Fiscal Policies Or k
City of Grand Terrace
Fiscal Policies
revised
November 16 , 2016
City of Grand Terrace
Fiscal Policies
Table of Contents
Policies Related to Safeguarding of Assets (Section 1) Page
• Cash Handling & Control (1.01)........................................................................ 3
• Petty Cash Funds & Change Boxes (1.02)..................................................... 11
• Accounts Receivable (1.03)............................................................................ 15
- Application for Discharge of Accountability (Exhibit A).............................. 21
• Investments (1.04)..........................................................................................23
• Fixed Assets (1.05).........................................................................................27
• Disposition of Surplus Property (1.06)............................................................ 31
- Surplus Property Form (Exhibit A).............................................................33
• Fraud Prevention & Detection (1.07).............................................................. 35
Policies Related to Liability (Section 2)
• Accounts Payable (2.01) ................................................................ ....43
Policies Related to General Fiscal Management (Section 3)
• Purchasing (3.01.01) .....................................................................................47
- Environmentally Preferred Purchasing (3.01.02)....................................... 53
• Budget Appropriation Adjustments (3.02).. . ............ . ....... ............ ... . .. . . . 61
- Budget Appropriation Adjustment Form (Exhibit A)...................................65
• Travel & Related Business Expenses (3.03).................................................. 67
- Travel Authorization & Expense Reporting Form (Exhibit A)..................... 77
• Grants (3.04) ............ .................................................................................... 79
- Grant Proposal Informational Form (Exhibit A)..........................................85
- Grant Cost/Benefit Worksheet(Exhibit B)................................................. 87
• Donations (3.05).............................................................................................89
- Donation Receipt Form (Exhibit A)............................................................93
• Reserves (3.06)..............................................................................................95
• Unclaimed Money (3.07) ........,........ ............................................................1.99
- Sample Public Notice (Exhibit A)............................................................. 103
- Claim Form (Exhibit B)............................................................................ 105
2
City of Grand Terrace
Fiscal Policy Policy No. 1.01
Subject: Cash Handling & Control
Effective Date: 918114
Page I of
PURPOSE: The purpose of this policy is to establish the practice by which all cash receipts,
or cash equivalents, tendered to the City will be accepted, documented,
recorded, safeguarded and deposited. This policy is also intended to provide staff
with acceptable practices in the handling and safekeeping of cash or cash
equivalents.
DEFINITIONS:
Cashier: Anyone who accepts payments on behalf of the City.
Cash Receipts: Includes coin, currency, checks, money orders, or other cash
equivalents that may be processed by a financial institution. (Debit and credit
card payments are also considered Cash Receipts, although they are not
currently accepted by the City.)
Cash Receipt Location (CRL): A physical location, other than the Main Cashier
at City Hall, which has been designated as a location to collect and receipt cash
for the City of Grand Terrace.
Main Cashier: Located at the front counter of the Finance Department in City
Hall.
Point of Sale System (POS): A software program that can be run either on a
stand-alone computer or on a network and allows for the recording of cash
collection and receipting related to payments for goods or services.
Remote Deposit: The process for scanning and transmitting checks to the bank
electronically for deposit.
Returned Items: Transactions that have been presented to the bank for deposit
and returned to the City due to account balance or status issues. Such
transactions could include but are not limited to Non-Sufficient Funds (NSF) or
closed accounts.
Starter Checks: Checks that are issued to a bank depositor upon the opening of
a new checking account. These checks typically do not contain any address or
telephone information related to the depositor.
POLICY:
I. Responsibility
A. The Finance Director has oversight, fiduciary, and administrative responsibility for
all cash collections performed by City staff or on behalf of the City by contractors.
B. The Finance Director has the responsibility and authority to ensure that all cash
handling is performed according to this policy.
C. This responsibility shall include:
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City of Grand Terrace
Fiscal Policy Policy No. 1.01
i Subject: Cash Handling & Control Effective Date: 918114pa e 2 of 8
1. To act as an advisor for cash handling activities performed by City staff_
2. To oversee the cash handling activities on behalf of the City.
3. To verify that all deposits are handled and prepared in accordance with City
policy.
4. To review and implement internal controls as needed to ensure the safety of
City cash and cash equivalents.
II. Scope
A. This policy shall apply to all locations that collect cash or cash equivalents on behalf
of the City.
B. In some cases due to the nature of the collection activity, specialized procedures
may be developed which are different than those outlined within this policy. In these
cases these procedures must be approved by the Finance Director prior to their
implementation.
C. Entities that collect funds on behalf of the City, through a contractual relationship,
may adopt policies and procedures that differ from those outlined herein. In such
cases, these documents must be reviewed and approved by the Finance Director.
Ill. Internal Controls
A. Standard accounting internal control procedures will be established and followed.
B. Standard accounting internal controls include but are not limited to:
1. Separation of duties. (For example, the person preparing the deposit should be
different from the person who accepted the payment and receipted the
transaction, when it is practical to do so from a staffing standpoint.)
2. Periodic reconciliation of accounts by someone independent of the cash
handling or recording functions.
3. Document Control. Unused manual receipt books should be maintained in a
secured location with access limited to authorized staff.
IV. Collection Locations
A. The Main Cashier in the Finance Department is designated as the primary location
for the collection and deposit of cash receipts. A Cash Receipt Location has also
been authorized for the Community Development Department (CDD) counter and
Child Care Center.
B. Cash Receipts received by the City should be deposited in the City's bank
whenever accumulated deposits total$500 or more. Cash deposits will be made in
person at the bank; check deposits may be made in person at the bank or via
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City of Grand Terrace Policy No. 1.01
Fiscal Policy
Effective Date: 918114
Subject: Cash Handling & Control
Page 3 of 8
Remote Deposit. Deposits processed by the Child Care Center require a deposit
slip submitted to Finance for bank reconciliation purposes. When the appropriate
account coding is not immediately available, the payment should be deposited and
coded to a suspense account until such time that the coding is identified and
communicated to Finance staff. Items placed in suspense need to be identified and
reclassified to their correct account within ten working days or by the calendar
month-end.
C. Any request for the collection of cash receipts at a location other than the Main
Cashier, CDD counter or Child Care Center must be authorized by the Finance
Director and should include the following information:
1. How customer service will be improved through the processing of payments..
2. The cash custodian(s).
3. How cash activities will be accounted for (for example, cash register, hand
receipts, etc.).
4. How cash receipts will be safeguarded (for example, safe or lockbox)
5. How deposits will be managed.
D. A list of approved collection locations will be maintained by the Finance
Department.
E. All Cash Receipts will be maintained in a secured area with limited access.
F. The establishment of change funds to support collection operations will follow the
guidelines set forth in Fiscal Policy No. 1.02 (Petty Cash Funds & Change Boxes).
G. All City employees who handle cash will be included under the City's insurance
coverage.
V. Methods of Payment
A. The following methods of payment will be accepted:
1. Cash
2. Checks
3. Money Orders
4. Traveler's Checks
5. Wires 1 Electronic Funds Transfer(EFT)
6. Other forms of tender as approved by the Finance Director and the City's bank.
7. Credit Card Payments (Visa, Mastercard, or Discover)
8. Note: Debit card payments are currently not accepted but will be recognized
as an allowable payment method once the City has established the procedures
to process such payments.
B. Checks
1. Checks, Money Orders and Traveler's Checks are to be made payable to the
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City of Grand Terrace Policy No. 1.01
Fiscal Policy
Subject: Cash Handling & Control Effective Date: 918114
Page 4 of 8
City of Grand Terrace.
2. Change will not be made for checks written in excess of the invoice amount. In
cases where the amount of the check is in excess of the invoice amount the
difference will be refunded by means of a City check.
3. Personal Checks
a. Personal checks presented in person must have the customer's name and
address preprinted on the face of the check-
b. Starter/Blank checks are not to be accepted without the approval of the
Finance Director. Proper identification must be provided and the name,
address and phone number will be placed on the face of the check.
c. Returned items
L Returned Items will be subject to a returned check fee.
ii. The amount of the Returned Check Fee will be determined annually
and published in the City's Fee Schedule.
iii. Payors may not replace the returned item(s) in the same manner as
the original presentment. (For example if the customer provided an
NSF personal check they cannot replace this with another personal
check.)
iv. Upon the occurrence of a returned item, Finance staff will notify the
accepting department so that the related goods or services can be
held until the item is replaced.
v. The Finance Department will maintain a list of customers who have
presented payments that have been returned, The City may require
other forms of payment from customers who have recurring issues
with returned payments.
d, Checks will not be accepted for the following reasons:
i_ Post-Dated Checks (Checks written on a future date)
ii. Stale Dated Checks (Checks written 30 days prior)
iii. Checks drawn on foreign currency
e. The following personal check transactions will not be performed:
i. No cash may be given as change for a personal check transaction. If
a check is accepted for an amount greater than the cost of the
service, a payment request must be prepared and processed as a
refund once the check has cleared. In the case of business license
renewals, a credit may be applied to the account.
No Exceptions. (This constitutes an illegal loan of City funds.)
li. City employee personal checks will not be redeemed (cashed) for
cash.
iii. No two-party checks will be accepted, (A two-party check is made
payable to one party and endorsed to the City)
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City of Grand Terrace Policy No. 1.01
Fiscal Policy
Subject: Cash Handling & Control Effective Date: 9/8/14pa e 5 of$
f. When checks are received through the mail the following requirements will
be met:
i. Checks will be restrictively endorsed. The first employee at a Cash
Receipt Location to come in contact with a check is responsible to
have the check restrictively endorsed. Endorsement stamps will be
obtained from the Finance Director or his/her designee. In the case of
checks processed through the Remote Deposit process, the
endorsement is automatically generated.
ii. If the check is payable to the City but lacks sufficient information to
identify the appropriate general ledger account number, write
"SUSPENSE" on the deposit form and present to the Main Cashier or
Finance Department staff. The check will then be deposited into the
bank. When the appropriate general ledger account number is
identified, provide the coding to Finance so that the funds can be
properly applied to the account. The appropriate account should be
identified prior to the month-end closing.
4. Business Checks
Company checks will be inspected to ensure that multiple signatures are in
place if required or if a "not valid over V statement is included.
5. Traveler's Checks
a. Traveler's checks are treated as cash but will require the following
actions:
i. Cashier must witness the customer write in the payee.
ii. Cashier must witness the customer countersign the check.
iii. Signature and countersignature should be compared.
b. Identification will be required.
c. No traveler's checks drawn an foreign funds will be accepted.
6. Cashier's Checks/ Personal Money Orders
a. Cashier's Checks and Personal Money Orders will be accepted.
b. Identification will be required.
7. Currency
a. Anyone receiving cash payments is responsible for exercising
reasonable care in screening cash transactions for counterfeit currency.
b. Mutilated currency is still legal tender. Staff may ask customers to
substitute another bill for the mutilated bill. If they cannot substitute the
bill staff must accept the mutilated bill.
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City of Grand Terrace Policy No. 1.01
Fiscal Policy
Subject: Cash Handling & Control Effective Date: 918114
Page 6 of 8
L Currency is considered mutilated if it is torn, written on, missing a
portion, or otherwise damaged.
ii. Mutilated currency will be exchanged at full value if 3/ of the two serial
numbers are present. Currency that is less than 3/ intact will riot be
accepted due to its diminished redemptive value.
iii. Mutilated currency should be removed from the deposit and returned
separately to the bank for collection.
8. Wires/ Electronic Fund Transfers (EFT)
a. All wires or EFTs are to be coordinated through the Finance Director or
his/her designee.
b. Documentation supporting the wirelEFT and identifying the correct
revenue coding will be provided to Finance staff prior to the anticipated
date of receipt. This will assist Finance staff in their daily cash
management planning.
VI. Documentation of Transactions
A. All transactions will be recorded by means of an acceptable method of
documentation.
B. Acceptable methods of documentation include:
1. Cash Register
2. Point of Sale System (POS)
3. Manual Receipt books as issued by the Finance Department.
C. Customers must always be provided a receipt which provides the following
information:
1. Amount Paid
2. Date of Transaction
3. Service or Product provided
4. Manner of payment
D. Receipts
1. Receipts provided to customers will be pre-numbered and issued in numerical
sequence by the receipting location (Finance, CDD counter and Child Care
Center).
2. Manual Receipting will be performed when necessary (e.g., during power
outages, computer system failures, or special events) by utilizing City of Grand
Terrace receipt books, which are maintained and issued by the Finance
Department.
3. Receipts generated by POS systems or cash registers should have a system
generated receipt number that should be unique and should be issued in
sequence.
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City of Grand Terrace
Fiscal Policy_ Policy No. 1.09
Subject: Cash Handling & Control Effective Date: 9/8/14pa e 7 of 8
E. When City of Grand Terrace manual receipts are issued, copies will be distributed in
the following manner:
1. Customer
2. Issuing department
3. Cash drawer/transaction
4. Receipt book
VII. Balancing and Reconciling
A. It is the responsibility of each cashier to balance and reconcile his/her cash
drawer(s) daily. Cash drawer(s) should be equal to the change fund plus the
balance of cash receipt activity for the day or shift.
B. Cash drawer(s) should be reconciled against the daily cash receipts report, cash
register tape or calculator tape depending on whether the site uses a POS system,
a cash register, or manual receipts.
C. Overage 1 Shortage
1. When the amount in the cash drawer does not balance with the daily report,
staff will report an Overage or a Shortage as appropriate.
2. When an Overage or Shortage is identified, staff will complete the City of
Grand Terrace Overage/Shortage Form and submit with their deposit.
3. The Overage/Shortage form will require the following information:
a. Date of Deposit
b. Amount of overage/shortage
c. Reason for overage/shortage
d. Signature of staff responsible for drawer
e. Signature of supervisor
4. The Overage/Shortage Form must accompany deposit to the Main Cashier.
5. Overages or Shortages in excess of $10 must be immediately brought to the
attention of the Finance Director or his/her designee upon identification.
6. Under no circumstances is City staff allowed to balance averages by keeping
the overage out of the deposit or balance shortages by taking money from
other sources, such as out of pocket or money held back from a previous
overage.
Vill. Requirements for Deposit
A. All cash receipts will be deposited into the City's bank account in a timely manner to
ensure the proper posting of accounts and to ensure the safety of staff and City
funds.
1. Deposits can be made at the Main Cashier during City Hall business hours.
2. Deposits not taken to the bank the same day will be secured by Finance staff in
a fireproof and locked cabinet or safe. A drop safe is utilized at the Child Care
Center for checks not processed the same day as received. No cash is to be
dropped off.
City of Grand Terrace
Fiscal Policy Policy No. 1.01
i Subject: Cash Handling & Control Effective Date: 918114
Page 8 of 8
B. All Cash Receipt Locations will prepare deposits whenever accumulated deposits
total $500 or more.
C. Funds received by staff who are not designated as a Cash Receipt !rotation must
be forwarded to the Finance Department the same day as received.
D_ Cash Receipts are not to be sent through the City's interoffice mail system.
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City of Grand Terrace
Fiscal Polic Policy No. 1.02
Da_ 5113/14
Subject: Petty Cash Funds & Change Boxes Effective Date:Page 1 of 4
PURPOSE: For Petty Cash — To authorize the use of petty cash funds for emergency
purchases and minor out-of-pocket expense reimbursement.
For Change Boxes —To authorize change boxes for the sole purpose of making
change.
DEFINITIONS: Petty Cash is defined as a small fund of cash that is maintained for the payment
of incidental expenses. It may also be advanced to employees on an exception
basis to make small, incidental purchases where payment by check is not
possible or not feasible given the circumstances. It is also available on an
exception basis to reimburse City officials or employees for prior-approved, City
business-related purchases which were originally paid out-of-pocket, and where
reimbursement by check is not feasible under the circumstances.
Change Box is defined as a small fund of cash requiring a particular mix of
denominations of dollar bills and coinage for the explicit purpose of making
change. Reimbursements and advances for incidental City purchases may not
be made from a change fund.
POLICY:
I. Approval to Make Purchases or Receive Reimbursement from Petty Cash
A. Advance approval from the employee's department head must always be
obtained to make a Petty Cash purchase or to be reimbursed for out-of-pocket
expenses from Petty Cash. Without prior approval, there should be no
expectation that an out-of-pocket expense will be reimbursed by Petty Cash. For
recurring purchases, a standing approval may be given by the department head
so that advance approval is not needed for each transaction.
B. Use of Petty Cash is considered an exception to the standard means of procuring
supplies. Issuance of a City check shall be the preferred method of procurement.
I[. Establishment_and Authorization of Petty Cash Funds
A. Petty Cash funds have been established in the following amounts:
City Hall (Finance Department) $550
Child Care Center $500
Community Services * $100
* Maintained in the Finance Department and used for special events such as Animal Licensing.
B. Increasing the above amounts or establishing any additional Petty Cash funds
requires written recommendation by the applicable department head and Finance
Director, and approval by the City Manager.
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City of Grand Terrace Policy No. 1.02
Fiscal Policy
Subject; Petty Cash Funds & Change Boxes Effective Date: 5113/14
Page 2 of 4
Ill. Maximum Limit For Petty Cash Expense or Reimbursement
A. The maximum amount or Petty Cash that may be used for a particular expense
or reimbursement shall be as follows:
City Hall Petty Cash $200
Child Care Center Petty Cash $200
B. Any request to exceed above limits limit must be approved by the Finance
Director or his/her designee_
IV. Responsibilities and Procedures
A_ Fund Custodians
1. Finance Department staff shall maintain the City Hall Petty Cash fund.
The Petty Cash fund maintained at the Child Care Center shall have a
fund custodian appointed by the department head and an appropriate
authorization form on file with the Finance Department.
2. At all times, and without exception, the total Petty Cash fund shall consist
of cash or a combination of cash and approved Petty Cash Request
Forms, which together total the authorized amount of the fund, as
identified in Section ILA of this Policy.
B. Procedures for Advancement of Petty Cash for Incidental Purchases
1, Whether the request is to utilize the City Hall or Child Care Center Petty
Cash fund, the requesting department or individual must complete a Petty
Cash Request Form, which shall provide the date, dollar amount
requested, description, account number to be charged, and the
appropriate signature approvals.
2. In the event the amount requested exceeds the limits set forth in Section
III.A of this policy, the signature of the Finance Director of his/her
designee shall be obtained to approve the disbursement.
3. The Petty Cash Request Form must clearly indicate if the monies are
being "Advanced".
3. A receipt or other supporting documentation substantiating a purchase is
to be obtained from the employee within two (2) working days following
the purchase.
