Missouri Municipal Review March 2014

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The Missouri Municipal

Review

The Official Publication of The Missouri Municipal League

March 2014

In This Issue: • New Traffic Incident Management • Strategic Abstentions And Absences In Third And Fourth Class Cities • Developing An Internal Control Manual • Citizen Attitudes Toward Municipal Elections


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The Missouri Municipal

Review

March 2014

VOLUME 79, NO.2

The Official Publication of The Missouri Municipal League

CONTENTS

President

Councilmember Jan Marcason Kansas City

4 / New Traffic Incident Management by Christine Becker and Sherry Appel

Vice President

Mayor Bill Kolas Higginsville

10 / Strategic Abstentions And Absences In Third and Fourth Class Cities: What Do You Do Now? by Paul Martin

Immediate Past President Mayor Pro Tem Susan McVey Poplar Bluff

14 / Developing An Internal Control Manual by Ron Steinkamp

e

MISSOURI MUNICIPAL LEAGUE BOARD OF DIRECTORS Ruth Baker, City Clerk, Manchester; David Bower, Mayor, Raytown; Conrad Bowers, Mayor, Bridgeton; Roger Haynes, Deputy City Manager, Mexico; Bill Johnson, Director of Administration, Fulton; David Kater, Mayor, Desloge; Patrick Kelly, Mayor, Brentwood; Donald Krank, Councilmember, Black Jack; Paul Martin, Attorney, Olivette; *Norman McCourt, Mayor, Black Jack; *Ron Monnig, Councilmember, Slater; Raeanne Presley, Mayor, Branson; John “Rocky” Reitmeyer, Alderman, St. Peters; Randall Rhoads, Mayor, Lee's Summit; Matthew G. Robinson, Mayor, Hazelwood; Frank Roland, Mayor, Hillsboro; Kathy Rose, Mayor, Riverside; *Carson Ross, Mayor, Blue Springs; Tom Short, City Administrator, Carthage; Robert Stephens, Mayor, Springfield; *Gerry Welch, Mayor, Webster Groves; *Kevin Wood, Mayor,

16 /Are Newspapers Valuable To Your Municipal Election? by Scott Swafford 20 / Missouri Community Betterment Education Fund, Inc. 25 / Missouri Transportation Finance Corporation 26 / Big Opportunities For Small Communities: Missouri Has The Tools For Success by Mike Downing

DEPARTMENTS 18 / A Day In The Life: City Administrators And City Managers 22/ Professional Directory 28/ Frequently Asked Questions: Municipal Classification 30 / Classifieds, Member Accomplishments, Calendar of Events

Harrisonville.

*Past President

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AFFILIATE GROUPS: Missouri City Management Association; City Clerks and Finance Officers Association; Government Finance Officers Association of Missouri; Missouri Municipal Attorneys Association; Missouri Park and Recreation Association; Missouri Chapter of the National Association of Telecommunications Officers and Advisors; Missouri Chapter of the American Public Works Association; Missouri Association of Fire Chiefs. www.mocities.com

Laura Holloway, Editor Contributing Editors: Dan Ross and Richard Sheets Missouri Municipal Review (ISSN 0026-6647) is the official publication of the Missouri Municipal League state association of cities, towns and villages, and other municipal corporations of Missouri. Publication office is maintained at 1727 Southridge Drive, Jefferson City, MO 65109. Subscriptions: $30 per year. Single copies: $5 prepaid. Advertising rates on request. Published bi-monthly. Periodicals postage paid at Jefferson City, Missouri. Postmaster: Send form 3579 to 1727 Southridge Drive, Jefferson City, MO 65109. To contact the League Office call 573-635-9134, fax 573-635-9009 or email the League at info@mocities.com. The League’s Website address is: www.mocities.com.

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NEW TRAFFIC INCIDENT MANAGEMENT TRAFFIC INCIDENT MANAGEMENT TRAINING IS IMPROVING SAFETY, TRANSFORMING INCIDENT RESPONSE ACROSS MISSOURI

by Christine Becker and Sherry Appel

O

n Dec. 13, 2013, a minor two-car accident on Interstate-44 turned into a deadly, multiple-vehicle incident, resulting in one fatality and numerous tractortrailer pile ups, blocking the westbound lane for four hours. Just two days prior to the accident, traffic incident responders from across the Springfield, Joplin and Branson areas began training on the latest techniques in responding to such incidents – and this information really paid off. One trooper who helped at the scene said “I applied some of the training techniques and it made a difference.” More than 500 incident responders are now on Missouri roads and highways using more effective ways to position their vehicles to protect the police, fire and others on the scene. Now, first responders can better manage the traffic flow around incidents, work more efficiently as a team, and put in place other key techniques to quickly and safely clear crash sites. Master Sgt. Bill Johnson, a crash re-constructionist for the Kansas City Police Department, said the Department’s participation in the National Traffic Incident Management (TIM) training program has changed how responders approach traffic crashes. “We are using a different thought process that emphasizes quick, effective action to keep traffic moving which dramatically reduces the risk of secondary accidents,” Johnson said. In the Kansas City area, exposure to the quick clearance philosophy began in 2007 at the Missouri Traffic Incident Management Summit sponsored by the Federal Highway Administration 4 / March 2014

(FHWA). Since then, the Kansas City Scout program has reported that incident responders in the Kansas City metro area have shaved 111 minutes off the average time it takes to clear major traffic accidents, including those involving multiple vehicles, overturned trucks, serious injuries and crime scene investigations. The Kansas City Scout is a joint traffic-management program of the Missouri and Kansas Departments of Transportation. Secondary crashes like the one on Interstate-44 are often worse than the initial accident. Ten to 25 percent of all incidents are secondary crashes caused

by backups and inattentive drivers in the crash area. In fact, every minute spent clearing a traffic incident increases the chance of a secondary crash by 2.8 percent. Mortality rates for responders are staggering: on average, six to eight responders from local fire, rescue and emergency medical services; ten to 12 law enforcement officials; 50 towing or recovery providers; and 100+ highway workers are struck and killed each year while working in or near traffic incidents. Missouri traffic incident responders understand the high risks involved in clearing accidents. In 2012, Clifton Scott, a Missouri Department of Transportation employee, was working a traffic incident scene in Independence. He was killed when a driver barreled through warning cones and flares and slammed into Scott’s truck. In another Kansas City area traffic incident, a police officer ended up on permanent medical disability when he was injured in a secondary crash that occurred in backed-up traffic. Cpl. Ben Barbarick, a deputy assigned to the traffic unit of the Cass County Sheriff’s Office, said the training program opened his eyes to better ways of managing traffic incidents. “I always thought closing the highway was the best option for

Top photo: A crew from Haz-Mat Response assists local responders in cleaning a hydrochloric acid spill after a tanker truck flipped over on Interstate 35 in Kansas City. Photo by Rusty James of Kansas City Scout. Lower photo: Traffic incident responders work quickly to clear a multiple-vehicle accident that closed a section of US 71 during a snowstorm in Belton, Mo. Photo courtesy of Belton Police Department.

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working an accident,” Barbarick said. “But the training program showed me that keeping as many lanes open as possible is safer because it gives drivers a place to go rather than wait and risk a pile up.” At a recent truck-car crash during an ice storm, Barbarick said he quickly pushed the damaged car off the road using his cruiser rather than risk having other cars slide into it creating a bigger pile up and serious injuries. “I wouldn’t have done that before the training program,” he added. In addition to focusing on quick clearance, Barbarick said providing much earlier warning alerts to motorists of an incident ahead further enhances safety at the scene. “Our overall approach is to notify drivers early of what’s ahead, use the right traffic control strategies, and keep it flowing,” he added.

MOVING AHEAD IN MISSOURI With more than 500 responders already trained, FHWA and state leaders are seeking broad local engagement to roll out the TIM training program. Trainers who took the initial FHWA-led courses are available in Missouri to take the training back to their agencies or regions. Shorter, four-hour classes are available and one-hour modules will soon be available online. Local officials can support the program by: • Ensuring key people in the responder community are engaged and informed. • Becoming a leader in the state or regional implementation effort. • Partnering with other agencies involved in incident response to raise awareness. • Encouraging training opportunities for staff. • Seeking agency support for the TIM training program.

