removal of City employees.
5.2.4.1. Only the City Council can authorize an increase in the authorized City career
staffing complement. Such approval is accomplished through the adoption
of the annual operating budget or through subsequent budget amendments
approved by the City Council.
5.2.5. The City will maintain a level of expenditures, which will provide for the public well-
being and safety of the residents of the community.
5.2.6. The operating budget will provide for appropriate design, construction, maintenance
and replacement of the City's capital infrastructure, plant, and equipment.
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5.2.7. A multi-year vehicle and equipment maintenance and replacement schedule will be
developed based on the City's projections of its future replacement and maintenance
needs. The projections will be updated and the schedule revised on an annual basis.
5.2.8. The budget will provide sufficient levels of maintenance and replacement funding to
ensure that all capital facilities and equipment are properly maintained and that such
future costs will be minimized.
5.2.9. The following criteria must be met to qualify any portion of the year-end General Fund
surplus for one-time operations, nonrecurring emergency capital expenditures, or
dedicated to the Capital Facilities Plan:
5.2.9.1. There are surplus balances remaining after all reserve requirements and
current expenditure obligations are met.
5.2.9.2. An analysis has occurred assuring that the City has an adequate level of short
and long-term resources to support the proposed use of surplus balances.
5.2.9.3. The funds are specifically appropriated by the City Council.
5.2.10. Year-end surplus in the Street Fund shall be designated for use in the Capital Facilities
Plan or be used for one-time capital expenditures for street and parks projects. Use of
surplus for these purposes must be approved by the Council.
5.3. Budgetary Control
5.3.1. The budget will be developed and administered in compliance with applicable State of
Washington budgetary statutes.
5.3.2. The Finance Department will maintain a system for monitoring the City's budget
performance. The system will include provisions for amending the budget during the
year in order to address unanticipated needs or emergencies.
5.3.3. Appropriations requested after the original budget is adopted will be approved only
after consideration of the availability of current and future revenues. Such
appropriations must be approved by City Council.
5.3.4. Accounting and reporting practices will be maintained to provide accurate and timely
monitoring of the City's budget performance.
5.3.5. Monthly budget reports will be issued by the Finance Department to Department Heads
regarding the department's actual performance compared to budget estimates. The
department also assists in implementing any needed corrective action approved by the
City Manager.
5.3.6. Current revenues and operating expenditures will be reviewed quarterly by the City
Council, and the Chief Financial Officer will prepare a mid -year assessment of the City's
financial position for presentation to the Council.
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6. DEBT MANAGEMENT POLICIES
6.1. Goals
6.1.1. All borrowing is subject to approval by the City Council. The basic objectives of the City's
debt management policy are:
6.1.1.1. To achieve the lowest possible cost for borrowing.
6.1.1.2. To ensure access to the bond market to adequately provide the capital
needed to finance public improvement and other long-term development
objectives.
6.1.1.3. To maintain strong and sound credit, demonstrated by its commitment to
meet all obligations in a timely fashion.
6.1.1.4. To maintain a level and structure of outstanding indebtedness that does not
lead to excessive debt service requirements, thereby avoiding unnecessary
strains on the operating budget.
6.1.1.5. To maintain the confidence of lending markets and the taxpayers.
6.1.1.6. To maintain adequate debt service coverage.
6.2. Short -Term Debt
6.2.1. Short-term debt covers a period of one (1) year or less. With careful monitoring and
planning of cash inflow and outflow requirements, it is intended that the City will avoid
the use of short-term indebtedness to the maximum extent possible.
6.2.2. The City may use short-term debt to cover temporary cash flow shortages resulting from
delay in receipting tax revenues or issuing long-term debt or to finance capital
construction.
6.2.3. Interfund loans with a repayment period of three years or less, may be used to meet
short-term cash flow needs as an alternative to outside debt instruments. Interfund
loans will be permitted only if an analysis of the lending fund indicates excess funds are
available and that the use of these funds will not adversely affect current operations.
6.3. Long -Term Debt
6.3.1. Long-term debt is defined as debt, which exceeds three years. The City will confine long-
term borrowing to capital improvements that cannot be financed from current
revenues.
6.3.2. Acceptable uses of bond proceeds will include items, which can be capitalized and
depreciated. Refunding bond issues designed to restructure current outstanding debt is
an acceptable use of bond proceeds, provided an analysis is done which determines the
net present value (NPV) of savings is favorable for the City.
6.3.3. Where possible, the City will use special assessment revenue, or other self-supporting
bonds, instead of general obligation bonds.
6.3.4. The City will not use long-term debt for current operations.
6.3.5. The City will maintain communications with bond rating agencies regarding its financial
condition. The City will follow a policy of full disclosure on financial reports and bond
prospectuses including proactive compliance with disclosure to the Electronic Municipal
Market Access (EMMA) according to guidelines established by the Municipal Securities
Rulemaking Board (MSRB).
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6.4. General Obligation Bond Policy
6.4.1. Before general obligation bond propositions are placed before the voters, projects
proposed for financing through general obligation debt should be included in the Capital
Facilities Program and be accompanied by an analysis of the future operating and
maintenance costs associated with the project.
6.4.2. Bonds will not be issued for a longer maturity schedule than a conservative estimate of
the useful life of the asset to be financed.
6.4.3. Limited Tax General Obligation (LTGO) Bond Policy:
6.4.3.1. As a precondition to the issuance of limited tax general obligation bonds,
alternative methods of financing should also be examined.
6.4.3.2. Limited tax general obligation bonds will be issued under certain conditions:
6.4.3.2.1. A project in progress which requires monies not available from
alternative sources;
6.4.3.2.2. Matching fund monies are available which may be lost if not
applied for in a timely manner; or
6.4.3.2.3. Catastrophic or emergency conditions exist.
6.4.4. Unlimited Tax General Obligation (UTGO) Bonds and Legal Debt Limits:
6.4.4.1. Under RCW 39.36.020(2), the public may vote to approve UTGO bond issues
for general government purposes in an amount not to exceed 2.5% of
assessed valuation. Within the 2.5% limit, the Port Angeles City Council may
approve LTGO bond issues and/or lease purchases up to 1.5% of the City's
total assessed value (RCW 39.36.020(2) and RCW 35.42.200). In addition,
state law provides for an additional 2.5% of assessed valuation for parks and
open space purposes with a vote of the people.
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7. INVESTMENT POLICIES
7.1. Goals
7.1.1. The goal of the policy is to invest public funds in a manner, which will provide the
highest investment return with the maximum security, while meeting the daily cash flow
demands and conforming to all Washington statutes governing the investment of public
funds.
7.1.2. Available cash will be co -mingled into a common investment portfolio and earnings
from such portfolio will be distributed monthly. This policy will apply to all financial
assets of the City, which are accounted for in the City's annual financial report.
7.1.3. General standards. The following general standards shall govern the investment of City
funds: (PAMC3.06.010)
7.1.3.1. All funds not required for immediate expenditure are available for
investment.
7.1.3.2. The Finance Director or City Treasurer, under guidance of the Finance
Committee, shall determine the amount of money available in each fund for
investment purposes and shall make investments in accordance with State
Statutes applicable thereto, including RCW 35A.40.050 and the policies of the
City.
7.1.3.3. All monies available for investment shall be commingled when possible or
practical within one common investment portfolio for the mutual benefit of
all participating funds, and all income derived therefrom shall be
apportioned among the various participating funds in direct proportion of
the amount of money invested by each.
7.2. Objectives
7.2.1. The primary objectives, in priority order, of the City's investment activities shall be:
7.2.1.1. Legality: The City's investment will comply with all statutes governing the
investment of public funds and the provision of all applicable bond
ordinances.
7.2.1.2. Safety: Investments shall be undertaken in a manner that seeks to ensure
the preservation of capital in the overall portfolio. The objective will be to
mitigate credit risk and interest rate risk.
7.2.1.3. Credit Risk: The City of Port Angeles will minimize credit risk, the risk of loss
due to the failure of the security issuer or backer, by:
7.2.1.3.1. Limiting investments to the safest types of securities.
7.2.1.3.2. Pre -qualifying the financial institutions, brokers/dealers,
intermediaries, and advisers with which the City will do business.
7.2.2. Diversify the investment portfolio so that potential losses on individual securities will be
minimized.
7.2.2.1. Interest Rate Risk: The City will minimize the risk that the market value of
securities in the portfolio will fall due to changes in general interest rates, by:
7.2.2.1.1. Structuring the investment portfolio so that securities mature to
meet cash requirements for ongoing operations, thereby avoiding
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the need to sell securities on the open market prior to maturity.
7.2.2.1.2. Investing operating funds primarily in shorter -term securities,
money market mutual funds, or similar investment pools.
7.2.2.2. Liquidity: The City's investment portfolio shall remain liquid to enable the
City to meet all operating requirements, which might be reasonably
anticipated. Because all cash requirements cannot be anticipated,
investments in securities with active secondary or resale markets are
recommended. A portion of the portfolio also may be placed in money
market mutual funds or local government investment pools, which offer
same day liquidity for short-term funds.
7.2.3. Return on Investment (Yield): Yield should become a consideration only after the basic
requirements of safety and liquidity have been met. The City's investment portfolio
shall be managed in a manner to attain a market rate of return throughout budgetary
and economic cycles, taking into account the investment risk constraints and liquidity
needs. The core of investments are limited to relatively low risk securities in
anticipation of earning a fair return relative to the risk being assumed. Securities shall
not be sold prior to maturity with the following exceptions:
7.2.3.1. A security with declining credit may be sold early to minimize loss of
principal.
7.2.3.2. A security swap would improve the quality, yield, or target duration in the
portfolio.
7.2.3.3. Liquidity needs of the portfolio require that the security be sold.
7.2.4. Prudence
7.2.4.1. The standard of prudence to be applied by investment officials shall be the
"prudent investor" rule, which states "...investments shall be made with
judgment and care, under circumstances then prevailing, which persons of
prudence, discretion and intelligence exercise in the management of their
own affairs, not for speculation, but for investment, considering the probable
safety of their capital as well as the probable income to be derived."
7.2.5. Delegation of Authority
7.2.5.1. There is hereby established a Finance Committee to be composed of three
Councilmembers, the City Manager, Director of Finance and Administrataive
Services and the City Treasurer. The duties of the Committee are as follows:
(PAMC 3.06.020)
7.2.5.1.1. To review the financial operation of the City and to recommend
such policies from time to time to the City Council as required to
improve the financial operation of the City.
7.2.5.1.2. To review the investment program of the City and to act in an
advisory capacity to the Director of Finance and Administrative
Services and the City Treasurer.
7.2.5.1.3. To recommend, in accordance with RCW 35A.40.030, to the City
Council the bank or banks which shall be the depository of city
funds.
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7.2.5.2. Authority for investment decisions shall be granted to the City Manager,
Chief Financial Officer, and City Treasurer. Each is authorized to sign
necessary agreements and documents for the purpose of carrying out this
policy, which do not obligate the City for the expenditure of funds.
Management responsibility for the investment program is hereby delegated
to the Chief Financial Officer and/or City Treasurer.
