City Council

Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 MAYOR AND CITY COUNCIL CITY OF SEAT PLEASANT REGULAR WORK SESSION MONDAY, MARCH 3, 2025 6:00P.M. 1. OPENING 1.1 Call to Order Council President Higgs called the meeting to order at 6:01p.m. 1.2 Roll Call Present: Council President Monica Higgs, Councilmember Garry A. Jones, Councilmember Ashley Kearney, Councilmember Hope Love, Council Vice President Shireka McCarthy, Mayor Kelly Porter, Councilmember Gerald Raynor, Sr. (Late Arrival), Councilmember Kizzie Scott Staff: Dashaun Ball, City Clerk, Michael Barber, EJD Director, Ashley Drakeford, Public Engagement Manager, Demetrious Harris, Interim City Manager, Cedric Heyward, Acting Chief of Police, Betty Logan, Chief Financial Officer 1.3 Invocation and Pledge of Allegiance: Councilmember Jones gave the invocation. 1.4. Approval of Agenda Motion to approve the agenda. Motion by Hope Love, second by Garry A. Jones Final Resolution: Motion Carried Yes: Monica Higgs, Hope Love, Kizzie Scott, Shireka McCarthy, Ashley Kearney, Garry A Jones 2. PRESENTATIONS 2.1. Performance Audit-Lisa Norman o Ms. Norman, Mr. Parks, and Mr. Cepin shared the results of the performance audit from 07/01/19-06/30/23 of revenue and expenditures. They conducted the audit in accordance with HB200. The audit covered Council Governance, Ethics, Conflict of Interest Policies, Workplace Cultures, Cash Management, Budget Process, Business Personal Property Tax Rates, Hiring Practices, Procurement Process, General Expenditures, Travel Expenditures and Revenue and Cash Receipts. o Council Governance-The City Council oversight and actions extended beyond the authority established by the City Charter. Specifically, changes in day-to-day operations must go through a committee and final approval by Page 1 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 the council. Certain employees noted that Council has asked that any complaints or issues be communicated to Council and not their direct supervisors first. Employees favored by Council members received promotions or other favored treatment. o As described in the City Charter, the City Council serves as the City’s policy-making body. Direct involvement of the City Council in day-to-day operations might lead to conflicts of interest, particularly if Council members are involved in hiring decisions, contracts, or resource allocation. Additionally, when daily operations are delegated to professional staff, a clear line of accountability is established. o Ethics and Conflicts of Interest- The city has an excellent Ethics policy. All staff are not aware of the City’s Ethics policy. Additionally, the city does not conduct annual fraud awareness training. The City could better communicate and exemplify its expectations regarding ethical behavior and the ethics policy. Conduct fraud awareness training. o Policies and Procedures- The City’s processes for establishing, reviewing, and updating its policies and procedures were not always effective to ensure that policies and procedures were timely updated, accurate, and appropriate. Many of the City’s policies are in draft form and have not been reviewed and approved. Separate procedures should be established for budget preparation, procurement and purchasing, and tangible personal property. Procedures are incomplete or contain processes outside of the scope of work. The Accounting Manual has not been updated since 2014. The budget calendar is being maintained by the City Clerk and the SOP for the city clerk has information regarding the annual audit, and this should be in the accounting manual and the City Manager SOP’s. o Cash Management- The City’s cash management processes need improvement to ensure that cash balances are appropriately collateralized and available cash invested. The city maintained significant cash balances in its accounts. o Budget Process- The City’s procedures and Charter do not provide City department leaders with a process for creating and projecting future revenues and expenditures. City management and department heads understand the City’s budgeting process; however, the process is not in writing or formally adopted. The city does have a budget calendar that is maintained by the City Clerk. Documenting detailed procedures for forecasting revenues and expenditure will provide consistency across all departments in the budgeting process. Adopt the budget calendar and procedures for the budgeting process. Page 2 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 o Business Personal Property Tax Rates- The city's rate significantly exceeds the statewide average of 0.55 to 2.25 as for the $12.00 rate of the cities and the ask is the city aligns it to the other municipalities. o Hiring Practices-Audited testing ten employees within the testing scope and found that the hired employees hired met the minimum qualification for the position. Documentation showed that most candidates hired (8 of the 10) received the highest interview score compared to all individuals interviewed for the position. The reference and background checks were not noted in the file. It is recommended that the city completes the background and reference checks. o Procurement Process- Internal controls were not sufficient to ensure that procurements are appropriately bid, documented, or paid. The policies lacked typical procurement controls such as purchase threshold. The city lacked supporting documentation. The recommendation that all contracts that are signed are on hand and documentation is maintained to support the funds going out. o General Expenditures- Documentation was not always maintained to support amounts paid and did not always pay vendors timely. The city continues to enhance its procedures. They did not have supporting documentation for 2019, and they noted that the city’s retirement payments were not paid for 2021-2023, and the recommendation is that all city expenditures are approved and paid accordingly. o Travel Expenditures - Travel expenditures were not always made or documented in accordance with City policy. The City’s policy was not consistent between elected officials and City employees. The city could not provide documentation to support seventeen travel expenditures totaling $25,061 from the 2019-20 FY. Travel was not conducted in the most economical and practical method for 4 of 45 trips. Documentation for fifteen travel payments totaling $13,850 was not complete and did not support the reasonableness of the amounts charged or compliance with City policy. o Revenues and Cash Receipts- Revenues