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Memorandum

DATE July 15, 201 1TO Honorable Mayor and Members of the City Council

SUBJECT Follow up to Budget Workshop #4

CITY OF DALLAS

Attached please find responses to questions asked during the June 15h Budget Brie fing.Please let me know if you have any questions.

C: Thomas P. Perkins, Jr., City AttorneyRosa Rios, Acting City SecretaryCraig Kinto n, City Aud itorJudge C. Victor Lander, JudiciaryRyan S. Evans, First Assistant City ManagerJill A. Jordan, P.E. , Assistant City Manager

A.C. Gonzalez, Assistant City ManagerForest E. Turner, Assistant City ManagerJeanne Chipperfield, Chief Financial OfficerHelena StevensThompson, Assistant to the CityManagerJack Ireland, Dire cto r, Office of Financial Services

City Manager

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BudgetWorkshop#4 June15,2011CouncilQuestions

1) WhattechnologyenhancementsdoesBuildingInspectionneedtoincreaseefficiencies?

ForFY12,theDepartmenthasbudgeted$550,000tobeallocatedfornewertechnologyto improvedocument

management,peertopeerengineeringreviews,publicaccesstobuildingplansonline,andthereplacementand

enhancementsofmobile laptopcomputersandsoftwareupgrades forfield inspectors. These laptopsprovide

inspectorstheabilitytouploadinspectionresultsandnotifycustomersinrealtimetokeepconstructionprojects

movingforwardwithminimaldelay. Inaddition,thedepartmentwillalsobeworkingoverthenextmonthwith

key internal and external stakeholders to create a technology action plan. This action plan will focus on

improvingcustomerservicebyprovidingonlineapplicationsubmittal,reviewandapproval,improvingresponse

times, increasing efficiency, and providing more effective communication with customers. We plan to brief

CouncilinAugust.

2) WhatistotalamountofpropertytaxrevenueforbothgeneralfundanddebtservicefundinFY10andFY11?

FY10Actual=$643,377,046(GeneralFund:$423,468,178,DebtService:$219,908,868)

FY11Estimate=$651,380,942(GeneralFund:$435,784,656,DebtService:$215,596,286)

FY12 Preliminary Forecast (as of June 15, 2011) = $627,716,692 (General Fund: $419,967,134, Debt Service:

$207,749,558)

3) WhatamountofrevenuelossisforecastbasedonanticipateddeclineintaxbaseforFY12?

TheMay18thbudgetbriefingforFY12 indicated$27.1madvaloremrevenue lossresultingfromforecastthat

propertyvalueswoulddeclineby4.23%. IntheJune15thbudgetbriefing,thisdeclinewasadjustedto3.65%

forecastofpropertyvaluedeclineinsteadoftheoriginalforecastof4.23%decline. Thisadjustmentwasmade

afterreceivingpreliminaryinformationfromtheappraisaldistricts. Theadvaloremrevenuelosswasadjusted

intheJune15thbudgetbriefingby$3.7mresultinginaforecastof$23.4mrevenueloss. Thecertifiedtaxroll

willbereceivedfromtheappraisaldistrictsinlateJuly.

4) WhatisdebtservicecostforFY10andFY11?

FY10 $282,863,468(actualprincipalandinterestpayment)

FY11 $248,083,224(projectedprincipalandinterestpayment)

5) WhatwasoriginalassumptionforimpacttoCityfromStateandFederalbudgetissues?

The May 18th briefing assumed an impact to the City of $21.4m. As of the June 15th briefing, this assumption

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7) ProvideadditionalinformationonpotentialsaleofElginB.RobertsonParkatLakeRayHubbard?

Consideration has been given to selling Elgin B. Robertson Park which is a 257 acre underutilized park about 10

miles outside of the main limits of Dallas and adjacent to Lake Ray Hubbard. This budget brainstorming idea

was briefed to the City Council on January 20 and May 19, 2010. A proposition authorizing the City to sell and

convey all city park land contained in Elgin B. Robertson Park failed on November 2, 2010 ballot with 46% votingin favor and 54% voting against.

InordertoagainseekvoterapprovaltoallowtheCitytosellthisproperty,anelectioncouldbecallednolater

thanMarch2,2012foraMay12,2012election.

8) WhataccountsfortheincreaseinexpensefromFY11($1,006.0m)toFY12($1,054.3m)asshownonslide3?

