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MEMORANDUM

DATE: May 11,2011


TO: Finance and Personnel Committees
FROM: Cal Patterson, Director of Finance & Treasurer
RE: City of Franklin Financial Office Succession Plan

One of the financial best practices is the establishment/maintenance of a succession plan


for the Finance Department. The benefrts include ensuring continuity and consistency of
financial service delivery, knowledge transfer and leadership development. lt is especially
difficult to do succession planning in a smaller or$anization.
rhe present staffins;*i":'ïffi:i1î::Ï:it FrE is as forrows:

o Deputy Treasurer

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There are two issues to consider: The proper staffing level of the department and in
preparation for retirement of the cunent Director who will turn 65 this summer.
What is the proper staffing level? A chart of when core responsibilities occur during the
year is shown in Attachment A. The Director is on record that one additional professiona[
staff member is needed to properly manage the services and functions that are expected
of the department, Attachment B shows the request for additional staffing requested in
2008 for 2009. That year was the second year assistance was requested, The request
was unable to be filled that year and has not been proposed each year since due to the
economic slowdown and not due to the lack of need. The department has been able to
maintain its cofe functions due the experience of the existing staff, the lower level of
activity due to the recessíon and the workload that has been delayed because of the
available level of staffing.
How does the City of Franklin Finance Department staffing size compare to other
communities of our size? The FTE count and population for the following communitíes is
shown below with the supporting documentation found in Attachment C:
Brookfield 9.25 FTE 37,920 Oak Creek 5.25 FTE 34,451
Greenfield 5.10 FTE 36,720 WestAllis 10.98 FTE 60.411
New Berlin 5.75 FTE 39,584
All of the above municipalities except Oak Creek, have one individual responsible for both
the Finance and the Treasury functions. Greenfield does not have a water utility while Oak
Creek has a separate entiÇ handle the water and sewer activity. Duties of the Finance
Departments also varied by municipality with those giving the department more
responsibilities having larger staff than those having less responsibilities.
The staffing level in Franklin is below most of the comparable municipalities when
compared to the duties asked to be performed and available staffing.
Succession planning alternatives the City of Franklin could consider include filling the
existing position when the incumbent announces a retirement date or providing a transition
plan that allows for an eventual replacement to be hired and transition in during the period
of time the incumbent transitions out.
The transition plan that I would like you to consider would be to temporarily split the
current position of Director of Finance & Treasurer into two posÍtions: Treasurer and
Director of Finance. Name the incumbent to the part time position of Treasurer and fill a
full tíme position of Director of Finance by the beginning of the next budget season
(August) with that position reporting to the Treasurer. This provides the new person time to
leam the issues in the City of Franklin incrementally rather than being accountable for all
of them immediately. The transition plan would come full circle at the time of the
retirement of the current Treasurer with the Treasurer duties then being added to the
Director of Finance's duties repoÈable to either the Mayor of the Director of
Administration. A full time Deputy Finance Director could then be hired to support the next
Director of Finance & Treasurer.
The benefits of this transition plan include time for the necessary institutionaf knowledge
transfer to occur, the fìlling of a position that has been needed for several years and time
to implement some of the projects that never get to be addressed.
The cost impact of the transition plan's wages and benefits assuming that the new Dírector
of Finance starts September 1't and the inéumbent goes to half time August 1s witl be an
increase to the department's 2011 budget of $13,000. Had the transition plan been
implemented at the beginning of the year the annual increase to the department's budget
would have been $23,000,
From time to time in the past the concept of retuming to a separate Finance Department
and Treasury Department wtth separate department heads is raised. The rationale always
seems to be that it is necessary to provide for'checks and balances", While that concept
sounds nice and sounds like it would provide more protection for the City the opposite is
the actual result. Look at the staffing table above, a separate Treasury department w¡th
one full time position and one full time position made up of part time employees cannot
institute enough internal controls steps and procedures to insure that within this area a
proper segregation of duties are maintained to safeguard the assets of the City.
The present setup of a Treasury Office and a Finance Office within the Finance
Department with employees in the Finance office participating in the internal controltasks
in the Treasury Office is much superior in terms of internal controls and 'checks and
balances" needed to safeguard the assets of the City. ln addition one manager who is not
involved in daily activity in either offic,e can better coordinating the financial activity of the
City than two department heads that each are charged with pad of the responsibility.
An example that highlights the benefits of a combined depañment follows. Would a
separate Treasury department head with responsibility for investments consider reducing
the investibfe funds to pay off debt early, debt that is the responsibility of the Finance
Department head?