7.2.6. Ethics and Conflicts of Interest
7.2.6.1. Officers and employees involved in the investment process shall refrain from
personal business activity that could conflict with proper execution of the
investment program, or which could impair their ability to make impartial
investment decisions. Employees and investment officials authorized to
place or approve investments shall not personally, nor through a close
relative, maintain any accounts, interest, or private dealings with any firm
with which the City places investments, except for regular savings accounts,
checking accounts, money market accounts, or other similar transactions
which are offered on a non-negotiable basis to the general public. All
persons authorized or approved for investments shall disclose to the City
Manager any material financial interest in financial institutions that conduct
business within this jurisdiction. All personnel involved in the investment
function shall adhere closely to the City's Code of Ethics.
7.2.7. Authorized Financial Dealers and Institutions
7.2.7.1. As required by the Public Deposit Protection Commission (PDPC) all
authorized public depositories will be located in the State of Washington
(RCW 39.58.080).
7.2.7.2. Authorized broker/dealers and financial institutions will be limited to those
that meet one or more of the following:
7.2.7.2.1. Financial institutions approved by the Washington Public Deposit
Protection Commission; or
7.2.7.2.2. Primary dealers recognized by the Federal Reserve Bank; or
7.2.7.2.3. Non -primary dealers or institutions qualified under U.S. Securities
and Exchange Commission Rule 15c3-1 (Uniform Net Capital
Rule), and a certified member of the National Association of
Securities Dealers.
7.2.7.3. Whenever possible, the City shall make an effort to utilize brokers or dealers
doing business in the State of Washington, or recognized adequately
capitalized dealers on the west coast.
7.2.7.4. A current audited financial statement is required to be on file for each
financial institution and broker/dealer in which the City invests.
7.2.8. Authorized Investments
7.2.8.1. All municipal corporations in Washington State, including the City of Port
Angeles, are empowered by statute to invest in securities and deposits
authorized by State statute as defined in RCW 35A.40.050. These eligible
securities include:
7.2.8.1.1. Investment deposits, including certificates of deposit, with
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qualified public depositories as defined in RCW 39.58.
7.2.8.1.2. Certificates, notes, or bonds of the United States, or other
obligations of the United States or its agencies, or of any
corporation wholly owned by the government of the United
States (such as the Government National Mortgage Association).
7.2.8.1.3. Obligations of government-sponsored corporations, which are
eligible as collateral for advances to member banks as determined
by the Board of Governors of the Federal Reserve System (these
include, but are not limited to, Federal Home Loan Bank notes and
bonds, Federal Farm Credit Bank consolidated notes and bonds,
and Federal National Mortgage Association notes, bonds and
guaranteed certificates of participation).
7.2.8.1.4. Bankers' acceptances purchased on the secondary market.
7.2.8.1.5. Bonds of the State of Washington and any local government in the
State of Washington, which have, at the time of investment, one
of the three highest credit ratings of a nationally recognized rating
agency.
7.2.8.1.6. Repurchase agreements for securities listed in 2, 3, and 4 above,
provided that the transaction is structured so that the City of Port
Angeles obtains control over the underlying securities and a
Master Repurchase Agreement has been signed with the bank or
dealer.
7.2.8.1.7. State of Washington Investment Pool.
7.2.8.1.8. Commercial Paper purchased in the secondary market and having
received the highest rating by at least two (2) Nationally
Recognized Statistical Rating Organization (NRSROs) at the time of
purchase and adhering to the investment policies and procedures
adopted by the State Investment Board.
7.2.8.1.9. Mutual funds used specifically for debt issues related to arbitrage.
7.2.9. Safekeeping and Custody
7.2.9.1. All investment securities bought by the City, including collateral being held
on repurchase agreements, will be held by the City or in safekeeping by the
City's custodian bank. A third party bank trust department may be appointed
as agent for the City under the terms of a custody or trustee agreement
signed by both the bank and the City. The primary agent of the custodian
bank will provide a safekeeping receipt to the City listing the specific
instrument, its rate and maturity, and any other pertinent information. All
security transactions, including collateral for repurchase agreements,
entered into by the City will be conducted on a delivery -versus -payment
(DVP) basis.
7.2.10. Diversification
7.2.10.1. It is the policy of Port Angeles to diversify its investment portfolios. To
eliminate risk of loss resulting from the over -concentration of assets in a
specific maturity, issuer or class of securities, all cash and cash equivalent
assets in all funds shall be diversified by maturity, issuer, and by the class of
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security. In establishing specific diversification strategies, the following
maximum percentage of the City's portfolio shall apply:
7.2.10.1.1. Washington State Local Government Investment Pool - 100%
7.2.10.1.2. U.S. Treasury Obligations —100%
7.2.10.1.3. Federal Agency securities —100%
7.2.10.1.4. Municipal Investment Accounts — 40%
7.2.10.1.5. Certificates of Deposit (CDs) - 50%
7.2.10.1.6. Repurchase Agreements (Repos) - 40%
7.2.10.1.7. Bonds of State of Washington or any local government in the
State of Washington — 20%
7.2.10.1.8. Bonds of other states or local governments of a state other than
the State of Washington - 15%
7.2.11. Maturities
7.2.11.1.
To the extent possible and to preclude sales of securities that could result in
a loss, investments will be made to coincide with anticipated cash flow
requirements. Because of inherent difficulties in accurately forecasting cash
flow requirements, a portion of the portfolio should be continuously invested
in readily available funds such as the Local Government Investment Pool and
money market funds to ensure that appropriate liquidity is maintained to
meet ongoing obligations.
7.2.11.2.
To this extent, 10% of the portfolio, at the time of investment, will be
comprised of investments maturing within a year.
7.2.11.3.
Satisfying this requirement, remaining funds may be invested in authorized
securities not to exceed five and a half years in maturity, except when
compatible with specific investment needs. Maturities longer than five and a
half years must have prior approval of the Chief Financial Officer.
7.2.11.4.
To ensure additional liquidity and provide for ongoing market opportunity,
the weighted average maturity and effective duration of the overall portfolio
shall not exceed three years without the prior approval of the Chief Financial
Officer.
7.2.12. Internal Control
7.2.12.1.
The controls shall be designed to prevent losses of public funds arising from
fraud, employee error, misrepresentation of third parties, unanticipated
changes in financial markets, or imprudent actions by employees and officers
of the City.
7.2.12.2.
Controls deemed most important include: control of collusion, separating
transaction authority from accounting and record keeping, custodial
safekeeping, clear delegation of authority, specific limitations regarding
securities losses and remedial action, written confirmation of telephone
transactions, minimizing the number of authorized investment officials,
documentation of transactions and strategies, and code of ethics standards.
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7.2.13. Performance Standards
7.2.13.1. The investment portfolio shall be designed to attain a market -average rate of
return throughout budgetary and economic cycles, taking into account the
City's investment risk constraints, the cash flow characteristics of the
portfolio, and State and local laws and ordinances that restrict investments.
The City will report investment yield benchmarked to the yield of the 6 -
month Treasury Bill and/or the return provided by the State Investment Pool.
7.2.14. Reporting
7.2.14.1. The City Treasurer is charged with the responsibility of preparing a report on
investment activity.
7.2.15. Distribution of Income
7.2.15.1. Interest income received shall be distributed monthly from the common
portfolio to all participating funds based on the average cash balance
included in the common portfolio for the earning period.
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8. PURCHASING POLICIES
8.1. Goal
8.1.1. This document establishes guidelines and clarifies the policies for purchasing supplies
and materials, and contracting for services by the City of Port Angeles. The City of Port
Angeles dedicates itself to purchasing goods and services seeking maximum operational
value thereby assuring the prudent and economical use of public monies. The purpose
of this policy is to ensure that authorized personnel approve purchases in advance
whenever possible, that expenditures are recorded electronically as soon as possible, to
maximize internal controls without sacrificing efficiency, and to provide management
with the ability to analyze purchasing patterns and cash flow requirements.
8.2. Right to Establish, Amend or Repeal
8.2.1. The Chief Financial Officer shall have the exclusive right to repeal, modify, or amend any
portion or all of this Purchasing Policy at any time and with any such changes to take
effect immediately, with or without notice, subject to approval of the City Council by
Resolution. The Chief Financial Officer shall be responsible for interpretation of this
Policy.
8.3. Financial Information Provided to Council
8.3.1. Prior to any consideration for approval of a motion, resolution, or ordinance that grants
City Council authorization to purchase or acquire any goods or services, including
professional services and construction contracts, for the City of Port Angeles, the
Council shall be provided with a Fiscal Note prepared by the Chief Financial Officer or
designee that details the source and amount(s) of revenues proposed to pay for the
purchase together with a budget for the acquisition.
8.3.1.1. The Fiscal Note is required to be included in the Agenda packet delivered to
the Council prior to the meeting as well as the packet posted on the City's
website.
8.3.1.2. No proposed acquisition of goods or services may be considered by the
Council without the inclusion of a Fiscal Note designed to allow the City
Council to make an informed decision on the particular issue at hand.
8.3.1.3. If the proposed acquisition of goods or services is part of a larger project, the
Fiscal Note shall include the total budget for the project, the source of
funding and a summary of all expenditures made prior to the proposed
acquisition.
8.3.2. On a quarterly basis, the Chief Financial Officer shall provide Council with a written
report and analysis of the City's Operating and Capital budgets. The report shall be
provided by the 25th day following the end of the quarter unless the Chief Financial
Officer has informed the City Council and City Manager of the need for a delay in the
delivery of the report. In the message from the Chief Financial Officer informing the City
Council and City Manager of the delay in providing the quarterly report, the Chief
Financial Officer shall provide the reason for the delay together with the projected date
for the delivery of the quarterly report.
8.3.2.1. The quarterly report shall be posted to the City website following delivery to
the City Council.
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8.4. Purchasing Policy Definitions
8.4.1. It shall be the responsibility of each Department Head of the City to review and approve
or disapprove all purchase orders for his or her Department. It shall be the
responsibility of the Chief Financial Officer to review and approve or disapprove all
purchase orders in excess of $5,000.00. All purchase orders in excess of $15,000.00
shall be approved by the City Manager or designee. All purchase orders in excess of
$25,000.00 shall be approved by the City Council. (PAMC3.05.010)
8.4.2. Approval Levels: Set by City Council, these are specific dollar levels of authorization for
the approval of purchases and payments made on behalf of the City of Port Angeles as
noted below.
Purchase Amount Authorizing Official/Entity
$0.01 - $4,999.99 Department Director
$5,000.00 - $14,999.99 Department Head & Chief Financial Officer
$15,000.00 — 24,999.99 City Manager, Department Head & Chief Financial
Officer
$25,000.00+ City Council + City Manager, Department Head &
Chief Financial Officer
8.4.3. Any contract or agreement for the purchase of goods or services shall require
authorizing signatures:
Purchases of Less than $5,000:
Purpose Authorizing Official/Entity
Approval to purchase Department Director
Purchases of Greater than $5,000 but less than $14,999.99:
Purpose Authorizing Official/Entity
Approval to Purchase Department Director
Availability of Funds Department Director, Chief Financial Officer
Purchases of Greater than $15,000:
Purpose Authorizing Official/Entity
Approval to Purchase City Manager
Department Approval
Availability of Funds
Approval as to Form
Department Director
Chief Financial Officer
City Attorney
8.4.4. Blanket Purchase Order (BPO): Otherwise known as an "Open Purchase Order," a BPO
is a purchase order used for purchases with local vendors or frequently utilized vendors.
