Quarterly Report: 2014, January - March (Q3), Metlakatla

Community:
Metlakatla 
Staff:
Lynn Kenealy  
DCRA Regional Office:
Juneau regional office 
Gov't Type:
Organized Under Federal Law 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
Metlakatla Indian Community 
Population:
1471 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
2/6/2014 
Exp Date:
 
Last Updated:
4/17/2014 
Community Sanitation Overview:
The Metlakatla Indian Community is a federally-recognized tribe of the Annette Island Reserve, the only federal Indian reservation in the State of Alaska. Metlakatla is incorporated as a municipality under federal law, and is unincorporated under state law. The Municipality of Metlakatla is governed by officials elected by tribal members within the community. Elected officials include the six-person tribal council, the mayor, the secretary, and the treasurer. The community is located on the west coast of Annette Island, 15 miles south of Ketchikan. Metlakatla is a traditional Tsimshian village, employed predominantly by subsistence and commercial fishing; and tribal and federal employees. The community is powered by a near-by hydroelectric plant, and is accessible by ferry, boat, and float plane. The community provides filtered and chlorine treated gravity-fed water at a rate of about 600 gallons per minute during the winter and up to 1,000 gallons per minute during the summer. The utility can store up to a million gallons, which can provide for the community for a minimum of eight hours in case of an emergency. The treatment plant is flushed approximately twice per week, and the distribution system is flushed approximately twice per year. The community provides wastewater treatment through two aerated lagoons, a sludge pond, and effluent discharge through an ocean outfall. There are some individual wastewater tanks on the island for which the community provides pumping services. Village Safe Water has provided several water treatment plant upgrades over the past five years, including automating much of the treatment plant system and installing several treatment upgrade processes. The community’s distribution lines are now in need of several replacements and upgrades. Much of the community lies on muskeg, and the high level of acidity in this terrain is breaking down several of the distribution line pipes. Additionally, the region is prone to frequent earthquakes, and some lines have broken or are at risk of breaking as a result of this. Utility staff would also like to intertie a number of dead ends in the distribution lines. Wastewater collection lines are also in need of similar upgrades. The Metlakatla Indian Community operates and manages the following utility services: Class 2 water treatment, Class 1 water distribution, Class 1 wastewater collection and treatment, solid waste haul, landfill, and cable television. 
RUBA Status & Activities This Qtr:
This quarter RUBA staff traveled to the Metlakatla Indian Community to conduct the RUBA assessment of management indicators. The community is not meeting six of the indicators (two essential and four sustainable) in various areas. Additionally this quarter RUBA staff attended a Sanitation Deficiency Systems provider's meeting which discussed the community's water and wastewater utilities. The utility is requesting funding for distribution system upgrades to address corrosion issues. Operator certification was also discussed at the meeting. 
RUBA Activities for the Coming Qtr:
The community has requested a rate study be conducted in the coming quarters to assess the actual cost of providing water and wastewater services to the community. RUBA staff will also provide any other advice and assistance requested.
Scores:
 
Essential Indicators:
20 of 26
Sustainable Indicators:
22 of 27
Total Score:
42 of 53

Finances

Essential Indicators
Answer Question
No All revenues and expenses for the utility are listed in the utility budget.
No The utility has adopted a balanced realistic budget.
No Monthly financial reports are prepared and submitted to the policy making board.
Yes The utility is current in paying all water/wastewater electric bills.
Yes The utility has on hand a year's adequate fuel supply or it has a financial plan to purchase an adequate supply.
Yes The utility is receiving revenues (user fees or other sources) sufficient to cover operating expenses.
Sustainable Indicators
Answer Question
Yes The utility is receiving revenues (user fees or other sources sufficient to cover operating expenses and Repair & Replacement (R) costs.
No YTD revenues are at a level equal to or above those budgeted.
No YTD expenditures are at a level equal to or below those budgeted.
Yes A monthly manager's report is prepared.
No Budget amendments are completed and adopted as necessary.
Finances Comments
The Metlakatla Indian Community operates on the federal fiscal year beginning in October and finishing at the end of September. The community has not adopted an FY14 budget, and thus is not able to meet related indicators. The treasurer provides a financial report indicating balances in each fund category (specifically: port, smoke shop, tourism, water/garbage/wastewater, cable, gaming, and general funds). However, no profit and loss or balance sheet is provided at this time. A verbal report is provided to the tribal council monthly by the treasurer along with a fund balance report. Water/wastewater customer fees have not been increased since 2005. There are no meters, and therefore fees are assessed monthly at a flat rate for water/wastewater/garbage of $45 for resident members; $57 for resident non-members; and $59.40 for commercial customers. According to the January 22, 2014 aging report for water/wastewater/garbage, 53 percent of customers are delinquent on payment. Despite insufficient revenues from water/wastewater customers, the community does have sufficient revenue to cover the cost of water and wastewater services. Revenue from the smoke shop and gaming sufficiently subsidize the cost of water/wastewater services to the community. Metlakatla Power and Light provides electricity for the community and water utility. Electric bills are coded to the appropriate account, and charged accordingly to that fund. Payments are made monthly, and were evidenced as such. Annette Island Gas provides fuel to the community and utility, and there are sufficient funds to cover fuel costs.