TheMay18thbriefing,slide12, listedexamplesofkeydrivers thatmaycauseexpenditures to increase from

FY11toFY12. Thislisttotaled$56.5mandincluded:

PossibleimpactfromFederalandStatebudgetreductions,$21.4m

Increasingfuelprices,$5.7m

ElectricitytransmissionanddistributioncostsresultofOncorrateincrease,$1.6m

EmployeeHealthBenefits,$5.8m

Ambulancereplacement,$1.8m

IncreasingobligationsinpublicprivatepartnershipssuchaswiththeZooandATTPAC,$2.0m

Operationalcostforcapitalprojectsbeingplacedinservice,$2.8m

2ndyearofMeetandConferAgreement,restore$9.0m(1styearsavingswas$22.4m)

Train60paramedics,$4.5m

Incrementalincreaseof64firerecruitstoreduceovertimeinfutureyearssaving($5.5minFY201213),

$1.9m

9) WhatculturalprogramsareproposedtonotbefundedinFY12?

Service ServiceDetail ProposedFY12Reduction

OCA002/

CULTURALCENTERS

BathHouseCulturalCenter 20%reductioninprogramfundscompared

toFY11($3,543).Thiswillreduceexhibits

from15to12andshortenbyoneweek

therunofoneofthe1:30Productionsplays.

LatinoCulturalCenter 20%reductioninprogramfundscompared

toFY11($11,118).Thiswillreduce

exhibitsfrom8to7;suspendDiadelNio

communityfestival;booksmaller

d h

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Service ServiceDetail ProposedFY12Reduction

SouthDallasCulturalCenter 20%reductioninprogramfundscompared

toFY11($10,627).Reduceexhibitsfrom

12to8,reducefilmprogramsfrom14to

8,andsuspendAfricanDiaspora

PercussionEnsemble.

OCA003/

CULTURALFACILITIES

Repairsandmaintenanceof

culturalfacilityspecialized

systems

Reducedby38%($143,656)comparedto

FY11.ReducedOCAsabilitytoaddress

repairsandmaintenanceoftheatrical

systemssuchassoundandlightingcontrol

boards,dimmers,Meyersonriggingand

canopy,etc.Thistypeofsystemisnot

maintainedbyEBS.

OCA004/

CULTURALCONTRACTS

Culturalcontractswithnonprofit

arts/culturalorganizations

25%reductioninfundingtoartsand

culturalorganizationsthroughCultural

OrganizationsProgram(COP)andCultural

ProjectsProgram(CPP)($746,169).

Impactonindividualorganizationspending

fundingrecommendationsbyCultural

AffairsCommission.

OCA009/

COMMUNITYARTISTS

PROGRAM

100%reductioncomparedtoFY11

($100,000).Theprogram(formerlyknown

astheNeighborhoodTouringProgram)

hiresdiverseartiststoprovidecultural

servicesinneighborhoodlocations,

communitycentersandcommunityevents

acrossDallas.Suspensionoftheprogram

willeliminateapproximately148services

to19,750residents.

10)Therankingsheetsindicatezerodollarsincolumn4recommendedamountforprogramssuchasWIC,andPeople

HelpingPeople. AretheseprogramsnotfundedinFY12?

WIC&PeopleHelpingPeopleare funded forFY12. Althoughzerogeneral funddollarsarerecommended for

FY12incolumn4,theseserviceswillstillreceivegrantfundingasnotedinthecommentsincolumn8. ForFY12,

WICwillreceive$16,968,735 in funding from theTexasDepartmentofStateHealthServices. PeopleHelping

PeoplereceivesfederalfundingintheformofCDBG,forFY12theyarebudgetedtoreceive$1,242,127.

11)WhenwillStatefinalizeitsbudget?

Th 1st S i l S i f h 82nd S L i l d d J 29 2011 Th G h il J l 19

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12)HaveanyofthereservefundsbeenusedduringFY11?

OnMay25,2011,CityCouncilapprovedresolution#111390fortheuseof$1,576,119fromtheContingency

ReservefundforelectionservicescontractbetweentheCityandDallasCountyfortherunoffelectiononJune

18thandotherelectionrelatedcosts.

13)Provideadditionalinformationofcostinfutureyearsunderthepoliceandfiremeetandconferagreement.

AttachmentAisasummaryoftheMeetandConferagreementasbriefedtotheCityCouncilonAugust4,2010

andapprovedbyCouncilonSeptember1,2010.

14)Howmuchasphaltandconcretestreetrepairisineachofthe3categories: funded,asterisked,andnotfunded?

