Delaware City finance staff reviewed proposed changes to the city's financial-management policies at the Nov. 3 Finance Committee meeting and the committee moved to refer the updates to City Council for ordinance action. Staff also asked the committee to send a draft of the federal "Uniform Guidance" procedures to the city's legal counsel for review.

City staff said the policy changes are primarily clarifying and procedural. Proposed additions include a formal definition of what constitutes a "balanced budget" (to assist with annual GFOA award applications), a budget "gauge" to guide actions during economic downturns, and a statement that temporary levies should not be used to fund ongoing operations. Under reserve policies, staff proposed specific language to account for "presumptive" workers' compensation claims referenced in the Ohio Revised Code and to hold additional reserve for those exposures. Staff said the city's maximum exposure for an individual workers' compensation claim is $300,000 and that two presumptive claims arose this year; if both reach maximum exposure, the city could face about $600,000 of additional liability.

The policy package also removes a previously required balance in the recreation-improvement income-tax account because staff said current revenues make that set-aside unnecessary. For fire and emergency medical services, staff proposed a target fund balance similar to utility funds of roughly 20% to 25% of operating costs. In debt management, staff recommended aiming for multiple funding sources for any general-obligation debt, including tax-increment financing and community-assessment mechanisms where applicable.

Staff asked that the updated purchasing provisions be aligned with the federal Uniform Guidance (2 C.F.R. Part 200). Alicia, a finance/procurement staff member, described the Uniform Guidance draft as covering four core areas: allowable versus unallowable costs; time-and-effort documentation; procurement rules; and cash-management requirements for federal grants, including subrecipient monitoring and steps to take when noncompliance is discovered. She said the draft is near completion and does not require initial council approval before counsel review. The committee voted to send that draft to counsel for review.

A motion to bring the financial-management policy updates to council was made and seconded during the meeting. The committee record shows the motion and a second; the transcript records the referral motion but does not include a committee roll-call tally in the recorded excerpt.

Why it matters: The proposed clarifications and the Uniform Guidance procedures affect how the city budgets for volatility, tracks grant compliance and allowable costs, and maintains reserves for large but infrequent liabilities. Changes to reserve treatment and debt-funding guidance affect how the city plans for contingencies and finances infrastructure.

What's next: Staff said the budget-gauge graphic (referenced in the presentation) will be attached to the formal policy before it is sent to council and that the Uniform Guidance draft will be reviewed by the city's counsel before any ordinance or formal adoption action.

(Reporting based on staff presentation and the Nov. 3 Finance Committee transcript.)