Chapters: Financial Records

Chapter 3.04 Financial Records Sections:

3.04.010 Purpose

3.04.020 Fees

3.04.030 Finance officer

3.04.040 Records retention

3.04.050 Fund control

3.04.060 Authorization to expend

3.04.070 Operating budget preparation

3.04.080 Budget amendments

3.04.090 Budget accounting

3.04.100 Contingency account

3.04.110 Investment of funds

3.04.120 Financial reports

3.04.130 Bidding-major contracts

3.04.140 Unauthorized expenditure

3.04.010 Purpose. The purpose of this chapter is to establish policies and provide rules and regulations governing the management of the financial affairs of the city.

3.04.020 Fees . To assure the proper accounting and safe custody of moneys the following shall apply:

A. All moneys or fees collected for any purpose by any municipal officer shall be deposited with the city treasury through the office of the city clerk. If any fees are due to an officer, they shall be paid to him by warrant/check drawn by the clerk and approved by council only upon such officer making adequate reports relating thereto as required by law, ordinance or council directive.

B. All moneys belonging to the city shall be promptly deposited in banks selected by the council in amounts not exceeding the authorized depository limitation established by the council.

C. The clerk shall be custodian of a petty cash fund not to exceed fifty dollars ($50.00) for the payment of small claims for minor purchases or collect on delivery transportation charges, and for which payments the clerk shall obtain some form of receipt or bill acknowledged as paid by the vendor or his agent. At such time as the petty cash fund is approaching depletion, the clerk may draw a warrant/check for replenishment in the amount of the accumulated expenditures. Said warrant and supporting details shall be submitted to the council as a claim in the usual manner for claims and charged to the proper funds and accounts. It shall not be used for salary payments or other personal services or personal expenses. The petty cash fund shall be balanced at all times with applicable receipts.

D. The clerk shall be custodian of a Utility Change Fund not to exceed one hundred dollars ($100.00) for the purpose of making change without co-mingling other funds to meet the requirements of said office. Said change fund shall be balanced with applicable receipts and it shall be the duty of the city clerk to maintain the integrity of said fund.

3.04.030 Finance officer . The city clerk shall be the finance and accounts officer of the city and shall be responsible for the administration of the provisions of this chapter. 3.04.040 Records-retention . City records and documents or accurate reproductions shall be kept for at least five (5) years. Ordinances, resolutions, council proceedings, or bond issues shall be maintained permanently. (Code of Iowa, 1991, Sec. 372.13(5))

3.04.050 Fund control . The clerk and treasurer shall establish and maintain separate and distinct funds in accordance with the following:

A. All moneys received by the city shall be credited to the proper funds as required by law, ordinance or resolution.

B. No disbursement shall be made from a fund unless such was properly budgeted and supported by a claim approved by the council.

C. A Debt Service Fund shall be maintained except where prohibited by state law. Moneys may be transferred from any other fund to the Debt Service Fund to meet payments of principal and interest. Such transfers must be authorized by the original budget or a budget amendment. (IAC, 1984, 230-2.5(4), 384,388)

D. A Capital Improvements Fund may be established by the council except where specifically prohibited by state law. Moneys may be transferred from any city fund to the Capital Improvements Fund. Such transfers must be authorized by the original budget or a budget amendment. (IAC, 1984, 230-2.5(4), 384,388)

E. The governing body of a city utility, combined utility system, city enterprise or combined city enterprise which has a surplus in its fund may transfer such to any other city fund by resolution. A surplus shall be defined in accordance with generally accepted accounting principles as promulgated by the American Institute of Certified Public Accountants. No transfer shall be made that is in violation of the rules established by the council.

F. The clerk and treasurer shall reconcile their fund accounts at the close of each month and submit a report thereof to the council. (IAC, 1984, 230-2.5(5), 384,388)

3.04.060 Authorization to expend . The clerk shall determine whether a purchase order may be issued by checking the availability of an appropriation sufficient to pay for such a purchase and whether the purchase, if a major item, has been authorized by the budget or other council approval. The clerk shall draw a warrant/check only upon an invoice received, or progress billing for public improvement supported by a purchase order and a signed receipt indicating the materials have been delivered of the quality and in the quantities indicated or the services have been performed satisfactorily to the extent billed, and only if an appropriation is available. No purchase shall be authorized unless there is an appropriation available or the council amends the appropriations or transfer of appropriation is made in accordance with power delegated by council and within the limits set by law and the council.

3.04.070 Operating budget preparation . The annual operating budget of the city shall be prepared in accordance with the following:

A. The clerk shall be responsible for the preparation of the annual budget detail for review and adoption by the mayor and council in accordance with the directives of the mayor and council and the provisions set forth in Section 384.16 of the Code of Iowa.

B. All boards, commissions, and other administrative agencies of the city that are authorized to prepare and administer budgets must submit their budget proposals to the clerk for inclusion in the proposed city budget no later than February 15 of each year and in such form as may be required by the council.

C. The clerk shall submit the completed budget proposal to the council no later than the first Monday of the month of March for each year.

D. The council shall review the proposed budget and may make any adjustments in the budget which it deems appropriate before accepting such proposal for publication, hearing and final adoption.