Funded Asterisked ShouldbeFunded NotFunded

Asphalt

Repair

$8,907,966 $2,939,257 $0

StreetRehabof22lanemiles

FullDepthAsphaltRepairsof20lanemiles

StreetRestorationof14lanemiles

AsphaltLevelupRepairsof60,000sqyds

AlleyRepairsof6,000sqyds

Restores40lanemilesfulldepthasphalt

repair

Restores8lanemilesofasphaltstreet

rehab

Concrete

Repair

$10,479,611 $4,200,666 $0

Partialreconstructionof26lanemiles

CurbandGutterRepairsof56,000lnft

FulldepthConcreteRepairsof56,000sqyds

Sidewalk(associatedwithcurbandgutter)Repairof

45,000sqft

AlleyRepairsof6,000sqyds

Restores36lanemilesofPartial

Reconstruction

Restores18,000lnftofCurbandGutter

Repair

Restores11,000sqftofSidewalk

(associatedwithcurbandgutter)Repairs

Slurry

&

Micro

$2,368,416 $1,002,184 $0

SlurrySealof110lanemiles

MicroSurfacingof55lanemiles

Restores65lanemilesofSlurrySeal

Restores15lanemilesofMicroSurfacing

Total $21,755,993 $8,142,107 $0

15)ProvidelibrarycirculationinformationforDVD/movies.

InFY10,DVDcirculationwas1,939,276. DVDsareapopularformatforlibrarypatrons;whiletheymakeup7%

ofthecollection,theyaccountfornearly30%ofcirculation. Itsalsoimportanttonotethehighturnoverrate

forDVDs,whichreferstothenumberoftimesan item is loaned. InFY10theturnoverrateforDVDswas4.5

timeshigherthanbooks.

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18)Providejustificationforhowitwillbedeterminedwhich3smallrecreationcenterswillbeclosedinFY12.

Athoroughevaluationofallrecreationcenters iscurrentlyunderwayfromtheperspectiveofattendanceand

geographicservicearea. Priortoidentifyinganysmallrecreationcenterthatmightbeimpacted;theParkBoard

will

participate

in

evaluating

the

recreation

centers

using

the

above

criteria,

which

will

result

in

the

identification

ofthecentersthatwillnotoperate.

19)Providecomparisonof2006bondissueamountwithactualcostforprojectsthathavebeencompleted.

Attachment C provides information on 2006 Bond Program projects that have been completed or cancelled. As

requested theoriginalbondprogramcostestimatecompared toactualexpendituresassociatedwiththeprojects

areprovided.

WhenevaluatingpotentialsavingsfortheoverallBondProgramthefollowingmustbeconsidered:

Intheinitialplanningstages,allprojectswereassesseda4.5%inflationratewherebythesavingsofthe

earlierprojectsweretobeusedtopayfortheinflatedcostofthelaterprojects.

Useofbondprincipaltopartiallyoffsetstaffcostsassociatedwithimplementation.

Duetotheincreaseinoilandoilrelatedproducts,someoftheearlierprojects(i.e.resurfacing)have

experiencedincreasedcosts.

Somesavingshavebeenreprogrammedtopayforunbudgetedprojectsorexistingprojectswith

enhancements,i.e.streets,sidewalks,HVACreplacements,etc.

InProposition4(LibraryFacilities)savingshavebeenusedtofunddesignforprojectsscheduledforthenext

BondProgram.

AnticipatedsavingsinPropositions4,5,6and12allowforsomePhaseIIsegmentstobeaddedinthe2006

BondPrograminlieuoffuturebondprograms.

20)WhereareweontheplannedimprovementsforFarmersMarket?

$6,635,000wasapprovedinthe2006BondProgramProposition#9forFarmersMarket.Thesefundsweretobe

used for thereconfigurationandreplacementof thestormwaterandsanitarysewersystemasmandatedby

E.P.A., the complete replacement of shed #3 and renovation improvements of sheds #1 and #2 and site

improvementstoparkingandwalkwaysfortheentirecomplex.

Campos Engineering was awarded a professional services contract for $486,905 to provide engineering and

designservicesforallstructuresandallsiteanddrainageimprovements.

The engineering and design services were halted when Convention and Event Services began to evaluate

l i f h f h F M k f ili i d i i Th i i d d i

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21)Whatare theFY11andFY12revenuesandexpenses for theMajesticTheaterandwhat isbeingdone toaddress

facilityneeds? (OCA)

FY11 FY12

EstimatedRevenues $490,260 $625,458

EstimatedExpenses $610,843 $687,318

RoofreplacementandHVACupgradeswerepartof the2006Bondprogramandarecurrentlyunderway.We

expectthemtobecompletedinfallof2011.Additionalmajorrenovationstothehistoricbuildingwillneedtobe

addressedbyfuturebondprogramsorprivatesectorsupport.

22)WhataretheunfundedprogramsinEconomicDevelopment?

