b'City of Dover Tuscarawas County, Ohio Managements Discussion and Analysis For the Year Ended December 31, 2019 Unauditedmaster capital fund has always been the source of revenue for many projects such as the purchase of land and equipment and improvements to infrastructure.In 2019, the master capital fund received 25 percent ofincometaxcollections,allowingmanyprojectstobefundedandcompleted.Intergovernmental revenue increased from 2018 in the master capital fund due to contributions received for the school street project and for the new fire station, as well as grants received for the canal park project.It is a practice of the City to pay cash for items such as fire trucks.Sinking funds are only utilized when necessary.The Citysfundsaremonitoredconsistentlywithadjustmentsmadethroughouttheyearinbudgetsto accommodate yearly revenues.The one fund that consistently exceeds our expense expectations is our employee health insurance fund.Ourmedical/surgicalanddentalbenefitplanshavebeenself-fundedsince1988.Anordinancewas passed in 2012 to increase the premium by $100 monthly for family coverage and by $50 for single coverage and allow for an additional $500 per employee per month to be contributed to the fund on an as-needed basis, and this has helped maintain the fund.In 2019, the fund had an operating gain despite an increase in claims expense and a decrease in charges for services revenue.The increase in claims expense was due to an increase in the claims payable for 2019, as well as a significant reduction in the claims payable during 2018.Charges for services decreased in 2019 because of the prior years additional City contributions paid into the fund in response to a low carryover balance from 2017.We are consistently negotiatingwithallourunionsforplanmodificationsandincreasedemployeecontributionstohelp control plan costs.Information about the proprietary funds starts on page 25.These funds are accounted for on an accrual basis.The sewer fund had a small increase in net position due to the special item recognized for the transfer of operations discussed previously.The electric fund had a small increase in net position as expenses decreased slightly, despite the larger decrease in charges for services revenues.The water fund also had an increase in net position, due to the special item recognized for the transfer of operations discussedpreviously,aswellasadecreaseinexpenses,despitedecreasesinoperating revenuesand capital contributions. The City consistently monitors these funds and takes the required actions to ensure strength in our enterprise funds.In 2008, the City found it necessary to pass along a 25 percent water rate increase effective in January of 2009.In an effort to avoid large percentage increases in the future, a 3 percent increase will be effective in January of every year to come.This increase will allow the City to properly maintain and grow the water system for the future.Budgeting HighlightsThe Citys budget is prepared according to the laws of the State of Ohio and is based on accounting for certain transactions on a cash basis for receipts, expenditures, and encumbrances.The City of Dover is somewhat different than many other Ohio cities its size in that the general fund is not our most significant fund.Our budget is adopted at the object level within each department.Any budgetary modifications at that level may only be made by Council action.For 2019, general fund appropriations were modified by Council several times.Final budgeted revenues werelessthanoriginalbudgetedrevenues,andfinalappropriationswerehigherthanoriginal appropriations due to revised estimates in several expenditure categories, primarily general government and basic utility services.Actual revenues were higher than the final budgeted revenues due to the receipt of higher amounts in all categories of revenues, most significantly income taxes and charges for services.Actual expenditures were lower than the final appropriations, primarily due to conservative spending in general government, security of persons and property, and leisure time activities.- 12 - - 12 -'