A Team Of Skilled Responders

The National Traffic Incident Management training (TIM) program is building teams of highly-skilled responders who work together efficiently and effectively from their initial arrival on the incident scene to its investigation and eventual clearance. Developed through the second Strategic Highway Research Program (SHRP2), the training program is a collaborative effort of FHWA, American Association of State Highway and Transportation Officials (AASHTO), and the Transportation Research Board (TRB). It has been endorsed by the International Association of Police Chiefs, International Association of Fire Chiefs, National Volunteer Fire Council, Towing and Recovery Association of America, and AASHTO. As of mid-January 2014, more than 31,370 responders in 33 states have already completed the training program and are producing significant improvements in incident response across the country. Three train-the-trainer sessions were held in Missouri in 2013, in Kansas City, Springfield and St. Louis. “We have a really strong group of instructors in Missouri already and strong partnerships in order to reach responders in communities throughout the state,” said William “Rusty” James, incident management coordinator for Kansas City Scout, a joint traffic management program of the Missouri and Kansas Departments of Transportation.

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Fourteen additional training sessions have been scheduled for the Springfield, Joplin and Branson areas. Bruce Pettus, Incident Management Coordinator for MoDOT’s Southwest District, is targeting 21 counties in southwest Missouri, focusing on Interstate-44, Interstate-65 and Interstate-49, with emphasis on Interstate-44 due to its high traffic volumes and significant truck traffic. “It is important that we responders work together so motorists across the state will see consistency in how responders

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react to accidents,” said Pettus. The program was designed by responders for responders. It uses a train-the-trainer model to broaden the impact, create stronger connections among responders, and draw on shared real-life experiences in the region or state. Training modules are flexible and can be modified to fit state and local regulations or practices. The training includes case studies, tabletop roleplaying sessions and field instruction to simulate real-life situations and maximize participant engagement. March 2014 / 5


“The key to building stronger incident response teams is to train instructors with representatives from all responder agencies in the same room,” said Paul Jodoin, Traffic Incident Management Program manager in the FHWA’s Office of Operations. “Then these trained responders train other responders, expanding the reach of the program across their region or state.”

Saving Lives, Money And Time

Johnson said that because responders from many disciplines take the training together, a “crashteam” approach develops. Everyone knows what he or she should be doing, potentially saving lives, time and money at every accident scene. “When we arrive on an accident scene, we no longer assume that we’ll automatically close the road and proceed from there,” Johnson said. “Instead, we show up with a mission and a plan to clear the accident and keep traffic moving. If we can take action that prevents someone else from being hurt or killed, that’s what our job is all about.” An added savings is that expensive equipment – from fire engines and police cars to towing vehicles – can be moved out of harm’s way more quickly and safely, making them available to respond to the next emergency in a more timely fashion. This also reduces the potential damage to expensive public safety vehicles that can lead to real budget savings for a community. In addition, with fewer crashes and delays,

Benefits Of Traffic Incident Management Training Save Lives • Safer and more effective on-scene techniques • Less responder exposure, reducing injuries and fatalities • Fewer secondary incidents Save Money • Less freight and travel time spent in backups • Fewer secondary crashes • Fewer insurance claims • Fewer responder vehicles hit by traffic • Cost savings for responder agencies Save Time • Faster incident clearance time, reducing traffic congestion • Mitigates the movement of goods and services

both local and cross-country freight moves in a more predictable manner, providing an economic stimulus. For James, the benefit of the training is clear. “The chances of all responder personnel going home at the end of the incident is greatly increased as a result of the training,” he said. “So there is no down side to this program.”

Why The Training Works

Barbarick said the training process improves collaboration on site and encourages regular communication in between incidents to maximize effectiveness. “If we are all on the same page, all working from the same philosophy, we will get the accident cleared more successful and make the situation safer for everyone.” Both in Springfield and in the Kansas City metropolitan area, traffic incident responders are meeting regularly to review their actions and plan for the next time. Anticipating possible traffic incident scenarios further contributes to improved incident response. “When you know it will be a long-duration incident, there are specific steps to take to ensure safety and prepare to open the highway as quickly as possible,” Johnson said.

Incident Management Training Produces Measureable Results

The training has already produced significant results in communities across the country. In Washington state, a team using the quick clearance philosophy opened a freeway blocked by an overturned tractor-trailer nearly five hours faster by dragging the truck off the road rather than uprighting it first.

6 / March 2014

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Aaron G. March, James C. Bowers, Michael T. White, Shannon M. Marcano, Patricia R. Jensen, William B. Moore, Brian E. Engel, Mark S. Bryant, Kimberley S. Spies

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After seeing significant reductions in clearance times and improved safety, several states, including Georgia, Tennessee, South Carolina and Arizona, are now requiring their highway patrol or state police to take the training.

An Indiana crash involving a tractor trailer on Interstate 70 that generated a hazardous waste spill was handled faster than expected with minimal environmental damage by a recently trained group of responders. The successful outcome drew a positive editorial in the Terre Haute Tribune-Star. “Last week’s I-70 incident certainly qualifies for the ‘could have been worse’ category,” the newspaper wrote. “You can thank the traffic incident group for that. The cooperation of multiple disciplines is a direct result of the National TIM First Responder Training Course…” After seeing significant reductions in clearance times and improved safety, several states, including Georgia, Tennessee, South Carolina and Arizona, are now requiring their highway patrol or state police to take the training. Arizona also is requiring all DOT-related managers, responders and construction

contractors to take the training as well. Pettus said that 150 MoDOT employees in his district will take the training. Christine Becker, Christine Becker Associates, and Sherry Appel, CH2M HILL. Becker is the former deputy executive director of the National League of Cities and Appel is the former NLC director of media relations. They are currently assisting the Federal Highway Administration’s Office of Operations on the National Traffic Incident Management Responder Training program. For more information about the Missouri strategy and opportunities to participate in the National Traffic Incident Management Responder Training, contact Rusty James at william.james@ modot.mo.gov; Bruce Pettus at bruce.pettus@ modot.mo.gov; or Marc Thornsberry, at marc. thornsberry@dot.gov; or email TIMTraining@ dot.gov at FHWA.

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STRATEGIC ABSTENTIONS AND ABSENCES IN THIRD AND FOURTH CLASS CITIES: WHAT DO YOU DO NOW? by Paul Martin

Your six-member board of aldermen is considering an ordinance to approve a controversial development. Half the board favors the development; half is opposed. Such splits pose no theoretical problem. If each member votes, the mayor breaks the tie. But what if the mayor favors the proposal? Can a project opponent prevent a tie, and preempt the mayor’s vote, by abstaining? If it happens, what can you do?

A

strategic abstention can stop the bill in its tracks. Walking out of a meeting before the critical vote, or not attending at all, can have the same effect. This article addresses whether “strategic inaction” is lawful, and if not, what can be done about it.

Is It A Problem?

Strategic inaction only happens when a significant controversy already exists, but it can put board and community members against each other. Opponents of the controversial bill may believe they are right to use every tool available— including abstentions or walking out of a meeting, while proponents view such tactics as cheating the process. At minimum, strategic inaction causes social and political strife. It can also put a city at risk from third-party litigation. Consider the possibility of a conditional use permit ordinance. The applicant may be entitled to a decision from the city as to whether a project may be developed. If the city fails to decide because of strategic inaction, the city might be dragged into litigation, and perhaps may even be at risk for a takings claim.

So Is Strategic Inaction Legal? The Law Suggests It Is Not.

Missouri statutes establish the

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procedure by which third and fourth class cities legislate: “[N]o bill may become an ordinance unless on its final passage a majority of the members elected” vote for it “and the ayes and nays be entered on the journal.” Missouri courts have interpreted this language as requiring yes votes from a majority of the full membership of the board, regardless of absences or abstentions. In the case of our sixmember board, four ayes are needed to pass the bill. If, and only if, the board is deadlocked at three-three, the mayor, “in case of a tie . . . shall cast the deciding vote.” These statutes establish a straightforward legislative process that is determined by the act of voting, casting the “ayes” and “nays.” Implicitly, the statutes impose on elected officials the duty to attend The Missouri Municipal Review

meetings and vote. They do not acknowledge or permit any other legislative response. Missouri courts would probably agree. In two older cases, school board members had either failed or refused to vote on pending issues. In both cases, the courts held that each board member had a duty to vote for or against the question submitted. And in a more recent appellate decision, a board of adjustment denied a variance application because there was no motion made to grant the variance. The court held that the applicable statute required the board to make a final decision on the merits; denying the variance because of procedural failure was not a permissible legislative response. These cases suggest that public office holders have a duty to vote on and decide the propositions coming before them for consideration. If this is true, it follows that the office holder has a corresponding duty to attend the meetings at which the public’s business is considered.