ThefollowingEconomicDevelopmentprogramsarenotfullyfundedintheabovethelineFY12budgetbids:

ThecurrentservicelevelisnotfullyfundedinBusinessDevelopment.Theproposedreductionoffundingforone

position would reduce the divisions administration of the Citys Public/Private Partnership Program. The

position is responsible for compliance with State and contractual requirements for approximately 80 to 100

contractsannuallyandsupportsproactiveattractionofdomesticandinternationalbusinesses,developersand

investors to Dallas. Responsibilities associated with the position would be absorbed by remaining staff at a

reducedlevel.(1FTE ECO004A)

ThecurrentservicelevelisnotfullyfundedinSmallBusinessInitiatives. Theproposedreductionofoneposition

would

eliminate

the

divisions

capability

to

meet

with

small

business

clients

who

may

be

provided

technical

assistance. ThedepartmentwillbeprovidingreferralstotheSmallBusinessAdministrationandDallasCountyas

opposedtodirecttechnicalassistance.(1FTE ECO006A)

Thecurrentservice level isnot fullyfunded in InternationalBusinessDevelopment.Notfundingoneposition

wouldreducetheCityseffortstomarketandencourageforeigninvestmentinDallasthroughtheUSCISCDRC

EB5 program. Responsibilities associated with the position would be absorbed by remaining staff in the

departmentatareducedlevel.(1FTE ECO008A)

The current service level is not fully funded in Area Redevelopment. Reduction of funding for one position

would impact response time on business inquiries that may impact potential investment, the tax base,job

creation/retentionandeconomicdevelopmentefforts. Responsibilitiesassociatedwiththepositionwouldbe

absorbedbyremainingstaffinthedepartmentatareducedlevel.(1FTE ECO013A)

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Budget Overview for Proposed Agreement

FY10-11* FY11-12 FY12-13

Bud et +/ - Bud et +/ - Bud et +/ -

Proposal

Contract Term

5 Days Mandatory City Leave* $ (7,500,000) $ 7,500,000

Comp Time for OT

Police**$ (7,457,500) $ (3,728,750)

Comp Time for OT Fire*** $ (1,200,000) $ (600,000)

Hiring 29 fewer Police Officers for FY09-10 $ (1,818,249)

Hiring 88 fewer Police Oficers for FY10-11**** $ (1,518,607) $ (3,565,879)

Delay rookie classes from going to paramedic

school*****$ (400,000)

Savings from no Paramedic School $ (140,300)Fire Dispatch Office Schedule Changes $ (400,000)

Suspend Fire Wellness $ (937,000) Grant Funded $ 937,000

Delay Truck 10 Implementation $ (350,000)

from 9 to 5$ (722,220)

3 Days Mandatory City Leave****** $ (4,500,000) $ 4,500,000

3% Across the Board (effective 10/1/2012) $ 13,927,316

Reinstate Steps

(if Trigger met) $ 6,976,277 $ 6,976,277Retention Incentive

(if Trigger not met), ,

Steps continue

(if Trigger met)$ 7,325,091

Retention Incentive

(if Trigger not met)$ 410,061

2 Holidays******* $ 3,800,000

uca on ay ncrease , ,

IF REVENUE TRIGGERS MET (22,443,876)$ 2,081,648$ 43,187,539$

IF REVENUE TRIGGERS NOT MET (22,443,876)$ (3,819,186)$ 29,296,232$

* Base pay will be reduced by 1.9231%** Keeps FTO OT of $851,680 and other Reimbursed OT*** Only for Admin, Arson, and Inspection units. Comp for OT doesn't work in Operations****

****** Base pay will be reduced by 1.1538%

******* Cost for Uniform Staff Only. Cost for implementing for Civilians would be an additional $3M.

***** Rookies will be used to fill-in where furloughs are scheduled. Remaining capacity for backfilling OT is$400,000

8

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Attachment B

Saturday - City Hosted Event

FY2010-11 FY2011-12

Actual ProjectedParade consultant - Donated FY2010-11 $0 $0Floats FY2010-11 (4 @ $1,115) $4,460 $4,460

Bleachers $1,500 $1,500

Nine (9) Port-a-potties $481 $481Electrical-EBS $1,050 $1,050Stage and Sound System - Donated $0 $0

Radios - Donated $0 $0

EBS Security $1,004 $1,004Volunteer Lunch $1,000 $1,000Barricades $4,835 $4,835

Parking Meters (Hooding) $1,054 $1,054

EBS Security Officers for City Hall Plaza $467 $467Police $26,011 $26,011Special Event Permit Fee - Waived $250 $250

Total - City Hosted Event $42,111 $42,111

Monday - Elite News Hosted Event

FY2010-11 FY2011-12

Actual ProjectedPolice $47,426 $47,426

Barricades $6,432 $6,432

SAN $855 $855Special Event Permit Fee - Waived $250 $250

Total - Elite News Hosted Event $54,962 $54,962

G d T t l $97 073 $97 073

MLK Jr. Parade Expenses

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Memorandum

CITY OF DALLASDATE July 15, 2011TO The Honorable Mayor and Members of the City Council