4. If the purchase was for less than the advanced amount, the fund
custodian must note the actual amount on the voucher form, obtain the
difference in cash from the recipient, and return this amount to the Petty
Cash fund. The recipient and fund custodian should initial the revised
voucher form as concurrence.
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City of Grand Terrace Policy No. 1.02
Fiscal Policy
Subject: Petty Cash Funds & Change Boxes Effective Date: 5/13/14
Page 3 of 4
5. If the purchase was for more than the advanced amount, the recipient
must submit a new and approved Petty Cash Request Form for the total
amount of the purchase. The fund custodian will reimburse the recipient
for his/her out-of-pocket amount and return the original Petty Cash
Request Form previously submitted.
C. Procedure for Use of Petty Cash for Out-of-Pocket Reimbursement
1. The requesting department or individual must complete the Petty Cash
Request Form for review and approval. The completed form shall provide
date, dollar amount requested, description, account number to be
charged, and the appropriate signature approvals prior to presentation.
2. Actual receipts of the out-of-pocket purchase must be attached to the
Petty Cash Request Form.
3. In the event the amount requested exceeds the limits set forth in Section
III.A of this Policy, the signature of the Finance Director or his/her
designee shall be obtained to approve the disbursement.
D. Replenishment of the Petty Cash Fund
To replenish the Petty Cash fund, the fund custodian will attach all receipts and
the applicable Petty Cash Request Forms, complete a payment request form,
obtain the appropriate authorization signatures, and submit the reimbursement
request to the Finance Department.
V. Approval to Establish or Increase a PettyCash Fund
A. The Finance Director shall be responsible for review of any request to establish
or increase a Petty Cash fund; however, approval to establish a new fund or
increase an existing fund requires approval of the City Manager.
B. Such requests shall be submitted in writing to the Finance Director by the
department head responsible, and shall include justification for the request. If the
Finance Director is in agreement with the request, he/she will indicate his/her
approval and forward the request to the City Manager for final approval.
VI. Change Boxes
A. Authorization and Control
1. Three (3) Change Boxes are currently authorized in the Finance
Department and integrated with the cash register.
2. Each Change Box maintains cash and coin totaling $200.
3. Each Cash Box has a separate custodian with individual password
security and daily reconciliation.
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City of Grand Terrace Policy No. 1.02
Fiscal Policy
Subject: Petty Cash Funds & Change Boxes Effective Date: 5/13/14
Page 4 of 4
B. Responsibilities and Procedures
1. Departments maintaining Change Boxes shall appoint fund custodians.
2. The procedure for establishing or increasing the amount of a Change Box
shall be the same as that for Petty Cash funds (see Section V of this
policy).
3. Internal control procedures for Change Boxes shall be the same as those
for Petty Cash (see Section VI I of this policy).
4. Under no circumstances shall a Change Box be used to advance money
or to reimburse for incidental purchases.
VII. Internal Control
A. Audits of Petty Cash Funds and Change Boxes
1. Audits of Petty Cash funds and Change Boxes will be the responsibility of
the Finance Department and shall consist of unannounced cash counts
on a periodic basis, but no less than semi-annually.
2. Petty Cash custodians shall have the responsibility to balance their
respective Petty Cash funds and Change Boxes on no less than a
monthly basis.
3. Any balancing discrepancies from the periodic cash counts must be
brought to the immediate attention of the Finance Director. Notification
shall consist of a memo from the department head detailing the known or
presumed causes of the discrepancy.
City of Grand Terrace
Fiscal Policy Policy No. 1.03
Subject: Accounts Receivable Effective Date: 5/13/14
Pa e 1 of 5
PURPOSE: To establish uniform guidelines and principles for the recognition, recording,
collection and write-off of accounts receivable related to goods or services
provided by the City or for citations issued by or administered by the departments
of the City.
DEFINITIONS:
Accounts Receivable: A debt owed to the City that arises in the normal course
of business dealings and not supported by negotiable paper; a claim against a
debtor usually arising from sales or services rendered. Accounts receivable
include but are not limited to, rent, concession fees, permit fees, license fees.
citations, and payments for goods and services.
Allowance for Doubtful Accounts: A valuation account (i.e. contra asset) that
is subtracted from the trade receivable on the balance sheet.
Bad Debt: A past due account receivable that, despite best efforts by the City,
remains unsatisfied and for which there is reasonable doubt that the underlying
debt will be satisfied in whole or in part. The expense for a bad debt is
recognized when the account receivable becomes doubtful, which typically
occurs prior to the write-off of the receivable. The recording of Bad Debt is for
accounting purposes only and this action does not discharge the debt. The debt
is still owed to the City, however, the amount shown as owed to the City has
been adjusted off the financial statement to reflect the doubtful collection.
Cognizant Department: The department within the City that negotiated the
agreement or contract, or issued the citation or invoice giving rise to the
particular account receivable.
Debt: In the context of this policy, debt refers to a sum of money due by express
agreement between the City and another party or parties. Debt may be owed the
City by an individual or by a business entity.
Past Due: Refers to an account receivable for which payment has not been
received by the established due date.
Unearned Revenue: An accounting transaction where items are not recognized
as revenue in the current period because they do not meet the "availability" or
"collectability" standards in order to be recorded in the current period.
Write-Off: An accounting transaction that removes an account receivable from
the accounting books and records, and signals the end of any further collection
efforts related to that account receivable.
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City of Grand Terrace
Fiscal Policy Policy No. 1.03
Subject: Accounts Receivable
Effective Date: 5/13/14
Page 2 of 5
POLICY:
I. Scope
This policy pertains to all accounts receivable City-wide whether processed through the
City's financial system or through other subsidiary systems or processes. Accounts
receivable include all monies owed to the City for services performed, taxes levied, or
citations issued for other persons or organizations including contracts, grants and leases.
Il. Responsibilities
A. Finance Department: It is the responsibility of the Finance Department to perform the
following functions:
1. Record the transaction in the City's general ledger.
2. Maintain supporting documentation.
3. Bill the customer or reimbursing agency. The exception to this is in cases where
the Cognizant Department performs the billing function. In such cases, the
Finance Director must review and approve the billing and collection procedures.
4. Maintain an aging schedule of outstanding Accounts Receivable and follow up
monthly via statements, collection notices or telephone contact, as appropriate,
to collect any amounts outstanding more than 30 days. (Note: While monthly
follow up and collection efforts are administered by the Finance Department, the
Cognizant Department may be asked to assist with collection efforts due to their
relationship with the customer or reimbursing agency.)
5. Coordinate the referral of uncollected Accounts Receivable to a collection
agency, as applicable and further addressed in Section III of this Policy.
6. Annually review the collectability of outstanding accounts at fiscal year-end.
B. Cognizant Department: It is the responsibility of the department providing the service
or issuing the citation to perform the following functions.-
1. Obtain an agreement to pay such as contract or other form of documentation.
2_ Provide the product or service to the customer_
3. Document the product or service provided.
4. Communicate with Finance staff and provide supporting documentation for the
transaction.
5. Bill customer if not handled by the Finance Department. In cases where the
billing function is performed by the Cognizant Department rather than the
Finance Department, the Finance Director must review and approve the billing
and collection procedures.
6_ Communicate with customer or agency to resolve disputes or discrepancies.
7. Assist with collection efforts if requested to do so by the Finance Department.
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City of Grand Terrace
Fiscal Policy Policy No. 1.03
Subject: Accounts Receivable Effective Date: 5113114
Pa e3of5
8. In conjunction with the Finance Department, annually review the collectability of
outstanding accounts at fiscal year-end.
C. Contractors working on behalf of the City to collect for goods or services provided or
for citations issued are responsible to perform the following functions:
1. Provide to the Finance Department a monthly aging schedule of all Accounts
Receivable including an accounting of current billings, collections and any other
activity conducted on accounts related to City services or citations.
2. Maintain a system that tracks the history and status of customer accounts.
lll. Payment Terms 1 Collections
A. The following payment terms and collection process shall be followed.
1. Payments will be due within 30 days from the invoice date.
2. Interest/Penalty/Late Fees will be charged in a manner consistent with
applicable ordinances or policies. The imposition of interest charges, penalties
or late fees will be communicated to the customer through the following
methods:
a. A warning notice or statement will be sent out thirty (30) days in advance of
the penalty effective date.
b. A new statement will be sent out with the amended invoice/citation amount
including the appropriate interest, penalty or late fee.
3. Statements will be issued on a monthly basis unless there are circumstances
that warrant some other billing cycle. Exceptions from the monthly billing cycle
must be approved by the Finance Director.
4. The Cognizant Department may be requested to assist Finance staff in
collection efforts on accounts more than 60 days outstanding.
5. Accounts more than 60 days outstanding may be assigned to a collection
agency as determined by the Finance Director.
IV. Financial Reporting for Accounts Receivable
A. The finance Department will record the revenues and associated accounts
receivable in accordance with Generally Accepted Accounting Principles.
B. Periodically, at least annually in conjunction with the fiscal year-end audit, open
accounts receivable balances will be reviewed in order to ensure that the City's
financial statements accurately and appropriately reflect the status of these
accounts.
C. The collectability of open accounts receivable will be estimated so that they can be
reflected in the City's financial statements at their net realizable value, which is
consistent with Generally Accepted Accounting Principles. These amounts will be
reflected in the following manner:
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City of Grand Terrace
Fiscal Policy Policy No. 1.03
Subject: Accounts Receivable Effective Date: 5/13114
Pa e4of5
1. Enterprise Funds; For enterprise funds (if applicable), an allowance for doubtful
accounts will be established in an amount to be determined by the Finance
Director or his/her designee in consultation with the current outside auditor for
the City.
2, Other Funds: Taxes, fees, citations and other types of revenues found in
governmental funds that are due but not collected at year-end, and where there
is some level of uncertainty about the ultimate collectability, wilt be recorded with
a debit to Accounts Receivable and a credit to Unearned Revenue within the
appropriate fund structure until the uncertainty is resolved at which time the
appropriate entry would be a debit to Unearned Revenue and a credit to the
appropriate revenue account_ This method will result in recognizing the
receivable on the financial statements without impacting fund balance with
potential fluctuations as revisions are made to estimates.
V. Write-Offs:
A. As part of the annual review of accounts receivable balances, accounts that have
progressed through the collection process and remain unpaid will be reviewed to
determine collectabitity. Based on this review, a recommendation for the write-off of
the account or additional collection efforts will be made, The collection process will
consist of, but not be limited to, the following steps or processes:
1. Internal Collection efforts (including consultation with the City Attorney's office
for potential legal remedies);
2. Assignment to collection agency;
3. Claims to the Franchise Tax Board (Administrative & Parking Citations);
4. Claims to the Department of Motor Vehicles (Administrative & Parking
Citations).
B. The City Manager may, at his/her discretion, discharge from further accountability
any City department, officer, or employee charged by law with the collection of
money which is due and payable if any of the following circumstances apply.-
1. The amounts are too small to justify the cost of collection_
2. The likelihood of collection does not warrant the cost involved.
3. The amount has been otherwise lawfully compromised or adjusted.
Such discharge of accountability shall only be made upon consideration and
approval of a verified application submitted by a department or division with the
Finance Director and then approved by the City Manager, Such a discharge of
accountability does not constitute a release of any persons from liability for payment
of any amount due the City.
C. The request to authorize the write-off of accounts must be accompanied by the
following documentation:
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City of Grand Terrace
Fiscal Policy Policy No. 1.03
Subject: Accounts Receivable Effective Date: 5/13/14
Page 5 of 5
1. A detailed account aging (listing of date of servicelcitation and amount owed by
account);
2. A description of collection efforts undertaken;
3. Explanation of reason(s) account(s) is/are determined to be uncollectible;
4. A signed Application for Discharge of Accountability form (Exhibit A).
D. Applications for Discharge of Accountability that have been deemed by the Finance
Director to be appropriate to forgo further collection actions will be submitted to the
City Manager for final approval.
E. A copy of the completed Application for Discharge of Accountability and the
supporting documentation will be forwarded to Finance staff for entry into the City's
financial system.
19
Exhibit A
Application for Discharge of Accountability
To: (1) Finance Director
(2) City Manager
From: Applicable Department Head
Date:
Subject: Application for Discharge of Accountability for Collection of Monies Owed the City
1. 1, on behalf of the Department apply for
(Department Head) (Departmgiit)
Discharge of accountability for collection of the following obligation(s)for the following reason(s):
o The amounts are too small to justify the cost of collection.
u The likelihood of collection does not warrant the cost involved.
o The amount has been lawfully compromised or adjusted.
Other
2. The person(s)or entity(ies)liable for payment are:
(Attach a separate sheet it necessary)
Type/ Account/
Program Invoice# De artment Name Date Balance
I certify that all reasonable collection efforts have been attempted and that correspondence files and other
collection documentation supporting the reasons for discharge of accountability shown above will be
maintained for three years from the approved date of the discharge of accountability.
(Department Haad Si9r-.3h ro)
Above Application for Discharge of Accountability:
Approved as submitted. - Approved as submitted.
Approved except as noted E- Approved except as noted.
(Finance Director Signature) Date (City Manager signature) Date
21
City of Grand Terrace Policy No. 1.04
Fiscal Policy
Effective Date: 5/13/14
Subject: Investments page .1 of 4
I. PURPOSE
To establish a policy for the management and oversight of the City's investments.
II. POLICY
It is the policy of the City of Grand Terrace to invest funds in a manner which will
provide the highest investment return with the maximum security while meeting the
daily cash flow demands of the City and conforming to all statutes governing the
investment of City funds.
III. SCOPE
This investment policy applies to all financial assets of the City. These funds are
audited annually and accounted for in the Annual Financial Report. Funds include
the General Fund, Capital Projects Fund, Special Revenue Funds, Enterprise Funds
and Trust Funds, including funds held by the Successor Agency to the Grand
Terrace Community Redevelopment Agency.
IV. PRUDENCE
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. The
standard of prudence to be used shall be the "prudent person" standard and shall be
applied in the context of managing an overall portfolio. Investment officers acting in
accordance with written procedures and the investment policy and exercising due
diligence shall be relieved of personal responsibility and/or liability for an individual
security's credit risk or market price changes.
V. OBJECTIVES
The primary objectives, in order of priority, of the investment program shall be:
A. Safety: Safety of principal is the foremost objective of the investment program.
Investments of the City shall be undertaken in a manner that seeks to ensure
the preservation of capital in the overall portfolio. To attain this objective,
diversification is required in order that potential losses in individual securities
do not exceed the income generated from the remainder of the portfolio.
B. Liquidity: The investment portfolio will remain sufficiently liquid to enable the
City to meet all operating requirements which might be reasonably anticipated.
C. Yield: The investment portfolio shall be designed with the objective of attaining
a market rate of return throughout budgetary and economic cycles, taking into
account the investment risk constraints and the cash flow characteristics of the
portfolio.
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City of Grand Terrace Policy No. 1.04
Fiscal Policy
Subject: Investments Effective Date: 5113/14
Page 2 of 4
VI. DELEGATION OF AUTHORITY
Authority to manage the investment of surplus funds is derived from California
Government Code Section 53600, et seq., and this policy. Management of bond
funds is controlled by Government Code Section 5922(d) and such investments must
conform to the requirements of the bond indenture. In some cases, it may be
appropriate for investments of bond proceeds to cover a longer duration than those
limits established for surplus (operating) funds. Management responsibility for the
investment program is hereby delegated to the Treasurer (or Finance Director if a
separate position of Treasurer is not staffed), who shall establish procedures and
operate the investment program consistent with this investment policy. Procedures
may include, but not limited to, references to: safekeeping, repurchase agreements,
wire transfer agreements, collateral/depository agreements and banking services
contracts, as appropriate. The Treasurer (Finance Director) may delegate authority
to subordinates for day-to-day investment transactions_ No person may engage in
an investment transaction except as provided under the terms of this policy and the
procedures established by the Treasurer(Finance Director).
VII. ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain From
personal business that could conflict with the proper execution of the investment
program, or which could impair their ability to make impartial investment decisions.
VIII. AUTHORIZED FINANCIAL INSTITUTIONS AND BROKER/DEALERS
A. The City will utilize only financial institutions and brokerldealers who are
authorized to provide investment services in the State of California.
B. No public deposit shall be made except in a qualified public depository as
established by State laws. For brokerldealers of government securities and
other investments, the Treasurer (Finance Director) shall select only
brokerldealers who are licensed and in good standing with the Securities and
Exchange Commission and the Securities Regulation Division of the California
Department of Business Oversight. .
C. Broker/dealers and investment advisors utilized by the City shall be approved
by the City Council.
1X. AUTHORIZED INVESTMENTS
The City is empowered by statute and authorized by the City Council to invest in the
following.-
A. U.S.Treasury Obligations (Treasury Bills,Treasury Notes)
B. Repurchase Agreements
Fd
City of Grand Terrace
Fiscal Polic Policy No. 1.04
Subject: Investments Effective Date: 5113174 i
Page 3 of 4
C. Certificates of Deposit with State Banks, National Banks, State or Federal
Savings Associations, State and Federal Credit Unions in California that
are fully insured by federal deposit insurance. The Treasurer (Finance
Director) may waive collateral ization in lieu of deposit insurance.
D_ Negotiable Certificates of Deposit, Collateralized with U.S. Treasury
Obligations Having a Market Value of 110%. The Treasurer (Finance
Director) may, at his/her discretion, waive security for that portion of a deposit
that is already covered by federal deposit insurance.
E_ Passbook Savings Accounts Placed with Federal or State Banks or Credit
Unions that are fully insured by federal deposit insurance. The Treasurer
(Finance Director) may waive collateralization in lieu of federal deposit
insurance.
F. Securities Issued by Federal Agencies
G. Local Agency Investment Fund (LAIF)
1. This is a special fund of the State Treasurer, in which local agencies are
allowed to pool their funds for investment purposes up to a maximum of
$50 million, with no restrictions on the amount of bond proceeds that can
be invested.
2. LAIF is part of the Pooled Money Investment Account (PMIA). The PMIA
began in 1955 and oversight is provided by the Pooled Money Investment
Board (PMIB) and an in-house Investment Committee. The PMIB
members are the State Treasurer, Director of Finance, and State
Controller.
3. All securities are purchased under the authority of Government Code
Section 16430 and 16480.4. The State Treasurer's Office takes delivery of
all securities purchased on a delivery-versus-payment (DVP) basis using a
third-party custodian. All investments are purchased at market and a
market valuation is conducted monthly. Additionally, the PMIA has
policies, goals and objectives for the portfolio to ensure that the goals of
Safety, Liquidity and Yield are not jeopardized and that prudent
management prevails. These policies are formulated by Investment
Division staff and reviewed by both the PMIB and the LIAB on an annual
basis.