E. Upon adopting a proposed budget, the council shall set a date for a public hearing thereon to be held before March 15 and cause notice of such hearing and a summary of the proposed budget to be published not less than four (4) nor more than twenty(20) days before the date established for the hearing. Proof of such publication must be filed with the county auditor. (Code of Iowa, 1991, Secs. 384.16(3), 362.3)

F. No later than ten (10) days before the public hearing, the clerk shall make available a sufficient number of copies of the detailed budget to meet the requests of taxpayers and organizations and have them available for distribution at the offices of the mayor, clerk and city library and any other locations designated by the council. (Code of Iowa, 1991, Sec. 384.16(2))

G. After the hearing, the council shall adopt by resolution a budget for at least the next fiscal year and the clerk shall certify the necessary tax levy for the next fiscal year to the county auditor and the county board of supervisors. The tax levy certified may be less than but not more than the amount estimated in the proposed budget. Two copies each of the detailed budget, as adopted, and of the tax certificate must be transmitted to the county auditor. (Code of Iowa, 1991, Sec. 384.16(5))

3.04.080 Budget amendments . A city budget finally adopted for the following fiscal year becomes effective July 1 and constitutes the city appropriation for each program and purpose specified therein until amended as provided by this section. A city budget for the current fiscal year may be amended for any of the following purposes:

A. To permit the appropriation and expenditure of unexpended and unencumbered cash balances on hand at the end of the preceding fiscal year which had not been anticipated in the budget.

B. To permit the appropriation and expenditure of amounts anticipated to be available from sources other than property taxation and which had not been anticipated in the budget.

C. To permit transfers from the Debt Services Fund, the Capital Improvements Fund, or other funds established by state law to any other city fund unless specifically prohibited by state law.

D. To permit transfers between programs within the general fund.

E. A budget amendment must be prepared and adopted in the same manner as the original budget as provided in Section 384.16 of the Code of Iowa and is subject to protest as provided in Section 384.19 of the Code of Iowa. (Code of Iowa, 1991, Sec. 384.18)

3.04.090 Budget accounting. The accounting records of the city shall consist of not less than the following:

A. There shall be established and maintained books of original entry to provide a chronological record of cash received and disbursed.

B. There shall be established and maintained a general ledger controlling all cash transactions, budgetary accounts and for recording unappropriated surpluses.

C. Checks and warrants shall be prenumbered and signed by the clerk and mayor following council approval except as provided by subsection E hereof.

D. There shall be established such individual accounts to record receipts by source and expenditures by program, sub-program and activity as well as provide adequate information and control for budgeting purposes as planned and approved by the council. Each individual account shall be maintained within its proper fund and so kept that receipts can be immediately and directly compared with revenue estimates and expenditures and can be related to the authorizing appropriation. No expenditure shall be posted except to the appropriation for the function and purpose for which the expense was incurred.

E. The council may, by resolution, authorize the clerk to issue checks for immediate payment of amounts due which, if not paid promptly, would result in loss of discount, penalty for late payment or additional interest or cost. Any review and approval shall be brought before the council with and in the same manner as other claims at the next meeting following such payment. The resolution authorizing immediate payment shall specify the type of payment so authorized and may include but is not limited to, payment of utility bills, contractual obligations, payroll and bond principal and interest.

F. The clerk shall perform and be responsible for accounting functions of the municipally owned utilities.

3.04.100 Contingency account . Whenever the council has budgeted for a contingency account, the clerk shall set it up in the accounting records, but he shall not charge any claim to a contingency account. Said contingency accounts may be drawn upon only by council resolution directing a transfer to specific purpose account within its proper fund and then only upon compelling evidence of an unexpected and unforeseeable need or emergency.

3.04.110 Investment of funds . The clerk shall advise the council on investments and shall invest city moneys not immediately needed in accordance with council directives and the requirements of Chapter 452 of the Code of Iowa, as amended. (Code of Iowa, 1991, Sec. 452.10)

3.04.120 Financial reports . The clerk shall prepare and file the following financial reports:

A. There shall be submitted to the council at the first meeting of each month a report showing the activity for the preceding month.

B. Not later than the first day of October of each year there shall be published an annual report containing a summary for the preceding fiscal year of all collections and receipts, all accounts due the city, and the legal debt limit of the city for the current fiscal year. A copy of the published annual report shall be furnished to the auditor of the state. (Code of Iowa, 1991, Sec. 385.22)

3.04.130 Major contract bidding . A motion to spend public funds in excess of ten thousand dollars ($10,000.00) on any one project shall be placed before the council for vote subject to the following conditions:

A. Such motion to spend funds in excess of ten thousand dollars shall require an affirmative vote of not less than a majority of the council members. Each council member's vote on such a motion must be recorded. (Code of Iowa, 1991, Sec. 380.4)

B. When the estimated total cost of a public improvement exceeds the sum of twenty-five thousand dollars ($25,000.O0), the council shall advertise for sealed bids for the proposed improvement by publishing a notice to bidders as provided in Section 362.3 of the Code of Iowa, except that the notice to bidders must be published more than twenty (20) days but not more than forty-five (45) days before the date for filing bids.

C. This section is in no way meant to impair the power of the superintendent of public works and utilities to order expenditures in emergency situations where the council is not available to meet and the interests of the city would be promoted most readily by immediate action.

D. Major items involving any budgetary provisions or items not otherwise authorized by council shall likewise be put before the council for policy decision and letting where required.

3.04.140 Unauthorized expenditure . No city official or employee, or any person acting under color of such office or employment, shall knowingly make any contract or authorize any expenditure known by him or her to be in excess of that authorized by law, resolution or the provisions of the city code.