There Is No Statutory Right To Strategic Inaction

If strategic absences and abstentions are lawful legislative responses, then the “right to do nothing” must be found in law. It isn’t. Neither www.mocities.com


the laws governing third- and fourthclass cities, nor those governing local governments generally acknowledge a right not to act when faced with a legislative choice. If there is no statutory right, some may look to their city’s parliamentary rules that may well acknowledge the abstention as a permissible response to an association’s decision on an issue. The problem with this approach is that parliamentary rules can’t contradict statutes. A rule that permits the defeat of legislation through inaction cannot take precedence over a statutory decisionmaking process that is grounded in the act of voting. One also may argue that a legislator has a constitutional right to abstain under the free speech clause of the First Amendment. Some courts have held so, but the United States Supreme Court appears to have settled that issue by holding that a legislator has no First Amendment right to vote on the policy decisions that he or she was elected to determine. If a legislator has no constitutional right to vote, by extension there can be no constitutional right to refuse to vote, whether by abstention or absence. In the absence of such a right, refusing to vote or to attend meetings, would violate Missouri’s statutory legislative scheme. It follows that strategic inaction cannot be a lawful response to a legislative choice.

The Abstention Solution

Case law from Missouri and other jurisdictions suggest a procedural solution to the problem of strategic abstentions. Missouri courts have held that under common law principles, an abstention is counted with the prevailing majority. A failure to vote has been deemed an acquiescence to the members who voted, and has been “regarded in law as voting with the majority.” But while these cases invoked the common law rule, its application was deemed improper in a later case. Because a statute required the affirmative votes of a majority of the full membership of the governing body, the court reasoned that an abstention could not be counted as a "yes" vote. Since Missouri statutes require a fixed affirmative majority in third- and fourth-class cities, a strategic abstention cannot be counted as a "yes" vote. Courts from other jurisdictions

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have acknowledged the strategic abstention problem and have solved it by either counting the abstention with the majority or by doing the opposite—counting it as a “no” vote. If counted as a no, the abstention causes a constructive tie, and the mayor can then cast the deciding vote. The general theory expressed by these courts is that a legislative minority should not be allowed to defeat the legislative process and the will of the majority by abstaining. Although these authorities suggest that a strategic abstention can be resolved by counting the abstention as a no vote, the question remains, how do you get there? Also left unresolved is the strategic absence. There appear to be three options; litigation, self-help or legislation, whether state or local.

The Litigation Option

Theoretically, suit could be filed against an abstaining or absent board member. A “mandamus” action would assert the member’s duty to attend meetings and to vote either yes or no on the controversial bill, and it would ask the court to order the member to perform these duties. While simple in theory, mandamus presents many hurdles. Initially, the city will have a practical problem in authorizing a lawsuit. Remember that the abstaining or absent member has support on the board at least among the minority who oppose the controversial ordinance and The Missouri Municipal Review

you will not be able to get a majority to approve a lawsuit. Your city attorney may also decline to represent the city because of a perceived conflict of interest with the recalcitrant board member. So initiating the litigation brings you back around to the same problem you had in the first place, gaining majority approval from a split board. If the city can’t sue, a citizen might. But, does the citizen have standing – a protectable interest in the recalcitrant legislator’s attendance and vote? The mayor also might be a plaintiff, since the mayor is deprived of voting due to the board member’s inaction. A councilmember might also have standing if his or her favorable vote is being nullified by the opposing member’s inaction. These questions would have to be resolved before filing suit. These difficulties are compounded by time and money factors. Contractual or statutory deadlines could run before litigation could be effective, and lawsuits require funding. If the city isn’t footing the bill, is there someone else able and willing to do so? If you clear these hurdles and get into court, you may need to prove that the recalcitrant member’s motives are, in fact, strategic, and you will have to persuade the court that the law supports the relief that you seek an order directing the recalcitrant member to attend a meeting and vote. While March 2014 / 11


the weight of authority suggests this outcome, a court might still turn you down. The court might believe that as an elected official, the board member’s inaction should be judged solely by the electorate. Again, this brief article can’t answer all the issues that might arise, but the litigation option, while viable in theory, may well fail in fact.

The Self-Help Option

Self-help also carries with it no small element of legal and political risk. First, it must be noted that this remedy can be used only when a member abstains from voting, giving the mayor the opportunity to declare and break a constructive tie. Under the germane Missouri statutes, the mayor presides over the board, and he or she is further responsible for the care of the city, executing or vetoing legislation, and “enforcing all laws . . . for the [city’s] government.” Using this authority, the mayor might, after a final vote on the controversial ordinance, declare that the abstention is to be recast as a no vote. The mayor could then vote to break the resulting tie. The mayor’s authority to do so would be subject to legal challenge, either from a political opponent or from a party interested in having the ordinance declared lawful. And the

mayor would face significant political pressure, and perhaps make some lasting political enemies. But, if your mayor has the political fortitude, the “self help” option could result in the bill being enacted into an ordinance. The validity of the ordinance might then be subject to litigation, but the legislative process would have been completed, and based on the legal authorities already discussed, the ordinance would have a reasonable probability of being declared lawful.

The Legislative Option

The best option, of course, is to fix the problem before it happens. Consider adopting curative legislation. Thirdand fourth-class cities have the power to enact ordinances deemed necessary to implement the city’s powers. You could adopt an ordinance providing that if a member abstains from voting, the abstention is counted as a “no” vote. If the no vote creates a tie, the mayor gets to vote. This might prove difficult at the local level. Board members who often find themselves in the minority, or who fear that possibility, may not want to foreclose a future opportunity to frustrate the majority’s will. In fact, attempting such legislation might lead to the very problem you’re trying to prevent! And while this solution could

apply to any abstention, regardless of the abstaining member’s motive, it would have no effect on strategic absences. Perhaps local legislation could declare a board member’s absence as a “nay” vote, but that question also is beyond the limits of this discussion. State legislation, on the other hand, could avoid the local implementation challenge while conclusively solving the strategic inaction problem. The germane laws could be amended to require a mayoral vote if one-half of the board votes in favor of any legislation, regardless of absences or abstentions. If the mayor then votes in favor of the bill, it becomes law. If not, the measure fails. Such an amendment would circumvent strategic inaction difficulties while preserving each member’s “right” to abstain. Unfortunately, Missouri cities could not adopt similar legislation, because it would unlawfully contradict current state law that limits the mayor’s role exclusively to a tie-breaking alone. The Missouri legislature, however, could solve the problem of strategic abstentions and absences.

Conclusion

Strategic absences and abstentions are unusual, but not unheard of, and they can cause political, social and legal turmoil. If it happens to you, think long and hard before heading to court. Consider adopting local legislation, if possible. If not, self-help might provide a viable remedy. The best option may be for the Missouri legislature to permit the mayor to vote, not in case of a tie, but whenever half the membership of the board has voted in favor of any given ordinance. Be sure to seek and heed the advice of your city attorney to help you through the thicket of the various legal issues.

Paul Martin is the city attorney for Olivette, Rock Hill and Crystal Lake Park, and he serves as special counsel to Maryland heights. He has represented local governments in the state of Missouri since 1992. He is a member and officer of the Missouri Municipal Lawyers Association and a member of the Board of Directors of the Missouri Municipal League. Footnotes are available with this article by contacting MML at Lnoe@mocities.com or by calling (573) 635-9134.

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DEVELOPING AN INTERNAL CONTROL MANUAL by Ron Steinkamp, CPA, CIA, CFE, CRMA, CGMA

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any times problems arise at governmental entities due to the lack of appropriate internal controls or failure to follow already established internal controls. Here are two particular instances discovered when assisting government entities with internal audit and fraud investigations. City X – City X did not have internal controls established to ensure that recreational league fees paid to the parks department were properly safeguarded, accounted for and deposited. The city parks director collected these fees and was responsible for depositing them into the city bank account – without any additional oversight. As a result, the city parks director was able to steal approximately $15,000 over a three-year period in fees paid by residents for recreational leagues. City Y – City Y had established internal controls that were documented in its policies and procedures manual, over the drawdown of federal grant funds it was owed. However, the manual was seldom referred to and eventually forgotten over time. So, City Y was actively looking into finding out why they had failed to draw down in a timely manner more than $6 million in federal funds owed. It was discovered that an accountant, who had been hired in the past year, was not told about the controls established and documented in the policies and procedures manual, making the internal controls a moot point. These are just a couple of examples that show the need to document internal controls. This article will define what internal controls are, discuss why a manual is critical for local government, and outline the steps to develop a manual and the related components.