Accounting Systems

Essential Indicators
Answer Question
No The utility has adopted a collection policy and actively follows it.
Yes The utility bills customers on a regular basis.
Yes An accounts receivable system is in place which tracks customers and reports past due accounts and amounts.
Yes An accounts payable system is in place.
Yes The payroll system correctly calculates payroll and keeps records.
Yes A cash receipt system is in place that records incoming money and how it was spent.
Yes The utility has a cash disbursement system that records how money was spent.
Sustainable Indicators
Answer Question
Yes A chart of accounts is used that identifies categories in a reasonable, usable manner.
Yes Monthly bank reconciliations have been completed for all utility accounts.
Yes The utility has a purchasing system that requires approval prior to purchase, and the approval process compares proposed purchases to budgeted amounts.
Accounting Systems Comments
The utility utilizes Microsoft Access for all accounts receivable, and IBM I-Series for all payroll and accounts payable, including a chart of accounts. The accounting file in each system is accessible on any finance staff computer throughout the building. There is strong segregation of duties in the accounting department, including an accounts receivable clerk, an accounts payable clerk, payroll, a cashier, grants staff, and a treasurer who provides purchasing approvals, budgets, supervision, and reconciliation to finance staff. Utility bills are sent out within the first week of every month and are due for payment 10 days after mailing. If payment is not made, notices are issued and the accounts receivable clerk contacts the customer by phone to notify them of the delinquency and attempts to identify solutions to the payment issue. According to the community’s collection policy, if payment is not received within 20 days, service is to be terminated until payment is made in full. Subsequent to termination, if payment is still not received, the account is turned over to the Metlakatla Tribal Court for collections, then Ketchikan Credit Bureau or District Court of Alaska for collections. Currently, terminations are not being carried out, though upon 90-day delinquency, the account is being turned over to the Metlakatla Tribal court for collection. Accounts are not being forwarded to Ketchikan Credit Bureau or District Court of Alaska for payment. The current 90-day delinquency collection rate is approximately 47 percent. As the community does not wish to utilize shut-offs as a means of collecting on utility debt, they are considering revising the collections policy to reflect this. Further collections tools will be necessary to improve the delinquency rate. The community receives many payments in cash. When cash is received, the cashier notes payment in the general fund account as an accounts receivable, tallies and itemizes each payment, and deposits cash into the bank daily. There is no cash disbursement. Each employee is responsible for a timecard, which is signed by two supervisors (the direct supervisor, and a Metlakatla Indian Community official). The timecards are tallied by the payroll clerk and entered into the accounting system, along with any leave slips. Payroll is processed after garnishments and withholdings are factored in, and checks are signed by the appropriate supervisor, and then distributed to employees. Reconciliation is completed monthly in phases first by the treasurer and then entered into the system by the finance director. When utility staff requires a purchase, a requisition form is completed including the vendor, department, quantity, part, description, purpose, unit price, and extended price. Finance staff links the request to an account code for that department, and then the request is authorized by the treasurer. A purchase order is completed and signed by the staff member designated with purchasing authority and the item is ordered by the utility staff member. Final payment is made by the purchasing authority and reconciled through the above-noted reconciliation process.

Tax Problems

Essential Indicators
Answer Question
Yes The utility has a system to accurately calculate, track, and report payroll tax liabilities.
Yes The utility is current on filing tax reports.
Yes The utility is current on making tax deposits.
N/A If there are any past due tax liabilities or recorded tax liens, a lien release has been issued or a repayment agreement has been signed and repayments are current.
Tax Problems Comments
The community utilizes IBM I-Series accounting systems to compute payroll and related liabilities. The community is compliant with all IRS tax requirements as of March 17, 2014, and with all State of Alaska tax requirements as of March 4, 2014.