4. The State Treasurer's Office is audited by the Bureau of State Audits on
an annual basis and the resulting opinion is posted to the State
Treasurer's Office website following its publication. The Bureau of State
Audits also has a continuing audit process throughout the year. All
investments and LAIF claims are audited on a daily basis by the State
Controller's Office as well as an in-house audit process involving three
separate divisions.
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City of Grand Terrace Policy No. 1.04
Fiscal Policy
Subject: Investments Effective Date: 5113/14
Page 4 of 4
H. Mutual Funds issued by diversified management companies as defined by
Section 23701(m) of the Revenue and Taxation Code, provided that the portfolio
of such investment company or investment trust is limited to U.S. government
obligations or agencies of the federal government and repurchase agreements
fully collateralized by such securities.
I. Pools and Other Investment Structures Incorporating Investments
Permitted in California Government Code Sections 53601 and 53635 such
as local government investment pools sponsored by counties and joint powers
authorities. These entities will typically have their own investment policies,
which may differ from that of the City.
X. COLLATERALIZATION
All certificates of deposit must be collateralized by U.S. Treasury obligations held by
a third party_ The Treasurer (Finance Director) may waive this requirement up to the
amount already insured by federal deposit insurance.
Xl. SAFEKEEPING AND CUSTODY
All securities purchased from broker/dealers shall be conducted on a delivery-
versus-payment (DVP) basis and shall be held by a third-party custodian designated
by the Treasurer (Finance Director) and evidenced by safekeeping receipts. This
would not apply to any book-entry direct purchases from the U.S. Government.
XII. DIVERSIFICATION
The City will diversify its investments by security type and institution.
20
City of Grand Terrace Policy No. 1.05
Fiscal Policy
Effective Date: 5/13/14
Subject: Fixed Assets Page 1 of 3
PURPOSE: To establish the criteria for determining fixed assets, as well as their physical
control, accountability, and depreciation.
DEFINITIONS: Fixed Assets refers to land, buildings, equipment, furniture, vehicles, and
improvements other than buildings, acquired by the City of Grand Terrace for
use in the provision of goods and services to its citizens.
Not all Fixed Assets are required to be reported on the balance sheet. Fixed
Assets with very short useful lives, or of small monetary amounts, can be
"expensed" in the period in which they are acquired. Fixed Assets reported on
the balance sheet are said to be "capitalized", meaning the capital outlay is
recorded as an addition to the asset account, and will have an expected useful
life of at least two years.
The monetary criteria by which governments decide to report Fixed Assets on
the balance sheet, is known as the "capitalization threshold." Governments
may utilize separate thresholds for different classes of fixed assets, or establish
a single threshold for all of its fixed assets.
Capitalization is a financial reporting issue. It addresses the material
expenditure level by which users of the City's financial reports are informed of
the policy decision to account for Fixed Assets. It does not eliminate the City's
responsibility for maintaining adequate control over all of its assets, or other
equipment below the capitalization threshold, to minimize the risk of loss or
misuse.
POLICY:
I. Fixed Asset Capitalization Threshold Criteria
A. Land
Land will be capitalized at actual cost. There is no specific dollar threshold.
B. Improvements to Land
Improvements to land with a value of $25,000 or more will be capitalized.
Improvements valued at less than $25,000 will be expensed in the current year.
C. Buildings and Building Improvements
1. Buildings and building improvements with a value of $25,000 or more will
be capitalized. Buildings and improvements valued at less than $25,000 will
be expensed in the current year.
2 Capitalized cost generally includes such items as site clearance and
excavation, architectural fees, initial landscaping, building construction and
others.
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City of Grand Terrace
Fiscal PolicyPolicy No. 'f.t]5
Subject: Fixed Assets Effective Date: 5/13/14
Page 2 of 3
D Equipment and Vehicles
1. Equipment and vehicles with a value of $5,000 or more will be capitalized.
Equipment and vehicles valued at less than $5,000 will be expensed in the
current year.
2. Capitalized cost generally includes purchase price, sales tax, transportation
costs and installation.
B. Useful Life
1. Fixed assets will be capitalized only if they have a useful life of at least two
years following the date of acquisition.
2. Assets that do not meet this criterion shall be expensed regardless of cost.
3_ Following are the various Fixed Asset categories and the corresponding
useful life range for each category:
a. Machinery & Equipment 5— 15 years
b. Vehicles 6— 15 years
c. Improvements other than Buildings 15—20 years
d. Infrastructure 20—30 years
e. Buildings 50 years
f. Sewer Lines 90 years
Note: The specific useful life assigned to each asset will be determined by
the Finance Director, in accordance with Governmental Accounting
Standards Board (GASB) Statement No. 34.
C. Final Capitalization Decision Rests with Finance Director
The final decision on whether to capitalize, or how much to capitalize a fixed
asset, rests with the Finance Director or his/her designee.
III. Identification and Inventory
A. Each vehicle, furniture and equipment item that is classified as a Fixed Asset will
have a unique identification tag affixed to the item by Finance staff for security
and control purposes at the time the Fixed Asset is placed in service.
B. An inventory of all Fixed Assets will be conducted by Finance staff annually to
verify that no Fixed Assets are missing nor have been moved to another location.
Any Fixed Assets that are missing or not in the assigned location when the
inventory is conducted must be reported to the City Manager, along with a written
explanation from the director of the department to which the Fixed Asset was
assigned.
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City of Grand Terrace Policy No. 1.05
Fiscal Policy
Subject: Fixed Assets Effective Date: 5/13/14
Page 3 of 3
Ill. Depreciation
A. Financial Statement Basis:
1. Fixed Assets will be depreciated over their estimated useful lives, as
reflected in the City's Annual Financial Report, in accordance with GASB
Statement No. 34.
2. The straight-line method of depreciation will be used for all Fixed Assets,
unless it is determined by the Finance Director or his/her designee, and
confirmed by the City's outside auditor, that another depreciation method is
more appropriate for a given Fixed Asset or a Fixed Asset class.
B_ Budgetary Basis:
1. Depreciating Fixed Assets over their useful lives for budgetary purposes is
not required but is a recommended practice in that it establishes an Asset
Replacement Account for each Fixed Asset. Such a practice increases the
City's annual operating costs, in that depreciation charges become a
budgeted expense, however, it levels operating expenses over time
because when Fixed Assets are replaced, the funds (or a portion of the
funds) have already been set aside and therefore do not need to be re-
budgeted.
2. While the City has not previously depreciated Fixed Assets for budgetary
purposes, it is the City Council's intent to do so beginning with the FY 2014-
15 budget, and to continue the practice on a go-forward basis thereafter.
20
City of Grand Terrace Policy No. 1.06
Fiscal Policy
Subject: Disposition of Surplus Property Effective Date: 5/13/14
Page 1 of 1
PURPOSE: To define the process for identification and disposal of surplus City supplies,
materials and equipment (collectively referred to as property).
POLICY:
I. Identifying Surplus Property.
A. Departments will be responsible for identifying surplus property within work areas
assigned to their control.
B. Departments will notify the Finance Director of surplus property by completing a
Surplus Property Form (Exhibit A). Such form will include descriptive information
on the property (i.e., license number, model number, serial number, condition of
the item, reason the item is no longer needed, etc.), along with the location of the
property. The form must be approved by the respective department head,
Finance Director and City Manager before disposition of the item is authorized.
C If the surplus property is a Fixed Asset, as defined in Fiscal Policy No. 1.05, the
Fixed Asset identification number must also be included on the Surplus Property
Form, so that the City's Fixed Asset records can be adjusted accordingly.
D. If a Fixed Asset is being declared as surplus before its useful life (as reflected in
the City's Fixed Asset records) has been exhausted, detailed justification for the
requested disposal must be provided on the Surplus Disposal Form.
E. Finance staff, in consultation with the City Manager's Office, will be responsible
for making arrangements to warehouse surplus property, as needed, or
determining if the item can be used by another department.
F. Information Technology staff will be advised if any of the surplus property is
computer or telephone equipment.
Ill. Disposition of Surplus Property:
A. Supplies, materials and equipment which are determined to be surplus and to
have no further use by the City will be disposed of by Finance staff through trade-
in, sale, auction, or donation.
B. The City Manager or his/her designee will be responsible for determining which
method of disposition will be most advantageous to the City.
C. The method of disposition will be reflected on the Surplus Property Form.
3f
Exhibit A
Surplus Property Form
Requesting Department Request Date Contact Person
Property Description Location Model No. Serial No.
Reason No Longer Recommended Disposal Method
Condition Needed
Trade-in Sale Auction Donation
Comments regarding recommended disposal method:
If the surplus property is a fixed asset that is not fully depreciated, please provide detailed
justification for the requested disposal below.
Submitted by: Date Department Head approval Date
CD Disposal endorsed 0 Disposal approved
O Disposal not endorsed CD Disposal not approved
Finance Director Date City Manager Date
Comments: Comments:
33
City of Grand Terrace Policy No. 1.07
Fiscal Policy
Subject: Fraud Prevention & Detection
Approval Date: 1128114
Page 1 of 7
1. PURPOSE AND SCOPE
To establish a policy and procedures for identifying acts that might be fraudulent,
and to describe the steps to be taken when fraud or other dishonest activities are
suspected, and to establish procedures to follow in accounting for missing
funds, investigating other irregularities, and providing for restitution and recoveries.
H. DEFINITIONS
A. Fraud — the intentional false representation, or concealment of material
fact for the purpose of personal gain for oneself or others; or inducing
another to act similarly. Fraud and other similar irregularities include, but
are not limited to:
1. Claim for reimbursement of expenses that are not job-related or
authorized by City policy.
2. Forgery or unauthorized alteration of documents (checks,
promissory notes, time sheets, agreements, purchase orders,
budgets, etc.).
3. Misappropriation of City assets (funds, securities, supplies, furniture,
equipment, etc,).
4. Improprieties in handling or reporting of financial transactions.
5. Authorizing or receiving payment for goods not received or services
not performed.
6. Computer-related activity involving unauthorized alteration,
destruction, forgery, or manipulation of data or misappropriation of
City-owned software.
7. Misrepresentation of information on documents.
8. Misrepresentation of authority.
9. Any apparent violation of Federal, State, or Local laws related to
dishonest activities or fraud.
10. Seeking or accepting anything of material value from those doing
business with the City including vendors, consultants, contractors,
lessees, applicants, and grantees.
B. Employee — In this content, employee refers to any individual or group
of individuals who receive compensation, either full-time or part-time, from
the City of Grand Terrace. The term also includes any volunteer who
provides services to the City through an official arrangement with the City
or a City organization, as well as Council Members, consultants, vendors,
35
City of Grand Terrace Policy No. 1.07
Fiscal Policy
Subject: Fraud Prevention & Detection Approval Date: 1/28114
Page 2 of 7
contractors, outside agencies and/or any other parties with a business
relationship with the City of Grand Terrace.
C. Management — In this context, management refers to any administrator,
manager, director, supervisor, or other individual who manages or
supervises funds or other resources, including human resources.
D. Investigator — In this context, Investigator refers to any person, persons or
governmental agency assigned by the City Manager and/or the City Council
to investigate any fraud or similar activity.
E. External Auditor - In this context, External Auditor refers to
independent audit professionals who perform annual audits of the City's
financial statements.
Ill. POLICY
A. The City of Grand Terrace is committed to protecting its assets against
the risk of loss or misuse. Accordingly, it is the policy of the City to
identify and promptly investigate any possibility of fraudulent or related
dishonest activities against the City and, when appropriate, to pursue
legal remedies availabte under the law.
B. This policy applies to any irregularity, or suspected irregularity, involving
Employees, consultants, vendors, contractors, outside agencies, and/or
any other parties with a business relationship with the City.
C. Any investigative activity required will be conducted in an objective and
impartial manner, without regard to the suspected wrongdoer's length of
service, position, title, or relationship to the City.
D. All Employees are responsible for the detection, reporting and prevention
of fraud, misappropriations, and other irregularities.
E. It is the City's intent to fully investigate, or cause the investigation of,
any suspected act of fraud, misappropriation, impropriety or other simiar
irregularity. An objective and impartial investigation will be conducted
regardless of the position, title, length of service or relationship with the City
of any party who might be or become involved in or becomes the subject of
such investigation.
F. Each department of the City is responsible for instituting and maintaining
a system of internal controls to provide reasonable assurance for the
prevention and detection of fraud, misappropriations, and other
irregularities. Management should be familiar with the types of
improprieties that might occur within their area(s) of responsibility and be
alert for any indications of such conduct.
as
City of Grand Terrace Policy No. 1.07
Fiscal Policy
Subject: Fraud Prevention & Detection Approval Date: 1/28/14
Page 3 of 7
G. Investigator, in conjunction with the City Manager, has the primary
responsibility for the investigation of all activity as defined in this policy.
H. Should the City Manager be a subject of the investigation, the City Attorney
will be substituted for the City Manager in references throughout this policy.
Employees or other individuals suspecting any fraudulent activity by the City
Manager should report his/her concern directly to the City Attorney.
I. Should the City Manager and City Attorney both be subjects of the
investigation, the Mayor will be substituted for the City Manager and City
Attorney in references throughout this policy. Employees or other
individuals suspecting any fraudulent activity by both the City Manager and
City Attorney should report his/her concern directly to the Mayor, who will in
turn advise the other members of the City Council.
J. Throughout the investigatiion, the Investigator will inform the City Manager
and others that he/she designates, of pertinent investigative findings. The
City Council shall also be immediately advised of the investigation and kept
apprised of its status throughout the investigation.
K. Employees will be granted whistle-blower protection when acting in
accordance with this policy. When informed of a suspected impropriety,
neither the City nor any person acting on behalf of the City shall-
1. Dismiss or threaten to dismiss the Employee,
2. Discipline, suspend, or threaten to discipline or suspend the
Employee,
3. Impose any penalty upon the Employee, or
4. Intimidate or coerce the Employee.
Violations of the whistle-blower protection will result in discipline up to
and including dismissal.
L. Upon the conclusion of the investigation of an allegation of fraud said to
have been committed by an employee or official, the City Council shall be
informed by the City Manager, or by the official whom received the
complaint and authorized the investigation, of the outcome of the
investigation. This shall be done in manner cognizant of the privacy right, if
any, of the accused employee or official, as advised by the City Attorney.
M. The City Manager, following review of investigation results, will take
appropriate action regarding Employee misconduct. Disciplinary action
can include termination, and referral of the case to an appropriate law
enforcement agency and District Attorney's Office for possible arrest
and prosecution.
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City of Grand Terrace Policy No. 1.07
Fiscal Policy
Subject: Fraud Prevention & Detection
Approval Date: 1/28/114
Page 4 of 7
N. The City will pursue every reasonable effort, including court-ordered
restitution, to obtain recovery of City losses from the offender, or other
appropriate sources.
IV. PROCEDURES
A. Management Responsibilities
1. Management is responsible for being alert to, and reporting fraudulent
or related dishonest activities in their areas of responsibility.
2. Each City official should be familiar with the types of improprieties
that might occur in his or her area(s) of responsibility and be alert for
any indication that improper activity, misappropriation, or dishonest
activity is or was in existence in his or her area(s).
3. When an Improper activity is detected or suspected, Management
should determine whether an error or mistake has occurred or if there
may be dishonest or fraudulent activity.
4. If Management determines a suspected activity may involve fraud or
related dishonest activity, they should contact their next immediate
supervisor not involved in the alleged misconduct -- and together with
that supervisor inform their Department Director (unless the
Department Director is alleged to have involvement in the alleged
misconduct) and City Manager.
5. If the City Manager is suspected to be involved in the alleged
misconduct, the City Attorney should be notified in lieu of the City
Manager. if the City Manager and City Attorney are both suspected to
be involved in the alleged misconduct, the Mayor should be notified In
lieu of the City Manager or City Attorney. The Mayor will, in turn,
advise the other members of the City Council.
6. Management should not attempt to conduct individual investigations,
interviews, or interrogations. However, Management is responsible
for taking appropriate corrective actions to ensure adequate controls
exist to prevent reoccurrence of improper actions.
7. Management should support the City's responsibilities and cooperate
fully with the Investigator, other involved departments, and law
enforcement agencies in the detection, reporting, and investigation of
criminal acts, including the prosecution of offenders.
B. Management must give full and unrestricted access to all necessary
records and personnel. All City furniture and contents, including
desks and electronic devices, are open to inspection at any time.
There is no reasonable expectation of privacy.
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City of Grand Terrace
Fiscal Policy Policy No. 1.07
Subject: Fraud Prevention & Detection Approval Date: 1128/14
Page 5 f 7
9. In dealing with suspected dishonest or fraudulent activities, great
care must be taken. Therefore, management should avoid the
following:
a. False accusations.
b. Alerting suspected individuals that an investigation is underway.
c. Treating Employees unfairly.
d. Making statements that could lead to claims of false accusations
or other offenses.
10. In handling dishonest or fraudulent activities, Management has the
responsibility to:
a. Make no contact (unless requested) with the suspected individual
to determine facts or demand restitution. Under no
circumstances should there be any reference to "what you did",
"the crime", "the fraud", "the misappropriation", etc.
b. Avoid discussing the case, facts, suspicions, or allegations with
anyone outside the City, unless specifically directed to do so by
the City Attorney.
c. Avoid discussing the case, facts, suspicions, or allegations with
anyone other than employees who have a need to know such as
the City Manager, City Attorney, Department Head, Finance
Director, Investigator, or law enforcement personnel — and
should direct any City Council inquiries to the City Manager.
d. Direct all inquires from the suspected individual, or his or her
representative, to the Investigator. All inquires from the media
should be directed to the City Manager.
e. Take appropriate corrective and disciplinary action, up to and
including dismissal, after consulting with the City Manager, in
conformance with the City's Personnel Rules and Regulations
and the appropriate Memorandum of Understanding, as
applicable.
B. Investigator Responsibilities
1. Upon assignment by the City Manager, the Investigator will
promptly investigate the allegations of fraud or other dishonest
activities.
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City of Grand Terrace Policy No. 1.07
Fiscal Policy____
Subject: Fraud Prevention & Detection Approval Date: 1/28/14
Page 6 of 7
2. Employees must cooperate with the Investigator. Refusal to
cooperate, or the conveyance of inaccuracies, may subject an
Employee to disciplinary action up to and including dismissal.
3. In all circumstances where there appears to be reasonable grounds
for suspecting that a fraud has taken place, the Investigator, in
consultation with the City Manager, and City Attorney as appropriate,
will contact the appropriate taw enforcement agency.
4. The Investigator shall be available and receptive to receiving
relevant, confidential information to the extent allowed by law.