It has.been a pleasure to provide financial direc'tion to the City and work with the other
empfoyees of the City for a better Franklin for the past almost eleven years and while I
believe a younger person should be on board and bearing some of the burdens I am
willing, if desired, to continue contributing on a reduced basis for the next couple of years.
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Attachment B

2OO9 FINANGE DEPARTMENT


GITY OF FRAT.IKLIN
June,2008

PERSONNEL BUDGET REQUEST

The Finance and Treasury area's have had essentially the same level of stafhng
since the year 2000 when a -5
payable related clerical duties.
increased role in forecasting,
projections, water ut¡lity rate setting, TIF
'r.h"g"rnent, financial strategy issues, auditing and financial management
issues-. The deparbnent covers many issues but does not have 'enough
resources to be ä¡1" to do as through of analysis or get to issues timely as they
should be addressed'

The request would be for a Deputy Finance Director position so that duties could
be rediiected between the eisting Accounting Supevisor, Staff Accountant, and
the Director of Finance and Treasurer within the Finance area or the department.
St f¡ng in this departnent is normally seasonal d.ue.to the'nat¡re of the work.
fñä à#r*þ is thät the main seasons: forecast, budget, tax, year end closing
and audit run together and don't leave opporturytV for.special projects or_ longer
I. An additional Accountant position will
er and more thoroughly to existing and
require a four year aocounting degree
'
C¡ty Franklin Brookfield Greenfield New Berlin Oak Creek WestAllis
2010 Census Population 35,451 37,920 36,720 39,584 34,451 60,411

FTE:
Director of Finance & Treasurer 1.00 1_00 1.00 1.00 l_00
Finance Director 1.00
Treasurer 1.00
Deputy Treasurer 1.00 1 1.00
Deputy Finance Director 1.00 1 1.00
Revenue Manager 1 1.00
4
Finance Manager a 1.00
Accounting Manager 1 1.00 1_00
Util¡ty Accountant 1 1.00 1.00
Accounting Supervisor 1 1.00
Staff Accountant 1 1.00 1,00 1.00 1.00
Accounting Technican 1 1.00
Finance Clerical 2 1.23 3 2.50 1 0.60 2 1.75 2 2.00 5 4.50 Þ
Treasury Cashiers 4 1.40 2 0.75 2 1.50 1 1.00 2 1.00 2 '1.48 to
fi

SeasonalTax Cashiers 5 o.25 4 0.25


3
Other Departments o
Water & Sewer Billing 1.30 N/A N/A tfi
Assessor & Assessor Clerk 2.OO o
17 8.18 11 9.25 7.10 5.75 10 5_25 12 10.98
Functions other than Finance:
Set Group Health rates Y Y N/A N/A NY
Prepare Water rate cases YYN/AY N/A Y
Set Sewer rates YYYY N/A Y
Prepare TIF Districts Cashflow YYNN/A YY
Responsible for Risk Management NYNN NN
Responsible for Information Tech NNNN NN
Labor Negotiations NNTYNN N NTY

Prepares a CAFR? lnternally? YYYYNNYYN NYN


Prepares audit schedules & reports YYYY YY
Prepares PSG Report internally NYN/AY NY
Prepares State report internally NYYY NY
TotalCost of 2010 Audit 39,350 40,600. 33,100 37,300 42,OOO 47,500
Should the Treasury and Financial functions be Separate?

Background
ln earlier times and in smaller municipalities all clerk, election, financial recordkeeping
and administrative functions were vested in a single individual. As municipalities got
larger organizational and more complex. Over time and due to growth, the functions
were $radually separated. Some municipalities kept the Clerk treasurer functions
together and separated the administrative and the financial recording functions. Others
kept the Clerk /TreasureriAdministrative functions together and separated the financial
recording functions. Still others separated the administrative, from the Clerk and
Elections, from the financial and treasury functions. The larger the municipality the more
differentiation in functions is required. The major organizational structure in today's world
for medium sized municipafities is in a single financial position responsible for all the
financial and treasury functions.