Internal Control

It is crucial to define what internal control is before delving any further into the topic of an internal control manual. The best and most

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widely accepted definition of internal control comes from the Committee of Sponsoring Organizations of the Treadway Commission (COSO) that was founded in 1992 and issued the Internal Control Integrated Framework.

Internal Control: “A process, effected by a n ent it y’s bo a rd o f directors, management and other personnel. This process is designed to provide reasonable assurance regarding the achievement of objectives in effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulations.” COSO defines internal control as: “A process, effected by an entity’s board of directors, management and other personnel. This process is designed to provide reasonable assurance regarding the achievement of objectives in effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulations.” This definition translates well to local government entities by simply replacing “board of directors” with “elected officials” in the first line above. The definition also focuses on the fiduciary responsibilities of local government entities to ensure the effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulation. The Missouri Municipal Review

Why Develop An Internal Control Manual

Government officials are accountable to the public. They have been entrusted with four main fiduciary responsibilities. The first is the responsibility to comply with all federal, state and local laws and regulations. The second is the responsibility to properly handle and safeguard public funds. Their third responsibility is to operate in an efficient and effective manner. Finally, government officials are responsible for achieving results. The Government Finance Officers Association (GFOA) recommends that every governmental entity document accounting policies and procedures in order to enhance accountability and consistency. GFOA further recommends that this documentation: • D e l i n e a t e t h e a u t h o r i t y a n d responsibility of all employees, especially the authority to allow transactions and the responsibility for the safekeeping of assets and records.

PLAN REVIEW EVALUATE DESIGN DOCUMENT EDUCATE Figure 1

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STEPS PLAN

REVIEW

EVALUATE

DESIGN

DOCUMENT EDUCATE

KEYS Gain City Council and Management support. Establish clear objectives and timelines for completion. Select a project team and leader. Determine the format of the manual. Identify processes to include in the manual. Identify process owners. Meet with process owners to notify them of the project and gain their support. Assign team responsibilities. Schedule team check points. Review currently documented policies and procedures. Walk-through “as is” process with the process owner. Document the “as is” process. Validate the “as is” process documentation with the process owner. Identify existing internal controls in the “as is” process. Determine the adequacy and effectiveness of the existing controls. Identify any missing controls or poorly designed controls. Discuss evaluation results with the process owner and seek input on the design and/or redesign of the process and related internal controls. Redesign the process with adequate and effective internal controls. Walk-through the redesigned process with the process owner. Make changes as necessary to the process design. Formally document the process and related internal controls. Compile an internal control manual with all processes and controls. Roll-out the manual and train all affected employees. As appropriate, based on position, make Internal Control Manual training part of new hire orientation. Consider periodic refresher training.

Indicate which employees are to perform which procedures. • Explain the design and purpose of control-related procedures to increase employee understanding and support of controls. Effective internal controls can assist every aspect of government operations by assuring compliance with applicable laws and regulations, safeguarding public funds, ensuring operational effectiveness and efficiency, and monitoring the achievement of results. Good governance through accountability and recommended practice dictate that local government entities develop internal control manuals.

Steps for Developing An Internal Control Manual

As depicted in Figure 1 (left), there are six key steps to developing an internal control manual. It is critical that these steps be followed in the order presented. With each step, there are several

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Figure 2

keys that should be considered as presented in Figure 2 above.

Components Of An Internal Control Manual

An Internal Control Manual should at a minimum contain the following sections detailed below. Introduction – The introduction should include the purpose, scope and authority of the manual. It should provide a discussion of how to use the manual, as well as whom to contact with questions related to the manual and internal controls. Internal Control Basics – This section should provide a definition of internal control and emphasize the importance of internal controls in the organization. It also should explain management’s responsibility for internal controls. Fraud Awareness – This section should define fraud and its characteristics. It also should identify each employee’s responsibility for fraud reporting, as well as how to report fraud to management.

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Control Activities – This section is the heart of the manual and should identify procedures and critical internal controls within key processes such as: • Revenue – Taxes, fines, fees, etc. • Procurement • Expense disbursement • Human resources and payroll • Treasury • Financial reporting • Fixed assets • R e g u l a t o r y c o m p l i a n c e – including grants

Information systems and security

A properly developed and implemented Internal Control Manual will not solve all issues faced by an organization, but it can certainly assist in anticipating, prevent ing and cont ro l l i n g ma n y problems that could arise.

Ron Steinkamp is a principal of the firm Brown Smith and Wallace.

March 2014 / 15


ARE NEWSPAPERS VALUABLE TO YOUR MUNICIPAL ELECTIONS? RJI SURVEY REVEALS RESIDENTS’ ATTITUDES TOWARD MUNICIPAL ELECTIONS, NEWSPAPERS’ COVERAGE OF THEM

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issouri residents believe that municipal elections are important, and that newspapers are a valued source of information about them, according to the results of a recent survey conducted by the Insight and Survey Center at the Donald W. Reynolds Journalism Institute. The results also show that residents favor in-depth, issue-based coverage of elections, stories that test the assertions candidates make during campaigns for local office, and reporting methods that allow side-byside comparisons of candidates. They find information that comes directly from candidates — through websites, social media or campaign mailings — less helpful, according to the research. The survey was conducted by the RJI Insight and Survey Center under the direction of Ken Fleming and Sarah Samson in November and December 2013. Its purpose was to gauge Missouri residents’ attitudes about municipal elections and their local newspapers’ coverage of them. Some of the surveys were completed online by subscribers of three participating Missouri newspapers, the Branson Tri-Lakes News, the Sikeston Standard Democrat and the St. Joseph News-Press, while others were conducted by telephone through random-digit dialing. More than 1,200 people were surveyed, with at least 400 coming from each of the newspapers’ readership areas. Here’s a rundown of some of the most interesting and important findings:

by Scott Swafford Ninety-five percent of the respondents said they were registered to vote, and 72 percent said they cast a ballot in the April 2013 municipal election. That’s a remarkably high number, given that actual county turnout in our three communities ranged from a high of about 16 percent to a low of less than 12 percent. So, either our sample skewed heavily toward residents who are politically active, or our respondents as a group exaggerated their participation. Seven percent of our respondents said they had been a candidate for a local political office, and 30 percent said they had contributed to a political campaign. Among the latter, most reported contributing to federal and state candidates more than local candidates.

Knowledge Of Local Government

We asked a couple of simple questions to get a feel for our respondents’ basic knowledge of local politics. Nearly one in five said they were not sure when we asked whether their city or town is governed by a city council or by a board of trustees or

aldermen. More than half said they didn’t know the term of office for a town council or board member, or for a local school board member.

Importance Of Municipal Elections

The results indicate that overall, people feel that elections on local bond issues or tax proposals are most important. We offered a series of statements to residents and asked them to rate them on a scale of 1 (“strongly disagree”) to 5 (“strongly agree). (See Figure 1.) Residents rated school board elections as slightly more important than city council or town board elections. They were neutral on whether the outcome of local elections has more impact on them than those for state and federal offices. In all, 83 percent of respondents either agreed or strongly agreed that voting in local elections is important, and 69 percent said they try their best to stay informed about them. Less than 70 percent agreed or strongly agreed that voting in school board and town council races is important, while 91 percent

Demographics

The average age of respondents was 54.4, and 49 percent were women. On average, they had lived at their present address for 15 years, and 84 percent reported owning their own homes. Education level was pretty evenly distributed. Here’s where it gets interesting.

16 / March 2014

Figure 1

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agreed or strongly agreed that voting on local bond issues and tax increases is important.

Figure 2

Value of Newspaper Election Coverage

Our respondents indicated that the print edition of the local newspaper is the most valuable of the information sources we asked them to consider. It’s worth noting that the surveys did not seek residents’ opinions about television and radio news and advertising. Those were left out largely for the sake of brevity. Conversations with other community members were second behind the newspaper, followed by political forums and newspaper websites. (See Figure 2.) Political advertising and information that comes from candidates for the most part rated poorly. That might be good news for those of us who are wringing our hands worrying that candidates will sidestep the newspaper in favor of delivering their messages directly to voters. (See Figure 3.)