5. If evidence is uncovered showing possible dishonest or fraudulent
activities, the Investigator will proceed as follows:
a. Discuss the findings with the City Manager and City Attorney.
b. Meet with the City Manager to;
1) Determine if disciplinary actions should be taken.
2) Notify insurers and coordinate the filing of insurance
claims.
C. Take immediate action, in consultation with the City Manager
and City Attorney, to prevent the theft, alteration, or destruction
of evidentiary records. Such action shall include, but is not limited
to:
1) Removing the records and placing them in a secure
location, or limiting access to the records.
2) Preventing the individual suspected of committing the
fraud from having access to the records.
6. In consultation with the City Manager and City Attorney, and the
appropriate law enforcement agency, the Investigator may disclose
particulars of the investigation to potential witnesses if such
disclosure would further the investigation.
7_ If the Investigator is contacted by the media regarding an alleged
fraud or audit investigation, the investigator will not speak with the
media but will instead refer the matter to the City Manager before a
response is made.
8. At the conclusion of the investigation, the Investigator will document
the results in a confidential report to the City Manager. If the report
concludes that the allegations are founded, the report will be
forwarded to the appropriate law enforcement agency and the City
Council will be advised.
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Fiscal Policy Policy No. 1.07
Subject: Fraud Prevention & Detection Approval Date: 1I28/14
Page 7 of 7
9. Unless exceptional circumstances exist, a person under investigation
for fraud is to be given notice in writing of essential particulars of the
allegations following the conclusions of the audit. Where notice is
given, the person against whom allegations are being made may
submit a written explanation to the Investigator no later than seven
calendar days after notice is received.
10. The Investigator will be required to make recommendations to the
appropriate department for assistance in the prevention of future
similar occurrences.
11. Upon completion of the investigation, including all legal and personnel
actions, all records documents, and other evidentiary material obtained
from the department under investigation will be returned to the City
Manager.
City of Grand Terrace Policy No. 2.01
Fiscal Policy
Subject: Accounts Payable Effective Date: 5/13/14
Page 1 of 3
PURPOSE: To define the process for review, authorization and payment of vendor invoices.
DEFINITIONS:
Check Register: A report provided to the City Council on a monthly basis
listing payments made to the various City vendors for the
preceding month.
Discount: A percentage or faxed amount that may be deducted from
payment of a vendor's invoice if payment is made by a
date determined by the vendor. A common discount term
is "1% 10", 'meaning that one percent (1%) may be
deducted from the invoice amount if payment is made with
10 days of the invoice date.
EFT: Electronic Funds Transfer; may be used as a payment
alternative to City check when authorized by the Finance
Director.
Invoice; A bill rendered to the City by a vendor requesting payment
for goods or services provided to the City.
Net 30: A specific type of trade credit where the payment is due in
full 30 days after the item is purchased and an invoice
received.
Purchase Order: A City document authorizing a specified quantity of goods
and/or services to be provided to the City at specified
prices and terms.
Receiving Document: A document provided to the City by a vendor attesting to
the delivery of goods and/or services.
Statement: A summary provided by a vendor showing amounts
previously billed, paid, and the unpaid balance.
Vendor: A business entity or agency providing goods and/or
services to the City.
POLICY:
I. Payment Terms
A. In order to maintain good business relations with the City's Vendors, it is the policy
of the City of Grand Terrace to pay Invoices for authorized goods or services within
30 days of Invoice receipt; (i.e., on a Net 30 basis) unless specified otherwise by
City Purchase Order or contract.
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City of Grand Terrace Policy No. 2.01
Fiscal Policy
Subject: Accounts Payable Effective Date: 5113/14
Page 2 of 3
B. Invoices offering a Discount should be paid within the Discount terms whenever it
is possible to process and pay the Invoice within those terms, unless it is
determined by the Finance Director that it is more advantageous from a cash
management standpoint to not take the Discount and instead to make payment on
a Net 30 basis. (Minimum amounts that qualify for Discount processing may be
established by the Finance Director in order to ensure that accelerated Invoice
processing is cost effective in relation to the Discount amount.)
U. Invoice Processing
A. Vendors are to be instructed to mail (or e-mail) their Invoices to the City's Finance
Department, attention Accounts Payable.
B. Invoices received in Accounts Payable are to be date stamped the same day as
received in order to document the date received by the City.
C, Should an Invoice mistakenly be received by a department other than Finance, it
should be given to the Finance Department Accounts Payable staff the same day
as received, so that the date stamp applied to the Invoice will reflect the date
received by the City.
D. On a timely basis, Accounts Payable staff should notify the applicable department
that ordered the goods or services, that an Invoice has been received, so the
responsible departmental staff can review and approve the Invoice for payment.
E. Invoice approval shall be in accordance with the City's Signature Authorization
Listing. No Invoice should be paid without proper City authorization.
F. If an Invoice is related to a City Purchase Order or contract, the quantity and prices
reflected on the Invoice must be verified by the department responsible for the
purchase to ensure that they are in agreement with the Purchase Order or
contract.
G. If an Invoice is provided by Accounts Payable staff to another department for
review and approval, Accounts Payable staff must maintain a record of the Invoice
and date it was provided to the applicable department to ensure that it is returned
to Accounts Payable in time to meet the City's Net 30 payment policy or Discount
terms. If there is a dispute regarding the goods or services that were billed to the
City, such that the Net 30 or Discount terms cannot be met, the applicable
department must notify Accounts Payable staff of the dispute.
H. Only original Vendor Invoices should be processed for payment. Payment should
never be made from an Invoice copy or Statement. (Should an original Invoice be
lost, such that a Vendor submits a duplicate Invoice for processing, the duplicate
Invoice should be stamped as a"Duplicate Original" by Accounts Payable staff.)
I. A City check should be mailed for all approved Vendor Invoices within 28 days of
the date of Invoice receipt in order to comply with the Net 30 payment policy,
allowing two days for mail processing and delivery. Exceptions would be Invoices
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City of Grand Terrace
Fiscal Policy Policy No. 2,01
Subject: Accounts Payable Effective Date: 5/13/14
Page 3 of 3
offering Discount terms, which would be paid sooner than 28 days from receipt in
order to qualify for the Discount (also allowing two days for mail processing and
delivery) and payments made by EFT.
J. If the City's business software system allows a "three-way matching" process, such
that a Purchase Order, Invoice and Receiving Document are electronically
matched, this process should be implemented since it is considered to be an
industry"best practice" and eliminates the need for Invoices to be manually verified
or provided to another department for review and approval.
IIII. City Council Approval
A, A Check Register will be prepared by the Finance Department and submitted to the
City Council for review and approval on a monthly basis during a regularly
scheduled City Council meeting.
B, The Check Register will list all vendor payments for the preceding month along
with a brief description of the type of goods or services purchased and the account
code(s) associated with each payment.
C. In order to meet the Net 30 payment terms, and to take advantage of Discounts
offered by Vendors, payment of Invoices will not be delayed pending approval of
the Check Register,
45
City of Grand Terrace
Fiscal Policy Policy No. 3.01.01
Subject: Purchasing Effective Date: 5/13114
Page 1 of 6
PURPOSE: The purpose of this policy is to ensure that the City's purchasing practices are
carried out in accordance with the Purchasing Ordinance, which was approved by the City
Council on November 27, 2012.
DEFINITIONS:
Notice Inviting Bids: A document issued to specified potential bidders, or
posted on the City's website, inviting bids for specified merchandise or
service. The subsequent contract is generally awarded to the lowest
responsible bidder.
Purchase Order: A document which authorizes the delivery of specified
merchandise or the rendering of certain service and the making of a charge for
such merchandise or service.
Purchase Requisition: A document submitted by a department requesting
approval to purchase specified merchandise or service. Upon its approval, a
Purchase Order is issued to the selected vendor or service provider.
Purchasing Officer: The Purchasing Ordinance designates a Purchasing
Officer, to be appointed by the City Manager. The City Manager has currently
appointed the City's Finance Director as the Purchasing Officer. Under the
direction of this position, the Finance Department is charged with the
responsibility of administering the Purchasing Ordinance.
Request for Proposals (RFP): A document issued to specified potential
service providers, or posted on the City's website, requesting proposals for
services. The subsequent contract is awarded based on a number of factors
including professional expertise, experience, service level, references and
pricing. Consideration of factors other than pricing differentiates an RFP
process from a "Notice Inviting Bids" process.
POLICY & PROCEDURES:
I. Informal Purchases ($0 - $500)
The following procedures apply:
A. Funds must be budgeted for the goods or services to be purchased.
B. A Purchase Order (P.O.) is not required for purchases.
C. Price quotes are not required for purchases, although they are encouraged when
easily obtainable.
D. Payment for purchases is made by submitting a Request for Payment form with
approval by the applicable Department Head or designee (per the Authorized
Approval Listing).
E. Use of City credit card or petty cash may be appropriate for certain low-value
purchases, with separate guidelines applying to these purchases.
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City of Grand Terrace
Fiscal Policy Policy No. 3.01.01
Subject: Purchasing Effective Date: 5/13/14
Page 2 of 6
11, Informal Purchases ($501 -$1,000)
The following procedures apply:
A. Funds must be budgeted for the goods or services to be purchased.
B. A Purchase Order(P.O.) is required for purchases.
C. Price quotes are not required for purchases, although they are encouraged when
easily obtainable.
D. Payment for purchases is made by submitting a Purchase Requisition form with
approval by the applicable Department Head or designee (per the Authorized
Approval Listing).
E. Approval from the City Manager is required.
Ill. Open Market Purchases ($1,001 - $10,000)
The following procedures apply:
A. Funds must be budgeted for the goods or services to be purchased.
B. Three (3) informal price quotes must be obtained.
C_ A Purchase Requisition must be submitted to Finance by the requesting
department with the price quotes attached as back-up. Purchase Requisitions
require approval of the applicable Department Head or designee (per the
Authorized Approval Listing).
D. Following Finance review of the Purchase Requisition, a P.O. will be issued by
Finance and mailed to the vendor, with a copy returned to the originating
department. Funds will also be encumbered in the financial system at this time.
(Note: P_O.s are signed by the Finance Director signifying that funds are available
and that the purchasing requirements have been met_)
E. Invoices to be paid against an approved P.O. do not require a Request for
Payment form. Instead, to expedite processing, an approval stamp may be
utilized on the invoice referencing the applicable P.O. (The account code to be
charged does not need to be referenced on the invoice unless the P.O. is
allocated to multiple account numbers, as the invoice will be charged per the
P.O.) Department Head or designee signature is required on the invoice (per the
Authorized Approval Listing).
IV. Formal Purchases (over$10,0001
The following procedures apply:
A. Funds must be budgeted for the goods or services to be purchased.
B. Formal contracting procedures must be followed as enumerated in Section
3.24.080 of the Purchasing Ordinance, including:
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City of Grand Terrace
Fiscal Polic Policy No. 3.01.01
Subject: Purchasing Effective Date: 5/13/14
Page 3 of 6
1. Notice Inviting Bid
2. Bidders' List
3. Bidders' Security
4. Bid Opening Procedure
5. Performance Bonds as applicable
6. Formal Award of Contract by the City Council
C. Following award of contract, a Purchase Requisition should be submitted by the
applicable department, with a copy of the executed contract and City Council staff
report attached as backup. Purchase Requisitions require approval of the
applicable Department Head or designee (per the Authorized Approval Listing).
D. Following Finance review of the Purchase Requisition, a P.O. will be issued by
Finance and mailed to the vendor, with a copy returned to the originating
department. Funds will also be encumbered in the financial system at this time.
(Note: P.O.s are signed by the Finance Director signifying that funds are available
and that the purchasing requirements have been met.)
E. lnvoices to be paid against an approved P.O. do not require a Request for
Payment form. Instead, to expedite processing, an approval stamp may be
utilized on the invoice referencing the applicable P.O. number. (The account code
to be charged does not need to be referenced on the invoice unless the P.O. is
allocated to multiple account numbers, as the invoice will be charged per the P.O.)
Department Head or designee signature is required on the invoice (per the
Authorized Approval Listing).
V. Professional Services
A. Professional Services are not awarded via formal bidding, since there are a
number of factors other than pricing used to determine the company that is best
suited to provide the service. Such factors include professional expertise,
experience, service level and references.
B. Although not formally bid, it is recommended that professional services with an
expected value greater than $10,000 utilize a competitive selection process via a
Request for Proposals (RFP).
C. RFPs should be posted on the City's web page and distributed to known
companies with expertise in the applicable service area. Generally, at least 30
days should be allowed for proposal submittal following the RFP issuance date. It
may also be appropriate to schedule a pre-submittal conference to clarify the RFP
and respond to the interested parties' questions.
D. Contracts for professional services with a value of $10,000 or less may be
awarded by the City Manager.
E. Contracts for professional services with a value greater than $10,000 must be
awarded by the City Council.
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Subject: Purchasing Effective Date: 5/13/14
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F_ Following award of contract, a Purchase Requisition should be submitted by the
applicable department, with a copy of the executed contract and City Council staff
report (if applicable) attached as backup. Purchase Requisitions require approval
of the applicable Department Head or designee (per the Authorized Approval
Listing).
G. Following Finance review of the Purchase Requisition, a P.O. will be issued by
Finance and mailed to the vendor, with a copy returned to the originating
department. Funds will also be encumbered in the financial system at this time.
(Note: P.O.s are signed by the Finance Director signifying that funds are
available and that the purchasing requirements have been met.)
H. Invoices to be paid against an approved P.O. do not require a Request for
Payment form. Instead, to expedite processing, an approval stamp may be
utilized on the invoice referencing the applicable P.O. number. (The account code
to be charged does not need to be referenced on the invoice unless the P.O. is
allocated to multiple account numbers, as the invoice will be charged per the P.O.)
Department Head or designee signature is required on the invoice (per the
Authorized Approval Listing).
VI. Single Source Purchases 1 Waiver of Biddinq 1 Piggy Backing
A. If it is determined that only one company is available or capable of providing the
desired goods or services, the purchase may be approved without obtaining price
quotes (purchases of $1,001 to $10,000), conducting formal bidding (purchases
aver $10,000), or utilizing an RFP process (professional services over $10,000),
provided that approval is received for the single source purchase, as follows:
1. Purchases with a value of $1,001 - $10,000: Memo explaining the basis for
the single source purchase must be submitted by the applicable Department
Head along with the Purchase Requisition and approved by the City
Manager.
. Purchases with a value greater than $10,000: Approval for the single source
purchase must be submitted via a staff report in conjunction with the
contract award and approved by the City Council.
B. If a purchase is not considered to be single source but a waiver of
bidding/competitive selection is requested because it is in the best interest of the
City, approvals must be obtained by the City Manager ($1,001 - $10,000) or City
Council (over$10,000) as described above.
C. Justification must be provided if a waiver of bidding/competitive selection is
requested. A waiver is an exception to the competitive bid process. As a result,
explanation/documentation is required to begin the review process. Below are
examples for requesting the waiver of the bid/competitive selection process:
i. Sole Source: Only one company is available/capable of performing the
task or providing the goods or services; the goods or services provided by
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City of Grand Terrace Fiscal Policy Policy No. 3.09.01
Subject: Purchasing Effective Date: 5/13/14
Page 5 of 6
a specific company are unique in quality, performance, or use
specifications.
ii. Time Sensitive: The need for the desired good/service is needed to
correct or prevent an emergency;
iii. Intrinsic Value: When a good or service is determined by its historic,
artistic, or educational value.
D. If the City has determined that another municipality (host agency) has completed
the competitive bid/RFP process awarding a contract within the last 6 months for
goods and/or services that the City may require, in order to avoid time and costs,
the City has the option to "piggyback" on the public agency's existing contract
provided the following requirements are met;
L Approval roust comply with the purchasing policy as follows:
a. $0 - $500 requires Department Head approval;
b. $501 - $10,000 requires City Manager approval; and
c_ Over $10,000 requires City Council approval.
ii_ The other public agency's bid and contract award process meet's the
City's bid and contract award requirements;
iii. The host agency and the City (piggybacking agency) must sign an
agreement allowing the piggyback;
iv. The vendor/contractor must agree to the piggyback, offering the same
terms and conditions written in their contract to the piggyback agency;
and
V. The vendor must inform both the host agency and the piggybacking
agency in writing that they agree to the piggyback.
Vli. Contract Requirements
A. If a purchase involves work to be performed on City premises or the public right of
way, regardless of the dollar amount, a City contract is recommended to
adequately address liability issues. If there is uncertainty regarding whether or not
a contract is needed for a given purchase, the City Attorney should be consulted.
B. Contracts up to $10,000 in value may be approved by the City Manager, following
City Attorney approval as to legal form. Whenever possible, the standard City
contract form should be used.
C. Contracts over $10,000 in value require City Council approval via the agenda
process.
City of Grand Terrace
Fiscal Policy Policy No. 3.01.01
Subject: Purchasing
Effective Date: 5113/14
Page 6 of 6
D. Contracts should include a requirement for the service provider to obtain a City
Business License. The department administering the contract is responsible for
coordinating with Finance to ensure that a Business License Is obtained if the
contract value is $10,000 or less (City Manager approval). If the contract value is
greater than $10,000 (City Council approval), the City Clerk's Office will
coordinate with Finance to ensure that a Business License is obtained.
E. The department administering the contract is also responsible for obtaining the
insurance certificates from the service provider and verifying that the coverage
conforms to the contract requirements if the contract value is $10,000 or less (City
Manager approval). If the contract value is greater than $10,000 (City Council
approval), the City Clerk's Office will be responsible for obtaining the insurance
certificates from the service provider and verifying that the coverage conforms to
the contract requirements.
52
City of Grand Terrace
Fiscal Policy_ Policy No. 3.01.09
Subject: Environmentally Preferable Purchasing Effective Date: 11/16116
Page 1 of 8
1.0 STATEMENT OF POLICY
It is the policy of the City of Grand Terrace to:
• Institute practices that reduce waste by increasing product efficiency and effectiveness;
Purchase products that minimize environmental impacts, toxics, pollution, and hazards
to worker and community safety;
• Purchase products that reduce greenhouse gas emissions in their production, shipping,
use and discard; and
• Purchase products that include. recycled content: are durable and long-lasting, and
conserve energy and water
2.0 PURPOSE
This Policy is adopted in order to:
• Conserve natural resources,
• Minimize environmental impacts such as pollution and use of water and energy,
• Eliminate or reduce toxics that create hazards to workers and our community,
• Support strong recycling markets,
• Reduce materials that are landfilled,
• Increase the use and availability of environmentally preferable products that protect the
environment,
• Identify environmentally preferable products and distribution systems,
• Reward manufacturers and vendors that reduce environmental impacts in their
production and distribution systems or services, and
• Create a model for successfully purchasing environmentally preferable products and
encourage other purchasers in our community to adopt similar goals.
