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HomeMy Public PortalAbout2012.009 (01-03-12)RESOLUTION NO. 2012.009 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LYNWOOD AMENDING RESOLUTION NO. 2010.228 ADOPTING A CHECK SIGNING POLICY FOR THE CITY OF LYNWOOD AND ITS RELATED AGENCIES WHEREAS, on October 19, 2010, the City of Lynwood adopted Resolution No. 2010.228 establishing a City -wide policy describing the specific procedures for the issuance of payments from the accounts of the City or Lynwood Redevelopment Agency; and WHEREAS, the City Council's goal is to establish clear criteria for payments to be approved by the designated City and Agency officials, while assuring adequate safeguards are in place to guard against fraud, mistake or misappropriation of funds; and WHEREAS, the City Council has evaluated the effectiveness of the adopted Check Signing Policy and wishes to add additional safeguards, while providing an efficient and clear process for the approval of checks; and WHEREAS, the City Council wishes to adopt the Amended and Restated Check Signing Policy attached hereto as Attachment No. 1 as the procedure applicable to the approval of checks from the City and its related agencies and that such Check Signing Policy shall amend Resolution 2010.228 and supersede any other policy addressing the method for the approval or signing of checks, whether adopted by the City or any of its departments; and WHEREAS, the City Council hereby finds that the attached Amended and Restated Check Signing Policy is consistent with the provisions of State Law. NOW, THEREFORE, BE IT RESOLVED, THAT THE CITY COUNCIL OF THE CITY OF LYNWOOD HEREBY FINDS, ORDERS AND RESOLVES AS FOLLOWS: Section 1. That the City Council hereby adopts the policy attached hereto as Attachment No. 1, and incorporated herein by this reference, as if fully set forth, entitled the "Amended and Restated City of Lynwood Check Signing Policy." Section 2. This Resolution supersedes all prior resolutions or other Council or individual City Department actions or policies related to the approval and signing of checks from the City and its related agencies. Section 3. This policy will take effect immediately upon adoption. Section 4. The City Clerk shall certify to the passage and adoption of this Resolution. PASSED, APPROVED and ADOPTED this 3rd day of January, 2012. ATTEST: Maria Quinonez, City Clerk APPROVED AS TO FORM: Fred Galante, City Attorney Jim Morton, lQiayor APPROVED AS TO CONTENT: / la '�� gle City Manage STATE OF CALIFORNIA ) ) SS. COUNTY OF LOS ANGELES ) I, the undersigned, City Clerk of the City of Lynwood, do hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of Lynwood at a regular meeting held on the 3rd day of January, 2012. AYES: COUNCIL MEMBERS CASTRO, RODRIGUEZ, SANTILLAWBEAS, ALATORRE AND MORTON NOES: NONE ABSENT: NONE ABSTAIN: NONE Maria Quinonez, City Clerk STATE OF CALIFORNIA ) ) SS. COUNTY OF LOS ANGELES ) I, the undersigned City Clerk of the City of Lynwood, and the Council of said City, do hereby certify that the above foregoing is a full copy of Resolution No. 2012.009 on file in my office and that said adopted on the date and by the vote therein stated. Dated this 3` 2012. o r' Maria Quinonez, Citly Clerk Clerk of the City true and correct Resolution was day of January, Attachment No. 1 CITY OF LYNWOOD AMENDED AND RESTATED CHECK SIGNING POLICY PURPOSE: The purpose of this policy is to establish guidelines and procedures applicable to the City, its City Departments and related agencies for the approval and execution of checks for payment of funds from the City or its related agencies. POLICY PROCEDURES: The issuance of checks by the City or its related agencies shall be approved and signed authorized pursuant to the following procedures: 1. Authorization a. Required Signatures All instruments of payment of the City and its component units must have two signatures, with at least one of the signatures being handwritten (manual). Any two of the following officials of the City are designated by title to sign instruments of payment with a handwritten (manual) signature or a facsimile signature (provided that at least one signature is handwritten). i. City Treasurer ii. Deputy City Treasurer iii. Mayor iv. City Manager The Treasurer's Office shall provide all authorized signatures to all applicable banking institutions within 48 hours (excluding non - working days) of its receipt of any updates to the authorized signatures. b. Expenditure Authorization All expenditures to be paid shall be authorized in accordance with the provisions of the Lynwood Municipal Code. (See L.M.C. section 6 -3.7.) The department initiating the request shall be responsible for obtaining the required authorization for any expenditure that is the subject of a check request. c. Required Authorization and Documentation All requests for payment shall be submitted to the Finance Department by either (1) using the Check Request Form attached hereto as Exhibit A and supported by appropriate documentation, or (2) affixing the Approval Stamp, the form of which shall be conform to the stamp shown below, upon each original invoice (or if an original is unavailable, a copy marked by the vendor as a replacement original) or purchase order from a vendor, receipts, travel /media reimbursement form, or other applicable documentation confirming the requisition or expenditure of reimbursable costs. Each department submitting a check request is responsible for verification of invoices for payment, including, but not limited to comparing quantities billed on the invoice with quantities listed on a purchase order, contract or other applicable document as well as quantities actually delivered; comparing prices, discounts and terms with those specified on the purchase order, contract or other applicable document; and verifying clerical accuracy of the invoice. Form of Approval Stamp Date: ______ PO Account # Payment Amount, AuthoriztA Signer Name, Title. Department d. Persons Authorized to Request Checks Any check request and documentation required by Section 1.c above shall be submitted by the applicable department head or, in his /her absence, the designee specifically authorized by the department head. Such authorized person must sign and print his /her name in the appropriate location on the Approval Stamp or Check Request Form, verifying that the service or goods at issue have been received, as set forth in Section 1.c above. The department head shall be responsible for updating his /her authorized designee with the Finance Department on forms approved and maintained by the Finance Department, with a copy provided to the Treasurer's Office. e. Time to Correct Check Request Errors The department head or designee shall correct any error or deficiency identified by the Finance Department or Treasurer's Office within 48 hours (excluding non- working days), unless the Finance Department or Treasurer's Office's request is not supported by the requirements of this Policy, in which case, the City Treasurer shall take the item to the City Manager and the City Manager shall contact the department head or designee to correct any error or deficiency. If the matter is not resolved within 48 hours (excluding non - working days), the City Treasurer's Office shall place the matter on the next City Council agenda for consideration. 