Figure 3

Types of Newspaper Coverage

The people surveyed indicated strongly that they want substantive coverage of elections. Information about candidates’ stances on issues rated most important. The respondents indicated they favor in-depth news stories about community issues in the election, question-and-answer pieces with candidates’ verbatim responses and charts or grids that compare candidates’ positions. Photographs ranked low. We suspect that would change if newspapers did more documentary-style election

photography. (See Figure 4.) So, what’s next? Now that we’ve done the first wave of research we’ll be encouraging the Sikeston, Branson and St. Joseph newspapers to do their best to take these findings to heart and to improve their coverage of local elections. We hope they’ll experiment with candidate profiles, with in-depth

explorations of issues and with attempts to engage their readers in the election conversation. We hope they’ll try bringing documentary photography into the mix and that they’ll publish a voters’ guide shortly before the election to synthesize their campaign coverage. When we come back with a second survey after the April election, we hope to find that residents noticed and appreciated the newspapers’ efforts. If we also can show that better election reporting prompts more people to go to the polls, we truly will have contributed to down-home democracy. Scott Swafford is an associate professor at the Missouri School of Journalism. He serves as the senior city editor at the Columbia Missourian and is a 2013-2014 Fellow at the Reynolds Journalism Institute.

This article is reprinted with permission. Slight edits were made for context. Find the full article at http://www.rjionline.org/ downhomedemocracy/rji-survey-revealsresidents-attitudes-toward-municipalelections-newspapers-coverage-them.

Figure 4

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March 2014 / 17


A DAY IN THE LIFE ...

In 2014, The MML Review is featuring insights from local government officials across the state in the series, "A Day In The Life." In this issue, the Review asked several Missouri City Administrators and Managers to share what inspired them to serve in their community and other questions to provide a glimpse into their role as city leaders.

Eric Johnson, Blue Springs Keith Moody, Harrisonville John Butz, Rolla Dennis Gehrt, Platte City

What Sparked Your Interest In Local Government? Johnson: I began working in local government in 1986 in my hometown of Richmond, Missouri as a Parks and Recreation employee. I really liked the diversity of work assignments and enjoyed interacting with people throughout the community. Being exposed to various aspects of local government at an early age (i.e. management, law enforcement, parks, development, etc.) and working with so many positive people began to influence, and finetune my personal/professional development and education goals, ideas, and values. My time in Richmond was rewarding and helped define my future career in local government. Gehrt: My initial interest in local government was sparked by my parent’s active involvement in community organizations while I was growing up. Both parents were involved in local political party activities in a community in which city elections were contested on a partisan basis. As a very young person, I did not understand any of the issues but was very attracted by the energy and activity involved in the local election process which involved candidates who where friends and neighbors. Although I now have a much greater appreciation for the benefits of nonpartisan local elections, I do miss some of the excitement and color surrounding local elections in a partisan community. Moody: The impact that one person can have on an entire community, being part of decisions that will forever change lives, the culture and direction of the community.

18 / March 2014

What Do You Love About Your Community? Gehrt: Platte City residents were willing to make tough choices to improve their community. In the mid 1990s the community had an opportunity to either improve itself and take advantage of economic activity around Kansas City International Airport or to do nothing that would change the community in any way. Although change is always difficult and uncertain, Platte City residents voted in several elections to issue debt and increase tax revenue to rebuild the City’s water, sewer, storm water, and street infrastructure. The results of those tough decisions are evident throughout the community in outstanding quality of public infrastructure in every neighborhood, the strong state of city finances, the high quality of city services and the incredible growth in economic activity made possible by the infrastructure investments of the past 20 years. Butz: I love that Rolla is a full-service community that blends the best attributes of a rural community with the amenities of a first-class university town.

What Do You Enjoy Most About Managing Your City? Johnson: I can’t imagine another career that provides the diversity of work and opportunity to influence positive change more than that of a city administrator. Ultimately, what I enjoy most is the ability to deliver initiatives and projects that enrich the lives of residents in our community. I can remember working for six years on a very large retail development project. There were many days when we thought the project would never manifest and when we finally had the ribbon cutting on the first store; it was like having a parade that the entire community attended. The feeling of accomplishment and satisfaction was unbelievable.

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Butz: Working with the City Departments and employees in providing quality services for our citizens and visitors. So much of what we accomplished is truly due in large part to the partnerships we have with our schools, the Chamber, the County, key institutions and community organizations so we try to be a very outward-focused organization.

What Accomplishment Are You Most Proud Of For Your City? Johnson: A few things come to mind. In 2009, we opened 600,000 square feet of new retail in a lifestyle/power center during one of the nations’ most challenging economies. The retail development responded to a large demand from residents who desired to shop locally and keep sales tax dollars within their community. During 2011, our residents also showed great support for the City by passing a one-half cent sales tax (no sunset) dedicated for public safety. These funds are programmed for equipment and new technology, additional police personnel and improved public safety facilities. Passed during the nations’ recession, the successful initiative further demonstrates our community’s commitment and support for important local initiatives. Gehrt: The accomplishment I am most proud of is that residents rarely have to think about their city government or city services. Most people would rather spend their time and energy focusing on their family, their faith and their work rather than having to worry municipal services or municipal issues. Platte City provides extremely high-quality services ranging from police to streets to utilities to parks and recreation. The City prides itself in providing this high level of basic services while maintaining reasonable tax and service fees and still making appropriate contributions to reserve and replacement funds. Moody: Consolidation of ambulance and fire service into a 24/7 Emergency Services

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MISSOURI CITY ADMINISTRATORS AND CITY MANAGERS

Department, as well as a culture that looks for the best way forward by considering our performance relative to peers and based on citizen input.

What Challenges Do You Face In Your Position? Gehrt: The major challenge I face is the constant struggle to balance immediate operational, administrative and community demands with the professional responsibility to assist the community and the elected officials to envision, plan and fund the future. Because local government tends to be a “what have you done for me lately” proposition, it is all too easy for to get pulled into issues that can and should be addressed and resolved at the department or community interface level. Encouraging and empowering staff at all levels to make service decisions frees me up to assist elected officials in focusing on longer range issues but it also takes a leap of faith to allow staff to take initiative and make substantive decisions. Butz: The expectation of more services with less resources and the challenges that brings with keeping everyone on the same page.

What Advice Would You Give To A New City Manager / City Administrator, Or Someone Considering The Field? Johnson: Two things: 1) Position yourself in an organization where you can learn budget and finance and 2) Find a mentor. When I finished my MPA, I had the opportunity to work for the city of Kansas City, Mo., for six years in the budget office. During that time, I was immersed into the world of Excel spreadsheets and policy development. I spent my days locked in a cubicle, but I learned about municipal finance and honed my skills as a financial/policy analyst. Manager’s must understand how budgets work and possess the skill set that allows them to blend policy goals with budget reality; more art than science. I would have been lost in my position had I not ‘cut my teeth’ in the budget office. Secondly, and perhaps the most import, is to find a mentor. I was very fortunate to work for Fred Siems. Fred, now retired, was the Blue Springs city administrator for 26 years and is a legend among Missouri city managers. He was time-tested and a proven leader/manager. It was his leadership, wisdom, patience,

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and guidance that helped mold me into the administrator I am today. Butz: Get ready for a crazy and remarkable ride. Everyday will bring new challenges and opportunities. Remain humble but work with conviction.

When You Were A Child, What Did You Want To Be When You Grew Up? Johnson: I asked my 10-year-old son this question the other day. He said, “professional baseball player, fighter pilot, or City Manager.” There’s something not right with this picture…. I had similar thoughts when I was 10, except for the city manager part! When I began to cultivate the musician in me I, of course, wanted to become a rock star. Secretly, I’m still pursuing that dream… Gehrt: I wanted to be a soldier. My father was a veteran of both World War II and the Korean War. As it turned out, my first career was as a Marine Corps infantry officer. The sense of duty, responsibility and purpose I learned in the Marine Corps proved to be excellent preparation for serving as a city manager or city administrator for the past 20 years. Butz: Initially I wanted to work with animals – a vet or a zoologist (the latter because I thought the name sounded cool) as a teen I wanted to be a police officer and then headed to college I wanted to be a lawyer. Simultaneously, like many Catholic boys, I wanted to be a Priest. After 26 years in the profession, 27 years of marriage and 5 kids, I think I chose correctly! Moody: I wanted to race motorcycles for a living. Turned out a need for speed does not equate to gainful employment.

Most People Would Be Surprised To Learn ... Johnson: Although I sit behind a desk and enjoy my career in local government, that was not always the case. In high school I was not the college-bound kid. I was in vocationaltechnical school for two years as an auto-body technician. I learned how to work on cars and developed a fairly extensive mechanical skill set. To this day, I enjoy working on cars and have the ability to weld, paint, work with fiberglass, tear-down and rebuild engines, and do fairly extensive automotive restoration work; although I don’t have much time for it.