Checks and Balances


\A/hatever the organizational setup they must be large enough to segregate duties
among the staff to create checks and balances to safeguard the organization's assets.
Some have contended that the best way to have checks and balances is to have
separate Finance and Treasury departments with separate managers both reporting to
the chief administrative position in the organization. In order to effectively do this each
department needs to have suffÌcient staffing to enable proper checks and balances to
insure that one person does not have complete control of the receipt, deposit recording
and disbursing of funds in order to safeguard assets.

Internal Control procedures


\Â/hat used to be called checks and balances is now refened to as internal controls
procedures. These procedures are instituted within and across departments to insure
that no one person has to much control over the processing or recording of cash both
coming in and going out of the organization. Intemal control procedures form the
backbone of the managerial control mechanism of the organization for safeguardlng
assets and are reviewed and relied on annually by the outside accounting firm, With the
advent of intemal control procedures organizations no longer have to set up separate
departments to achieve the necessary checks and balances that are needed in every
organization.

Separate Treasury/Financialfunctions do have merit in some organizations


The decision on separating treasury and financial functions in the light of proper intemal
controls is when organizations develop sufficient activity to have enough personnel in
each department to maintain the functions as separate functions in an efficient and
efiective manner. Such separation work best when they report to a single financial
manager who responsibilities include coordinated fi nancial policies.

Does Frankfin have enough size to effectively split the financial functions?
Cunently in the combined Fínance Department: five FTE's are directly involved in the
processing of cash, four FTE's are involved in the processing of receivables, four FTE's
in the processing of disbursements and three FTE's plus HR ínvolved in the processing
of payroll. The two FTE's that are currently in the Treasury office could not provide the
necessâry segregation the duties to maintain an etfec{ive and efficient intemal control
structure for the Gity of Franklin.
Salary Ranges Non-Represented Employees
Effective July l, 2010

*The hourfy rate is the rate used for payroll purposes.


* AII hourly wage rates based on 2080 hours per year except Polic€ Sergeant and ER Serv Supv whlch arê basêd on
2002 hours pêr year and the Battalion Ghiefs which are based on2912 hour^Tear.. I
CITY OF FRAAIKLIN
Job Description
Job Title: Director of Finance & Treasurer

Department: Finance and Treasurer


Reports to: Mayor

level:
salary ManagemenuAdministrative/supervisory Lever xl . '

FLSA Status: Exempt

Prepared by: Calvin A. Patterson

Prepared Date: January 11,2006


Approved By: Gommon Gouncil Resolution 2006-
Approved Date: January 17,2006

I communicate the finance and treasury


rgement of the departments, informatioñ
Administration, Finance Committee and

Essential Duties and Responsibilities:


Eval.uate, develop, recomniend and implement fìscaland treasury policies that wlll
result in sound fiscal and treasury manâgement.

Anal I
and É
and

Provide high. level consultation to City officials on financiaf and treasury


management issues.

Prepare complex financial analysis and reports

dated by both the preparer and the Direct


completed, revîewed and.was acceptable.

Mana.ge the ínves,tment of City funds including making the short term investment
decisions forthe City in accordance with inveõtment pblicies and goals, and local,
state and federal regulations including- maintainíng required invesÌinent records
and preparing neceésary reports.
Supervise the annual property tax collection to insure that all funds received are
properly credited against taxpayers receivable balance and deposited daily. The
timely payment is made to other taxing jurisdictions and the final settlement is
tirnely made to the County.

Superuise the subsequent collection of delinquent personal property taxes to


maximize the subsequent collection of these delinquent taxes to the extent
possible and the timely chargeback of any uncollected personal property taxes to
the taxing jurisd ictions.

Act in the lead role in debt management, bond issuance and credit rating issues
including determining appropriate times to refinance existing debt to ensure the
most efficient use of the City's bond capacity and borrowed monies.

Superuise and maintain the Citt's payroll operations to ensure the efficient
handling of employees' pay, deductions and benefit payments.

Supervise and maintain the Citt's accounts payable operations to ensure the
efficient and timely handling of payment of the City's obligations.

Supervise and maintain the City's special assessment collection system to ensure
the proper collection of special assessment receivables from taxpayers when due.

Supervise and maintain the City's cash receipting system to insure the proper
receipt, deposit and recording of all funds received,

Supervise and maintain the operation of the financial and treasury data
processing systems and analyze and recommend data processing alternatives.