BPOs are created with a set dollar amount and are received and invoiced as purchases
are made. BPOs are generally for items that are needed daily, but not always
anticipated. BPOs are also used for annual agreements such as copier charges,
maintenance agreements, etc.
8.4.5. Emergency Purchases: An emergency purchase is created by an urgent need affecting
the health and safety of citizens, which requires immediate action, and where the
occurrence or condition is "unforeseen." Lack of anticipation or planning cannot be
deemed as a cause for declaring an emergency.
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8.4.6. Field Purchase Order (FPO): FPOs can be used as a quick way to obtain goods or
services. An FPO can also be used to request advance payments for legitimate business
expenses such as travel, food, lodging, and conference fees. FPO's should not be used
for purchases over $1,000 unless as specified in policy.
8.4.7. Purchase Order (PO): Computer generated numbered document used to authorize a
vendor to ship merchandise or to perform services for a proposed price. POs are
generated by a requisition, or documentation that has been approved at all required
approval levels. With regular purchase orders, you must add the line item information
describing the merchandise or services when you create them. With blanket purchase
orders, you can add the line items when you receive or invoice them.
8.4.8. Requisition: A request to order goods that must be processed through approval levels
before a purchase order can be generated. Funds are then pre -encumbered at this
requisition phase of purchasing. Buyers then process items from approved requisitions
onto purchase orders to selected vendors.
8.4.9. Sole Source & Single Source: A sole source can be a manufacturer, software developer
or service provider that sells direct and there are no other sources offering an "equal"
product or service. A single source could be a distributor/wholesaler/retailer that has a
contractual agreement for a specific territory to the exclusion of others.
8.5. Policy Requirements
8.5.1. All employees making purchases on behalf of the City of Port Angeles shall maintain
effective and professional public, vendor and customer relationships. Opportunity will
be provided to all responsible suppliers to do business with the City of Port Angeles
unless this purchase is required from a sole source. No official or employee will be
interested financially in contracts or purchases entered into by the City of Port Angeles.
8.5.2. Most purchases will be processed with one of these options:
8.5.2.1. Requisitioned Purchase Orders (PO)
8.5.2.2. Blanket Purchase Order (BPO)
8.5.2.3. Field Purchase Order (FPO)
8.5.3. Finance will administer travel, credit card purchases, utility bills, phone charges, and
petty cash in accordance with City policies and statutory requirements.
8.5.4. Authorization levels of purchases $5,000 and under will be determined by the
Department Director. Each Department Director shall supply the Chief Financial Officer
with departmental policy for individual authorization. Individuals authorized to approve
requisitions for purchase orders will only have security set up for their level of approval
and with those accounts as authorized.
8.6. Requisitioned Purchase Orders (PO)
8.6.1. Purchase Orders are created from an authorized requisition. Purchase Orders are for all
purchases other than those authorized by blanket purchase orders and field purchase
orders. All purchases for capital items, contracts that are subject to retainage, and
inventory items need to be made with a purchase order. The requisition for purchase is
processed and approved before the purchase is physically made, however this may not
be the case in emergency purchases. With regular purchase orders, the line item must
be added describing the merchandise or services from the authorized requisition. An
authorized person creates the purchase orders, which includes: purchase order
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information, such as purchase order date, type, and buyer name; vendor information,
such as vendor number, name, and terms; quantities of items ordered; unit cost of each
item ordered; and inventory information for each item on the purchase order.
8.7. Blanket Purchase Order (BPO)
8.7.1. Approval levels established by ordinance are required as signatures on the Blanket
Purchase Order (BPO) request form to authorize creation of a BPO.
8.7.2. BPOs are used for frequently purchased items from a frequently utilized vendor. BPOs
are usually created at the beginning of the year with an annual anticipated dollar
amount of expected purchases. Some department heads or directors may indicate the
maximum dollar amount of a single purchase to be entered on a BPO. When a purchase
exceeds the authorized maximum, a requisition/purchase order will need to be created
for that purchase. The BPO request form includes a section to be completed authorizing
the increase on a BPO when the initial balance requested is expended. On BPOs, line
items are added as the items are received.
8.8. Receipt of Goods
8.8.1. When items are received from a vendor, the receipt is recorded against an open
purchase order. Open purchase orders are purchase orders that are not canceled and
still have items that are not fully received, invoiced, or both. All items on a purchase
order can be received at once or individual items or quantities of an item received
separately. The department that created the original purchase order is responsible to
receipt all items on the purchase order.
8.9. FPO (Field Purchase Order)
8.9.1. An FPO can be used for smaller purchases that may be under $1,000, such as
subscriptions, registrations, and routine budgeted transactions. All items previously
posted to an account other than an expense account will be paid using an FPO. FPOs
may also be used for larger transactions, insurance payments, debt redemption, other
liabilities previously approved, and to request advance payments for legitimate business
expenses. Contracts having retainage need to be processed using purchase orders.
8.10. Invoicing
8.10.1. All claims for payment shall be submitted to the Finance Department with
documentation certifying that (1) the materials have been furnished, the services
rendered, or the labor performed as described and (2) the claim is a just, due and
unpaid obligation against the City. (PAMC3.05.020)
8.10.2. Claims shall be processed for payment by the Finance Department after proper
processing and receiving is completed at the department level. Invoices should be sent
directly to the Finance Department from the vendor. All invoices should be complete
with the following: (1) City purchase order number; (2) complete description of goods
or service provided; (3) quantity; (4) unit prices and extensions; (5) discount terms; and
(6) invoice number.
8.10.3. Adequate documentation will be attached to City payment vouchers to assure that it
supports a valid, legally authorized purchase. Payments will be made only on original
invoices. Properly prepared and approved requisitions, purchase orders, and receiving
reports will be attached when applicable.
8.10.4. All City claims approved by the Departments are certifying that the materials have been
furnished, the services rendered or the labor performed, and that the claim is a just, due
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and unpaid obligation against the City, prior to submitting the claim to the Finance
Department for payment.
8.10.5. The department initiating the claim will be responsible for compliance and
documentation for bid requirements, prevailing wages, approved change orders, and
any additional statutory consideration related to the transaction.
8.11. Check Signing
8.11.1. To be valid, all checks in payment of claims must be signed by both the City Manager
and the Chief Financial Officer. (PAMC3.05.030)
8.12. Approval of Payment Claims
8.12.1. It shall be the duty of the Chief Financial Officer to present not less frequently that once
each month a list showing all claims paid and the date of such payment to enable the
City Council to make inquiry on any item appearing thereon. Upon satisfaction of such
inquiry, if any, the City Council shall by motion approve the report of claims paid and
other the same filed as a permanent record. (PAMC3.05.040)
8.13. Contracts
8.13.1. The City Manager or his designee may sign contracts less than $25,000.
8.13.2. City Manager or his designee is authorized to enter into lease or rental agreements
provided the agreement does not obligate the City of Port Angeles in excess of $25,000
and the agreement is for a period that does not exceed one year.
8.14. Bidding Requirements
8.14.1. Purchases of supplies, materials and equipment or services other than professional
services over $7,500 but less than $15,000 may be purchased after obtaining three
written or telephone quotes. All purchases over $15,000, other than professional
services, are required to go through a formal bidding process.
8.15. Lowest Responsible Bidder (PAMC3.05.050)
8.15.1. Before award of a public works contract, a bidder must meet the following responsibility
criteria to be considered a responsible bidder and qualified to be awarded a public
works project. The bidder must:
8.15.1.1. At the time of bid submittal, have a certificate of registration in compliance
with chapter 18.27 RCW;
8.15.1.2. Have a current Washington state unified business identifier number;
8.15.1.3. If applicable, have industrial insurance coverage for the bidder's employees
working in Washington as required in Title 51 RCW; and employment security
department number as required in Title 50 RCW; and a state excise tax
registration number as required in Title 82 RCW; and
8.15.1.4. Not be disqualified from bidding on any public works contract under RCW
39.12.065(3).
8.15.2. Supplemental criteria: In addition to the bidder responsibility criteria in 8.14.1 above,
when the City receives bids or quotes and it is necessary to determine the lowest
responsible bidder, the following shall apply:
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8.15.2.1. For a contract for purchase of supplies, material or equipment, the City may
take into consideration the quality of the articles proposed to be supplied,
their conformity with the specifications, and the times of delivery.
8.15.2.2. In determining "lowest responsible bidder", in addition to price, the following
elements shall be given consideration:
8.15.2.3. The ability, capacity, and skill of the bidder to perform the contract;
8.15.2.4. The reputation, ability, experience, and efficiency of the bidder;
8.15.2.5. Whether the bidder can perform the contract within the time specified;
8.15.2.6. The quality of performance of previous contracts;
8.15.2.7. The previous and existing compliance by the bidder with laws relating to the
contract;
8.15.2.8. Tax revenue that the City would receive from purchasing the supplies,
materials, or equipment from a supplier located within the City's boundaries,
so that the purchase contract would be awarded to the lowest bidder after
such tax revenue has been considered. The tax revenues that the City may
consider include sales taxes that the City imposes upon the sale of such
supplies, materials, or equipment, from the supplier to the City, provided
that if the City considers such tax revenues that it would receive from the
imposition of taxes upon a supplier located within its boundaries, the City
shall also consider tax revenues it would receive from taxes it imposes upon
a supplier located outside its boundaries;
8.15.2.9. If products are available that meet the contract specifications and
requirements and that are made from recycled materials or may be recycled,
whether the products are specified in the bid are made from recycled
materials or may be recycled or reused; and
8.15.2.10. Other criteria applicable to the particular contract and provided in the
invitation to bid.
8.15.3. Supplemental criteria for determining bidder responsibility, including the basis for
evaluation and the deadline for appealing a determination that a bidder is not
responsible, must be provided in the invitation to bid or bidding documents.
8.15.4. In a timely manner before the bid submittal deadline, a potential bidder may request
that the City modify the supplemental criteria. The City must evaluate the information
submitted by the potential bidder and respond before the bid submittal deadline. If the
evaluation results in a change of the criteria, the City must issue an addendum to the
bidding documents identifying the new criteria.
8.15.5. If the bidder fails to supply information requested concerning responsibility within the
time and manner specified in the bid documents, the City may base its determination of
responsibility upon any available information related to the supplemental criteria or
may find the bidder not responsible.
8.15.6. If the City determines a bidder to be not responsible, the City must provide, in writing,
the reasons for the determination. The bidder may appeal the determination within the
time period specified in the bidding documents by presenting additional information to
the City. The City must consider the additional information before issuing its final
determination. If the final determination affirms that the bidder is not responsible, the
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City may not execute a contract with any other bidder until two business days after the
bidder determined to be not responsible has received the final determination.