SuBJECT Accounts Receivable Status and Collection EffortsIn response to questions regarding the briefing to Budget, Finance & AuditCommittee on Accounts Receivables and Collection Efforts, the responses beloware provided.Question #1: For each receivable, please address the following:1.) What determines when the first delinquency notice is sent?2.) What determines the t ime frame for subsequent notifications?3.) What determines the time past due at which the collection agency takes the account?4.) What determines the dollar amount and percentage of billings that are turned over to collection agency?5.) What determines the dollar amount and percentage of billings that are collected by the collection agency?6.) What determines the fees paid to collection agencies for recovery of funds in each category?

Answer:Property Tax:1.) Property tax is due Jan 31t of every year. Dallas County sends additionalnotices in February and May to delinquent accounts. State law restrictscollection agencies from pursuing delinquent business personal property untilApril 1t and July 1t for real property.2.) The Countys collection agency, Linebarger, regularly sends 6 to 8 demandmailings to all accounts between July and June of a collection cycle (July 1 June 30). Each mailing is coordinated with the Dallas County Tax Office. Inaddition to the mass mailings, Linebarger sends targeted mailings to specificgroupse.g. by property type, by year, by status of account. Simultaneously,

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Aviation Fees:1.) Aviations collection policy for the first delinquency notification is governed bythe 97 individual contracts for onsite tenants.Other non-contracted (self reported) items including landing fees, fuel vendingfees, and international arrival fees are governed by Aviations collection policy.Notifications for non-receipt of either the report and/or payment regarding landingfees and fuel vending fees are sent out as of the 1 1h day of the following month.Non-payment notifications for international arrival fees are sent out as of the 1 1hday after the invoice is sent to the customer.2.) Subsequent notifications follow in accordance with the Department ofAviations delinquency policy. Fo r unpaid items over 30 days old, a past duedelinquency letter is sent. If an item remains open for over 60 days, a moredetailed letter is sent by Aviation Property Management, which may includespecific lease language. For items that are unpaid for more than 90 days, adefault or termination notice with deadlines in accordance with the lease contractis sent.3.) Aviation s accounts receivable collection procedures specify that after 120days delinquent, Aviation property management will send a memo to the CityAttorney who in turn determines the activity for collection.4,) Administrative Directive 4-10 defines that accounts under $1,000 will go tothird party collection agencies and delinquent balances over $1,000 will go to theCity Attorneys office. $1,000 is considered the threshold where it becomesfinancially viable for the City Attorneys Office to pursue collections in-house.5.) Contractual agreements specify pursuing the full unpaid balance.6.) Delinquent Aviation Department receivables are typically over $1 ,000; assuch they follow the protocol of Administrative Directive 4-10 which specifies theCity Attorneys Office handle the account. There is no direct fee for this service.If a delinquent receivable was under $1,000, the Aviation Department woulddirect collections to Progressive Financial Services. The Progressive contractstates the fee rate to be 16.5% on all accounts that are under 2 years old as of

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a) Internal departmental policy requires monthly subsequent notifications untilthe delinquent balance is referred to the City Attorney ($1000 or more at 90 daysdelinquent) or collection agency (less than $1000 at 90 days delinquent)depending on the amount delinquent. The customer is also denied access to thelandfill during this time.3.) Sanitations procedures specify that at 90 days the delinquent account iseither referred to the City Attorney or a third party collection agency dependingon amount delinquent.4.) The Citys Administrative Directives (AD 4-10) defines that accounts under$1,000 will go to third party collection agencies, and delinquent balances over$1,000 will go to the City Attorneys office. $1,000 is considered the thresholdwhere it becomes financially viable fo r the City Attorney Office to pursuecollections in-house.5.) The City Attorney and collection agency pursue the full unpaid balance.There is no percentage.6.) Delinquent landfill receivables are typically over $1,000; as such they followthe protocol of Administrative Directive 4-10 which specifies the City AttorneysOffice handle the account. There is no direct fee fo r this service. If a delinquentreceivable was under $1,000, the Sanitation Department would direct collectionsto Progressive Financial Services. The Progressive contract states the fee rateto be 16.5% on all accounts that are under 2 years old as of 9/30/08; and 18%on accounts over 2 years old as of 9/30/08.Court Fines & Fees:1.) The State of Texas Office of Court Administration (OCA) regulates thecollection efforts fo r Munic ipal Courts. The first collection letter is sent after adefendant is assessed a fine by the court and agrees to pay within a specifictime frame and fails to pay. OCA mandates that the court send a collection letterwithin 30 days after the case is delinquent.2.) The time frame fo r subsequent notifications is determined by the State ofTexas Office of Court Administration, who regulates the collection efforts for