Prepare the annual revenue and expenditure budget forecast, coordinate the
requests for capital and operating budget expenditures and summarize the
budgets requests for the Mayor, and Common Council all
under the general direction of the hanges to the budget as it
goes through the review process- Suppc ents by preparing, for their
review, the departmental personal ser and assisting them with
budget related issues.

Prepare the annual adopted budget document based on the input received.

Supervise the operation of the Self lnsurance Fund including the setting of
reimbursement rates from City depañments, employees and retirees to insure the
solvency of this fund.

Supervise and train assigned personnel, to ensure development of their full


potential.

Supervise preparation of the annual audit and prepares the City's Comprehensive
Annual Fínancial Report.
Receive the tax levy certifications from the other taxing jurisdictions and
combined with the City of Franklin tax levy information calculate the proper tax
increment for the TIF Distrícts
Prepare the annual property tax rates for use in the annual property tax bills.
Calculate the tax bills to insure that the proper amounts get billed to taxpayers.

Maintain all official accounting records and insures that reporting is in


conformance with gen erally a ccepted govern ment accou nting princi ples.

Insure the statutory duties of Treasurer are performed as required.

Attend meetings, when required, to support financial items. This may include
meeting outside of normal business hours.

Provide the Board of Water Commîssioners with assistance in financial matters.

Provide the Community Development Authority with assistance in financial


matters.

Maintain and catalog permanent records as required by the State.

Peripheral Duties:
Perfórm other duties and assume other responsibilities as apparent or as
delegated.

Minímum Qualifications:
Education and Experience:
Graduation from añ accredited college or university with a BacheloÊs degree in
accounting, four (4) to five (5) years municipal accounting or finance experience,
a minimuñl' of twb years in'þubtic accountihg, or any equivalent combination of
education and experience.

Licensing and Gertification:


Certified Public Accountant or Certified Public Finance Officer certification.

Necessary- Knowledge, Skills and Abilities:


Thorough knowledge- of regulations, policies and procedures that apply to
accounting and financing in municipal government.

Ab¡fity to read, analyze and interpret complex documents.

Working knowledge of data processing equipment and applications which apply


to municipal government.
Ab¡lity to formulate, initiate and administer policies and procedures for effective
fiscal control.
Ab¡lity to plan, delegate and supervise personnel in a manner that will gain and
maintain respect.

Ab¡lity to maintain effective and respected work relationships with other appointed
officiáls, elected officials, department heads and the general public.

Ability to present and communicate ideas and concepts in public and private, both
verbally and in writing.
Ability to make independent judgments that have highly significant impacts on the
organization.

Supervision Received:
Works under the general policy guidance and direction of the Mayor or policies
established by the Common Council

Superuision Exercised:
Exercises supervision of the Accounting Supervisor and Deputy Treasurer.

Responsib¡lity for Public Gontact:


Daily contact requiring courtesy, discretion and sound judgment.

Tools and Equipment Used:


Familiar with computers and computer software including financîal, tax, cash
receipting, special assessment and payroll software, spreadsheet, database,
presentation and word processing software, copy machine, fax machine, 10-key
calculator and telephone.
Physícal Demands:
The physical demands described here are representative of those that must be
met by an employee to successfully perform ihe essential functions of this job.
Reasonable accommodations may be made to enable individuals with disabilities
to perform the essential functions.

While performing the duties of this job, the employee is frequently required to sit,
talk and hear. The employee is occasionaily required to walk; use hands and
fingers to operate, handle, or feel objects, tools, or controls; and reach with hands
and arms.

The employee must occasionally lift and/or move up to 25 pounds. Specific vision
abilities required by this job include close vision and the ability to adjust focus.
Work Environment:
The work environment characteristics described here are representative of those
an employee encounters while performing the essential functions of this job,
Reasonable accommodations may be made to enable individuals with disabilities
to perform the essentíal functions.
The noise level in the work environment is usually moderately quiet.

intended o
. The omis
position if
assignment to the position.