3.0 STRATEGIES FOR IMPLEMENTATION
3.1 Source Reduction
3.1.1 Institute practices that reduce waste, encourage reuse, and result in the purchase of
fewer products.
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City of Grand Terrace Policy No. 3.01.02
Fiscal Policy _
Subject: Environmentally Preferable Purchasing Effective Date: 11/15/16
Page 2of8
3.1.2 Purchase remanufactured products such as toner cartridges, tires, furniture,
equipment and automotive parts when possible.
3.1.3 Consider short-term and long-term costs in comparing product alternatives. This
includes evaluation of total costs expected during the time a product is owned,
including, but not limited to, acquisition, extended warranties, operation, supplies,
maintenance and replacement parts, disposal costs and expected lifetime compared
to other alternatives.
3.1.4 Purchase products that are durable, long lasting, reusable or refillable and to the
extent possible avoid purchasing one-time use or disposable products.
3.1.5 Request vendors eliminate packaging or use the minimum amount necessary for
product protection. Vendors shall be encouraged to take back packaging for reuse.
3.1.6 Specify a preference for packaging that is reusable, recyclable or compostable,
when suitable uses and programs exist.
3.1.7 Encourage vendors to take back and reuse pallets and other shipping materials.
3.1.8 Encourage suppliers of electronic equipment, including but not limited to computers,
monitors, printers, and copiers, to take back equipment for reuse or environmentally
sound recycling when the City of Grand Terrace discards or replaces such
equipment, whenever possible.
3.1.9 Consider provisions in contracts with suppliers of non-electronic equipment that
require suppliers to take back equipment for reuse or environmentally sound
recycling when the City of Grand Terrace discards or replaces such equipment,
whenever possible.
3.1.10 Promote electronic distribution of documents rather than printing or copying.
11.11 When producing paper documents, print and copy all documents on both sides to
reduce the use and purchase of paper- Printers and copiers shall be set to default
to duplex.
3.1.12 Reduce the number and type of equipment needed to perform office functions to
save energy and reduce purchasing and maintenance costs. Eliminate desktop
printers, redundant network printers and reduce the number of fax machines leased
or owned by the City of Grand Terrace. Consider lease or purchase of multi-
function devices.
3.1.13 Ensure all imaging equipment is installed with energy and resource-efficient settings
set as default.
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City of Grand Terrace Policy No. 3.01.02
Fiscal Policy
Subject: Environmentally Preferable Purchasing Effective Date: 11/15116
Page 3 of 8
3.2 Recycled Content Products
3.2.1 Purchase products for which the United States Environmental Protection Agency
(U.S. EPA) has established minimum recycled content standard guidelines, such as
those for printing paper, office paper, janitorial paper, construction, landscaping,
parks and recreation, transportation, vehicles, miscellaneous and non-paper office
products.
3.2.2 Purchase multi-function devices, copiers and printers compatible with the use of
recycled content and remanufactured products.
3.2.3 To the extent feasible and in accordance with California Public Contract Code, Sec.
10409, purchase re-refined lubricating and industrial oil for use in its vehicles and
other equipment, as long as it is certified by the American Petroleum Institute (API)
as appropriate for use in such equipment. This section does not preclude the
purchase of virgin-oil products for exclusive use in vehicles whose warranties
expressly prohibit the use of products containing recycled oil.
3.2.4 Ensure- pre-printed recycled content papers intended for distribution that are
purchased or produced contain a statement that the paper is recycled content and
indicate the percentage of post-consumer recycled content.
3.3 Energy Efficient and Water Saving Products
3.3.1 Purchase energy-efficient equipment with the most up-to-date energy efficiency
functions. This includes, but is not limited to, high efficiency space heating systems
and high efficiency space cooling equipment.
3.3.2 Replace inefficient interior lighting with energy-efficient equipment when possible.
3.3.3 Replace inefficient exterior lighting, street lighting and traffic signal lights with
energy-efficient equipment when possible. Minimize exterior lighting where possible
to avoid unnecessary lighting of architectural and landscape features while providing
adequate illumination for safety and accessibility.
3.3.4 Purchase U. S. EPA Energy Star certified products when available.
3.3.5 Purchase U.S. EPA WaterSense labeled water-saving products when available.
This includes, but is not limited to, high-performance fixtures like toilets, low-flow
faucets and aerators, and upgraded irrigation systems.
3.4 Green Building Products and Practices
3.4.1 Consider Green Building practices for design, construction, and operation as
described in the LEED Rating Systems for all building and renovations undertaken
by the City of Grand Terrace.
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City of Grand Terrace
Fiscal Policy Policy No. 3.01.02
Subject:- Environmentally Preferable Purchasing Effective Date: 11/15/16
Page 4 of 8
3.5 Landscaping Products and Practices
3.5.1 Select plants to minimize waste by choosing species for purchase that are
appropriate to the microclimate, species that can grow to their natural size in the
space allotted them, and perennials rather than annuals for color. Native and
drought-tolerant plants that require no or minimal watering once established are
preferred.
3.5.2 Hardscapes and landscape structures constructed of recycled content materials are
encouraged. Limit the amount of impervious surfaces in the landscape. Permeable
substitutes, such as permeable asphalt or pavers, are encouraged for walkways,
patios and driveways.
3.6 Toxics and Pollution Prevention Products and Practices
3.6.1 Manage pest problems through prevention and physicals, mechanical and biological
controls when the City of Grand Terrace and its contractors maintain buildings and
landscapes.
3.6.2 Use products with the lowest amount of volatile organic compounds (VOCs), highest
recycled content, low or no formaldehyde and no halogenated organic flame
retardants when purchasing building maintenance materials such as paint,
carpeting, adhesives, furniture and casework.
3.6.3 Prohibit the purchase of products that use polyvinyl chloride (PVC) such as, but not
limited to, furniture and flooring.
3.6.4 Purchase products and equipment with no lead or mercury whenever possible. For
products that contain lead or mercury, the City of Grand Terrace should give
preference to those products with lower quantities of these metals and to vendors
with established lead and mercury recovery programs_ In addition, whenever lead-
or mercury-containing products require disposal, the City of Grand Terrace will
dispose of those products in the most environmentally safe manner possible All
fluorescent lamps and batteries will be recycled.
3.6.5 Purchase or specify commercial carpeting that meets NSF/ANSI 140 Standard for
Sustainable Carpet Assessment and require old carpet that is removed be recycled.
3.6.6 When replacing vehicles, consider less-polluting alternatives to diesel such as
compressed natural gas, bio-based fuels, hybrids, electric batteries, and fuel cells,
as available.
3.7 Bio-Based Products
3.7.1 Encourage the use of vehicle fuels made from non-wood, plant-based contimts such
as vegetable oils whenever practicable.
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City of Grand Terrace
Fiscal Policy Policy No. 3.01.02
Subject: Environmentally Preferable Purchasing Effective Date: 11/15/16
Page 5 of 8
3.7.2 Use paper, paper products and construction products made from non-wood, plant-
based contents such as agricultural crops and residues when feasible.
3.7.3 Use bio-based plastic products that are biodegradable and compostable, such as
bags, film, food and beverage containers, and cutlery when feasible.
3.7.4 Purchase compostable plastic products that meet American Society for Testing and
Materials (ASTM) standards as found in ASTM D6400. Meet ASTM D6868
standards for biodegradable plastics used as coatings on paper and other
compostable substrates when feasible.
3.8 Forest Conservation Products
3.8.1 To the greatest extent practicable, do not procure wood products such as lumber
and paper that originate from forests harvested in an environmentally unsustainable
manner.
3.8.2 Encourage the purchase or use of previously used or salvaged wood and wood
products whenever practicable.
4.0 RESPONSIBILITIES
4.1 City of Grand Terrace recognizes its duty to act in a fiscally responsible as well as a
timely manner.
4.2 Nothing contained in this policy shall be construed as requiring a department,
purchaser or contractor to procure products that do not perform adequately for their
intended use, exclude adequate competition, risk the health or safety of workers and
citizens, or are not available at a reasonable price in a reasonable period of time.
4.3 Nothing contained in this policy shall be construed as requiring the City of Grand
Terrace, department, purchaser, or contractor to take any action that conflicts with
local, state or federal requirements.
4.4 Grand Terrace has made significant investments in developing a successful
recycling system and recognizes that recycled content products are essential to the
continuing viability of that recycling system and for the foundation of an
environmentally sound production system.
5.0 IMPLEMENTATION
5.1 The Director of Finance shall implement this policy in coordination with other
appropriate Grand Terrace personnel.
57
City of Grand Terrace fiscal Policy Policy No. 3.01.02
Subject: Environmentally Preferable Purchasing Effective Date: 11/15/16
Page 6 of 8
5.2 Upon request, buyers making the selection from competitive bids shall be able to
provide justification for product choices that do not meet the environmentally
preferable purchasing criteria in this policy.
5.3 Encourage vendors, contractors and grantees to comply with applicable sections of
this policy for products and services provided to the City of Grand Terrace.
6.0 PROGRAM EVALUATION
6.1 The Director of Finance shall periodically evaluate the success of this policy's
implementation and report to the City Council.
7.0 DEFINITIONS
7A "American Society for Testing and Materials" means ASTM International, an open
forum for the development of high quality, market relevant international standards
use around the globe.
7.2 "Bio-Based Products" means commercial or industrial products (other than food or
feed) that utilize agricultural crops or residues but does not include products made
from forestry materials.
7.3 "Biodegradable plastic" means the degradation of the plastic must occur as a result
of the action of naturally occurring microorganisms.
7.4 "Buyer" means anyone authorized to purchase or contract for purchases on behalf
of this jurisdiction or its subdivisions.
7.5 "Compostable plastic" means plastic that is biodegradable during composting to
yield carbon dioxide, water and inorganic compounds and biomass, at a rate
consistent with other known compostable materials and leaves no visually
distinguishable or toxic residues.
7.6 "Contractor" means any person, group of persons, business, consultant, designing
architect, association, partnership, corporation, supplier, vendor or other entity that
has a contract with the City of Grand Terrace or serves in a subcontracting capacity
with an entity having a contract with the City of Grand Terrace for the provision of
goods or services.
7.7 "Degradable plastic" means plastic that undergoes significant changes in its
chemical structure under specific environmental conditions.
7.8 "Energy Star" means the U-S. EPA's energy efficiency product labeling program.
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Fiscal Policy
Subject: Environmentally Preferable Purchasing Effective Date: 11/15/16
Pa e7of8
7.9 "Energy-Efficient Product" means a product that is in the upper 25% of energy
efficiency for all similar products, or that is at least 10% more efficient than the
minimum level that meets Federal standards.
7.10 "Federal Energy Management Program" is a program of the Department of Energy
that issues a series of Product Energy Efficiency Recommendations that identify
recommended efficiency levels for energy-using products.
7.11 "LEED Rating System" means the most recent version of the Leadership in Energy
and Environmental Design (LEED) Rating System, approved by the U.S. Green
Building Council, and designed for rating new and existing commercial, institutional,
and residential buildings.
7.12 "NSF/ANSI" means NSF International follows the American National Standards
Institute (ANSI) standards development process. Standards are developed by joint
committees (balanced stakeholder+ groups of public health, industry and user
representatives).
7.13 "Post-consumer Material" means a finished material which would normally be
disposed of as a solid waste, having reached its intended end-use and completed its
life cycle as a consumer item, and does not include manufacturing or converting
wastes.
7.14 "Pre-consumer Material" means material or by-products generated after
manufacture of a product is completed but before the product reaches the end-use
consumer. Pre-consumer material does not include mill and manufacturing trim,
scrap, or broke which is generated at a manufacturing site and commonly reused
on-site in the same or another manufacturing process.
7.15 "Recovered Material" means fragments of products or finished products of a
manufacturing process, which has converted a resource into a commodity of real
economic value, and includes pre-consumer and post-consumer material but does
not include excess resources of the manufacturing process.
7.16 "Recycled Content" means the percentage of recovered material, including pre-
consumer and post-consumer materials, in a product.
7.17 "Recycled Content Standard" means the minimum level of recovered material and/or
post-consumer material necessary for products to qualify as "recycled products."
7.18 "Recycled Product" means a product that meets the City of Grand Terrace's
recycled content policy objectives for post-consumer and recovered material.
7.19 "Remanufactured Product" means any product diverted from the supply of discarded
materials by refurbishing and marketing said product without substantial change to
its original form.
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City of Grand Terrace
Fiscal Policy Policy No. 3.01.02
Subject: Environmentally Preferable Purchasing Effective Date: 11/15/16
Page 8 of 8
7.20 "Reused Product" means any product designed to be used many times for the same
or other purposes without additional processing except for specific requirements
such as cleaning, painting or minor repairs.
7.21 "Source Reductior}" refers to products that result in a net reduction in the generation
of waste compared to their previous or alternate version and includes durable,
reusable and remanufactured products; products with no, or reduced, toxic
constituents; and products marketed with no, or reduced, packaging.
7.22 "U.S. EPA Guidelines" means the Comprehensive Procurement Guidelines
established by the U.S. Environmental Protection Agency for federal agency
purchases as of October 2007 and any subsequent versions adopted.
7.23 "Water-Saving Products" are those that are in the upper 25% of water conservation
for all similar products, or at least 10% more water-conserving than the minimum
level that meets the Federal standards.
7.24 "WaterSense" means a partnership program by the U.S. Environmental Protection
Agency. Independent, third-party licensed certifying bodies certify that products
meet EPA criteria for water efficiency and performance by following testing and
certification protocols specific to each product category. Products that are certified
to meet EPA specifications are allowed to bear the WaterSense label_
8.0 EFFECTIVE DATES
8.1 This policy shall take effect on November 15, 2016.
so
City of Grand Terrace
Fiscal Polic Policy No. 3.02
Subject: Budget Appropriation Adjustments
Effective Date: 5/13114
Page 1 of 3
PURPOSE- To establish policies and procedures regarding changes to appropriation
amounts after adoption of the Annual Budget by the City Council.
DEFINITIONS:
Type A Adjustments: New or increased appropriations necessary to fund
service level changes, new programs, fixed assets, and expenditures in excess
of approved budget amounts.
Type B Adjustments: New or increased appropriations with offsetting revenues
such that there is no net budgetary impact.
Type C Adjustments: Transfer of budget amounts from one operating program
to another in different funds and/or departments.
Type D Adjustments: Transfer of budget amounts from a Capital Improvement
Plan (CIP) project to another, regardless of fund.
Type E Adjustments: Transfer of budget amounts from one division, program,
or object code to another within the same fund and department.
POLICY:
I. Responsibility
A. Budget adjustments shall be processed at such time it is determined that additional
funds are needed in a program (business unit) so that expenditures will not exceed
the City Council approved appropriation for the program (business unit). This shall
apply to operating programs as well as capital projects.
B. Every budget adjustment request requires the completion of a Budget
Appropriation Adjustment (BAA) Form. Written justification is required on the BAA
Form for all requests.
II. Procedures and Re uired Approvals
A. Tyoe A: New or increased appropriations from reserves or fund balance
1. New or increased appropriations from reserves or fund balance shall require
City Council approval. A properly completed BAA Form must be submitted as
an attachment to the City Council staff report describing the appropriation
request. The Finance Department will retain the BAA Form following its
review and verification; it will not be included as an attachment to the final staff
report.
2. These adjustments must be approved by the City Council prior to commitment
of funding in excess of budgeted amounts.
ar
City of Grand Terrace Policy No. 3.02
Fiscal Policy
Subject: Budget Appropriation Adjustments Effective Date: 5113/14
Page 2 of 3
B. Type B: New or increased appropriations with offsetting revenues; no net
budgetary impact
1. The City Manager is authorized to approve such appropriations.
2. This type of appropriation adjustment shall require the following approvals:
Requestor: Program Supervisor/Manager
Approval: Department Head
Approval: Finance Director
Approval: City Manager or designee
C. Tyge C: Transfers of budget amounts between operating programs in different
funds and/or departments, regardless of fund, shall require the following approvals:
1. The City Manager is authorized to approve such appropriations.
2. This type of appropriation adjustment scull require the following approvals:
Requestor: Program Supervisor/Manager
Approval: Department Head
Approval: Finance Director
Approval: City Manager or designee
D. Type D: Transfer of budget amounts between Capital Improvement Plan (CIP)
projects, regardless of fund, shall require the following approvals:
1. The City Manager is authorized to approve such appropriations.
2. This type of appropriation adjustment shall require the following approvals:
Requestor: Program Supervisor/Manager
Approval: Department Head
Approval: Finance Director
Approval: City Manager or designee
E. Type E: Transfer of budget amounts from one division, program, or object code to
another within the same fund and department shall require the following approvals:
1. The Finance Director is authorized to approve such appropriations.
2. This type of appropriation adjustment shall require the following approvals:
Requestor: Program Supervisor/Manager
Approval: Department Head
Approval: Finance Director
Ill. Request Procedures
Requests for Budget Appropriation Adjustments shall be completed on the authorized
BAA Form (Exhibit A).
92
City of Grand Terrace
Fiscal Policy Policy No. 3.02
Subject: Budget Appropriation Adjustments
Effective Date: 5/13/14
Page 3 of 3
IV. Routing and Follow-up
A. Type A adjustments (City Council approval required)
1. The department requesting the appropriation adjustment is responsible for
completing the BAA request form and attaching it to the corresponding City
Council staff report.
2. The Finance Director will retain the BAA Form following its review and
verification; it will not be forwarded with the staff report for subsequent
reviews and approvals, nor included as an attachment to the staff report.
3. Upon Council approval, the Finance Department will process the budget
adjustment, with no further approvals on the BAA Form required.
B. All Other Types of Adjustments
1. The department shall prepare the BAA Form and specify in the justification
box of the form, the reason for the adjustment request. If there is insufficient
room for the justification, an additional Word document specifying the
purpose or need for the adjustment may be attached.
2. After departmental staff signatures are obtained, the BAA Form should be
routed to the Finance Director for review and final processing.
V. City Council Staff Reports
A. The recommendation and fiscal impact sections of the report to City Council should
include specific reference to the nature of the appropriation adjustment.
1. If the adjustment is to increase an amount of an existing budgeted project or
program, the proper account codes must be included in the recommended
action.
2. If the request is for a new project or program, the report should indicate the
proposed funding sources and amounts of appropriations required.
3. In addition, if new revenue sources are associated with the proposed
project/program (i.e., grants, special revenues, etc.) these should be included
and identified in the recommended City Council action so that appropriate
revenue accounts can be adjusted.