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3.) The State of Texas determines when an account may be forwarded to acollection agency after delinquency. State Law prohibits a municipality fromforwarding delinquent accounts to a collection agency prior to 60 days from theday of default. Dallas CTS presently forwards delinquent accounts to thecollection agency on day 83 (21 days active + 2 days default+ 60 days).4.) Fine and fees are assessed by Municipal Court Judges in accordance withState Law. The percent of billings turned over to a collection agency is governedby the State of Texas and the collection agency vendor contract. All accounts indefault are pursued by the third party collection agency (Linebarger). Asmentioned in the briefing, accounts are considered in default if they either fail torespond to a citation or Court Program, or have not complied with a partial payagreement.5.) The State of Texas Office of Court Administration regulates collection effortsfor Munic ipal Courts. When a case is sent to the collection agency, a fee of 30%is assessed, as allowed by State Law.6.) State Law regulates the amount a collection agency can charge for therecovery of delinquent billings. The City o f Dallas has a collection agency vendorcontract which adheres to State Law by requiring that defendant pay a 30% feeto the collection agency, in addition to the delinquent amounts owed andcollected by the vendor.

EMS Fees:1.) The contract with Intermedix specifies that the first delinquency notice is sent30 days after the initial invoice.2.) In accordance with the Intermedix contract, subsequent delinquencynotifications are sent every 30 to 45 days.3.) The collection agency takes the account 20 days after the 4h delinquencynotice.4.) The lntermedix contract specifies that all receivables will be handled by the

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Parking Fines:1.) The contract with ACS guides when the first delinquency notice is sent. Perthe contract, a courtesy notice is sent 7 days after ticket issuance, 16 days afterthe courtesy notice, the 1t delinquency notice, a hearing default notice, is sent.2.) The contract with ACS guides when subsequent delinquency notices aresent. Per the contract, the 2nd notice, which is the final notice, is sent 31 daysafter the 1t notice.3.) Per the contract with ACS, the 3d notice, which is the collection warning, issent 31 days after the 2d notice and the violator is sent to the collection agency.4.) The ACS contract specifies that all receivables will be handled by the thirdparty vendor.5.) ACS contract specifies pursuing the full unpaid balance. There is nopercentage.6.) The City does not pay any fee for collection. 100% of the ticket and fineamounts collected by the collection agency are added to the revenue sharingpool for the City and ACS.Safelight Fines:1.) Per ACS contract and state legislation, a citizen must be given 30 days topay the citation or request a hearing after receiving notice of violation. On the31t day, the first delinquency notice is sent.2. ) Per ACS contract, subsequent delinquency notices are sent every 30 daysfor up to five notices.3.) On the 150h day, the Contractor sends a final delinquency notice whichincludes a credit bureau marking notification, approximately 5 days later thecitation will be pursued by the collection agency.4.) The ACS contract specifies that all receivables are handled by ACS

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assessed a 30% contingency fee which will be paid to the contractor based onthe total value of the account (base fine + late fees).Land Based Fees1.) It is Code Compliances current po licy to provide the customer a 20 dayresponse time to the initial invoice. On day 21, the first delinquency notice issent.2.) Code Compliances collection procedures require a second delinquencynotice be sent 30 days after an account is declared delinquent.3.) Linebarger takes action on past due liens when they pursue collections forpast due property taxes.4.) Linebarger pursues the entire delinquent balance of the lien when a propertytax lien also exists on the property.5.) Linebarger takes action regardless of the dollar amount of the lien.6.) Per contract, Linebarger receives 15% of the amount collected.

Question #2: Why do we wait 30 days to issue the first Safelight notice?Answer: The first notice is sent within 30 days of the violation. State Law requiresa notice be sent out no later than 30 days. DPD sends notices on or about day15. Processing of the violation takes approximately 15 days - 7 days for ACS tosend video/image of the incident + 8 days to internally review the document andprocess the ticket.

Question #3: How many days after a utility bill is mailed is the paymentdue and why do we wait 15 days to assess a late fee (thus effectivelycreating a due date that is 15 days later)?Answer: City Ordinance (Chapter 49) requires DWU to provide customers 15

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Question #4: Why do we wait 21 days to begin telephone reminders onpast due utility bills?Answer: City Ordinance (Chapter 49 ) does not require the utility to providetelephone reminders on past due utility bills. A courtesy automated telephonecall is made to the customer on the 6h day after invoice due date.