The job description does not constitute an employment agreement between the
employer and employee and is subject to change by the employer as the needs
of the employer and requirements of the job change.
Preliminary Duties Analysis

Treasury

Daily Approve departmentalvouchers Approve departmental vouchers


Sign Ghecks

Weekly Prepare special Financial reports and analysis Determine cash pos¡tion
Review payroll or accounts'payable issues, as necessary Monitor and make investment changes as necessary
Advise and Mentor the new Direstor of Finance

Monthly Attend Finance Committee - take minutes ' Attend Finance Committee - present items
Prepare and attend for Finance related CouncilAgenda items Prepare and attend for Treasury related CouncilAgenda items
Review and sign off on Monthly Joumal Entries Review and sign off on Bank Reconciliations - Treasury
Review Monthly General Fund Financial Report ..:, " Review and sign off on Bank Reconciliations to Ledger
Responsible for budget monitoring Review ICM lnvestment Shtement
' Prepare Finance Cornmittee Agenda items
Attend and present ñnancial items to Water Comrn., when necessary

Quarterly Review Quarterly Financial Statements prepared by staff Review investment performance of outside investment managers
Write commentary for Quarterly Statements ' Review status of special assessrnents
Distribute special reports and scanned quarterly statements
Process Budget Amendments
Annual
January Review financial repofting and prepare very Preliminary reports Review investment policy statements for potential policy changes
Prepare budget preparation schedule Review, balance and approve the January tax distribution
* Update the status of special assessment cash flows

February Analyze and finalÞe end of year final results Review, balance and approve the February tiax distribution
Prepare preliminary annual results Annual Report on Investment Activity
* Review proposed sewer rates for compliance with policy

March Prepare for áudit Review and approve the March PP Charge backs to jurisdictions
Prepare Annual CAFR I Annual Status report on the Self Funded
Group Health Plan

April Sumbit Expenditure Restraint report to DOR Review, balance and approve the April tax distribution
Supervise and prepare parts of the Budget Forecast '* Prepare parts of the Budget Forecast
Annual Report on lmpact Fees

May Submit annual TlF report to other jurisdictions (5/15) Submit GAFR to satisfy continuing disclosure on debt issues
* Review Actuarial reports on Pension
Submit CAFR to GFOA for Award consideration
Capital lmprovement Fund - Funding Availability Report
Equipment Revolving Fund Annual Report
Duties Analysis.xls 5t13t201',|
June Review Salary and Benefit information prepared by staff Review, bafance and approve the June tax distribution
* Information to develop new OPEB Actuarial Reports (every otherYear)
Request Capitaland Manpower Budget Requests from Depts.
Complete Budget Forecast

July Receive and Summaraize Department Requests ' Review Actuarial reports on OPEB

August Work with Budget group to get Mayorial decisions Review, balance and approve the two August tax distributions
Prepare Budget worksheets and dishibute to Departments

September Receive Budget Requests from Departments Develop preliminary Assessment information frorn Assessor
Incorporate requests into budget file * Review budget as part of the budget group
Work with Budget group to develop Mayor Recommendations
Distribute recommended budgets

October Work with Finance Cornmittee as they review budget Work with Finance Gommittee as they review budget
Prepare Public Hearing Notice
Prepare Public Hearing Presentation

November Participate in Budget Adoption Participate in Budget Adoption


Receive tax levys from other jurisdictions
Receive valuation information from State
Finalize Assessment and tax rate information
Prepare ùax systems for new tax bills

December Prepare Adopted Budget Book Create and mailtax bills


Develop following year investrnent plan
* Develop group health rates for the following year

Special Projects Analysis & reporting on specifed expenditure lssues * Prepare and present Water Rate Cases
Capital Projects budget issues Prepare information and work with IDRB proposals
Prepare information and work with Financial advisor on debt issuance

Pending Projects Review payroll systems for upgrades or changes Work to eliminate duplicate recording of Govern receipts
Review FÍnancial system for future upgrades or replacement Review for possible implementatlon of current best practices
Review AS400 for future upgrades or replacement Im plement business credit/pu rchasing cards
lmplement Popular (Stmplified) Annual Reporting lmplement EFT payments in lieu of check payments to some vendors
Participate in Budget Document Award Program Biennial review of internal control policies
Review for possible implementation of current best practices ,
Detiail review of Police receipting process
Review possibilities of going away from paper processing Update electronic files
Redo Financial storage areas Review for possible issuance of a banking RFP
Review to revise current accounts payable process Old Personal Property enhanced collection
Biennial review of internal control policies
lmplement automatic receipting of transactions into GL
Review for possible implementation of current best practices
Duties Analysis.xls 5t1312011