8.15.7. Subcontractors. A public works contractor must verify responsibility criteria for each
first tier subcontractor, and a subcontractor of any tier that hires other subcontractors
must verify responsibility criteria for each of its subcontractors. Verification shall
include that each subcontractor, at the time of subcontract execution, meets the
responsibility criteria listed in subsection A. and possess an electrical contractor license,
if required by chapter 19.28 RCW, or an elevator contractor license, if required by
chapter 70.87 RCW. This verification requirement, as well as the responsibility criteria,
must be included in every public works contract and subcontract of every tier.
8.15.8. The Director of Public Works and Utilities shall apply the criteria established in this
section and determine whether a bidder is responsible. An appeal shall be heard and
determined by the City Manager, whose decision shall be final.
8.16. Bid Inspection (PAMC3.05.055)
8.16.1. Immediately after the award is made, the bid quotations obtained shall be recorded,
open to public inspection, and available by written, telephonic, or electronic request.
8.17. Authority to Enter into Contracts, Leases or Rental Agreements (PAMC 3.05.060)
8.17.1. The City Manager or his designee is hereby authorized to enter into contracts and leases
or rental agreements provided that the following conditions are met:
8.17.1.1. The contract does not obligate the City to expend in excess of $25,000.
8.17.1.2. The particular expenditure of City funds has been approved in the City
Budget as approved by the City Council.
8.17.1.3. The lease or rental agreement is for a period that does not exceed one year
and involves a total rental amount or value that does not exceed $25,000. As
deemed appropriate by the City Manager, the City Council's Real Estate
Committee may be consulted prior to executing any such lease or rental
agreement.
8.17.1.4. The City Manager or his designee shall notify the Council in writing of
contracts entered into pursuant to this section.
8.18. Small Purchase Contracts (PAMC 3.05.070)
8.18.1. Whenever the reasonably anticipated purchase price of supplies, material and
equipment, except for public work or improvement, is more than $7,500 but less than
$15,000.00, advertisement and formal sealed bidding for their purchase may be
dispensed with if the uniform procedure provided in RCW 39.04.190 and in this section
is followed.
8.18.2. At least twice per year, the City Clerk shall publish in a newspaper of general circulation
within the City a notice stating the existence of vendor lists and soliciting the names of
vendors for the lists.
8.18.3. Each City department that desires to award contracts for the purchase of supplies,
material or equipment pursuant to this process shall do the following:
8.18.3.1. Obtain at least three written or telephone quotations from different vendors
of the supplies, material or equipment to be purchased.
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8.18.3.2. Transmit the quotes to the City Manager or designee, accompanied by a
recommendation for award of the purchase contract to one of the vendors,
who shall be the lowest responsible bidder as defined in RCW 43.19.1911 or
elsewhere in these policies.
8.18.3.3. If less than three quotes are obtainable due to factors beyond the control of
the department, the recommendation to the City Manager or designee shall
be accompanied by an explanation of the reasons for the lower number of
quotes.
8.19. MRSC Rosters (PAMC3.05.080)
8.19.1. The City has contracted with and hereby is authorized to use the Municipal Research
and Services Center of Washington (MRSC) for the City use of state wide electronic
databases for small works roster and consulting services developed and maintained by
MRSC. In addition, paper and/or electronic rosters may be kept on file by appropriate
City Departments.
8.20. Small Works Rosters (PAMC3.05.085)
8.20.1. The following small works roster procedures are established for use by the City pursuant
to RCW 39.04.155:
8.20.1.1. Cost. The City need not comply with formal sealed bidding procedures for
the construction, building, renovation, remodeling, alteration, repair, or
improvement of real property where the estimated cost does not exceed
$300,000, which includes the costs of labor, material, equipment and sales
and/or use taxes as applicable. Instead, the City may use the small works
roster procedure for public works projects as set forth herein. The breaking
of any project into units or accomplishing any projects by phases is
prohibited if it is done for the purpose of avoiding the maximum dollar
amount of a contract that may be let using the small works roster process.
8.20.1.2. Publication. At least once a year, on behalf of the City, MRSC shall publish in
a newspaper of general circulation within the jurisdiction a notice of the
existence of the roster or rosters and solicit the names of contractors for
such roster or rosters. Responsible contractors shall be added to appropriate
MRSC roster or rosters at any time that they submit a written request and
necessary records. The City may require master contracts to be signed that
become effective when a specific award is made using a small works roster.
8.20.1.3. Telephone or written quotations. The City shall obtain telephone, written or
electronic quotations for public works contracts from contractors on the
appropriate small works roster to assure that a competitive price is
established and to award contracts to a contractor who meets the
mandatory bidder responsibility criteria in Section 8.14 of this policies.
8.20.2. A contract awarded from a small works roster need not be advertised.
8.20.3. Invitations for quotations shall include an estimate of the scope and nature of the work
to be performed as well as materials and equipment to be furnished. However, detailed
plans and specifications need not be included in the invitation.
8.20.4. Quotations may be invited from all appropriate contractors on the appropriate small
works roster. As an alternative, quotations may be invited from at least five contractors
on the appropriate small works roster who have indicated the capability of performing
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the kind of work being contracted, in a manner that will equitably distribute the
opportunity among the contractors on the appropriate roster "Equitably distribute"
means that the City may not favor certain contractors on the appropriate small works
roster over other contractors on the appropriate small works roster who perform similar
services.
8.20.5. If the estimated cost of the work is from $150,000 to $300,000, the City may choose to
solicit bids from less than all appropriate contractors on the appropriate small works
roster but must notify the remaining contractors on the appropriate small works roster
that quotations on the work are being sought. The City has the sole option of
determining whether this notice to the remaining contractors is made by:
8.20.5.1. Publishing notice in a legal newspaper in general circulation in the area
where the work is to be done;
8.20.5.2. Mailing a notice to these contractors; or
8.20.5.3. Sending a notice to these contractors by facsimile or email.
8.20.6. At the time bids are solicited, the City representative shall not inform a contractor of the
terms or amount of any other contractor's bid for the same project.
8.20.7. A written record shall be made by the City representative of each contractor's bid on the
project and of any conditions imposed on the bid. Immediately after an award is made,
the bid quotations obtained shall be recorded, open to public inspection, and available
by telephone inquiry.
8.20.8. Limited public works process. If a work, construction, alteration, repair, or
improvement project is estimated to cost less than $35,000, the City may award such a
contract using the limited public works process provided under RCW 39.04.155(3). For a
limited public works project, the City will solicit electronic or written quotations from a
minimum of three contractors from the appropriate small works roster and shall award
the contract to the lowest responsible bidder as defined under RCW 39.04.010. After an
award is made, the quotations shall be open to public inspection and available by
electronic request.
8.20.9. For limited public works projects, the City may waive the payment and performance
bond requirements of Chapter 39.08 RCW and the retainage requirements of Chapter
60.28 RCW, thereby assuming the liability for the contractor's nonpayment of laborers,
mechanics, subcontractors, materialmen, suppliers, and taxes imposed under Title 82
RCW that may be due from the contractor for the limited public works project.
However, the City shall have the right of recovery against the contractor for any
payments made on the contractor's behalf.
8.20.10. The City shall maintain a list of the contractors contacted and the contracts awarded
during the previous 24 months under the limited public works process, including the
name of the contractor, the contractor's registration number, the amount of the
contract, a brief description of the type of work performed, and the date the contract
was awarded.
8.20.11. Award. All of the telephone bids or quotations shall be collected and presented at the
same time to the Council for consideration, determination of the lowest responsible
bidder, and award of the contract.
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8.21. Consulting Services Rosters (PAMC3.05.090)
8.21.1. Consulting services. Consulting services are professional services that have a primarily
intellectual output or product and include architectural and engineering services as
defined in RCW 39.80.020.
8.21.2. Publication. At least once a year, on behalf of the City, MRSC shall publish in a
newspaper of general circulation within the jurisdiction a notice of the existence of the
consulting services roster or rosters and solicit statements of qualifications from firms
providing consulting services. Such advertisements will include information on how to
find the address and telephone number of a representative of the City who can provide
further details as to the City's projects needs for consulting services. Firms or persons
providing consulting services shall be added to appropriate MRSC roster or rosters at
any time that they submit a written request and necessary records. The City may
require master contracts to be signed that become effective when a specific award is
made using a consulting services roster.
8.21.3. Professional architectural and engineering services. The MRSC Rosters will distinguish
between professional architectural and engineering services as defined in RCW
39.80.020 and other consulting services and will announce generally to the public the
City's projected requirements for any category or type of professional or other
consulting services. The City reserves the right to publish an announcement on each
occasion when professional services or other consulting services are required by the
agency and to use paper and/or other electronic rosters that may be kept on file by
appropriate City departments.
8.22. Public inspection of purchase, small works roster, or limited public works awards (PAMC
3.05.100)
8.22.1. Each department that makes an award for a purchase contract under the informal
bidding process in section 8.14 of this chapter shall provide the City Clerk with the name
of the contractor or vendor awarded the contract, the amount of the contract, a brief
description of the type of work performed or items purchased under the contract, and
the date it was awarded.
8.22.2. The City Clerk shall post a list of the contracts awarded under section 8.17 of this
chapter at least once every two months. The lists shall contain the name of the
contractor or vendor awarded the contract, the amount of the contract, a brief
description of the type of work performed or items purchased under the contract, and
the date the contract was awarded. The lists shall also state the location where the bid
quotations for these contracts are available for public inspection. The quotations shall
be available by written, telephonic, or electronic request.
8.22.3. Approval for change orders shall be granted in writing and signed by the officials noted
below:
GENERAL PURCHASING
Change Order Amount Authorizing Signatures
$0.01 -- $4,999.99 • Department Director (or as delegated in
writing to Finance Department)
$5,000.00 -- $14,999.99 . Department Head — authorizing official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
$15,000.00 -- $24,999.99 • City Manager — authorizing official
• Department Head — requesting official
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• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
Greater than $25,000.00 • City Council approval required
• City Manager — authorizing official
• Department Head — requesting official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
CONSULTANT CONTRACTS Note: Funding of any change orders must have been
WITH ORIGINAL AWARD included in the original budget authorization approved
GREATER THAN $25,000 by the City Council. If additional funds beyond the
BUT LESS THAN $100,000 original budget are required, the City Council must
approve the change order regardless of the amount.
Change Order Amount Authorizing Signatures
$0.01 -- $4,999.99 • Department Director (or as delegated in
writing to Finance Department)
$5,000.00 -- $14,999.99 • Department Head —authorizing official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
$15,000.00 —15.0% • City Manager — authorizing official
whichever is greater • Department Head — requesting official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
Greater than 15.0% of the • City Council approval required
Original Contract Award • City Manager — authorizing official
• Department Head — requesting official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
CONSTRUCTION & Note: Funding of any change orders must have been
CONSULTANT CONTRACTS included in the original budget authorization approved
WITH ORIGINAL AWARD by the City Council. If additional funds beyond the
GREATER THAN $100,000 original budget are required, the City Council must
approve the change order regardless of the amount.