Question #5: Have we ever experimented with earlier reminders to see ifthat increases collections?Answer: Yes. With the implementation of SAP (new billing system) in 2008,changes were made to the intervals of the automated telephone calls, makingcontact with the customer nine days sooner.

Question #6: If the quality of life fines were subtracted from the courtfines (at 27% this is approximately $4jmillion), what percentage of courtfines are collected? How has this improved since the changes wereimplemented in the courts?Answer: The percentage of court fines collected, excluding quality of life fines,is as follows: 84.9% in FY 08/09 and 74.4% in FY 09/10.Improvements from the Zip Team implementations resulted in an averageincrease per citation collected from $69.67 in FY 2008-09 to $80.57 in FY 2009-10.

Question #7: Have we experimented with turning collections over to thecollection agencies sooner to see if the amount they collect would morethan cover the fees they receive?Answer: Yes, for example with the implementation of SAP changes were madeto shorten the time frame in which closed accounts are submiffed to the

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collection rates are reviewed to determine cause and to determine howcollections may be improved.

Question #9: Is it possible to add code fees, parking fines, Safelight fines,municipal court fines to the Pay One bill? If not, what steps could be takento add any or all of them?Answer: No. It is not possible to add any other non-utility charges to the utilitybill. During the implementation of SAP, it became evident that terms andconditions, due process, and state laws impacting the collection of the Citys feesand fines made it impossible to consolidate them in one single invoice. Forinstance, State Law requires that only utility charges, including sanitation, beincluded in a utility invoice. The City of Dallas utility invoice includes charges forwater, wastewater, sanitation, and storm water only.Currently, the SAP billing system includes over 900 non-utility charges as part ofthe billing process of nine other departments. Those departments are able toaccommodate the different term and conditions and state and local lawsapplicable to their individual charges.

Question #10: Dallas County recently implemented a policy wherebyemployees who owe the county money can no longer be promoted SeeDallas Morning News City Hall Blog, March 23. 2011. Can the city create asimilar policy or one that requires city employees to be current on any feesor fines owed to the city?Answer: The City can create a policy that requires its employees to be currenton all payments owed to the City. However, such a policy should include as afirst step, formal notification to the employee of the amount owed and the reasonfor the debt (e.g. unpaid ticket, back property taxes, etc.), and notice that theemployee should re-pay the debt, or that appropriate disciplinary action may betaken. After being notified of the debt, the employee should take steps to re-paythe debt, including, if necessary, entering into a re-payment plan. If an employeerefuses to pay the debts he or she owes to the City, then the employee shouldface discipline via the Citys disciplinary process. Any such discipline would

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Question #11: What is the amount of difference between receivables inthe annual financial report and billing systems?Answer: Attachment #1 shows the aging of the Citys receivables as of 9/30/10.Receivables are recorded in the financial statements up to 2 years in age atwhich time the City defines them as having a low probability of collection. Thecolumn labeled Total Receivable is the amount recorded in the Citys financialstatements less the allowance for doubtful accounts, the column labeled Totalshows what is recorded in the Citys billing systems.

Question #12: What is the amount of unpaid property tax for commercial,residential, and BPP?Answer: Linebarger tracks delinquent property tax by the sub-categories of realproperty, business personal property, and mobile homes. As of September2010, the City of Dallas had a cumulative outstanding property tax balance of$44.lm. Of this amount, 72% or $31.6m of the delinquent property tax owed tothe City was real property, 27% or $12m was business personal property, and1% or $0.5m was associated with mobile homes. Real property is inherentlymore collectible than the other property types; as is the most recent yearsturnover of delinquent accounts.Linebarger continually analyzes and stratifies the delinquent accounts in order tocustomize its collection effort to maximize the Citys collections. Every account isreviewed by Linebarger and placed in its collection program. Of the currentdelinquent accounts, approximately 84% fall into one of the following categories:Litigation (25%), Bankruptcy (7%), Over 65/Exempt/Disabled (21%), uncollectibleper Legal Determination (15%), Landbank Targeted Properties (1%), or delayedfrom additional collection activity or needs research (15%). The remaining 16%of accounts eligib le for collections are subject to continual mailings, phonecollections, seizures, site visits and/or litigation.

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Please contact me if you need additional information.