4. A properly completed BAA Form must be submitted as an attachment to the
City Council staff report describing the appropriation request. The Finance
Department will retain the BAA Form following its review and verification; it
will not be included as an attachment to the final staff report.
e�
EXHIBIT A - City of Grand Terrace Budget Appropriation Adjustment (BAA) Form
Date:
Department:
Cost Center.
Type of Adjustment:
O A) New/Additional Appropriations(Expense)from Reserves/Fund Balance
Required Signatures: 1:Requestor 2.Dept.Head 3:Finance Dept. 5: City Manager 6: City Council
0 B) New/Additional Appropriations(Expense)with offsetting Revenue(no net budgetary impact). Council Action Date
Required Signatures: is Requestor 2:Dept.Head 3:Finance Dept. 5: City Manager 6: City Council
Q C) Transfers between Funds 8 Departments(Inter-fund/Inter-Departmental Transfers) Council Action No.
Required Signatures: 1:Requestor 2:Dept.Head 3:Finance Dept. 5: City Manager
0 D) Transfers between Capital Improvement Program(CIP)projects within the same fund(no net budgetary impact)
Required Signatures: 1:Requestor 2:Dept.Head 3:Finance Dept. 5: City Manager
0 E) Transfers between Cost Centers within the same Department&Fund(no net budgetary impact)
Required Signatures: 1:Requestor 2:Dept.Head 3:Finance Dept.
Revenur
GL Account No. Account Description Current Increase{ Revised/ Justification/Reason for
Budget (Decrease) Budget Budget Appropriation Adjustment
000
0.00
TOTAL t,CJ 0 00 0.00
Expense
GL Account No. Account Description Current Increase) Revised/ Justification/Reason for
Budget (Decrease) Budget Budget Appropriation Adjustment
0.00
0.00
000
000
000
0.00
0.00
0.00
0.00
TOTAL .3m 0.00 0.00
Transfer OUT(From)
GL Account No. Account Description Current Increase! Revised/ Justification/Reason for
Budget (Decrease) Budget Budget Appropriation Adjustment
0-00
TOTAL r r."', WDD 0.00
Transfer IN(To)
GL Account No. Account Description Current Increase/ Revised/ Justification/Reason for
Budget (Decrease) Budget Budget Appropriation Adjustment
000
TOTAL 0 00 0.00 000
Prepared by: Requestor Extension: Date:
Authorization: Department Head Extension: Date:
Approval as to Funds: Finance Department Extension: Date:
Authorization: City Manager Extension: Date:
Note.- For Type A adjustments,please attach minutes from the City Councf2 meeting to provide documentation of City Council approval.
Signature by the Mayor on the BAA Form is not required. 65
aaA Farm vt,Polity 3 02.Jan2013,PI
City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses
Effective Date: 5/13/14
Page 1 of 10
PURPOSE:
This policy establishes the basic guidelines for travel on City business. It defines the City's
expectations of its employees (and other City officials) who are required to travel in connection
with their work responsibilities, identifies which expenses will be advanced or reimbursed to the
employee by the City, and which expenses are considered the personal responsibility of the
employee. Business travel is defined as authorized attendance at conferences and seminars,
or authorized travel for any other purpose in connection with official City responsibilities.
Business travel includes one-day trips and trips requiring one or more overnight stays.
As a general rule, this policy is not intended to cover business meetings of less than one day
involving travel of less than 150 miles round trip, even though employees may be reimbursed for
their cost of meals and travel. In such cases Department Head discretion is required and
departments may decide that such travel fits within the scope of this policy. As an example, a
day trip to Los Angeles to attend a business meeting will likely involve meals and transportation
expense reimbursement. However, such travel may involve less than $100 of expenditures and
are generally not considered as part of the scope of this policy.
POLICY:
1, General Standards
A. Mandatory Use of the Travel Authorization & Expense Reporting Form (Exhibit A).
The Travel Authorization & Expense Reporting Form (Travel Form) is a mandatory
document for all employees, whether or not one expects to receive a travel advance
or reimbursement for business related travel expenses. It serves as an estimate of
the total cost of attending conferences, meetings and seminars, and provides
documentation of cash advances, vendor payments and credit card purchases.
Equally important, it serves as documented authorization to travel on City business
and helps identify when the employee is traveling on behalf of the City in case of an
accident or other incident. The requirement to submit a Travel Form also applies to
City Council Members and other appointed officials (such as Planning
Commissioners), who will coordinate travel with the City Manager's Office and
obtain City Manager approval of the Travel Form as a prudent internal control
measure.
B. Policy Emphasizes Economy and Practicality with Reasonable Subsistence and
Accommodations while on City Business
1. This policy provides for reasonable subsistence, modes of travel, and lodging
and accommodations while on City business, The intent is to allow employees
to eat in moderately priced restaurants, stay in moderately priced hotels, and
travel comfortably. Employees are responsible for using good judgment in
making reservations, and travel decisions should emphasize economy and
efficiency at all times. For example:
67
City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses
Effective Date: 5/13/14
Page 2 of 10
a- When using air travel, employees should always book flights in coach as
opposed to first class.
b. Although the Internet offers numerous specials and low-priced flights,
flexibility is often sacrificed and sales are often final. Employees should
consider this when booking their flights and can be held personally
accountable if a flight is booked incorrectly, costing the City money. To
provide more flexibility, designated travel agencies should be used,
C. When choosing a hotel for a conference, it is preferable to stay at the
hotel where the conference is being held even though it may be slightly
more expensive than others in the area.
2. It is permissible to combine personal travel with business travel, such as
departing for a business conference a few days early to utilize personal
vacation time. But only strictly business-related expenses will be advanced or.
reimbursed and personal travel shall not result in higher business travel costs
or they must be reimbursed to the City.
D. Policy is Not Intended to be All Inclusive
1. This policy is not intended to address every issue, exception or contingency
that may arise in the course of City travel or attendance at meetings.
2. Accordingly, the basic standard that should always prevail is to use good
judgment and economy in the use and stewardship of City funds.
li. Travel Authorization & Expense Reporting Form ("Travel Form")
A, Travel Authorization
1. Travel Authorization approval by Department Head and City Manager is
required whenever:
a. Total estimated cost will exceed $200; or
b. Overnight accommodations will be required.
2. Department Head authorization is acceptable for employee travel that is
estimated at $200 or less and does not involve overnight accommodations.
3. Travel Restrictions
a. Out-of-state travel authorizations require approval by the City Manager
(or hislher designee).
b. Department Head travel authorizations require approval of the City
Manager (or his designee).
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City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses
Effective Date: 5/13114
Page 3 of 10
4. Determining Methods of Payment for Travel Expenses
a. The City will pay for legitimate and reasonable travel-related business
expenses, including transportation, lodging, registration fees, meals, and
any other related expenses if they are for official business and fit within
these guidelines.
b. There are four methods of payment for travel-related expenses: (1) direct
payment to vendors by check; (2) payment by City credit card (secured in
the Finance Department); (3) reimbursement to the employee for out-of-
pocket expenses; and (4) cash advances, which include per diem.
c. Direct payments to vendors are made by the City to an organization to
pay for specific costs related to the trip. These costs usually include
registration fees, lodging and airfare.
d. City credit card (may be used to prepay travel expenses, including
registration fees, lodging and airfare, or may be used to cover expenses
as they arise on the trip. Credit cards may not be used to advance per
diem.
e. The employee will be reimbursed for actual, reasonable and allowable
out-of-pocket expenses related to travel on City business. The employee
must account for out-of-pocket expenses with receipts.
f. Cash advances, including per diem, are lump sum payments made to the
employee prior to one's travel based on reasonable estimated expenses.
Ground transportation is often difficult to estimate, but may be advanced
to the employee using reasonable estimates based on the itinerary. Upon
the employee's return, and with the exception of per diem expenses, the
employee must account for advanced expenses with receipts. Advances
exceeding substantiated expenses must be returned to the City. If
authorized expenses (excluding meals and incidentals covered by per
diem) exceed the amount advanced, the City will reimburse the employee
for the difference.
Note: Receipts are not needed to justify meals and incidental
expenses covered by per diem.
g. To obtain direct vendor payments or to receive a cash advance, the
employee must do the following prior to his trip:
1) Complete the appropriate sections of the Travel Form.
2) Attach documentation for all payments requested. This would
include copies of registration forms, announcements, itineraries, and
copies of seminar brochures that provide detail of costs.
City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses Effective Date: 5/13/14
Page 4 of 10
3) Attach completed and signed Direct Pay Request forms for all
travel-related payment requests.
a) Include the appropriate authorization signatures.
b) Retain a copy of the completed form to reconcile and account
for actual expenses upon return from trip.
c) Submit the Travel Form and any Direct Pay Request forms to
the Accounts Payable section of the Finance Department.
5. Per Diem (Meals and Incidentals)
a. Meals and incidentals, as defined by Internal Revenue Service (IRS)
guidelines, include all meals and miscellaneous hotel services, such as
tips to waiters and porters. Per Diem will be paid at the current rates
established by IRS guidelines determined by the minimum federal per
diem rate table for the City's region. All IRS tax rules will apply.
b. By IRS regulations, per diem is defined as travel subsistence extending
beyond one day and there is no requirement to provide receipts.
However, for one day or partial days of travel, meals expense receipts
are required and the standard one day, non-per diem meal allowance will
be $45 allocated as follows:
Breakfast: $ 8.00
Lunch: $12,00
Dinner: $25,00
If an employee is advanced money for one-day or partial day meals and
the total amount of all receipts is less than the amount advanced, the
difference must be reimbursed to the City.
Conversely, if the employee exceeds the total one-day or partial day
standard non-per diem meal allowance and is requesting
reimbursement, receipts MUST be provided and reimbursement shall be
at the discretion of the Finance Director based on the circumstances,
c. As a general rule, employees are expected to base their requests for
daily meals and incidentals according to the federal per diem rates.
d_ As an alternative, an employee can elect not to receive per diem and
request reimbursement of actual, reasonable and allowable subsistence
expenses that are substantiated with receipts. This alternative must be
approved in advance and receipts must accompany the request for
reimbursement. However, a combination of per diem and reimbursement
of meals and incidental business expenses is prohibited.
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City of Grand Terrace Policy No. 3.03
Fiscal Policy
Subject: Travel & Related Business Expenses Effective Date: 5/13114
Page 5 of 10
e. Partial per diem for travel of more than one day may be advanced
depending on the employee's departure time and return time. The
request for partial or full per diem will be based on the employee's
itinerary and will be granted based on a `fair and reasonable' request.
Partial days per diem will be prorated as follows:
1) Travel of less than 12 hours in a day will be prorated to one-half
day of per diem.
2) Travel of 12 hours or more in a day will count as a full day for per
diem.
For example, assuming a daily per diem of $45, if an employee leaves
on Monday at 6:00 A.M. to San Francisco for a business conference and
returns to work at 1.00 P.M. on Tuesday, the per diem advance would be
$90.
6. Other Expenses
a. Alcoholic Beverages — Expense reimbursement for alcoholic beverages
will not be allowed.
b. Spouses and Guests — Spouses and guests are welcome to accompany
employees on City travel and at conferences, seminars and meetings.
However, any additional costs associated with the participation of a
spouse or guests are the responsibility of the employee.
7. Method of Travel
a. When planning the transportation portion of the trip, the employee must
consider all aspects of cost to the City, such as daily expenses,
overtime, lost work time, and actual transportation costs. In general,
common carrier (bus, train or plane) is preferred mode of transportation.
b. The City will only pay or reimburse employees for the cost of coach class
flights.
C. Employees shall be responsible for canceling any airline or hotel
reservations they will not use. Any charge for an unused reservation
shall be considered the employee's personal expense, unless failure to
cancel the reservation was due to circumstances beyond the employee's
control.
d. If available, a City-owned vehicle should be used for travel unless the
employee receives a mileage allowance.
e. If a City vehicle is not available, or if there is another reason why the
employee should drive his/her personal automobile, the City will
reimburse the employee with either the cost of the most appropriate
71
City of Grand Terrace Policy No. 3.03
Fiscal Policy
Subject: Travel & Related Business Expenses Effective Date: 5/13114
Page 6 of 10
means of transportation, or the actual mileage involved in the travel,
whichever is the lesser of the two.
f. The reimbursed mileage rate for use of a private vehicle for City travel
will be at the current Standard Federal Mileage Rate set by the IRS.
g. Mileage reimbursement for a private vehicle being used for City travel
must consider the employee's normal commute to work and whether the
employee receives a monthly vehicle allowance. If the employee does
not receive a vehicle allowance, the employee is entitled to
reimbursement for all business miles driven, with the following
exceptions:
1} If travel begins and ends at work, the entire business mileage will
be reimbursed.
2) If travel begins at work and ends at home (or vice versa), and if the
total business mileage driven is less than the total mileage that
would have been driven if travel began and ended at work, the total
mileage can be claimed. (Example: John Doe lives in Banning and
is attending a morning conference in Los Angeles. The trip from
Banning to Los Angeles is 75 miles, but is only 60 miles from
Grand Terrace to Los Angeles. Since his normal commute would
bring him to Grand Terrace and 10 miles closer, i,l this case John
would be reimbursed 120 miles, the round-trip distance from City
Hall).
3) If travel begins at home and ends at horse, and if the total business
mileage driven is less than the total mileage that would have been
driven if travel began and ended at work, the total mileage can be
claimed_ (Example: Jane Doe lives in Banning and is attending a
conference in Palm Springs. The round-trip mileage from her
house is 120 miles, but would have been 130 miles had she started
at and returned to the Grand Terrace City Hall. In this case Jane
would be reimbursed for the 120-mile round trip).
4) Unider no circumstances shall reimbursement be given to the total
business mileage claimed that exceeds the total mileage had the
travel begun and ended at work,
h_ If an employee already receives a monthly vehicle allowance, a total of
50 mites must be deducted for each one-way travel to or from the
authorized City business travel destination. The mileage exceeding a
50-mile radius is subject to reimbursement, however, the first 50 miles
each way is considered applicable to the employee's vehicle allowance.
The above four rules shall also apply.
72
City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses
Effective Date: 5/13/14
Page 7 of 10
L In order to drive a privately-owned vehicle on City business, the
employee must:
1) Possess a valid California driver's license.
2) Carry liability insurance, as required by the State of California
3) Realize that any damage to the employee's personal vehicle and/or
service or repair occurring on the trip will be the employee's
responsibility, as insurance costs are factored in the IRS per mile
cost reimbursement.
j. If local ground transportation is needed during the trip, the use of public
transit such as airport shuttles, buses, streetcars, and subways is
appropriate.
k. Ground transportation must be efficient and cost effective. Use of taxis,
hotel courtesy buses and local shuttles are allowed when other public
transit or common carriers are not reasonably available.
I. Requests for advances of ground transportation costs (including tips)
should be substantiated whenever possible. If the cost cannot be
substantiated, advances will be based on a fair and reasonable estimate
of expenses.
m. Ground transportation receipts are required for reimbursement.
Employee requests for out-of-pocket reimbursement of ground
transportation costs without receipts are subject to review and approval
by the Finance Director.
n. The use of a rental car is authorized in cases where it is economical or
more feasible relative to using ground transportation.
o. If a car rental is required, the employee may request reimbursement for
out-of-pocket costs including fuel, upon return from business travel.
Receipts are required. The optional car rental agency-provided
insurance is not a reimbursable cost. Since employees are normally
insured by their own automobile insurance carrier for use of a rental
vehicle, employees may opt for this coverage at their own expense.
p. The City will reimburse all reasonable business travel expenses,
including bridge tolls and parking fees incurred as a result of an
employee's authorized use of a private vehicle or City vehicle while
traveling on City business. Receipts are required.
q. Without receipts, any employee request for out-of-pocket reimbursement
of costs incurred as a result of an employee's authorized use of a private
vehicle or City vehicle while traveling on City business is subject to
review and approval by the Finance Director and additional approval by
the City Manager.
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City of Grand Terrace
Fiscal Policy Policy No. 3.03
Subject: Travel & Related Business Expenses Effective Date: 5/13/14
Page 8 of 10
8. Compensation for Travel Time (Non-Exempt Employees)
a. When travel time exceeds the normal workday or workweek, the City's
rules for overtime apply to those employees eligible for overtime.
b. In determining overtime compensation, normal commute time should be
deducted from total travel time.
c. Normal unpaid meal periods are not considered work time while
traveling.
d. Overtime eligibility applies equally to drivers and passengers, and should
be granted whether travel occurs during normal workdays or on
weekends or evenings.
9. Lodging
a_ Lodging is allowed for attendance at conferences, seminars or meetings
that are in excess of 50 miles or one hour of travel time, one-way, from
the employee's home. The City Manager may approve exceptions to the
50-mile/one hour minimum if he/she considers the request to be
reasonable and practical, especially considering the destination, the
difficulty of the commute, and the starting time of the conference.
b. Reasonable lodging expenses will be paid at actual cost including taxes
and parking, for as many nights as necessary.
c_ The lodging accommodations should be economical and practical. In
general, the employee should select the most reasonably priced
accommodations available, but consistent with the purpose and goals of
the trip.
d_ When choosing a hotel for a conference, it is preferable to stay at the
hotel where the conference is being held even though it may be slightly
more expensive than others in the area, in order to reduce transportation
expenses such as cab fares.
e. Other non-business related room charges, including movies or
refreshments are not reimbursable.
f. When making lodging reservations, be sure to ask if a "government rate"
is available. Some cities exempt travelers on government business from
their local transient occupancy tax (TOT). This can represent as much
as a 12%-15% savings on lodging costs depending on the TOT rate.
Check with the hotel for this exemption and form.
g. Since there is seldom a difference in the room rate for double
occupancy, it is permissible for an employee to share a room with a
74
City of Grand Terrace Policy No. 3.03
Fiscal Policy
Subject: Travel & Related Business Expenses Effective Date: 5/13/14pa e 9 of 90
spouse or guest at no additional cost to the City. However, if double
occupancy of a room by a non-City employee results in an increased
room rate, the difference will be the employee's personal expense.
Furthermore, incurring a non-business related expense using advanced
City funds is prohibited.