Change Order Amount Authorizing Signatures
$0.01 -- $4,999.99 • Department Director (or as delegated in
writing to Finance Department)
$5,000.00 -- $14,999.99 • Department Head —authorizing official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
$15,000.00 —15.0% • City Manager— authorizing official
whichever is greater • Department Head — requesting official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
Greater than 15.0% of the • City Council approval required
Original Contract Award • City Manager — authorizing official
• Department Head — requesting official
• Chief Financial Officer — as to availability of
funds & compliance with policy requirements
Note: The City Council may grant specific additional
authority to the City Manager as part of the original
contract award approved by the City Council.
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8.23. Approval from the City Attorney on Change Orders:
8.23.1. Any change order that amend, modifies, alters or otherwise changes the original
contract document that required approval from the City Attorney as to form, except as
noted in Section 8.21.3 above, shall also require authorization from the City Attorney on
the change order.
8.24. Change orders on construction contracts and amendments to professional service agreements
(PAMC 3.05.110)
8.24.1. Upon subsequent approval by the City Council of a single or collective series of change
orders requiring Council approval, the approval threshold shall be re -set based on the
most recent Council —approved contract amount as the starting point.
8.24.2. Change orders to construction contracts or professional service agreements that extend
the time for performance or change the procedure for administration of the contract or
agreement and where there is no substantial change in scope or increase in cost of the
contract or agreement shall require the approval of respective Department Director,
Chief Financial Officer and City Manager. Any change orders approved in compliance
with this section shall be included in the bi-monthly report to the City Council.
8.24.3. In accordance with the terms and conditions of this section, the City Manager and the
respective department head are hereby authorized to approve and sign change orders
on construction contracts, and amendments to professional services agreements, if the
change order or the amendment does not substantially change the scope of the project,
the total contract amount as adjusted is within the amount budgeted for the project,
and the change order or amendment meets the criteria stated below.
8.24.4. If the total amount of a change order for a construction contract or an amendment to a
professional services agreement is $5,000.00 or less, the respective department head
may approve the change orders or the amendment for professional services
agreements.
8.24.5. If the amount of a construction contract change order is between $5,000.00 and
$100,000.00, or a professional services agreement amendment is between $5,000.00
and $25,000.00 it must be approved and signed by the City Manager.
8.24.6. Change orders and amendments may be approved as provided in this section subject to
the following limitations:
8.24.6.1. For a construction contract or a professional services agreement with an
original cost less than $100,000.00, the total of all change orders or
amendments shall not exceed $15,000.00.
8.24.6.2. For a construction contract with an original cost of $100,000.00 or more,
change orders, in total, may be issued for 15 percent of the original contract
amount, or $100,000.00, whichever is less. For a professional services
agreement with an original not -to -exceed cost of $25,000.00 or more,
change orders, in total, may be issued for 15 percent of the original amount,
or $25,000.00, whichever is less.
8.24.7. If the amount of the change order is in excess of the City Manager's authority, it must be
approved by the City Council.
8.24.8. When approval occurs by the City Manager or respective department head for change
orders, or professional services agreement amendments, according to the conditions
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stated above, they shall notify the City Council of the change order or amendment in the
next bi- monthly contract status report submitted to City Council.
8.25. Definition of credit card (PAMC3.05.120)
8.25.1. As used in this chapter, "credit card" means a card or device issued under an
arrangement pursuant to which the issuer gives to a cardholder the privilege of
obtaining credit from the issuer.
8.26. Issuance, use and control of credit cards (PAMC3.05.130)
8.26.1. The City Council hereby adopts the following system for the issuance, use and control of
credit cards by City officials and employees:
8.26.1.1. The Finance Department shall implement the following system for the
distribution, authorization, control, credit limits and payment of bills related
to the use of credit cards by City officials and employees:
8.26.1.1.1. Distribution. Credit cards will be distributed to those City
officials and employees who have job responsibilities which
would be facilitated by the use of a credit card and the credit
card use would benefit the City. This shall include the City
Council, City Manager, Department Heads, Division Managers,
and other officials and employees as determined by the City
Manager.
8.26.1.1.2. Authorization and control. The Finance Department shall
develop the implementation guidelines and accounting controls
to ensure the proper usage of credit cards and credit card
funds.
8.26.1.1.3. Credit limits. The Finance Department shall set credit limits on
each credit card issued. The credit limit shall not exceed $2,500
without written approval of the City Manager.
8.26.1.1.4. Payment of bills. The Finance Department shall establish and
implement a written procedure for the payment of all credit
card bills.
8.26.1.1.5. Unauthorized charges. No employee shall use the City -issued
credit card for non -City business use. Any employee who
violates this policy by using a City- issued credit card for non -
City business shall be subject to disciplinary action and shall be
billed for all charges on the credit card. The City Manager or
his/her designee is authorized and directed to make payroll
deductions to recover any unauthorized charges.
8.26.1.1.6. Cash advances. Cash advances on credit cards are prohibited.
8.26.2. The Finance Department is authorized to adopt any additional procedures or policies
necessary to implement the provisions of this section.
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9. POST ISSUANCE COMPLIANCE FOR GOVERNMENTAL BONDS
9.1. Scope:
9.1.1. This Post Issuance Compliance Policy addresses the City of Port Angeles, Washington's
(the "City") compliance with federal tax, federal securities and state law requirements
and contractual obligations applicable to the City's tax -advantaged governmental bond
issues. The Post Issuance Compliance Policy applies generally to all of the City's tax-
exempt governmental bonds, and other bonds subject to comparable requirements,
such as taxable direct -pay bonds. As used in this Post Issuance Compliance Policy,
references to "bonds" include bonds, lines of credit, bond anticipation notes, and
equipment and other financing leases.
9.2. Purpose:
9.2.1. This Post Issuance Compliance Policy is intended to improve the City's ability to:
9.2.1.1. Prevent violations in bond requirements from occurring in the first place,
9.2.1.2. Timely identify potential violations, and
9.2.1.3. Correct identified violations through appropriate remedial steps.
9.3. Schedule of Review:
9.3.1. The Post Issuance Compliance Policy is to be reviewed at least annually and upon each
issuance of new bonds, including refunding bonds. In connection with this periodic
review, the Chief Financial Officer will consider whether the Post Issuance Compliance
Policy should be amended or supplemented:
9.3.1.1. To address any particular requirements associated with the new bond issue,
or
9.3.1.2. To reflect general changes in requirements since the prior bond issue.
9.4. Requirements at Bond Closing:
9.4.1. Numerous federal tax, federal securities, and state law requirements must be met in
connection with a bond issue. In some circumstances (e.g., revenue bonds) rate and
other covenant requirements will also need to be satisfied. These requirements are
addressed in the bond transcript completed at bond closing, and confirmed in certain
respects by the legal opinions included in the bond transcript.
9.5. Requirements after Bond Closing:
9.5.1. Other federal tax, federal securities law and state law requirements and contractual
obligations require on-going monitoring after the issuance of the bonds.
9.6. Officials or Employees Responsible for Review:
9.6.1. The following officers and employees of the City are identified as the responsible
persons for reviewing compliance with the City's post -issuance obligations. Each
responsible individual is to institute a calendaring system to track compliance with tasks
in a timely manner.
9.6.1.1. Federal tax requirements, including arbitrage, use of proceeds, use of
facilities and IRS filings:
9.6.1.1.1. Arbitrage, IRS Filings: Chief Financial Officer or as designated
by Chief Financial Officer
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9.6.1.1.2. Use of Proceeds: Chief Financial Officer or as designated by
Chief Financial Officer
9.6.1.1.3. Use of Facilities: Department Director as designated by City
Manager
9.6.2. Continuing disclosure requirements:
9.6.2.1. Annual Filing: Chief Financial Officer or as designated in writing by the
Chief Financial Officer
9.6.2.2. Material Event Notices: Chief Financial Officer or as designated by Chief
Financial Officer
9.6.2.3. Prior to filing each annual filing or material event notice, the Chief Financial
Officer is to circulate the draft filing or notice to bond counsel or to the City
Attorney for review.
9.6.3. The Chief Financial Officer is responsible for reviewing the other requirements under
this policy.
9.6.4. The responsible persons identified above may need to confer, from time to time, with
the City's bond counsel, and/or financial advisor (if any), to confirm the applicability and
scope of the requirements outlined in this policy. For reference, the contact
information for these advisors is provided below:
9.6.4.1. Pacifica Law Group LLP, as bond counsel
9.6.4.1.1. Deanna Gregory at 206-245-1716 or
Deanna.gregory@pacificalawgroup.com, or
9.6.4.1.2. Stacey Crawshaw-Lewis at 206-245-1714 or
Stacey.Lewis@pacificalawgroup.com
9.6.4.1.3. Edward McCullough at 206-245-1727 or
Edward.mccullough@pacificalawgroup.com
9.6.5. Training of the responsible official/employee. The City provides opportunities for
training to the responsible individuals, specifically including the following training
opportunities:
9.6.5.1. At or after bond closing, a conference call or meeting with bond counsel to
review the requirements applicable to a new bond issue.
9.6.5.2. Identify other training activities, if applicable — such as participation in in-
house training sessions, CPE seminars, or seminars conducted by professional
organizations (e.g., GFOA, WFOA, WMTA)
9.6.6. Records to be Maintained. The following documents are maintained in connection with
each bond issue. The goal is to retain adequate records to substantiate compliance with
federal tax, securities law, state law and other contractual requirements applicable to
the City's bonds. Generally, records should be maintained for the term of the bonds
(plus any refunding) plus four years. Unless otherwise specified, the following records
are to be maintained in the office of the Chief Financial Officer.
9.6.6.1. Complete bond transcript (provided by bond counsel) in CD or hard copy.
9.6.6.2. Records of investment of bond proceeds in a format showing the date and
amount of each investment, its interest rate and/or yield, the date any
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earnings are received and the amount earned, and the date each investment
matures and if sold prior to maturity, the sale date and sale price.
9.6.6.3. Records of expenditure of bond proceeds in a format showing the amount,
timing, and the type of expenditure.
9.6.6.4. Records of invoices or requisitions, together with supporting documentation
showing payee, payment amount, and type of expenditure, particularly for
projects involving multiple sources of funds.
9.6.6.5. Records necessary to document the allocation of bond proceeds and other
sources of funds to particular projects or portions of projects.
9.6.6.6. Records documenting the final allocation of bond proceeds to projects,
including any reallocations of bond proceeds, in a format showing the timing
and substance of the reallocation, if applicable.
9.6.6.7. Records demonstrating compliance with arbitrage and rebate requirements,
including arbitrage calculations, documentation of spending exceptions to
rebate, rebate reports and IRS filings and payments.
9.6.6.8. Copies of contracts relating to the use of the bond -financed facility including
leases, concession agreements, management agreements and other
agreements that give usage rights or legal entitlements with respect to the
facility to nongovernmental persons (e.g., advertising displays, cell tower
leases, and naming rights agreements).
9.6.6.9. Copies of contracts relating to ongoing compliance with respect to the
bonds.
9.6.6.10. Copies of any filings or correspondence with the IRS, the SEC or other
regulatory body.