Jenne ChipperfieldChief Financial OfficerAttachment

c: Honorable Mayor and Members of the City CouncilMary K. Suhm, City ManagerRosa Rios, Interim City SecretaryThomas P. Perkins, Jr., City AttorneyCraig D. Kinton, City AuditorRyan S. Evans, First Assistant City ManagerA.C. Gonzalez, Assistant City ManagerJill A. Jordan, P.E., Assistant City ManagerForest E. Turner, Assistant City ManagerFrank Librio, Public Information OfficeHelena Stevens-Thompson, Assistant to the City Manager

Attachment #1

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Receivable status as of 913012010

Allowance forTotal Doubtful Collection

General Fund FY10 Revenue 0-90 Days 91-364 days 1-2 Years Receivable* >2 years** Total Accounts RateParking $ 6,718,000 $ 1,596,346 $ 4,255,972 $ 3,412,961 $ 9,265,279 $ 61,884,846 $ 71,150,125 $ (4,224,967) 54.4%Ambulance $ 17,299,000 $ 7,847,420 $ 17,518,810 $ 19,224,507 $ 44,590,736 NIA*** $ 44,590,736 $ (19.693,939) 55.8%Sanitation Disposal Fees $ 19,097,000 $ 1,238,900 $ - $ 871.193 $ 2,110,093 $ 1.126,474 $ 3,236.567 $ (1,224,632) 98.3oSan. Commercial Container&Franchise Fees $ 5,376,000 $ 344,374 $ 87 $ 190,879 $ 535,340 $ 432.679 $ 968,019 $ (353,331) 95.5%Sanitation - Residential Collection $ 54,436,000 $ 8,234,280 $ 2,244,925 $ 2,293,436 $ 12,772,640 $ 5,807,406 $ 18,580,047 $ (3,277,468) 97.3%Weed/Mowing $ 676,000 $ 2,042,240 $ 1,177,328 $ 1052,071 $ 4,271,639 $ 20,488,842 $ 24,760,480 $ (3,225,455) 24.0%Demolition $ 58,000 $ 811,622 $ 733,460 $ 527,701 $ 2,072,783 $ 13,121,255 $ 15,194,038 $ (1,636,310) 21.0%SecuredClosure $ 1,329,000 $ 288,995 $ 146,464 $ 184,707 $ 620,166 $ 2,621,247 $ 3,241,413 $ (395,824) 36.0%MultiTenant $ 1,689,000 $ 116,233 $ 203,091 $ 162,633 $ 481,957 $ 274,038 $ 755,995 $ (365,724) 70.0%PropertyTaxes $ 625,923,000 $ - $ 12,743,564 $ 7,311,444 $ 20,055,008 $ 23,097,270 $ 43,152,278 $ (36,730,195) 98.1%Safelight-Redlightcamera $ 6,546,000 $ 1,440,099 $ 3,427,154 $ 4,578,889 $ 9,446,142 $ 8,258,359 $ 17,704,501 $ (3,370,383) 64.3%

$ 23,960,508 $ 42,450,854 $ 39,810,420 $ 106,221,783 $ 137,112,416 $ 243,334,199 $ (74,498,228)Enterorise FundsAviation $ 12,073,000 $ 98,864 $ 36,196 $ 20,650 $ 155,710 $ 9,159 $ 164,869 $ (15,527) 99.8%WateriWastewater/OtherA/R $ 460,536,000 $ 53,804,017 $ 6,084,835 $ 6,263,039 $ 66,151,891 $ 19,206,645 $ 85,358,536 $ (18,999,776) 97.9%Storm Water $ 48,928,000 $ 6,091,366 $ 1,610,816 $ 1,198,726 $ 8,900,908 $ 2,895,427 $ 11,796,334 $ (2,995,569) 96.5%

As reported in the Citys Financial Statements. Receivables less than 2 years in age are recorded less an allowance for doubtful accounts. Property taxes receivable are an exception to the 2 yearreceivable. The full amount due in unpaid taxes are recorded in the financial statements, less an allowance for doubtful accounts. The total receivable is maintained in the applicable billing system.

** Not included in financial statements but continues to be carried in billing system with the exception of property taxes.Currently in the process of transferring ambulance receivables to new billing contractor.

Court Fines & FeesA receivable for delinquent municipal court citations is not recorded in the citys financial statements. When Generally Accepted Accounting Principles (GAAP) are applied, court citations donot meet the criteria for the establishment of a receivable on the financial statements. The City maintains a record of all citations in the courts case management system and transfersdelinquent citations to the collection agency as previously described. The face value of delinquent citations as of March 31, 2011 was $559.8 million, the breakdown by type of offense islisted below.

The information below is calculated on the face value of the unpaid citations. The City of Dallas does not forgive unpaid citations; thus the unpaid citations may be +30 years in age.Citation face

Offense Category # of citations % of citations value % of face valueTraffic 966,277 65% $343,979,922 61%Code 79,534 5% $28,875,556 5%Quality of Life 322,918 22% $152,996,324 27%Failure to Appear 116,239 8% $33,948,827 6%

Total 1,484,968 100% $559,800,630 100%