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Two years ago I restored a 1985 Cobalt speed boat and spend time on Blue Springs Lake with family and friends. If the rock star gig doesn’t pan out for me, in retirement, I would consider opening a classic auto restoration shop. I even have a name, “Nostalgic Auto.” Gehrt: That my wife and I raise, train and show reining horses, and that, until recently, much of my spare time was spent farming 200 acres for relaxation. Although I recently gave up leases on most of my hay ground and we have downsized our horse herd, my wife and I still have 15-20 head of horses at any one time. Butz: I’m in a four-person acoustical band called “Trilogy”. Moody: I enjoy restoring vintage motorcycles, love fast cars and motorcycle and relax by racing cars.

To W hat Location W ould You Most Like To Travel, And Why? Johnson: Like many people, I am a Beatles fan and have enjoyed listening and playing their music since I was 10 years old. Therefore, Liverpool, England is on my travel list. A family trip, no doubt, with the opportunity to visit English castles, countryside, and traverse the historic English canal system (I believe it’s their equivalent of going on a south Missouri weekend float trip.) Gehrt: I have been fortunate enough to travel and live in many parts of the United States as well as visiting more than 30 foreign countries, mainly during my military career. Although I have fond memories of virtually all those locations, including Afghanistan, the place I would most like to return is the coastal regions of Spain from Cadiz on the Atlantic east to Valencia in the Mediterranean. The people are extremely friendly and open, the landscape is stunning and the pace of life is many notches slower than in the US and most of other developed countries. Butz: My lifetime goal was to travel to Germany where my grandfather lived. I did that in 2013. Now, my sights are sent on Rome - why? I'm still a faithful Catholic boy! Moody: Any racetrack in a warm and sunny climate next to the water. The last three criteria are required in order to get my wife to come along.

March 2014 / 19


MISSOURI COMMUNITY BETTERMENT EDUCATIONAL FUND, INC.

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hroughout its 50year history, Missouri Community Betterment, Inc. (MCB), has emphasized both assistance in planning and implementing community betterment projects as well as the annual recognition of that process and accomplishments during an annual recognition day. MCB is a private, not-for-profit corporation established in 1963. It is designed to help Missouri communities enhance their quality of life through community development, planning and implementation. MCB lends technical assistance, provides recognition and awards communities that excel in the program. There are currently 50 participating communities in the state. Last year, MCB communities poured $37,027,425.00 back into their local economy. MCB has provided service to more than 415 communities, covering all parts of the state. MCB participating communities have had greater success in creating jobs and attracting outside investment into their community than Missouri communities that have not made this commitment. MCB continues to offer the assistance to participating communities

Rock. Hard place. 20 / March 2014

for many years, including: • How to organize a community betterment organization • How to conduct a community needs assessment • E n g a g i n g t h e c o m m u n i t y in planning discussions to set priorities • Project planning processes • How to present your material for easy understanding and recognition • Funding assistance for projects • Regional meetings as a way to minimize community leaders’ cost to network in face-to-face settings • M C B w e b s i t e a s a s o u r c e o f supporting information/ documents to assist in a community’s development efforts that includes items like: matrix of other community projects, list of funding resources, all program forms available electronically, assistance with writing a press release for your community • Monthly e-newsletters to provide updates on current events/ resources • MCB’s annual conference with a focus on the needs shared by our participating communities

Technical Assistance

With the addition of a second staff person in July 2013, MCB now has expanded capacity to provide technical assistance to the MCB participating communities. Some of the new services include: • Expansion of the “Rural Funding Team” – a process to assist your community in identifying additional funding streams • Expanding publicity assistance – publicity templates for your local community betterment program that corresponds with our statewide publicity • Expanding use of social media to share information from our MCB support staff, as well as provide more outlets for your local community to share/ request information from other communities • New information sharing/skill building opportunities through webinar training on topics of interest to participating communities utilizing the talent of our MCB Board and partners • Assistance with writing press releases for participating communities

As water and wastewater problems grow, our local communities are getting squeezed: capital improvement projects technical challenges shortages of licensed personnel government regulations revenue shortfalls. Missouri’s own Alliance Water Resources is a national leader in solving exactly these problems. If you can check any of these boxes, call (573) 874-8080 or visit www.alliancewater.com View Project Profiles at www.alliancewater.com

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New Initiatives

With the assistance of the MCB Board of Directors, two new initiatives are underway in 2014. The first is the creation of a statewide Youth Advisory Board. This effort will engage youth as leaders and guides of the MCB program in an expanded manner. This effort, led by MCB Board Vice President Brett Dinkins, with support from staff and Board, aims to have an official kickoff of the MCB Youth Advisory Board in place at the 2014 MCB Annual Conference held in October. The second major new initiative is a 2014 MCB Day at the Capitol on April 22. This is an effort to increase the Missouri General Assembly’s knowledge of MCB as a technical assistance program to Missouri’s rural communities. Also it provides an outlet for your local community betterment group to develop a personal working relationship with your local state representative and senator. More details on this event are available on the MCB website under “Upcoming Events.”

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Economic Development

At the Annual MCB Recognition Banquet, Mike Downing, director of Missouri Department of Economic Development (DED) made an offer to the MCB participating communities. He stated the first six to email him a list of specific information would receive a visit from DED. Those visits have been scheduled for Windsor, March 14; Steelville, March 18; Clinton, March 21; Albany, March 27; Grant City, March 28; and Jamesport, April 4. MCB and DED have partnered with other supporting agencies to provide the visits. The day will consist of several components, including meeting with the mayor and city council; an overview by the community; a community tour; meetings with local MCB leaders, Chamber of Commerce leadership, key businesses, school district, student council leaders/MCB Youth Group; and specialized groups based upon the community’s goals. After the group has met with everyone, they will take some time to meet privately to discuss the

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observations, develop preliminary recommendations, and finalize feedback to the community. A final open meeting will be held with the community to discuss the group’s observations and recommendations. It is the intent to identify some programs the community can use moving forward. MCB’s goal is to assist “small communities to have big accomplishments.” Please contact the MCB administrative office at (660) 383-1034 or visit www. mocommunitybetterment.com to learn more about these programs aimed at helping you meet your local community betterment needs. Likewise, please contact MCB to discuss the challenges you face and how we can assist your community. MCB looks forward to partnering with your community in 2014 to help make your community a better place to live, work and play in Missouri.

March 2014 / 21


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MISSOURI TRANSPORTATION FINANCE CORPORATION

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he demands for t r a n s p o r t a t i o n improvements have greatly outpaced the funds available to meet them. In response to this need, the Missouri Department of Transportation established the Missouri Transportation Finance Corporation (MTFC), a state infrastructure bank, to provide direct loans to public and private agencies for transportation improvements. The MTFC provides financial assistance for highway and transit capital improvements eligible for federal assistance. The benefits of an MTFC loan may include: inflation cost savings, early economic and public benefits, financing tailored to projects’ needs and a reduced cost of project financing. The MTFC was originally financed with federal and state funds. Loans are made from the original deposit, principal and interest payments from outstanding loans and investment income. Since 1997, the MTFC has provided 54 loans totaling $244 million for transportation improvements in Missouri. Some examples include interchanges, overpasses, roadway widening, roadway resurfacing, bridge replacements, intersection improvements, transportation facilities and pedestrian accommodations. Currently, the MTFC has $45 million available for loans. The minimum loan amount is $50,000.

To apply for a loan, ent it ies must complete an online application. Applications must include the current project budget, planned improvements, timing of loan disbursement(s), dedicated revenue stream(s) to repay the loan and audited financial statements. Applications are due in December, March, June and August for review in February, May, August and October. Exact dates are posted on the website. Staff reviews submitted applications, prepares an amortization schedule and provides a recommendation to the MTFC. The MTFC is administered by an eight-member board of directors made up of members from the Missouri Highways and Transportation Commission, MoDOT officials and at-large members with knowledge of business or finance. The board is responsible for the direction of the MTFC and approves all loan applications. Loan requests greater than $10 million require pre-approval by the executive director. Interest rates are normally the same as municipal borrowing rates for both rated and non-rated agencies. When determining which rating to use for non-rated agencies, consideration is given to the debt coverage ratio, the number of dedicated revenue streams and the term of the loan. Loan payments more than 15 days late are assessed a two percent late-payment fee on the amount of payment due.