9.7. Investment of Bond Proceeds:
9.7.1. In general, bond proceeds and certain other funds can only be invested at a rate that
exceeds the yield on the bonds under limited circumstances. Furthermore, amounts
earned by investing above the bond yield must be rebated to the IRS, unless the City
qualifies as a small issuer or a spending exception is met. The arbitrage and rebate
requirements for each bond issue are detailed in the federal tax certificate. The Chief
Financial Officer (or the City Treasurer if assigned the responsibility in writing by the
Chief Financial Officer) will monitor the investment and expenditure of the funds and
accounts listed below. The Chief Financial Officer (or the City Treasurer if assigned the
responsibility in writing by the Chief Financial Officer) determines whether the bond
issue meets the requirement for one of the expenditure exceptions to arbitrage rebate.
The Chief Financial Officer (or the City Treasurer if assigned the responsibility in writing
by the Chief Financial Officer) in consultation with bond counsel will determine whether
a rebate calculation is necessary and, if so, will perform the calculation or engage a
rebate consultant. The Chief Financial Officer (or the City Treasurer if assigned the
responsibility in writing by the Chief Financial Officer) will arrange for the payment of
any required rebate to the IRS together with the appropriate IRS form on the dates
described below.
9.7.1.1. Funds to Monitor.
9.7.1.1.1. Bond or debt service funds/accounts
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9.7.1.1.2. Project or construction funds/accounts
9.7.1.1.3. Debt service reserve funds/accounts
9.7.1.1.4. Other accounts with bond proceeds or amounts pledged to pay
bonds
9.7.1.2. Arbitrage Reports; Rebate May Be Due.
9.7.1.2.1. During construction, monitor expenditures to confirm
satisfaction of expected exception to rebate (such as six month
exception, 18 month exception, 24 month exception)
9.7.1.2.2. The first rebate payment is due five years after date of issue
plus 60 days
9.7.1.2.3. Rebate is due every succeeding five years, if there are unspent
gross proceeds of the bonds
9.7.1.2.4. Final rebate payment is due 60 days after early redemption or
retirement of the bonds
9.7.1.3. Limitations on Type of Investments. Bond proceeds must be invested as
permitted under state law. In addition, the bond ordinance or any bond
insurance agreement may further limit the permitted investments. To
monitor compliance with these investment restrictions, the City invests bond
proceeds in State Local Government Investment Pool as well as other
investments authorized by the City's Investment Policy and Washington State
law.
9.7.1.4. Use of Bond Proceeds During the Construction Period.
9.7.1.4.1. Monitoring the expenditure of bond proceeds is necessary to
assure that the required amount of bond proceeds are
expended for capital expenditures and that not more than 10%
of the bond proceeds are expended for projects that will be
used for in a private trade or business (including by the federal
government and nonprofit entities).
9.7.1.5. The Chief Financial Officer is responsible for reviewing the transcript for the
bonds, and in particular, the authorizing documents and the federal tax
certificate, as well as invoices and other expenditure records to monitor that
the bond proceeds are spent on authorized project costs.
9.7.1.6. If, at the completion of the project, there are unspent bond proceeds, the
Chief Financial Officer, conferring with bond counsel, will direct application
of the excess proceeds for permitted uses under federal tax law, state law,
and bond authorization documents.
9.7.1.7. If the project involves bond proceeds and other sources of funds and
included both governmental and nongovernmental use of the financed
facilities the Chief Financial Officer will undertake a final reconciliation of
bond proceeds expenditures with project costs no later than 18 months after
the later of the date of expenditure or the date that the project is placed in
service (but in no event more than five years after the date of issue).
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9.8. Use of Bond -Financed Facilities:
9.8.1. Monitoring (and limiting) any private use of the bond -financed facility is important to
maintaining the federal tax treatment of governmental bonds. In general, no more than
10% of the bond -financed facility can be used in a private trade or business (including by
the federal government and nonprofit entities). Private use can arise through any of the
following arrangements, either directly or indirectly.
9.8.2. Types of Private Use
9.8.2.1. Selling all or a portion of the facility
9.8.2.2. Leasing all or a portion of the facility
9.8.2.3. Entering into a management contract for the facility (except for qualified
management contracts under IRS Rev. Proc. 97-13)
9.8.2.4. Use of all or a portion of the facility for research purposes under a research
contract (except for qualified research contracts under IRS Rev. Proc. 97-14)
9.8.2.5. Entering into contracts giving "special legal entitlement" to the facility (for
example, selling advertising space or naming rights)
9.8.3. Procedures for monitoring private use; procedures reasonably expected to timely
identify noncompliance.
9.8.3.1. All leases and other contracts involving bond -financed property will be sent
prior to execution to the Chief Financial Officer for review.
9.8.4. Procedures ensuring that the City will take steps to timely correct noncompliance.
9.8.4.1. If the City takes official action to sell, lease or otherwise change the use of
bond -financed facilities to private use, action should be taken under Treas.
Reg. § 1.141-12 within 90 days to apply net proceeds of the sale or lease of
the facility to other qualifying capital expenditure or to redeem or defease
bonds. Upon a determination that there has been or could be a change in
use of a bond -financed facility under the monitoring procedures described
above, the Chief Financial Officer shall consult with bond counsel and apply
net proceeds of the change in use as required.
9.9. Continuing Disclosure:
9.9.1. The City is required to make annual filings with the Municipal Securities Rulemaking
Board ("MSRB") as described in the continuing disclosure undertaking for each bond
issue (which may include tax-exempt or taxable bonds), and to file notice of certain
material events.
9.9.1.1. Submissions will be made in electronic form through the MSRB's web -based
system known as Electronic Municipal Market Access ("EMMA"), currently
available at http://www.emma.msrb.org. Submissions will be made in word -
searchable PDF.
9.9.1.2. Annual filings to be made:
9.9.1.2.1. Financial information and operating data about the City
included in the Official Statement for the bonds
9.9.1.2.2. Change in fiscal year; other information described in the
continuing disclosure undertaking
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9.9.1.2.3. Audited financial statements
9.9.1.2.4. These reports must be filed no later than nine months (e.g.
September 30) for the majority of the City's bonds, and seven
months (e.g. July 31) with respect to one issue, after the end of
the City's fiscal year (the City's fiscal year currently ends
December 31)
9.10. Material event notices:
9.10.1. The City is required to provide or cause to be provided to the MSRB, in a timely manner,
notice of certain events with respect to the bonds. Amendments to SEC Rule 15c2-12
(the "Rule") in 2010 expanded the list of events requiring disclosure and added a 10 -day
compliance period for undertakings effective after December 1, 2010.
9.10.2. Generally, if any of the following events occur, the City shall provide, or cause to be
provided, to the MSRB, in a timely manner not in excess of ten business days after the
occurrence of the event, notice of the occurrence of the any of the following events
with respect to the bonds:
9.10.2.1. Principal and interest payment delinquencies
9.10.2.2. Non-payment related defaults, if material
9.10.2.3. Unscheduled draws on debt service reserves reflecting financial difficulties
9.10.2.4. Unscheduled draws on credit enhancements reflecting financial difficulties
9.10.2.5. Substitution of credit or liquidity providers, or their failure to perform
9.10.2.6. Adverse tax opinions, the issuance by the IRS of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB)
or other material notices or determinations with respect to the tax status of
the bonds, or other material events affecting the tax status of the bonds
9.10.2.7. Modifications to the rights of bondholders, if material
9.10.2.8. Bond calls, if material, and tender offers
9.10.2.9. Defeasances
9.10.2.10. Release, substitution, or sale of property securing repayment of the Bonds, if
material
9.10.2.11. Rating changes (both upgrades and downgrades)
9.10.2.12. Bankruptcy, insolvency, receivership or similar event of the City
9.10.2.13. The consummation of a merger, consolidation, or acquisition involving the
City or the sale of all or substantially all of the assets of the City, other than in
the ordinary course of business, the entry into a definitive agreement to
undertake such an action or the termination of a definitive agreement
relating to any such actions, other than pursuant to its terms, if material
9.10.2.14. Appointment of a successor or additional trustee or the change of name of a
trustee, if material
9.10.3. Procedure for ensuring that notice of the above events is provided to the responsible
individual(s) identified above: Chief Financial Officer (or the City Treasurer if assigned
the responsibility in writing by the Chief Financial Officer)
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9.10.4. Periodic check of information regarding bonds on EMMA. Periodically and at least prior
to each new bond issue, the City will search EMMA for its continuing disclosure filings to
confirm proper filings have been made.
9.11. Compliance with Bond Covenants:
9.11.1. Particularly for revenue bond issues, the City has made rate and other covenants for the
benefit of bond owners. The City monitors compliance with these bond covenants on
an annual basis, as part of its annual audit process. These covenants are summarized
below:
Covenant
Requirement
Document; Section
Timing
Rates
Insurance
Sale or disposition
of property
Debt Service
Reserve Fund
Balance
9.11.2. Other Reports. Under the terms of bond insurance policies, letter of credit
reimbursement agreements, debt service reserve surety agreements, financing
agreements, loan agreements, and remarketing agreements, the City may be required
to send copies of budget, disclosure and other documents as well as notice of the
issuance of additional bonds, events of default, redemptions or defeasances, or
amendments to the bond documents. The following entities are required to receive
copies of the following documents or notices.
Entity Type Name/Contact Document; Section Requirement Timing
Bond Insurer
Letter of Credit Bank
Underwriter/Remarketing Agent
Bank
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3.04.030 Annual budget.
3.04.040 Contingency fund created.
3.04.010 Fiscal year designated.
The fiscal year of the City shall commence on January 1 st and end on December 31 st of each year.
(Ord. 2790 § 1, 9/11/1992)
3.04.020 Adoption of State law.
Chapter 35A.33 of the Revised Code of Washington provides for the establishment and administration
of annual budgets by non -charter code cities in the State of Washington. Said chapter, including
amendments which may be hereafter enacted, is hereby adopted by reference.
(Ord. 2710 § 1, 9/91/1992)
3.04.030 Annual budget.
The fiscal annual budget for the City of Port Angeles shall be in effect for the period of January 1,
1993, through December 31, 1993, and for succeeding annual budgets as designated in PAMC
3.04.010.
(Ord. 2710 § 1, 9/11/1992)
3.04.040 Contingency fund created.
There is created a fund in the City Treasury which shall be called the "Contingency Fund." This fund
shall be used for the purposes, and in the manner, set forth in RCW 35A.33.1.45 and-RM...35A.33.146 as now or hereafter amended.
(Ord. 2710 § 1, 9/11/1992)
Port Angeles, Washington, Code of Ordinances >> Title 3 - REVENUE AND FINANCE >> CHAPTER 3.05
PURCHASING POLICIES AND PROCEDURES >>
CHAPTER 3.05 PURCHASING POLICIES AND PROCEDURES
3.05.005 Definitions.
3.05.010 Review and approval of purchase orders
3.05.020 Pre aration of claims.
3.05.030 Validity of checks.
3.05.040 Al3proval of payment of claims.
3.05.050 Lowest -responsible bidder.
3.05.055 Bid inspection.
3.05.050 Authority to enter Into contracts, leases or rental agreements.
3.05.070 Small purchase contracts.
3.05.080 MRSC rosters.
3.05.055 Small works rosters,
3.05.090 Consulting services rosters.
3.05.100 Public inspection of purchase, small works roster, or limited public works awards.
3.05.110 Change orders on construction contracts and amendments to professional service,_,ayreements,
3.05.120 Definition of credit card,
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3.05.130 Issuance, use and control of credit cards.