Personnel System

Essential Indicators
Answer Question
Yes The utility has a posted workers compensation insurance policy in effect.
Sustainable Indicators
Answer Question
Yes The utility has adopted and uses a Personnel Policy, which has been reviewed by an attorney, AML or Commerce for topics and language.
No The utility has adequate written job descriptions for all positions.
Yes The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation.
Yes The utility has an adequate written hiring process.
Yes The utility has personnel folders on every employee that contain at least: I-9, Job Application and Letter of Acceptance.
Yes The utility has a probationary period for new hires that includes orientation, job training/oversight, and evaluations.
No The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The utility’s workers’ compensation insurance is provided by AK National Insurance Company, and continued coverage was verified on February 7, 2014. Chapter 5.09 of the Metlakatla Indian Community Law and Order Code, as amended last in October 2002, provides for personnel policies and procedures. The chapter was reviewed by an attorney before being adopted by the council. Section 5.09.05 provides for a recruitment process, including job announcement, application, interviews, appointing authority, and orientation. All new employees begin with a 90 day probationary period, as provided in Subsection 5.09.05(K) (1). An employee performance program is discussed in Subsection 5.9.10(A), and is to be provided at the end of each employee’s probationary period and annually thereafter. A Performance Appraisal form is used for all employees which discusses several areas to be evaluated, and also includes space for manager and employee comments. On-site training is provided to all employees, and several employees have been sent to additional training, both through RUBA, and federal trainings provided throughout the country. See the ‘Organizational Management’ section of this report for further discussion of staff training. Community staff report that job descriptions are currently outdated, and there may be several positions without job descriptions. The community’s personnel officer is auditing all job descriptions and updating or creating job descriptions at this time. All employee files include I-9 forms, job applications, and a signature page indicating that employees have read and attest to the employee handbook and to their position and classification. This serves as a letter of acceptance.

Organizational Management

Essential Indicators
Answer Question
Yes The entity that owns the utility is known; the entity that will operate the utility is set.
Yes The policy making body is active in policy making of the utility.
Yes The policy making body enforces utility policy.
Yes The utility has an adequately trained manager.
No The utility has an adequately trained bookkeeper.
Yes The utility has an adequately trained operator or operators.
Yes The utility has adopted the necessary ordinances (or rules and regulations) necessary to give it the authority to operate.
Sustainable Indicators
Answer Question
Yes The utility has adopted an organizational chart that reflects the current structure.
Yes The policy making body meets as required.
Yes The utility complies with the open meeting act for all meetings.
Organizational Management Comments
Metlakatla Indian Community Law and Order Code Chapter 5.06 provides for water supply and system maintenance, including a provision requiring the community’s council to establish, operate, and maintain all services, ownership, and policies. The council meets monthly. Though they are not required to follow the Alaska Open Meetings Act, all meetings are posted throughout the community well in advance of meetings, and all community members are welcome to attend in an open meeting format. Meeting minutes are maintained and are available upon request. An organizational chart provides for delegation of authority among Metlakatla Indian Community staff, who are supervised by the council indirectly, and by the mayor or city manager directly. Each department then has an officer who supervises all employees under that department. The utility has a newly-elected mayor and secretary, who are being encouraged to attend Office of Management and Budget (OMB) circular, management, and RUBA-sponsored trainings over the coming year. The treasurer has been in this position for eight years, and all finance and public works staff have been in their positions for at least as long, with a few exceptions of employees hired over the past few years who are being trained under the supervision of more experienced employees. All employees are encouraged to attend trainings, and RUBA trainings have been attended three times.

Operation of Utility

Essential Indicators
Answer Question
No The utility operator(s) are actively working towards necessary certification.
Yes The utility has a preventative maintenance plan developed for the existing sanitation facilities.
Sustainable Indicators
Answer Question
Yes The manager receives a monthly O&M report from the utility operator and routinely "spot checks" the facilities to see that the maintenance items are being completed.
Yes The utility has a safety manual and holds safety meetings.
Yes Utility facilities have not suffered any major problems/outages due to management issues that are unresolved.
Yes The utility is operating at the level of service that was proposed.
Yes The operator provides status reports to the manager on a routine basis.
Yes The utility has completed and distributed its "Consumer Confidence Report".
Yes The utility is not on the "Significant Non-Complier" (SNC) list.
Yes The utility maintains an inventory control list.
Yes The utility maintains a critical spare parts list.
Operation of Utility Comments
The primary water operator has taken the provisional certification exam multiple times, and is still attempting to pass it. The State of Alaska Department of Environmental Conservation has expressed concerns that no real attempt is being made to certify operators, though there are questions as to which entity has the authority to enforce operation certification requirements on this utility. It is recommended that both water operators and the public works director begin efforts to become certified. Despite not having passed the requisite exam to date, the water operator has maintained all water testing and safety requirements, and has been working in the plant for many years. Various water testing requirements are completed daily, monthly, and quarterly by the primary water operator at various points in the treatment plan and throughout the distribution system. The community is not on the Significant Non-Complier list, and is up-to-date on all Consumer Confidence Report requirements as of February, 2014. The public works director is the manager for the water utility. He conducts spot checks of the plant multiple times daily, completes maintenance as necessary with the assistance of the back-up operator, and receives updates and status reports as needed. He conducts safety meetings and maintains safety manuals and preventative maintenance plans for all water/wastewater operations. Safety meetings are not currently being documented. The public works director maintains both an inventory control list and critical spare parts list through the purchase order and invoicing process. This will be expanded upon with the assistance of the Asset Management Program to be installed by SEARHC beginning in May, 2014.