MIRMA

BENEFITS:

Missouri Intergovernmental Risk Management Association Phone: 573.817.2554 Web: www.mirma.org

Missouri’s First Municipal Self Insurance Pool

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MTFC loan repayments must begin no later than five years after the project is completed. Loans for more than ten years require pre-approval by the executive director. A loan fee must be paid at the time of application submission and is non-refundable, unless the MTFC has no funds available to cover the loan. The loan fee is 0.15 percent of the loan amount for public agencies. The maximum amount charged is $75,000 and the minimum amount is $500. The loan fee is 0.25 percent of the loan amount for private agencies. There is no maximum amount charged. The minimum amount is $1,000. The difference in fees between public and private agencies is to account for the increase in administrative review and monitoring of a private agency loan. Contact the MTFC to learn more about how a MTFC loan can help deliver transportation improvements for your community. Missouri Transportation Finance Corporation • Carol Kliethermes 573-526-2561 • Todd Grosvenor 573-751-4626 • www.modot.org/ partnershipdevelopment/mtfc.htm

One comprehensive package! Proactive loss prevention training On-site safety training Annual police firearms training Risk Management Grant Program Aquatic audit reimbursement Police accreditation reimbursement Seminars & workshops Video library

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COVERAGE:

Workers’ Compensation Property General Liability Public Officials Liability Employment Practices Liability Law Enforcement Liability Automobile Boiler & Machinery Airport

March 2014 / 25


BIG OPPORTUNITIES FOR SMALL COMMUNITIES MISSOURI HAS THE TOOLS FOR SUCCESS by Mike Downing

O

ne of Missouri’s greatest strengths is its highlyskilled workforce. From excavators and miners to healthcare workers and computer technicians, Missouri can support any industry. However, only recently, has Missouri gained the tools to validate its workforce and promote it to prospective and current businesses.

Certified Work Ready Communities

Missouri currently has four Certified Work Ready Communities, by far the most in the nation, as well as the designation of having the nation’s first, Certified Work Ready Community in Jasper County. The Certified Work Ready Communities initiative was launched by the Missouri Division of Workforce Development in September 2012 when Missouri was chosen as one of only a handful of states to pilot the program. This initiative uses the ACT’s (American College Testing) National Career Readiness Certificate for a skill assessment on a county-by-county basis to help communities qualify their available workforce, and build a talent pipeline ready to serve existing employers and attract new business. The effort is a voluntary initiative within a community that gauges county certification by measuring the number of National Career Readiness Certificate (NCRC) holders within the county, as well as the number of employer partnerships. The NCRC is a portable, industryrecognized credential that clearly identifies and certifies three essentials skills – reading for information, applied math and locating information. These three specific skills are estimated to be required for 85 percent of jobs. The certificates, as well as the skills they verify, help assure prospective and current employers that the individuals hired and/or advanced will succeed in their jobs. The NCRC is similar to a passport – regardless of where an individual lives or moves, the certificate testifies to his or her work-readiness. To date, the certificates are proven to accurately predict work readiness

26 / March 2014

and job performance, proving that Missouri workers are ready, willing and extremely capable of providing and sustaining a solid, strong workforce with high productivity rates and low employee turnover. In 2012, Missouri was one of the first four states in the nation to qualify for the ACT CWRC Academy. Since its inception, the program has grown both statewide and nationally with 17 states currently participating. In March 2013, Jasper County achieved a huge feat when it became the first fully-certified Work Ready Community in the United States, less than two years after its largest city, Joplin, was struck by an E-F5 multiple-vortex tornado that affected 500 businesses and 4,000 workers. By utilizing the CWRC, the county was not only able to rebound from this disaster, but also exemplified how this innovative program could be successfully employed to strengthen and grow Missouri’s workforce. Since then, an additional three counties have achieved certified status, giving Missouri the distinction of having four out of the first five counties in the nation to receive this designation. (The only other county to achieve this distinction is Clarendon County in South Carolina.) In January 2014, the counties of Franklin, Ripley and Butler were certified as Work Ready Communities. With this certification, these counties are now better able to align workforce training programs with the economic development needs of their communities, match appropriate applicants to jobs based on skill level, and strengthen businesses by strengthening the workforce. In addition to Missouri’s four fullycertified counties, there are currently another 35 counties also working towards the certification. These counties are on track to become fully certified within two years and are narrowing the skills gap in their communities. Through participation in the CWRC program, prospective companies are able to immediately gauge the quality of the workforce in a given area.

The Missouri Municipal Review

Because a qualified workforce is one of the first factors that many businesses consider when undergoing site selection, Missouri’s high participation in the CWRC program is propelling prospective businesses to look at Missouri as the place to be for accelerated growth.

Community Development Block Grants

Another important factor that growing companies take into consideration when choosing a new place to locate, is the strength of the area’s infrastructure. If an area has poor water systems, roadways or undersupported utilities, the cost to do business can be high. Thanks to the Community Development Block Grants (CDBG) program, the state of Missouri is able to offer grants to small communities to improve local facilities, address critical health and safety concerns, and develop a greater capacity for growth. The grants that are only available to towns with a population less than 50,000 or counties with a population under 200,000, can be used to fund projects ranging from housing and street repairs to industrial loans and job training. These improvements speak volumes to expanding businesses. In the month of October 2013, the state of Missouri authorized more than $4 million in CDBG funding to communities all across the state. Through the use of these funds, small communities such as Holliday, Edgar Springs, Jamestown and Risco are now able to offer upgraded infrastructure and facilities to businesses engaged in the site selection process.

Mike Downing is the director of the Missouri Department of Economic Development and a Certified Economic Developer (CEcD) authorized by the International Economic Development Council. In this position, Mike collaborates with local and regional economic developers in Missouri to facilitate the expansion and retention of existing businesses, promote international trade, promote Missouri’s favorable business climate. Mike has a master’s degree in public administration from the University of Missouri-Columbia and a bachelor’s degree from Arkansas State University. A native Missourian from the Kennett area, Mike has been with DED from 1982, except for nearly two years as executive director for the Missouri CORE Partnership.

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MML Legislative Conference February 11-12, 2014 Jefferson City, Mo.

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The Missouri Municipal Review

March 2014 / 27


frequently asked questions - Municipal Classification Each day your Missouri Municipal League staff answers dozens of questions on municipal issues. This column discusses some of the most common questions the League staff receives. This issue’s column is devoted to the classification of Missouri municipalities. As with all legal matters, municipal officials are urged to consult their city attorney for guidance in the specific problems faced by their municipality. Answers provided in this column should serve only as a general reference.

Why Does A Municipality’s Classification Matter?

One of the first questions League staff may ask when someone calls the League with an inquiry is “What class of municipality is this”? That’s because the classification of the municipality in many ways determines how the municipality operates. Different laws apply to different classes of municipalities. Everything, from whether the city may have a city manager to the number of elected members of the governing body, is determined by the municipality’s legal classification. Knowing your municipality’s classification is fundamental to understanding the authority and restrictions under which it operates.

Where Can I Find Out The Class Of A Particular City?

There are lots of sources for this. Asking the city clerk is probably the easiest. The Missouri Secretary of State’s Blue Book lists all Missouri Municipalities, along with their classification and population and is available online at http://www. sos.mo.gov/BlueBook/2013-2014/8_ CityCounty.pdf#citiescounties. Another great reference source is the League’s website. The website includes a member search function that provides lots of details about all 675 League member municipalities – from classification to population to zoning enactment, as well as contact information.

What Are The Classifications For Missouri Municipalities?

In Missouri, municipalities fall into five distinct classifications: home rule charter, third class, fourth class, village and special legislative charter. The term municipality is used to include any of these types of political subdivisions,

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while the word city, when used in a legal context, excludes villages. In Missouri, the phrase “statutory cities” is generally used to distinguish third class, fourth class, and villages from home rule cities.

Why Aren’t There Any First- Or Second-Class Cities In Missouri?

In 1875, the Missouri Constitution led the nation in providing that the state’s largest municipalities could provide their own structure of government by drafting home rule charters for approval by the voters. For many years, St. Louis and Kansas City were the only constitutional charter cities in the state. In 1946, the voters approved a constitutional amendment to permit home rule status for municipalities over 10,000 population. Between 1946 and 1971, most of the existing first- or second-class cities (about 20) drafted and adopted home rule charters, in addition to the previously adopted charters in St. Louis and Kansas City. In 1971, the voters approved another amendment that broadened home rule powers and lowered the population requirement from 10,000 to 5,000. By 1975, all of the cities that were first or second class opted to become home rule charter cities, and the Missouri legislature repealed the chapters authorizing first- and secondclass cities, realizing that in the future any growing municipality would opt for becoming a home rule city.