were not always timely recorded. Supporting documentation was not available for 50 of 62 transactions selected for review. Majority of the City’s revenue is received via ACH or electronic transfers. Redlight and speed camera revenues are received, reconciled, and distributed by a third party. The city does not accept cash payments. The lack of cash acceptance is good practice, and the city should continue to do so. o Required Audits- Annual Audits are due on or before October 31st of each year. Audits were not conducted or submitted timely. Page 3 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 o 2020-21 FY audit was completed in April 2024 o 2021-22 FY audit was completed in October 2024 o 2022-23 FY audit was ongoing as of January 2025 o The city is in the process of completing the 2023 audit and then the 2024 audit. We recommend that the city performs the audits in a timely manner. o Potential Fraud- Potentially fraudulent transactions were identified by the City. Based on credit card statements, potential fraudulent transactions totaled approximately $1.4 million. The city has canceled the credit card. o The city had not informed the local law enforcement to see if it should be turned over for criminal investigation. o Mayor Porter inquired about the additional language not included in the presentation. He would like to have the information. o Ms. Norman stated that the information is included in the report. o Councilmember Kearney inquired about the audit that needs to be completed. o Mr. Harris stated that FY2023 is being completed, and the city will be on track by the end of the year. o Councilmember Jones inquired about the status of the $1.4 million fraud. o Council President Higgs stated that it will be discussed in the Closed Session. 3. CITIZEN COMMENTS 3.1. There were no Citizen Comments for the Regular Work Session held on Monday, March 3, 2025. 4. REPORTS 4.1 Mayor’s Report  Mayor Porter stated his report can be viewed in BoardDocs and read the February report for the record. 4.2 City Manager Report  Mr. Harris and the department managers presented their monthly reports to the City Council.  Councilmember Love inquired about the number of NCC Officers and the procedures for boarding up the houses.  Mr. Grant explained that the Environmental Justice does the boarding, and he investigates the status of the property to see if a deceased person owns it. He will track it through probate. Page 4 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1  Mayor Porter stated that the NCC is doing a great job, and he will provide information about the complaints, and one was in compliance and the other was in a probate process.  Councilmember Raynor inquired about the status of the business licenses.  Mr. Grant stated that the Family Dollar has not renewed the business license for FY24/25, and they have sent several notices.  Councilmember Raynor inquired about the property being built on Seat Pleasant Dr.  Mr. Grant stated that they are building a townhouse, and they issued a stop work order because they did not have a permit from the city.  Council President Higgs requested for Councilmember Scott to conduct the Public Safety Committee meeting to address the lights and legislation.  Councilmember Higgs stated that there is a concern with the lights being out in the community.  Councilmember McCarthy inquired about the fire being set in February and the rumored of arson with the high winds. If it was an isolated incident.  Chief Heyward stated that it was an isolated incident, and the person has been arrested. 4.3. Council Committee Reports  4.4 Economic, Planning, Development & Housing Committee- Councilmember Gerald R. Raynor, Sr. Committee report was read by the City Clerk.  Mayor Porter inquired about the areas for annexation and if the areas of consideration that will not impact on another area.  Mr. Harris stated that the committee discussed potential areas of annexation.  Councilmember McCarthy inquired about the hiring of the Economic Development Director.  Mr. Harris stated that they have received three applications that did not meet the criteria.  Councilmember McCarthy inquired if the city could consider some of the federal workers.  4.6 Governmental Affairs & Technology Committee-Councilmember Shireka McCarthy  Councilmember McCarthy stated the committee had four meetings in the month of February. The committee has been working on two items, the Personnel Rules and Regulations Manual, and the Charter Review Committee. Page 5 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 The committee completed the draft procedures manual and milestone reports. The boards and commission application were revised to remove the question for the criminal background. The city can decide to conduct background checks, and have an NDA signed by the committee members after the council discuss the NDA first.  Councilmember Higgs stated that she does not feel the band the box should be removed, and working on certain committees should have a background check.  Councilmember Love stated that she hears the concern and there should be an integrity level.  Councilmember Scott stated that she would like to see different people serve and not the same on different committees.  5. LEGISLATION  5.1 None 6. UNFINISHED BUSINESS  6.1 None 7. NEW BUSINESS 7.1 Approval of Committee Application  The council president recommended the committee review the application and bring back to the council.  It was motioned to approve the application as is.  Motion by Shireka McCarthy, second by Ashley Kearney.  Final Resolution: Motion Failed  Yes: Shireka McCarthy  No: Monica Higgs, Hope Love, Garry A Jones  Abstain: Gerald Raynor Sr, Kizzie Scott, Ashley Kearney 8. ANNOUNCEMENTS 8.1 National League of Cities, Congressional City Conference, Washington Marriott Marquis, 901 Massachusetts Ave., Washington, DC, March 8-12, 2025 Page 6 of 7 Docusign Envelope ID: 164EBA44-61CD-4219-8064-4869B38FF6C1 8.2. Public Session, Monday, March 10, 2025, Seat Pleasant City Hall-6301 Addison Rd., Seay Pleasant, MD 20743, at 7:00p.m., Hybrid, Meeting link details can be found on the city's website. 8.3 Elected Officials Retreat, Saturday, March 15, 2025, Seat Pleasant City Hall-6301 Addison Rd., Seat Pleasant, MD 20743, at 10:00am-3:00pm 8.4 Annexation Public Hearing, Monday, March 31, 2025, by Zoom at 6:00pm. Meeting link details can be found on the city's website.9. ADJOURN 9.1 Adjourn and Logout-The meeting will be adjourned at 8:51pm Respectfully submitted, Dashaun N. Ball, CPM, MMC City Clerk Page 7 of 7