3.05.140 Pollution control facilities, equipments systems or appurtenances
3.05.005 Definitions.
The definitions in RCW 39.04.010 are adopted by this reference.
(Ord. 3309, 1211412007)
3.05.010 Review and approval of purchase orders.
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It shall be the responsibility of each Department Head of the City to review and approve or disapprove
all purchase orders for his or her Department. It shall be the responsibility of the Finance Director to
review and approve or disapprove all purchase orders in excess of $5,000.00. All purchase orders in
excess of $15,000.00 shall be approved by the City Manager or designee. All purchase orders in
excess of $25,000.00 shall be approved by the City Council.
(Ord. 3264 § 1, 1219512006; Ord. 2628 § 1, 21151199 1)
3.05.020 Preparation of claims.
All claims for payment shall be submitted to the Finance Department with documentation certifying
that (1) the materials have been furnished, the services rendered, or the labor performed as
described, and (2) the claim is a just, due and an unpaid obligation against the City.
(Ord. 3264 § 1, 1211512006; Ord. 2628 § 2, 211511991)
3.05.030 Validity of checks.
To be valid, all checks in payment of claims must be signed by both the City Manager and the
Finance Director.
(Ord. 3264 § 1, 12115/2006; Ord. 2628 § 3, 21151199 1)
3.06.040 Approval of payment of claims.
It shall be the duty of the Finance Director to present not less frequently than once each month a list
showing all claims paid and the date of such payment to enable the City Council to make inquiry on
any item appearing thereon. Upon the satisfaction of such inquiry, if any, the City Council shall by
motion approve the report of claims paid and order the same fled as a permanent record.
(Ord. 3264 § 1, 1211512006; Ord. 2628 § 4, 211511991)
3.06.050 Lowest responsible bidder.
A. Before award of a public works contract, a bidder must meet the following responsibility criteria
to be considered a responsible bidder and qualified to be awarded a public works project. The
bidder must:
1 At the time of bid submittal, have a certificate of registration in compliance with chapter
18.27 RCW;
2• Have a current Washington state unified business identifier number;
3• If applicable, have industrial insurance coverage for the bidder's employees working in
Washington as required in Title 51 RCW; and employment security department number
as required in Title 50 RCW; and a state excise tax registration number as required in
Title 82 RCW; and
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4. Not be disqualified from bidding on any public works contract under RCW 3.06.010 or
39.12.065(3).
B. Supplemental criteria: In addition to the bidder responsibility criteria in subsection A. above,
when the City receives bids or quotes and it is necessary to determine the lowest responsible
bidder, the following shall apply:
For a contract for purchase of supplies, material or equipment, the City may take into
consideration the quality of the articles proposed to be supplied, their conformity with the
specifications, and the times of delivery.
2. In determining "lowest responsible bidder', in addition to price, the following elements
shall be given consideration:
a• The ability, capacity, and skill of the bidder to perform the contract;
b• The reputation, ability, experience, and efficiency of the bidder;
C. Whether the bidder can perform the contract within the time specified;
d. The quality of performance of previous contracts;
e• The previous and existing compliance by the bidder with laws relating to the
contract;
f Tax revenue that the City would receive from purchasing the supplies, materials,
or equipment from a supplier located within the City's boundaries, so that the
purchase contract would be awarded to the lowest bidder after such tax revenue
has been considered. The tax revenues that the City may consider include sales
taxes that the City imposes upon the sale of such supplies, materials, or
equipment, from the supplier to the City, provided that if the City considers such
tax revenues that it would receive from the imposition of taxes upon a supplier
located within its boundaries, the City shall also consider tax revenues it would
receive from taxes it imposes upon a supplier located outside its boundaries;
9• if products are available that meet the contract specifications and requirements
and that are made from recycled materials or may be recycled, whether the
products are specified in the bid are made from recycled materials or may be
recycled or reused; and
h• Other criteria applicable to the particular contract and provided in the invitation to
bid.
3• Supplemental criteria for determining bidder responsibility, including the basis for
evaluation and the deadline for appealing a determination that a bidder is not
responsible, must be provided in the invitation to bid or bidding documents.
4• In a timely manner before the bid submittal deadline, a potential bidder may request that
the City modify the supplemental criteria. The City must evaluate the information
submitted by the potential bidder and respond before the bid submittal deadline. if the
evaluation results in a change of the criteria, the City must issue an addendum to the
bidding documents identifying the new criteria.
5. If the bidder fails to supply information requested concerning responsibility within the
time and manner specified in the bid documents, the City may base its determination of
responsibility upon any available information related to the supplemental criteria or may
find the bidder not responsible.
6. If the City determines a bidder to be, not responsible, the City must provide, in writing,
the reasons for the determination. The bidder may appeal the determination within the
time period specified in the bidding documents by presenting additional information to
the City. The City must consider the additional information before issuing its final
determination. If the final determination affirms that the bidder is not responsible, the
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City may not execute a contract with any other bidder until two business days after the
bidder determined to be not responsible has received the final determination.
C. Subcontractors. A public works contractor must verify responsibility criteria for each first tier
subcontractor, and a subcontractor of any tier that hires other subcontractors must verify
responsibility criteria for each of its subcontractors. Verification shall include that each
subcontractor, at the time of subcontract execution, meets the responsibility criteria listed in
subsection A. and possess an electrical contractor license, if required by chapter 19.28 RCW,
or an elevator contractor license, if required by chapter 70.87 RCW. This verification
requirement, as well as the responsibility criteria, must be included in every public works
contract and subcontract of every tier.
D. The Director of Public Works and Utilities shall apply the criteria established in this section
3.05.050 and determine whether a bidder is responsible. An appeal, as provided in B.3. above
shall be heard and determined by the City Manager, whose decision shall be final.
(Ord, 3309, 12/14/2007, Ord. 3264 § 1, 12/15/2006)
3.05.055 Bid inspection.
Immediately after the award is made, the bid quotations obtained shall be recorded, open to public
inspection, and available by written, telephonic, or electronic request.
(Ord. 3309, 12/14/2007)
3.05.060 Authority to enter into contracts, leases or rental agreements.
The City Manager or his designee is hereby authorized to enter into contracts and leases or rental
agreements provided that the following conditions are met:
A. The contract does not obligate the City to expend in excess of $25,000.00.
B. The particular expenditure of City funds has been approved in the City Budget as
approved by the City Council.
C. The lease or rental agreement is for a period that does not exceed one year and
involves a total rental amount or value that does not exceed $25,000.00. As deemed
appropriate by the City Manager, the City Council's Real Estate Committee may be
consulted prior to executing any such lease or rental agreement.
D. The City Manager or his designee shall notify the Council in writing of contracts entered
into pursuant to this section.
(Ord. 3264 § 1, 12115/2006)
3.05.070 Small purchase contracts.
A. Whenever the reasonably anticipated purchase price of supplies, material and equipment,
except for public work or improvement, is more than $7,500.00 but less than $15,000.00,
advertisement and formal sealed bidding for their purchase may be dispensed with if the
uniform procedure provided in RCW 39.04.190 and in this section is followed.
B. At least twice per year, the City Clerk shall publish in a newspaper of general circulation within
the City a notice stating the existence of vendor lists and soliciting the names of vendors for the
lists.
C. Each City department that desires to award contracts for the purchase of supplies, material or
equipment pursuant to this process shall do the following:
Obtain at least three written or telephone quotations from different vendors of the
supplies, material or equipment to be purchased.
2.
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Transmit the quotes to the City Manager or designee, accompanied by a
recommendation for award of the purchase contract to one of the vendors, who shall be
the lowest responsible bidder as defined in RCW 43.19.1911 and in section 050 of this
chapter.
If less than three quotes are obtainable due to factors beyond the control of the
department, the recommendation to the City Manager or designee shall be
accompanied by an explanation of the reasons for the lower number of quotes.
(Ord. 3264 § 1, 1211512008)
3.05.080 MRSC rosters.
The City has contracted with and hereby is authorized to use the Municipal Research and Services
Center of Washington (MRSC) for the City use of state wide electronic databases for small works
roster and consulting services developed and maintained by MRSC. In addition, paper and/or
electronic rosters may be kept on file by appropriate City Departments.
(Ord. 3317 § 2, 211512008)
3.05.085 Small works rosters.
The following small works roster procedures are established for use by the City pursuant to RCW
39.04.155:
A. Cost. The City need not comply with formal sealed bidding procedures for the
construction, building, renovation, remodeling, alteration, repair, or improvement of real
property where the estimated cost does not exceed $300,000.00, which includes the
costs of labor, material, equipment and sales and/or use taxes as applicable. Instead,
the City may use the small works roster procedure for public works projects as set forth
herein. The breaking of any project into units or accomplishing any projects by phases is
prohibited if it is done for the purpose of avoiding the maximum dollar amount of a
contract that may be let using the small works roster process.
B. Publication. At least once a year, on behalf of the City, MRSC shall publish in a
newspaper of general circulation within the jurisdiction a notice of the existence of the
roster or rosters and solicit the names of contractors for such roster or rosters.
Responsible contractors shall be added to appropriate MRSC roster or rosters at any
time that they submit a written request and necessary records. The City may require
master contracts to be signed that become effective when a specific award is made
using a small works roster.
C. Telephone or written quotations. The City shall obtain telephone, written or electronic
quotations for public works contracts from contractors on the appropriate small works
roster to assure that a competitive price is established and to award contracts to a
contractor who meets the mandatory bidder responsibility criteria in Section 3.05.050 of
this chapter.
1 • A contract awarded from a small works roster need not be advertised. I nvitations
for quotations shall include an estimate of the scope and nature of the work to be
performed as well as materials and equipment to be furnished. However, detailed
plans and specifications need not be included in the invitation.
2. Quotations may be invited from all appropriate contractors on the appropriate
small works roster. As an alternative, quotations may be invited from at least five
contractors on the appropriate small works roster who have indicated the
capability of performing the kind of work being contracted, in a manner that will
equitably distribute the opportunity among the contractors on the appropriate
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roster. "E=quitably distribute" means that the City may not favor certain contractors
on the appropriate small works roster over other contractors on the appropriate
small works roster who perform similar services.
If the estimated cost of the work is from $150,000.00 to $300,000.00, the City
may choose to solicit bids from less than all appropriate contractors on the
appropriate small works roster but must notify the remaining contractors on the
appropriate small works roster that quotations on the work are being sought. The
City has the sole option of determining whether this notice to the remaining
contractors is made by:
a Publishing notice in a legal newspaper in general circulation in the area
where the work is to be done;
b• Mailing a notice to these contractors; or
G. Sending a notice to these contractors by facsimile or email.
3. At the time bids are solicited, the City representative shall not inform a contractor
of the terms or amount of any other contractor's bid for the same project.