What Does It Mean To Be A Home Rule City?

In essence, home rule charter cities have the authority to enact any local ordinance or policy as long as the authority can be found in the local charter and is not in conflict with state law or federal law. The 41 Missouri municipalities operating under home rule authority enjoy a much broader range of flexibility when responding to municipal needs than Missouri’s statutory cities. Statutory cities only have those powers specifically granted to them under the Missouri statutes.

What Are The Steps To Becoming A Home Rule City?

A municipality must have a population of at least 5,000 to become a home rule city. The first step in moving towards home rule is having the municipal governing body submit the question “Shall a commission be chosen to frame a charter”? to the voters. The 13 members of the charter commission will The Missouri Municipal Review

have the duty of creating the charter. The members of the committee are elected and typically an election is held in conjunction with the vote on whether to form a charter commission. The charter formed by the commission is then submitted to the electors at an election held at a time fixed by the commission, but not less than 30 days subsequent to completion of the charter; nor, more than one year from the date of the election of the commission. A technical bulletin on model charters is available to download on the League’s website or by contacting League headquarters.

What Are The Types Of Statutory Cities In Missouri?

There are four classifications for statutory cities in Missouri: villages, fourth class, third class and special legislative charter (also called special charter). Much of the law regarding these four classifications can be found in their respective chapters in Missouri Statutes: Villages (Chapter 80), fourth class (Chapter 79), and third class (Chapter 77).

What Are The Requirements For Changing A Municipality’s Classification?

There are two basic requirements to change the classification. First, the municipality must meet the threshold population for the new classification: fourth class - 500 (with some exceptions); third class - 3,000; home rule - 5,000. Second, the change in classification must be approved by a simple majority of the voters in a city-wide election.

Our Village Population Is More Than 500, Shouldn’t We Be Classified As A Fourth-Class City?

It should be emphasized that once a community is incorporated under a given classification, the municipality does not automatically change classifications with a gain or loss of population. A municipality may change classification only when the change is approved by a majority vote of the people. Some of the more notable examples of municipalities having perhaps unexpected classifications include: fourth class, St. Peters with a population of 52,000; third class, Huntsville population 1,564; and BelRidge, village, with a population of 2,737.

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What Is A Special Charter Or Legislative Charter City?

Special charter cities operate under their own unique individual charters granted to them by the Missouri Legislature, generally in the late 1800s. They are similar to home rule charter cities in that the procedures and powers of the city are delimited by their local charter. However, unlike home rule charter cities, special charter cities would need the formal action of the state legislature to change their charter; while home rule charter cities can amend their local charter by a vote of the local citizens. Further, special legislative charter cities must look to their charter or state law to find a grant of authority before they may carry out a policy or program. Whereas, home rule charter cities generally need only make sure the policy will not conflict with state or federal law. Missouri Statute Chapter 81 provides the primary guidance for the operation of special charter cities. All special charter cities (regardless of population) have the option of changing to home rule with a vote of the people. Augusta, Miami, Missouri City, Liberty, Chillicothe, Pleasant Hill, Carrollton and La Grange are the only remaining special charter cities in Missouri.

What Are The Primary Differences Between Villages And FourthClass Cities?

One of the most noticeable distinctions between municipal classifications is simply the different names given to the governing bodies. In villages, the legislative body is known as a board of trustees. The trustees elect from among their members a chairman who presides at the board meetings. Fourth-class cities are governed by a board of aldermen and a mayor who is elected at large. Usually the aldermen are elected from wards, while in villages the trustees are elected at large. A recent change to Missouri law allows aldermen in fourth-class cities to be elected at large in cities with a population of less than 1,000. One of the most important differences between villages and fourthclass cities is that the general property tax levy for a village is limited to $.50 (per one-hundred dollars assessed valuation) while fourth-class cities may levy a tax up to $1(per one-hundred dollars assessed valuation). Both have the ability to impose a $.30 levy (per one-hundred dollars assessed valuation)

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above their respective limits with a two-thirds vote and a four-year sunset. Generally, the statutes governing fourthclass cities are considered to be at least somewhat less ambiguous than those governing villages. There are approximately 300 villages and 550 fourth-class cities in Missouri.

What Are The Primary Differences Between Fourth Class And ThirdClass Cities?

Again, one of the most noticeable distinctions between classifications is simply the different names given to the governing bodies. In third-class cities, the legislative members are known as city councilmembers (with exceptions) while in fourth-class cities they are called aldermen. Both third- and fourth-class cities have mayors. In general, the taxing authority and most other powers are very similar between third- and fourthclass cities. Both third- and fourth-class cities have the option of employing a city administrator. The ability of the citizens to recall elected officials via petition and recall an election is provided under third-class city statutes, but not in fourth class. Another important distinction is that third-class cities have the option of utilizing alternative forms for their governance. These forms include the City Manager Form and the City Commission Form. There are approximately 55 thirdclass cities in Missouri. The Missouri Municipal Review

What Are The Alternate Forms Of Government In Third-Class Cities?

State law (Chapter 78 RSMo.) for third-class cities provides two alternative structures for the operation and division of authority in those cities: Commission Form and City Manager Form. Under the Commission Form, the lines between the legislative branch and executive branch are softened. In addition to having a vote as a member of the governing body, each commissioner also is given executive power and oversight for particular departments in the city government. West Plains is the only remaining Commission Form, third-class city in Missouri. The other alternate form for third-class cities is the City Manager Form. While the terms city administrator and city manager both denote an appointed municipal official serving in an executive capacity, there is a very important distinction. In city administrator cities, the elected mayor is considered the chief executive officer while, a city manager in a third-class city is technically the chief executive. Much more information about the different forms of municipal government in Missouri is available in the League’s technical bulletin Forms of Government in Missouri Municipalities, available online on the MML website under the "Publications" tab.ď ą

March 2014 / 29


Classifieds The city of Branson, Mo., will be accepting sealed bids for an Andritz Aquascreen 600 x 3400 x 6 Bar Screen and DSP 250 Compactor until 3:00 p.m. April 30, 2014. Specifications and additional information are available on the city of Branson’s website http:// www.bransonmo.gov/226/Utilities under Bid Number 2083-30, or by phone at 417-243-2740.

Member Accomplishments St. Joseph Is Growing Fast The city of St. Joseph was named one of the 12 fastest-growing cities in America by Business Insider, based on a report recently published by the Conference of Mayors and produced by IHS Global Insight.

Ballwin Named Ninth-Safest City in U.S. Congratulations to Ballwin, Mo., named the ninth-safest city in the U.S. by NeighborhoodScout research group. The group reviews cities with more than 25,000 people, based on the total number of property and violent crimes per 1,000 residents.

Welcome New Members! MML is happy to welcome our two newest members, the cities of Downing and Meadville. We look forward to serving you and welcome you to the MML community!

MML Calendar of Events April 8 30 30-May 2

Municipal Election Day GFOA Spring Conference, Lake Ozark, Mo. MCMA Spring Conference, Lake Ozark, Mo.

May 5-9 6-7 8 13-15 21-23 26

Missouri's Local Government Week Missouri Concrete Conference, Rolla, Mo. Harry S Truman's Birthday Missouri Traffic & Safety Conference, Columbia, Mo. APWA Mid-America Conference & Exhibit Show, Overland Park, Kan. Memorial Day

June 12-13

2014 MML Elected Officials Training Conference

July 29-31

Missouri Main Street Connection 2014 Get Plugged In Downtown Revitalization Conference, Clayton, Mo.

September 14-17

MML Annual Conference, St. Charles, Mo.

For more events, visit the events calendar at www.mocities.com.

2014 APWA Mid-America Conference & Exhibit Show

May 21-13, 2014 Overland Park Convention Center Overland Park, Kansas For more information, visit http://kcmetro.apwa.net/ MenuHomepage/144/2014-Mid-America

Missouri Concrete Conference May 6-7, 2014 Hosted by:

The Missouri University of Science & Technology Rolla, Missouri

HOW WILL YOU CELEBRATE LOCAL GOVERNMENT WEEK?

May 5-9, 2014 Find your toolkit with ideas and materials at www.mocities.com.

30 / March 2014

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March 2014 / 31



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