10. incidental Expenses
a. Incidental expenses include but are not limited to tips for persons who
provide services, such as waiters, maids, porters, and baggage
handlers.
b. Incidental expenses incurred while on an overnight business trip are
covered by per diem. To receive reimbursement on incidental expenses
incurred on a day business trip, receipts should be submitted whenever
possible. If the employee is unable to obtain a receipt, the costs should
be documented on the Travel Form as a reimbursement request, along
with an explanation of why a receipt was not available. Reimbursement
of such unsupported expenses will require approval by the Finance
Director and City Manager.
c. Business-related expenses such as telegrams and telephone calls,
copying and faxing, computer accessories, tapes and other training
materials purchased at a conference are reimbursable with receipts, and
become property of the City. Whenever possible, employees should
anticipate the need for supplies and should take whatever they need with
them instead of purchasing these supplies at their destination, where the
cost may be significantly more than what the City would normally pay.
d. Tips are generally an allowable and reimbursable cost of business travel,
but they must be reasonable.
1) For business trips not involving per diem, they should never exceed
15% of the cost of the meal.
2) For ground transportation, they should not exceed 10% of the fare.
11. Non-Reimbursable Expenses
Personal entertainment costs are not reimbursable. These include
headphones or alcoholic beverages purchased on airplanes, video rentals
and refreshment bars in hotel rooms, spas and gyms, laundry or dry
cleaning and other items of a personal nature.
B. Travel Expense Report
1. When returning from a trip, a final accounting of all expenses related to the
trip must be approved by the Supervisor and Department Head, and then
submitted to the Finance Department within 15 working days. Department
75
City of Grand Terrace
Fiscal Polite Policy No. 3.03
Subject: Travel & Related Business Expenses Effective Date: 5113114
Page 10 of 10
Head Travel Expense Reports must be approved by the City Manager. City
Manager Travel Expense Reports must be approved by the Finance Director
and Mayor,
2, A Travel Expense Report is required in all cases — there are no exceptions.
This is mandatory whether or not the advance received is equal to the
expenses incurred, whether the employee is eligible for additional
reimbursement, or whether money is owed to the City.
3. 1f the employee owes the City for the unused balance of a cash advance
(other than per diem), he/she should pay the amount due to the Finance
Department cashier and attach the receipt to his Travel Expense Report.
The amount returned to the City must be applied as a credit to the expense
account originally used for the cash advance_
4. Supervisors and Department Heads approving Travel Expense Reports are
responsible for ensuring that:
a. All expenses are reasonable, necessary and consistent with this policy;
b, Any required receipts are attached;
c. The final disposition is correct (balance due employee, or balance due
City);
d. Any amounts due to the City are fully reimbursed; and
e. Final accounting of all expenses related to the trip is submitted to the
Finance Department within 15 workdays following the employee's
completed travel.
5. If the City owes the employee money, the employee may request
reimbursement by forwarding the Travel Expense Report to the Finance
Department along with a Request for Payment. If the amount requested is
$100 or less, a Petty Cash Request may be submitted for reimbursement.
Requests for reimbursement will be processed on the next available
Accounts Payable check run, if submitted by the normal Accounts Payable
deadline, but no later than 10 workdays following receipt. Requests for
reimbursement by petty cash will be reimbursed per the City's Petty Cash &
Change Boxes Policy (Fiscal Policy No. 1.02).
6. If the employee owes the City money, he/she should attach a check to the
Travel Expense Report.
ro
EXHIBIT A - City of Grand Terrace - Travel Authorization & Expense Reporting Form
instructions. Prior to travel or training, complete Part i to have anticipated expenses approved Submit a copy of this approved form with each payment
expense submitted Complete Part 11 to confirm total travel expenses including any approved adjustments, if paid with a procurement card, submit a copy of
this approved form with the appropriate bank statement otherwise submit to Accounts Payable within 15 workdays of the travel end date
Part t - Travel Authorization Pro-Trip Employee Signature Pre-Trip Supervisor Signature(whore applicable)
Name: Purpose of Trip:
Job Title: Destination: Out of State?
i-
Division: EnIsr below the departrig date and time then the retum date and Lyre Per�-am t-avee days wA
automatraly be calculated
Business Units %Split Departure Example-
100 o Split Total Equals Date&Tim : 4122114 T:30 AM
Return Example
4114 5,30 P
Expense Type Account# Description of Expenses Amount
Registration.
Lodging
Mileage- M les X Rate: $0 560
Airfare
'Per Diem Check box to aplionaliy
decline Per Diem,
Total Travel Days (Enter tt of Days)>>> whereby actual rece pts
(up to the preset limits)
must be submitted.
•To receive per diem,travel must include an overnight stay = Total
Per Diem:
Misc. Other: ;v
Business Meals. i
Supervisor's Approval Date Total Anticipated Expenses:
X X City Manager Approval (as required) Date
Lpartment Head Approval Date
IX IX IX
Part 11 - Expense Reporting (Please check the appropriate box below and provide details)
No adjustments are necessary. Anticipated expenses match actual expenses incurred.
Advance payments exceeded the actual expenses incurred. Attached is my receipt as evidence of
reimbursement to the City. (Explain below, use negative numbers)
Actual expenses exceeded the anticipated anginal request. Additional funds are required as listed below
Expense Details Expenditure Code Amount. CAL-Card?
i_
T_
Post-Trip Employee I Business
I certfy that this document Signature: I Unit Split
is a true and accurate Bate: Totals:
record of travel expenses Ext- `—— ————s a__ r_————i—_for official City business.
Final Total Expenses:
Supervisor's Approval Date
X X City Manager Approval (as required) Date
Department Head Approval Date
x IX x x
77
f City of Grand Terrace
Fiscal Policy Policy No. 3.04
Effective Date: 5/13/14
Subject: Grants Page 1 of 5
PURPOSE: To clarify, standardize and identify the benefits of seeking potential grants and
the process to properly manage and maximize the use of grants.
GOALS: To seek grant funding that will enhance, support and provide additional services
to the City, which will clearly provide a positive benefit to the community or
needed infrastructure improvements that may not be provided at adequate levels
due to limited City revenues.
POLICY: To perform cost/benefit analysis of a grant request and to identify potential
financial impacts relating to costs associated with the hiring of new personnel,
equipment and technology and other related costs during the term of grant and
,after expiration of grant.
I. Pre-Application Process— Review of Grant/Grant Proposal Information Form
A, Upon notification of a potential grant, the City Manager shall assign it to the
applicable department. A department that receives direct notification of a grant
opportunity may also initiate the grant application process after notifying and
receiving concurrence from the City Manager's office. The department shall
designate a Grant Project Manager to identify and review potential grant sources,
obtain grant application materials and related regulations. This process is not
applicable for ongoing direct allocation grants such as the Community
Development Block Grant (CDBG) program. Sections II, IV and V of the Grant
Policy shall not apply to potential grants of less than $25,000 which the Grant
Project Manager determines have matching or administrative requirements which
can be handled within the approved City budget and current staffing resources,
1. Federal Grants: identify all requirements needed prior to and after
approval of grant such as public hearings, notification of public
clearinghouse, advisory boards, lobbying efforts, monitoring/audits and
type of reporting requirements. Address issues dealing with supplanting
of local funds which restrict funding or existing staffltechnology and limit
funding to only new hires and new technology.
2. State Grants: identify state requirements including mandatory
quarterly/annual reports and monitoring.
3. The annual CDBG entitlement process is not addressed in this policy
because the procedures and regulations are outlined under 24 CFR Part
570. Individual projects funded under CDBG shall be applicable to certain
provisions of this policy relating to Federal grants.
H. Completion of Grant Proposal Information Form &Cost/Benefit Worksheet
A. Based on information obtained, the Grant Project Manager shall complete the
Grant Proposal Information Form (Exhibit A) and Grant Cost/Benefit Worksheet
(Exhibit B). The grant funding identified in Exhibit B should be based on a five-
79
City of Grand Terrace Policy No. 3.04
Fiscal Polio
Subject: Grants Effective Date: 5/13/14
Page 2 of 5
year budget projection if applicable. Exhibits A and B shall be reviewed and
approved by the Department Head, Finance Director, and City Manager (or
designee) as part of the grant application process. -
1- Identify amount or percent of grant funds covering cost of personnel,
consultant services, design, construction, equipment and technology-
2. Identify source and amount of matching funds needed to be budgeted for
the term of the grant.
3. The Finance Director shall determine if adequate funds are available to
meet required local match plus any additional costs exceeding the match.
4. The City Manager and the Finance Director, after consultation with
Human Resources, shall determine whether grants that have supplanting
conditions relating to the hiring of new personnel and technology shall be
considered for funding.
a. Due to the financial impacts of short-term grants that fund
personnel for a limited time, special review must be undertaken to
analyze the cost/benefit of the grant.
b. If the cost/benefit analysis clearly demonstrates a strong
community benefit, the City Manager may. (1) limit the hiring of
new personnel to the term of the grant; or (2) authorize continued
funding of the new personnel costs after termination of the grant.
Ili. Complete Grant Application
A. The grant application shall be completed by the Grant Project Manager under the
direction of the applicable Department Head. The Grant Project Manager shall
write and complete the grant proposal. The Grant Project Manager shall also
confirm that the grant proposal meets eligibility requirements and is consistent
with the grant guidelines; that goals and objectives are clearly identified; and that
the percent and amount of costs funded by the grant and required matching
funds are clearly identified.
1. Ensure the complete computation of personnel and other applicable costs
such as consultant services, estimated design and construction,
equipment and technology, etc. are included in the grant document.
Obtain the computation of component grant costs as follows:
a. Personnel costs: Finance Department
b. Computer equipment and technology-related costs: Information
Services
C. Design and construction costs: Public Works Department
d. Other miscellaneous costs: Finance Department
90
City of Grand Terrace
Fiscal Polic Policy No. 3.04
Effective Date: 5/13114
Subject: Grants pa e 3 of S
2. Verify the source and amount of the required local match for term of
grant. Ensure that all direct costs or in-kind services are identified and
included in the grant as eligible expenses or City matching funds to the
extent possible.
IV. City Council Review
A. A City Council staff report describing and justifying the benefits of the grant
application request shall be presented to the Council prior to grant submittal. In
the event of agenda scheduling conflicts due to untimely notification by funding
agency of grant deadline, the City Council shall be advised by memo (or other
communication such as the City Manager's Report) of the grant submittal. A staff
report shall be submitted after grant award notification requesting acceptance of
grant award.
g. Complete resolution for City Council approval if required by grant.
V. Finance Director/City Manager Review
A. The completed grant application shall be reviewed by the Finance Director and
City Manager(or designee) prior to submittal:
1. Review completed grant proposal and staff report to evaluate cost/benefit
of receiving administering grant, assure consistency with program goals
and identification of personnel, equipment, technology and other related
costs.
2. Verify all costs associated with the grant are identified and fully accounted
for throughout the term of the grant.
3. The City Manager (or designee) shall have the exclusive authority to
execute grant agreements, to sign financial reports and grant
applications.
VI. Grant Award Notification
A. Upon notification of award the Grant Project Manager shall take the following
steps:
1. Prepare a staff report to City Council for acceptance of grant award, if the
City Council had not previously approved the grant application. The staff
report must include a Budget Appropriation Adjustment Form to record
grant revenues and expenditures, as further defined in Fiscal Policy No.
3.03 (Budget Appropriation Adjustments). Coordinate with Finance to
establish/set up fund accounts for grant, if necessary.
er
City of Grand Terrace
Fiscal Policy Policy No. 3.04
Subject: Grants
Effective Date: 5/13/14
Page 4 of 5
2. Following City Council's acceptance, prepare a News Release for review
and approval of the City Manager's office.
3. Schedule a meeting to discuss the applicable financial, project
management and reporting requirements of new grant.
a. Review personnel, equipment and technology data to determine if
needs and costs are still applicable or need updating.
b. Set up separate meeting for design and construction projects to
discuss project issues and grant requirements related to Federal
funding such as preparation of construction-related documents
procurement, Davis Bacon compliance standards, etc., and hold a
pre-construction conference and take minutes of meeting.
C. Initiate all necessary procurement activities, distribute grant
documents to those departments involved in the project, hire
grant-funded personnel and purchase equipment and technology.
d. Monitor projects for compliance with grant requirements, assure
timely submittal of required quarterly, semi-annual or annual
progress reports. The Grant Project Manager shall coordinate with
assigned department to specify the responsibilities of the grant-
funded personnel that may involve collection of data for
preparation of reporting requirements.
4. Provide technical and administrative assistance to the grantee
department if needed.
. Ensure that all grant-funded contracts include the required grant
provisions and route to applicable staff.
&. Prepare appropriate purchase requisitions and progress payment
requests. The Grant Project Manager shall prepare requests for grant
payments and/or reimbursements and obtain appropriate department
signatures and shall review for eligibility of purchase under conditions of
the grant.
7, Coordinate with Finance staff the submittal of copies of grant
documentation associated with grant-funded purchase requisitions. The
Grant Project Manager shall identify personnel, equipment and
technology and reference with specific grant name or number on
documentation for purchase requisition.
8. Prepare electronic transfer draw-downs for Federally-funded projects or
other procedure identified by funding agency.
9_ Review/approve change order requests for construction projects.
82
City of Grand Terrace
Fiscal Policy Policy No. 3.04
Subject: Grants
Effective Date: 5113/14
Page 5 of 5
VII. Grant Expiration/Proiect Completion
A. The Grant Project Manager and assigned department shall notify other
departments of proje,,t completion,
1. Review departmental grant file for completeness of all required
documentation and mandatory reports. Complete final assessment report
if required.
2. Retain records for the required time period.
3. Participate in grant audit or monitoring.
4. Prepare News Release regarding completion of project if appropriate.
5. Schedule and attend grant close-out meetings (construction projects).
EXHIBIT A
GRANT PROPOSAL INFORMATIONAL_ FORM
Name of Grant:
Funding Source: _ Federal _ State Other (Describe)
Responsible Department:
Amount of Grant:
Local Match Required
Please provide brief answers for the following questions.
1. Is the grant consistent with the policy and goals identified in the Grant Policy(Fiscal Policy
No. 3.04)?
I Provide brief description of grant.
3. Describe and identity costs for the personnel, equipment,technology, construction, design
and other items required or needed under this grant (refer to Attachment B).
a. Personnel
b. Equipment/Technology
C. Design/Engineering
d. Construction
e, Other
85
4- Identify Grant Project Manager and other departments/staff who will be responsible for
implementing the grant and providing project oversight-
s. List procedural requirements for grant such as public hearing,advisory board setup, Davis
Bacon, environmental reviews, etc. and describe any potentially costly monitoring or
compliance issues.
6. Identify required reports(quarterly, semi-annual,annual)to be completed after grant award
and what department/staff would be assigned reporting requirements_
7. Describe the cost/benefit aspects of the grant.
s. Complete Attachment B--Grant Cost/Benefit Worksheet
s�
EXHIBIT B
GRANT COSTIBENEFIT WORKSHEET
Grant Local Match Percent Total Cost
Budget by Percent Local Match by Fiscal of Local Revenue Source Local Match {Grant plus Total Cost by
Expenditure Calegorl Grant Bud et Fiscal Year of Grant Budget Year Match I]escr[ lion&Account Code) Local Matchl Fiscal Year
PersonnelfTitle �-----��~------
FY I FY I iFY
FY I IFY IFY
-- I -- FY --�. _ _ ., FY
F�� -* - -- IFY - - - FY
FY IFY FY
Subtotal I { # I I
E~ ntfTechn
FY FY FY
FY IFY -I FY _--- Y
FY - IFY - � -- -- -- --- -- - FY�
- � FY ----- FY --- - -- �FY
FY IFY _ FY
Subtotal I I I I I I
Desl n!E ineeri I i I �r4
FY a FY I FY
FY FY I _ FY
ry -- -FY - - FY
FY FY ---
Subtolal I ,
Construction
FY I FY FY
FY
FY w. FY - -- --- - �, FY
-- -- -- - - FY FY
FY FY _ _ _ _ _ FY
Subtotal I I-
Other I! _ --- ------ --FY
- ---IFY E ?FY -- —t - -- - --FY --
-- -_-._FY —---�- - FY
FY - - -- IFY
FY
- ---
Subtotal I —
Grand Total
FY _IFY
FY t -- ----- [FF
FY FY Y
FY I FY
- - - ---_._.- _G ---
FY FY _ -
FY------- - - i FY - --_--- --- --- - FY ---
TWaI --
ST
City of Grand Terrace
Fiscal Polic Policy No. 3.05
Subject: Donations Effective Date: 5/13/14
Page 1 of 4
PURPOSE: To establish policy and procedures for the solicitation and/or acceptance of
donations made to or for the City. A uniform set of procedures shall be followed
in the acceptance of all donations. Proper approval shall be obtained prior to
acceptance. All cash and capital goods donated to the City shall be accounted
for in accordance with the procedures set forth within this policy.
DEFINITIONS:
Donor: An individual, organization or business entity that is offering a monetary
contribution, personal property or real property to the City as a gift.
Gifts. For purposes of this policy, the terms gift and donation shall be
synonymous. Gifts may be a monetary contribution or a personal and real
property item which the City has accepted, and for which the donor has not
received anything of value in return from the City other than a tax benefit.
Included within the scope of this policy are donations whereby a private business
sponsors or co-sponsors an event on behalf of or in partnership with the City.
POLICY:
I. Legal Basis
A. (Ref. Government Code, Section 37354, Gifts and Bequests.) The City Council,
or its designated representative, may accept or reject any gift made to or by the
City for any public purpose. The City may utilize the gift as prescribed by the
donor or, providing use of the gift or the income from it is not restricted, the gift
may be used for any purpose that furthers City goals and objectives as stated at
the time of acceptance.
B. (Ref. California Code of Regulations, Section 18944.2) A gift will be deemed a
gift to a public agency, and not a gift to a public official, if all of the following
requirements are met: (a) the agency receives and controls the payment; (b) the
payment is used for official agency business; (c) the agency determines the
specific official or officials who shall use the payment; and (d) the agency
memorializes the payment in a written public record and the fling is done within
30 days of receipt of the payment by the agency.
II. Donations to the City
A. Resaonsibility: Donations with an estimated value of $5,000 or less may be
authorized by the City Manager. Donations with an estimated value exceeding
$5,000 must be approved by City Council. The Finance Director shall be responsible
for managing all donations of cash and for the accounting and inventory of all
donated items.
City of Grand Terrace Policy No. 3.05
Fiscal Policy
Subject: Donations Effective Date: 5113/14
Page 2 of 4
B. Solicitation of Gifts: The City Manager may authorize City staff to approach
companies or organizations to request donation of goods, services, or funds to
facilitate the achievement of identified City goals. Such solicitation shall be made
only with the approval of the City Manager.
C. Unsolicited Gifts: Unsolicited donations shall be accepted only if they have a
valid use to the City.
1. Donors who wish to make a gift to the City shall be referred to the
appropriate department head. Those gifts not specific to a given
department shall be referred to the Finance Director.