4. A written record shall be made by the City representative of each contractor's bid
on the project and of any conditions imposed on the bid. Immediately after an
award is made, the bid quotations obtained shall be recorded, open to public
inspection, and available by telephone inquiry.
D. Limited public works process. if a work, construction, alteration, repair, or improvement
project is estimated to cost less than $35,000.00, the City may award such a contract
using the limited public works process provided under RCW 39.04.155(3). For a limited
public works project, the City will solicit electronic or written quotations from a minimum
of three contractors from the appropriate small works roster and shall award the contract
to the lowest responsible bidder as defined under RCW 39.04.010. After an award is
made, the quotations shall be open to public inspection and available by electronic
request.
For limited public works projects, the City may waive the payment and performance
bond requirements of Chapter 39.08 RCW and the retainage requirements of Chapter
60.28 RCW, thereby assuming the liability for the contractor's nonpayment of laborers,
mechanics, subcontractors, materialmen, suppliers, and taxes imposed under Title 82
RCW that may be due from the contractor for the limited public works project. However,
the City shall have the right of recovery against the contractor for any payments made
on the contractor's behalf.
The City shall maintain a list of the contractors contacted and the contracts awarded
during the previous 24 months under the limited public works process, including the
name of the contractor, the contractor's registration number, the amount of the contract,
a brief description of the type of work performed, and the date the contract was
awarded.
E. Award. All of the telephone bids or quotations shall be collected and presented at the
same time to the Council for consideration, determination of the lowest responsible
bidder, and award of the contract.
(Ord. No. 3435, § 1(t), 9-5-2099, Ord. 3317§ 3, 2/95/2008)
3.05.090 Consulting services rosters.
A. Consulting services. Consulting services are professional services that have a primarily
intellectual output or product and include architectural and engineering services as defined in
RCW 39.80.020.
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B. Publication. At lease once a year, on behalf of the City, MRSC shall publish in a newspaper of
general circulation within the jurisdiction a notice of the existence of the consulting services
roster or rosters and solicit statements of qualifications from firms providing consulting
services. Such advertisements will include information on how to find the address and
telephone number of a representative of the City who can provide further details as to the City's
projects needs for consulting services. Firms or persons providing consulting services shall be
added to appropriate MRSC roster or rosters at any time that they submit a written request and
necessary records. The City may require master contracts to be signed that become effective
when a specific award is made using a consulting services roster
C. Professional architectural and engineering services. The MRSC Rosters will distinguish
between professional architectural and engineering services as defined in RCW 39.80.020 and
other consulting services and will announce generally to the public the City's projected
requirements for any category or type of professional or other consulting services. The City
reserves the right to publish an announcement on each occasion when professional services or
other consulting services are required by the agency and to use paper and/or other electronic
rosters that may be kept on file by appropriate City departments.
(Ord. 3317 § 4, 2/95/2008)
3.05.100 Public inspection of purchase, small works roster, or limited public works
awards.
A. Each department that makes an award for a purchase contract under the informal bidding
process in section 3.05.070 of this chapter shall provide the City Clerk with the name of the
contractor or vendor awarded the contract, the amount of the contract, a brief description of the
type of work performed or items purchased under the contract, and the date it was awarded.
B. The City Clerk shall post a list of the contracts awarded under section 3.05,070 of this chapter
at least once every two months. The lists shall contain the name of the contractor or vendor
awarded the contract, the amount of the contract, a brief description of the type of work
performed or items purchased under the contract, and the date the contract was awarded. The
lists shall also state the location where the bid quotations for these contracts are available for
public inspection. The quotations shall be available by written, telephonic, or electronic request.
(Ord. 3264 § 1, 12115/2006)
3.05.770 Change orders on construction contracts and amendments to professional
service agreements.
A. In accordance with the terms and conditions of this section, the City Manager and the
respective department head are hereby authorized to approve and sign change orders on
construction contracts, and amendments to professional services agreements, if the change
order or the amendment does not substantially change the scope of the project, the total
contract amount as adjusted is within the amount budgeted for the project, and the change
order or amendment meets the criteria stated below.
B. If the total amount of a change order for a construction contract or an amendment to a
professional services agreement is $5,000.00 or less, the respective department head may
approve the change orders or the amendment for professional services agreements.
C• If the amount of a construction contract change order is between $5,000.00 and $100,000.00,
or a professional services agreement amendment is between $5,000.00 and $25,000.00 it
must be approved and signed by the City Manager.
D. Change orders and amendments may be approved as provided in this section subject to the
following limitations:
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1. For a construction contract or a professional services agreement with an original cost
less than $100,000.00, the total of all change orders or amendments shall not exceed
$15,000.00.
2. For a construction contract with an original cost of $100,000.00 or more, change orders,
in total, may be issued for 15 percent of the original contract amount, or $100,000.00,
whichever is less. For a professional services agreement with an original not -to -exceed
cost of $25,000.00 or more, change orders, in total, may be issued for 15 percent of the
original amount, or $25,000.00, whichever is less.
F• If the amount of the change order is in excess of the City Manager's authority, it must be
approved by the City Council.
F. When approval occurs by the City Manager or respective department head for change orders,
or professional services agreement amendments, according to the conditions stated above ,
they shall notify the City Council of the change order or amendment in the next bi-monthly
contract status report submitted to City Council.
(Ord. No. 3435, § 9(I!), 9-6-2011; Ord. 3264 § 1, 12/95/2006)
3.05.120 Definition of credit card.
As used in this chapter, "credit card" means a card or device issued under an arrangement pursuant
to which the issuer gives to a cardholder the privilege of obtaining credit from the issuer.
(Ord. 3264 § 1, 12/15/2006; Ord. 3011 § 1, 2126/1999)
3.05.130 Issuance, use and control of credit cards,
The City Council hereby adopts the following system for the issuance, use and control of credit cards
by City officials and employees:
A- The Finance Department shall implement the following system for the distribution,
authorization, control, credit limits and payment of bills related to the use of credit cards
by City officials and employees:
1 Distribution. Credit cards will be distributed to those City officials and employees
who have job responsibilities which would be facilitated by the use of a credit
card and the credit card use would benefit the City. This shall include the City
Council, City Manager, Department Heads, Division Managers, and other officials
and employees as determined by the City Manager.
2. Authorization and control. The Finance Department shall develop the
implementation guidelines and accounting controls to ensure the proper usage of
credit cards and credit card funds.
3. Credit limits. The Finance Department shall set credit limits on each credit card
issued. The credit limit shall not exceed $2,500.00 without written approval of the
City Manager.
4• Payment of bills. The Finance Department shall establish and implement a
written procedure for the payment of all credit card bills.
5. Unauthorized charges. No employee shall use the City -issued credit card for non -
City business use. Any employee who violates this policy by using a City -issued
credit card for non -City business shall be subject to disciplinary action and shall
be billed for all charges on the credit card. The City Manager or his/her designee
is authorized and directed to make payroll deductions to recover any
unauthorized charges.
6. Cash advances. Cash advances on credit cards are prohibited.
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B. The Finance Department is authorized to adopt any additional procedures or policies
necessary to implement the provisions of this section.
(Ord. 3264 § 1, 12/15/2006; Ord. 3011 § 2, 212 611 9 9 9)
3.05.140 Pollution control facilities, equipments, systems, or appurtenances.
All pollution control facilities as defined in RCW 70.95A may be constructed, reconstructed, improved,
or procured without restriction imposed on the procedure for award of contracts for such purpose or
the lease, sale or other disposition of property.
(Ord. No. 3433, § 1, 7-5-2011)
Port Angeles, Washington, Code of Ordinances >a Title,3 - REVENUE AND FINANCE >> CHAPTER 3.06
INVESTMENT OF FUNDS >>
CHAPTER 3.06 INVESTMENT OF FUNDS
3.06.010 General standards.
3.06.020 Finance Committee established
3.06.030 Report to State Commission
3.06.010 General standards.
The following general standards shall govern the investment of City funds:
A. All funds not required for immediate expenditure are available for investment.
B. The Finance Director or City Treasurer, under the guidance of the Finance Committee,
shall determine the amount of money available in each fund for investment purposes
and shall make investments in accordance with State Statutes applicable thereto,
including RCW 35A.40.050 and the policies of the City.
C. All monies available for investment shall be commingled when possible or practical
within one common investment portfolio for the mutua[ benefit of all participating funds,
and all income derived therefrom shall be apportioned among the various participating
funds in direct proportion of the amount of money invested by each.
(Ord, 1882 § 1, 6124/1976)
3.06.020 Finance Committee established.
There is hereby established a Finance Committee to be composed of three Councilmembers, the City
Manager, Director of Finance and Administrative Services and the City Treasurer. The duties of the
Committee are as follows:
A. To review the financial operation of the City and to recommend such policies from time
to time to the City Council as required to improve the financial operation of the City.
B. To review the investment program of the City and to act in an advisory capacity to the
Director of Finance and Administrative Services and City Treasurer.
C. To recommend, in accordance with RCW 35A.40.030, to the City Council the bank or
banks which shall be the depository of city funds.
(Ord. 2344 § 1, 6/11/1985; Ord. 1882 § 2, 6/24/1976)
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3.06.030 Report to State Commission.
Page 11 of 74
The City Treasurer shall, on or before April 15th of each calendar year, file with the Public Disclosure
Commission all necessary statements required under RCW 42.17.245.
(Ord. 2344 § 2, 6/91/7985; Ord. 1882 § 3, 6124/9976)
Port Angeles, Washington, Code of Ordinances >> Title 3 - REVENUE AND FINANCE >> CHAPTER 3.12
SALES OR USE TAX >>
CHAPTER 3.12 SALES OR USE TAX Ll
3.12.010 Imposition.
3.12,020 Rate,
3.12.030 Administration and collection.
3.12.040 Inspection of records.
3.12.050 Contract with Department of Revenue.
3.12.060 Failure to pay or collect.
3.12.010 Imposition.
There is imposed a sales or use tax, as the case may be, upon every taxable event, as defined in
RCW 82.14.020 occurring within the City. The tax shall be imposed upon and collected from those
persons from whom the State sales or use tax is collected pursuant to Chapters 82.08 and 82.12
RCW.
(Ord. 1686 § 1, 5/27/1970)
3.12.020 Rate.
The rate of the tax imposed by section 3.12.010 shall be one-half of one percent of the selling price or
value of the article used, as the case may be. Provided, however, that during such period as there is
in effect a sales or use tax imposed by Clallam County, the rate of tax imposed by this chapter shall
be four hundred twenty-five one -thousandths of one percent.
(Ord. 1686 § 2, 5/27/1970)
3.12.030 Administration and collection.
The administration and collection of the tax imposed by this chapter shall be in accordance with the
provisions of RCW 82.14.050.
(Ord. 1586§3, 5127/1970)
3.12.040 Inspection of records.
The City consents to the inspection of such records as are necessary to qualify the City for
inspections of records of the Department of Revenue, pursuant to RCW 82.32.330.
(Ord. 1686 § 4, 5/27/1970)
3.12.060 Contract with Department of Revenue.
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