2. Finance Department Duties a. Verification of Check Request The Finance Department shall be solely responsible for ensuring that: (1) the Approval Stamp is affixed, with the department head or designee's signature, to the applicable supporting documentation or that the Check Request Form is properly filled out and sufficient supporting documentation provided, and (2) and that the amount requested has been appropriated in the relevant budget. Upon confirmation of these requirements, the Finance Department shall initial the Approval Stamp or Check Request Form at the appropriate place and issue the appropriate check for execution by the Treasurer's Department per Section 3 below. b. Addressinq Problems with Check Request If the submittal for a check request has missing or what appears to be incorrect information, the Finance Department personnel shall use their judgment in handling the problem in accordance with the following: i. If there is a minor problem, such as an incomplete or misspelled name and address, invoice number, purchase order number or account number discrepancy, they may communicate same to the initiating department to expedite resolution of the problem. ii. If the required approvals have not been obtained, the check request submittal should be returned to the initiating department with an explanation of the problem and proposed corrective action. iii. If budgeted funds are unavailable and the request for budget appropriation has not been completed, the Finance Department's response will be based on the approvals required for the particular expenditure in accordance with Section 1.b above and the Lynwood Municipal Code. The Finance Department personnel will attempt to resolve the problems in a timely manner so that the payment request is not delayed and /or late penalty or interest fees do not accrue for late payment. 3. Treasurer's Office Duties a. Disbursement of Monies Provided the check request is in compliance with the above requirements, the Treasurer's Office shall sign the check and disburse monies accordingly and deliver such signed check to the Finance Department for delivery to the payee. The Treasurer may withhold signing a check for the same reasons and pursuant to the same procedures set forth under Section 5 below. b. Time to Approve Checks All checks shall be rejected or approved by the Treasurer's Office within 48 hours (excluding non - working days) of its completed receipt of the check request submittal. Notwithstanding the foregoing, should the City Manager determine that withholding a check for the 48 hour period would present a detriment to the City or its related agencies, the City Manager, in his or her sole discretion, may place the matter on the next City Council agenda for consideration. c. Cash Reconciliation Pursuant to Government Code section 41004, the Treasurer, working in conjunction with the Finance Department, shall, by the 10 of each month, submit to the city clerk a written report and accounting of all receipts, disbursements, and fund balances. The Treasurer shall further file a copy of such report with the City Council. 4. Special Payment/Verification Procedures a. Invoices from Law Firms Each billing entry describing legal services performed must be verified and initialed by the responsible department, stamped with the Approval Stamp for each separate invoice and signed according to this Policy. b. Payroll Direct deposit payroll shall be processed by the Finance Department. Handwritten paychecks shall require the signature of two City officials per Section 1.a. The payroll specialist shall provide to the Treasurer's Office the direct deposit report to ensure the payroll account is funded to meet payroll. The Treasurer's Office, with the approval of the City Manager, shall have the authority to audit a payroll check to an employee on the payroll roster for which the Treasurer's Office does not have verification of the employee's status as a bona fide employee of the City. This provision shall not authorize the duplication of any portion of the employee's personnel file or any document that reveals the employee' personal information or invade his /her privacy c. Prepay Checks In the circumstances where a check cannot wait until the next warrant run, the initiating department shall provide a detailed explanation and justification of why the payment cannot wait until the next warrant run process in order to protect the interests of the City or related agencies. If such request is approved by the City Manager, the check shall be issued in accordance with the requirements of Section 3.b above, provided the item appears on the warrant run for the next available Council meeting. 5. Inappropriate Check Requests and Stop Payments a. Inappropriate Check Requests Should the City Manager or Treasurer have a reasonable belief that a check request was issued based on mistake, fraud or other criminal basis, such officer may direct that the request or check be held for a period not to exceed 48 hours from receipt of the request for check approval. During such 48 hour period, if the officer initiating the hold fails to present written documentation to the satisfaction of the City Manager, then the hold shall be removed and the check shall be processed pursuant to this Policy. b. Stop Payment. Should the City Manager or Treasurer have a reasonable belief that a check was issued based on mistake, fraud or other criminal basis, such officers may request that the bank place a stop payment on the check. All stop payment requests require the approval of the City Manager or Treasurer. The Treasurer's office shall immediately enter stop payments into the banking institution's online cash management system. Any stop payment made without reasonable justification shall be considered a violation of this Policy and reported to the City Council on its next agenda. 6. Access to Financial Reports. The Treasurer shall have the right to view, but not duplicate any portion of, the City's financial records database for the sole purpose of verifying the appropriateness of any check request.