2. In the event that the offered item does not have any practical use for the
department to which it has been presented, the donor shall be referred to
the Finance Director. If the gift may be of potential value, notice will be
circulated to each Department Head to determine if it can be utilized
elsewhere. The Donor will be notified within two weeks whether the City
will accept the offered gift. If the item clearly has no use to the City or
would be more effectively used elsewhere, the donor will be informed
immediately and referred to an appropriate agency by the Finance
Director.
4. Proof of Ownership: If there is a material question as to the legal
ownership of the offered item, proof of ownership shall be requested.
Such proof of ownership may include but not be limited to copy of title
certificate, receipt for purchase, or signed affidavit verifying ownership.
5. Donors shall be encouraged to place minimal restrictions on the use of a
donated item, allowing the City as much flexibility as possible in
determining its use and liquidation.
D. Conditions for accepting/rejecting donations: Staff shall work with the donor to
assure that restrictions are reasonable and do not leave the donor with
unrealistic expectations regarding use or life of the donation (e.g., if a tree is
donated it could die or be moved). The following are criteria which may be
applied in determining if a donation is appropriate for acceptance:
1. Would use of the item be consistent with existing City policy?
2. Would the maintenance or operating costs associated with the gift be
excessive?
3. Do proposed or imposed conditions or restrictions upon use of the item
make it impractical to accept?
4. Do proposed or imposed conditions or restrictions on disposition of the
item make it impractical to accept?
City of Grand Terrace Policy No. 3.05
Fiscal Policy
Subject: Donations Effective Date: 5113/14
Page 3 of 4
5. Is required accounting of acceptance or use of the item excessively
burdensome?
6. Would the item require extensive repair or maintenance, and if so, are
City means readily available to do so?
7. Does use of the item require the purchase of additional material or
equipment to serve the purpose of the gift?
S. Would acceptance of the item present a conflict of interest for the City or
any of its employees? Regardless of the value of the donation, if the
donor is a contractor, potential contractor or there is reason to believe
there may be a conflict of interest, then the offer shall be referred to the
City Manager who will determine if the gift will be accepted, rejected or
submitted to the City Council for approval.
III. Procedures
A. Non-monetary gifts valued at $5,000 or less: Any single donation whose total
value, as determined by the donor, is $5,000 or 1'ess.
1. A Donation Receipt Form (Exhibit A) will be completed when donations
are received, with the form completed by City staff.
2. The City will not place any value on the gift for the donor. The donor shall
provide proof of current market value. If real property is donated, a
current appraisal report will be required.
3. The City Manager will promptly acknowledge each gift by letter, thanking
the donor for the gift.
4. The Finance Director shall be notified of the acceptance of any capital
asset. Finance shall make the necessary entries on the respective
accounts and property records to ensure that the property is recorded to
the account of the proper City program. This reporting must take place
no later than 30 days after the receipt of the donated item.
B. Non-monetary gifts valued at more than $5,000:
1. Any gift valued at more than $5,000, as determined by the donor, cannot
be accepted without City Council approval. Subsequent to Council's
acceptance, procedures for acceptance of gifts in excess of $5,000 shall
be the same as those in Section A above.
C. Cash Gifts:
1. Depositing Cash Gifts: All cash gifts shall be deposited immediately with
the Finance Department in accordance with the City's Cash Handling &
Control Policy (Fiscal Policy No. 1.01) and shall be accompanied by a
City of.Grand Terrace Policy No. 3.05
Fiscal Policy
Effective Date: 5113114
Subject: Donations Page 4 of 4
copy of the Donation Receipt. Cash donations shall be deposited in the
appropriate restricted or unrestricted revenue account within the
appropriate fund.
2. Restricted Cash Donations:
a. Donation Receipt: Restricted cash donations must be supported
in Finance Department files by the Donation Receipt signed by the
donor, which identifies the name of the donor, the amount and
date of the donation, and the nature of the restriction.
b. Deposit of Restricted Cash Donations: Donations shall be
deposited in a revenue account, which will be managed by the
Finance Director. This fund shall be utilized by all depositing
departments. Upon receipt of donated cash, the department shall
submit a copy of the donation receipt form to the Finance Director
at which time an account number will be assigned to the donation.
C. Council Authorization: A request for authorization must be sent to
the City Council via a staff report and approved by the City
Council before a restricted cash donation is spent for its intended
use. The staff report must state the name of the donor, the
amount of the donation, the date the donation was received and
the nature of the restriction.
d. Procedures for Expending Donated Cash: The donation may be
liquidated by the expending department when an approved
purchase is made. Any over-expenditures will be charged to the
department's operating budget. Funds shall remain in this
account until they are entirely expended in accordance with the
terms of the gift. If the funds are not expended as intended, they
must be returned to the donor, or the donor must provide written
authorization to expend the gift differently than the original
purpose.
d. Monitoring of Cash Donations: The City Council will receive
periodic reports, not less than annually, from the Finance Director
accounting for receipts and expenditures of donated funds.
3. Unrestricted Cash Donations: Unrestricted cash donations shall be
deposited in an unrestricted revenue account in the General Fund.
D. Reporting of Donations: Within 30 days of the end of each quarter, the Finance
Director shall submit a report to City Council that summarizes all donations
received by each department during the prior fiscal year, with an estimate of the
monetary value of the donations.
EXHIBIT A
DONATION RECEIPT FORM
Date
Donor
Telephone f )
Address
City State Zip
DONATION DESCRIPTION:
CASH CHECK COMMODITY
(amount) (amount)
Description(be specific)
UNRESTRICTED
RESTRICTED (identify restrictions)
Total estimated value(estimated by Donor)
Received by: Date:
Signature of City Employee/Department
Donor: Date:
Signature
The donation was classified and handled in the following manner.-
Item was issued a City I.D. number and is located at
Item has short life span_ Not classed as a fixed asset.
Unrestricted cash or check deposited in General Fund, account number
Restricted cash or check placed in General Fund, account number
for use in
Other(explain)
Finance Director Date City Manager Date
City of Grand Terrace
Fiscal Policy Policy No. 3.06
Revision Date: 9127116
Subject: Reserves Page 1 of 4
I. PURPOSE~ AND SCOPE
To define the policy for establishing and maintaining cash reserves needed for prudent
financial management of the City.
IL POLICY
A_ Introduction
The City will maintain cash balances to preserve the City's credit worthiness and
to adequately provide for:
1. Economic uncertainties, local disasters or catastrophic events, and other
financial hardships or downturns in the local or national economy.
2. Contingencies for unforeseen operating needs.
3. Future debt service requirements.
4. Fixed asset replacements.
5. Cash flow requirements.
6. Legal requirements.
B. Budgetary Reserves
1. A contingency account will be budgeted each fiscal year in the Non-
Departmental cost center to provide for unanticipated expenditures of a
nonrecurring nature. Authorization to expend funds from this account will
require approval of the City Manager.
2. A General Fund Contingency Reserve account will be established and
maintained at the level recommended by the Government Finance Officers
Association of the United States & Canada (GFOA), which is a minimum of
two months of regular General Fund operating revenues or expenditures
(whichever is considered most predictable), to serve as a buffer against
unexpected local disasters or catastrophic events, and other financial
hardships or downturns in the local or national economy. The City will use
General Fund operating revenues as the basis for establishing the two-
month reserve target.
C. Fund Balance Reserves
The City shall report fund balances in accordance with the Governmental
Accounting Standards Board (GASB) Statement 54, which requires fund
balance to be classified in one of five categories as follows:
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City of Grand Terrace Policy No. 3.06
Fiscal Policy
Subject: Reserves Revision Date: 9127/16
Page 2 of 4
• Non-spendable fund balance includes amounts that are not in a
spendable form (inventory, for example) or are required to be
maintained intact (the principal of an endowment fund, for example).
• Restricted fund balance includes amounts constrained to specific
purposes by their providers (such as grant providers, bondholders,
and higher levels of government)through constitutional provisions or
enabling legislation.
• Committed fund balance includes amounts that can be used only for
the specific purposes determined by a formal action of the City
Council, the government's highest level of decision-making
authority.These funds include:
• Fixed Asset Fund - funds may only be used for
equipment replacement of for the purchase of new
equipment;
• Community Benefits Fund - funds may only be used
for City Council approved grants to benefit the
community;
• Public Safety Services Fund—funds may only be used for
additional public safety services as determined by the
City Manager and approved by City Council.
* Commitments may be changed or lifted only by City Council, the
government taking the same formal action that imposed the
constraint originally.
• Assigned fund balance comprises amounts intended to be used
by the government for specific purposes. Intent can be expressed
by the governing body or by an official or body to which the
governing body delegates the authority. In governmental funds
other than the general fund, assigned fund balance represents
the amount that is not restricted or committed. This indicates that
resources in other governmental funds are, at a minimum,
intended to be used for the purpose of that fund.
• Unassigned fund balance is the residual classification for the
general fund and includes all amounts not contained in the other
classifications. Unassigned amounts are technically available for
any purpose. If another governmental fund has a fund balance
deficit, then it will be reported as a negative amount in the
unassigned classification in that fund. Positive unassigned
amounts will be reported only in the general fund.
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City of Grand Terrace Policy No. 3.06
Fiscal Policy
Subject: Reserves Revision Date: 9/27/16
Page 3 of 4
General Fund Contingency
The City shall maintain a committed General Fund contingency reserve equal
to two months of operating revenues. If the reserve level falls below the -
minimum level, the City will seek to replenish fund balance within a
reasonable timeframe.
The reserves will be used to provide for temporary financing of unanticipated
extraordinary needs of an emergency nature, such as economic
uncertainties or a local disaster. Intended to act as a short-term solution to
fiscal needs, the contingency reserve will be drawn down as the funding
source of last resort.
Authorization and Action to Commit Fund Balance
The City Council, as the government's highest level of decision-making
authority, may commit fund balance for specific purposes pursuant to
constraints imposed by formal actions taken such as an ordinance or
resolution. These committed amounts cannot be used for any other
purpose unless the City Council removes or changes the specified use
through the same type of formal action taken to establish the
commitment. City Council action to commit fund balance needs to occur
within the fiscal reporting period; however the amount can be determined
subsequently.
Authorization and Action to Assign Fund Balance
The City Council may assign fund balance to a specific purpose in relation
to this fund balance policy. By resolution, the Council has also authorized
the City Manager and/or Finance Director to assign fund balance.
Assignments by the City Manager or Finance Director do not require formal
action by the City Council; however, each assignment must be approved by
either of the authorized officials before the item can be presented in the
financial statements.
D. Use of and Replenishment of General Fund Contin enc Reserve
1. The General Fund Contingency Reserve is intended to act as a buffer to
protect service levels during difficult economic times or as a result of
catastrophic events that require significant unanticipated expenditures.
2. During such times, or as a result of such events, the General Fund
Contingency Reserve may decline below the target level (two months of
operating revenues) with City Council authorization. Once the difficult
fiscal times pass, the General Fund Contingency Reserve will be
replenished to its target level as soon as funding permits, as determined
by the City Council through the annual budget process.
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City of Grand Terrace
Fiscal Policy Policy No. 3.06
Subject: Reserves Revision Date: 9/27/16
Page 4 of 4
3. Appropriate sources for replenishment of the General Fund Contingency
Reserve include one-time revenues and other sources not necessary to
support ongoing services.
E. Policy Versus Appropriation of Reserves
This policy establishes target reserve levels for the prudent financial
management of the City, However, specific appropriation of funds into the
various reserve accounts will be subject to the annual budget adoption process
or other City Council budgetary action.
Re
City of Grand Terrace Policy No. 3.07
Fiscal Policy
Subject: Unclaimed Money Approval Date: 1/14/14Pa e 1 of 3
I. PURPOSE AND SCOPE
To establish a policy and related procedures for escheatment and accounting of
unclaimed money in accordance with California Government Code Sections 50050
through 50056.
II. DEFINITIONS
A. Escheatment-The reversion of property to a government entity in the absence of
legal claimants or heirs.
B, Unclaimed Money- Money which is not the property of the City but that remains in
the City's treasury, including funds related to uncashed checks.
III. POLICY
A. Unclaimed Money that remains unclaimed for at least three (3) years will become
the property of the City if after proper notification the money remains unclaimed.
Unclaimed Money becoming the property of the City, which is in a special fund,
will be transferred to the City's General Fund, unless otherwise restricted.
B. Unclaimed Money items less than fifteen dollars ($15), or any amount if the owner
is unknown, which remain unclaimed for one (1) year will become the property of
the City without notification and will be transferred to the City's General Fund,
unless otherwise restricted.
C. All escheated money originating from the Successor Agency to the Community
Redevelopment Agency of the City of Grand Terrace (Agency) will revert to the
appropriate fund.
IV. AUTHORITY
This policy is established in California Government Code Sections 50050 through 50056.
V. PROCEDURES
A. Individual checks/deposits equal to or greater than fifteen dollars ($15):
1. On July 1st, the Finance Department will compile a list of outstanding
checks and.-or deposits which are equal to or greater than fifteen dollars
($15) and at least three years old; such checks will be deemed stale dated.
The Finance Department will proceed as follows:
a. A stop payment shall be placed with the bank on all stale-dated checks.
b. Accounts Payable will void stale-dated checks.
c. Accounting will post a Journal Entry to record the stale-dated check
liability.
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City of Grand Terrace
Fiscal Policy Policy No. 3.07
Subject: Unclaimed Money s Approval Date: 1114/14
Pa e2of3
2. The Finance Department will then publish a notice (Exhibit A) identifying all
such money in a local newspaper of general circulation once a week for two
successive weeks. The notice shalt state the payee name, fund in which it
is held, the amount of money, and that the money will become City property
forty-five (45) days after the first publication of the notice. Proof of
publication will be retained in the Finance Department.
B. Claims filed by Party of Interest:
1. Upon or prior to publication and before the date the Unclaimed Money
becomes City property, a party of interest may submit an Unclaimed Money
Claim Form (Exhibit B) with the Finance Department to collect money. The
Finance Department will require proof of identification from the claimant.
Once a decision is rendered by the Finance Department, notification will be
made to the claimant by letter.
2. Upon acceptance, the Finance Department will proceed as follows:
a. Accounts Payable will reissue check to the owner, their heir,
beneficiary, or duly appointed representative, following accounts
payable policies and procedures:
b. The Finance Department will remove the check from the list of
Unclaimed Money to be escheated.
3. If denied, the claimant may file a verified complaint seeking to recover all,
or a designated part, of the money in a court of competent jurisdiction within
San Bernardino County, and must serve a copy of the complaint and the
summons issues thereon upon the Finance Department. The copy of the
complaint and summons shall be served within 30 days of receiving notice
that the claim was denied. The Finance Department shall withhold the
release of the portion of Unclaimed Money for which a court action has
been filed until a decision is rendered by the court.
4. If the court renders a decision in favor of the claimant, the Finance
Department will follow the acceptance procedures identified in this policy to
Issue the check.
5. If the court renders a decision in favor of the City, the Finance Department
will proceed as follows:
a. Accounting will reverse the Unclaimed Money liability and record the
revenue.
b. Accounting will record the transfer of escheated special fund cash to
the General Fund, unless otherwise restricted.
c. Any escheated money related to Agency/Trust funds will revert to the
appropriate originating fund and not the General Fund.
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City of Grand Terrace
Fiscal Policy Policy No. 3.07
Subject: Unclaimed Money Approval Date: 1114114
Pa e3of3
i. Property Escheats to City:
1. On the forty-fifth day after the first publication of the notice, those checks
and/or deposits on which no claims were filed escheat to the City. The
Finance Department will follow procedures identified in the preceding
section.
2. On July 1st, the Finance Department will compile a list of outstanding
checks andlor deposits which are less than fifteen dollars ($15), or any
amount if the owner is unknown, and have remained unclaimed in the City
treasury for a period of one (1) year; such checks will be deemed stale
dated. Money identified on the list will escheat to the City and will be
transferred to the General Fund, unless otherwise restricted. The Finance
Department will proceed as follows:
a, A stop payment shall be placed with the bank on all stale-dated
checks.
b, Accounts Payable will void stale-dated checks.
c, Accounting will reclassify the voided check as a credit to Revenue.
d. Accounting will record the transfer of escheated special fund cash to
the General Fund.
e. Any escheated money related Agency/Trust funds will revert to the
appropriate originating fund and not the General Fund.
101
EXHIBIT A
CITY OF GRAND TERRACE
UNCLAIMED MONEY SAMPLE PUBLIC NOTICE
NOTICE IS HEREBY GIVEN pursuant to Government Code Sections 50050 through 50056 that
the following money, which is not the property of the City of Grand Terrace, has remained in the
City treasury for more than three (3) years and will become City property if not claimed by
August 14, 20XX.
FUND PAYEE NAME AMOUNT
The owner/depositor, their heir, beneficiary or duly appointed representative may file a claim
requesting release of money with the City of Grand Terrace's Finance Department, which must
include the claimant's name, address, telephone number, Employer Identification Number or
Social Security Number, amount of claim, and the grounds on which the claim is founded before
August 14, 20XX. If the claim is denied by the City, the claimant may file a verified complaint
seeking to recover all, or a designated part, of the money in a court of competent jurisdiction
within San Bernardino County, and must serve a copy of the complaint and the summons issues
thereon upon the Finance Department within thirty (30) days of receiving notice that the claim
was denied.
The Unclaimed Money - Claim Form is available at the City of Grand Terrace, Finance
Department, 22795 Barton Road, Grand Terrace, CA.
i0.7
EXHIBIT B
CITY OF GRAND TERRACE
UNCLAIMED MONEY CLAIM FORM
Claimant's Name Taxpayer Identification No.or Social Security No.
Address City/State/Zip Code
e ep one Number
Pursuant to California Government Code Section 50052, 1 am filing a claim for previously unclaimed
money in the amount of $ , which was published in the
on 1 1 (MMIDDIYY).
The grounds on which I am filing this claim are:
Please attach copies of all support documentation to this claim Do not attach originals as the City will retain a
documents
I hereby certify under penalty and perjury that the information contained and attached to this claim is true
and correct and is being submitted to the City of Grand Terrace to substantiate my claim to money held
by the City. I further certify that I have the authority and right to claim and receive payment of money and
hereby release the City of Grand Terrace, its directors, employees, representatives, attorneys and agents
from all liability and further obligation with respect to this claim.
Printed Name of Claimant Signature of Claimant Date
Mail Completed Forms to:
City of Grand Terrace
Finance Department
22795 Barton Road
Grand Terrace,CA 92313
CITY USE ONLY
Payee Name: Account Code:
Check No. Check Date: Check Amount: S
Accepted: Denied:
Finance Department Signature: Date:
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