Finance Advisory and Audit Committee

City of Columbia, Missouri Meeting Minutes Finance Advisory and Audit Committee Thursday, December 14, 2017 Conference Room 1C Regular Columbia City Hall 9:00 AM 701 E. Broadway I. CALL TO ORDER Present: 5- Kristian Bloom, John Clark, Maria Oropallo, Lisa Evans and Diane Suhler Non-Voting: 1- Michele Nix II. INTRODUCTIONS III. APPROVAL OF MINUTES Ms. Suhler moved to approve the minutes as presented; Mr. Clark seconded the motion and it passed unanimously. IV. NEW BUSINESS City of Columbia, Missouri Page 1 Printed on 2/26/2018 Finance Advisory and Audit Meeting Minutes December 14, 2017 Committee RSM representative, Kristen Hughes, presented the planning letter for the FY17 Audit. Ms. Hughes explained the letter is intended to communicate the planned scope and timing of the audit. She briefly explained each section. Also, an agreement letter is signed by both parties at the front end outlining the responsibilities of both RSM and the City as it relates to the audit. Mr. Bloom addressed Ms. Hughes about her starting field work began in July. He asked if any issues came up that she’d like to discuss. Her reply was that there were no issues or deficiencies. Mr. Bloom commented that the City had some system changes this past year. What impact has that had on the audit? Ms. Hughes shared that RSM has a specialist in IT to coordinate with the City’s IT Director to ensure the proper controls are in place. Mr. Clark asked Ms. Nix if she felt it would be a problem if the committee forwarded the planning letter to Council and said if they had questions to contact Ms. Oropallo? Ms. Nix responded that if the group opted to vote on this suggestion, they could. Mr. Clark moved to supply the presentation letter to Council for any questions or concerns they may have. Ms. Suhler seconded the motion and was unanimously approved. Being new to the committee this year, Ms. Suhler asked Ms. Hughes how long RSM has worked with the City. RSM has been auditing the City for several years. Ms. Hughes gave a brief history of the relationship and how RSM ensures a proper audit. Ms. Oropollo addressed the group and asked if they had any concerns or if there was anything that needed to be looked at in this year or next year’s audit. She asked Ms. Hughes if RSM was reviewing the pension. She stated they were. Mr. Bloom asked how this was done. Ms. Hughes explained the process. Ms. Oropollo asked when the audit will be presented to Council. Ms. Hughes stated that RSM will present the audit to the Finance Committee in February. It’s shortly after that a member of the Committee will go before Council with it. Mr. Clark stated he would like to have the audit a couple of weeks before it would be presented Council. He’d like time to review it; whoever will present probably feels the same way. Ms. Hughes exited the meeting at 9:42 a.m. City of Columbia, Missouri Page 2 Printed on 2/26/2018 Finance Advisory and Audit Meeting Minutes December 14, 2017 Committee V. OLD BUSINESS Ms. Oropallo reminded the group that there was an outline drafted and discussed last meeting about things the group wanted to look at in terms of revenue. She didn’t come prepared to approach that topic. She’d like to move on to the next. For general discussion, Ms. Oropallo asked if anyone had any thought or comments on the proposed systematic study of the city’s revenue base. She addressed staff about predictions in sales tax revenue. Ms. Nix responded. Ms. Oropallo asked for clarification on motor vehicle tax and how it works. Ms. Nix stated this tax revenue is recognized where the vehicle is being registered. The vehicle could have been purchased out of state, then registered in Columbia and the City would collect the sales tax. Then there is the aspect of moving to Missouri with a vehicle whose taxes have already been paid. Only a licensing fee would be charged to have it registered in the state. Mr. Clark stated he still was not clear on the maximum property tax that can be imposed. If Council has the ability to make an increase, he doesn’t feel it needs to be a ballot issue. He feels the group should learn where the calculation comes from and how the tax is calculated. If he recalls correctly, the State Auditor has that information. Mr. Clark explained the property tax rate process as it goes from Council to the State Auditor and their response back to the City. Mr. Bloom commented that he doesn’t feel a calculation needs to be done as it sounds as if what Mr. Clark is asking for can be obtained at the state level. Mr. Clark says the state’s response to the City doesn’t include what the maximum property tax rate could be. Is it possible for Council to request a higher rate for the coming year and be approved by the state? Ms. Oropallo asked Ms. Nix what avenue the committee could take to obtain what the property tax could’ve been in 2016 and its relative data. She stated Council or Mr. Matthes would be the place to start. The Council could make the request to Mike Matthes or he could be asked directly. The decision to proceed would be left to the city manager to direct staff. Ms. Oropallo addressed the group asking if the issue of property tax is something they’d like to pursue. Ms. Oropallo moved to pursue finding out the maximum property tax that would have been allowed in 2016 without a vote of the people. Mr. Clark seconded the motion and it was approved unanimously. Mr. Bloom suggested that the chair of the committee send a request via email to Mr. Matthes about the information they are requesting. If he is unable to provide it, they will move in another direction. Ms. Oropallo will send the email with a copy to the other members of the committee and staff. City of Columbia, Missouri Page 3 Printed on 2/26/2018 Finance Advisory and Audit Meeting Minutes December 14, 2017 Committee VI. NEXT MEETING DATE February 22, 2018 VII. ADJOURNMENT Mr. Bloom moved to adjourn; seconded by Ms. Evans and was approved unanimously. City of Columbia, Missouri Page 4 Printed on 2/26/2018