Quarterly Report: 2012, January - March (Q3), Angoon

Community:
Angoon 
Staff:
Lynn Kenealy  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Angoon 
Population:
452  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/1/2012 
Community Sanitation Overview:
Angoon is the only permanent settlement on Admiralty Island, located on the southwest coast at Kootznahoo Inlet. Angoon is 55 miles southwest of Juneau and 41 miles northeast of Sitka. The city operates and manages a Class 2 water treatment system, a Class 1 water distribution system, and a Class 1 wastewater collection system. System classifications are determined by the State of Alaska's Department of Environmental Conservation Division of Water based on the type of components found in a treatment plant and the number of connections served by water distribution and wastewater collection systems. Angoon's drinking water is derived from the Tillinghast Lake Reservoir before it is treated and the piped throughout the community. Over 95% of homes in the city are fully plumbed. Piped sewage is processed at a secondary treatment plant that flows to an ocean outfall. The City of Angoon also provides a garbage collection service. On a weekly basis, refuse is collected and deposited at a municipal landfill located approximately two miles from the city. Diesel-generated electrical service for Angoon is provided by the Inside Passage Electric Cooperative (IPEC). 
RUBA Status & Activities This Qtr:
This quarter, RUBA staff was in frequent contact with Angoon city officials, assisting the city in meeting essential and sustainable indicators on the RUBA assessment. This included one trip to the community to work hands-on with city staff, January 19-21, 2012. On the visit, RUBA staff supported the community in submitting their CCR, completing the city's 2011 federal and state tax filings, training city clerks on the process of merging their two separate QuickBooks files, entering bank reconciliations, drafting utility bill collections policy changes, amending the city's utility rate structure adoption process, and explaining the importance of staff safety meetings. Additionally, this quarter RUBA staff has supported the city in researching options for water collection policies, and in drafting ordinances regading the city's water collection title. On a monthly basis, RUBA staff has helped city staff get accurate financial information from their two QuickBooks files and consolidate this information into useful financial reports for council meetings, as well as providing ongoing support in cleaning up the QuickBooks files in preparation for consolidating the two files into one. RUBA staff assisted city staff in completing a questionnaire for AML-JIA, which will serve as an outline for creating a personnel policy. RUBA staff has also supported the community with regard to council meeting procedures, and personnel questions regarind drug and alcohol testing policies. 
RUBA Activities for the Coming Qtr:
RUBA staff continues to offer assistance to the community in managing its finances to ensure the long-term sustainability of sanitation services in Angoon. Next quarter, RUBA staff will conduct a site visit to Angoon to meet with city and utility staff. This visit will provide an opportunity to train the city clerk on drafting ordinances, amendments and resolutions; adopting an effective utility collection policy; developing a personnel policy; and continue working with the accounting clerks on consolidating their two QuickBooks files into one. In the mean time, RUBA staff will continue to assist in producing useful financial supports for council meetings, consolidating appropriate information from the two files. Additionally, the city's clerk will be attending the upcomign RUBA UTM Utility Clerk Management training held in Juneau. The city's Accounts Receivable clerk will be attending a QuickBooks training in Anchorage in April/May. The city will continue to send their water operators to appropriate trainings and testing in their effort to get the required certifications.
Scores:
 
Essential Indicators:
20 of 26
Sustainable Indicators:
18 of 27
Total Score:
38 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.
Yes 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.
No The utility is receiving revenues (user fees or other sources) sufficient to cover operating expenses.
Sustainable Indicators
Answer Question
No 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.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
The City of Angoon adopted its FY12 budget by non-code ordinance on June 23, 2011. Both budgets appropriately separate the revenues and expenditures for city's various departments and enterprises. The budget seeks to address the city's annual deficits with a 5% cut to administration and finance expenses, a 7% cut to the water utility budget (primarily due to a reduction in water testing costs and electricity needs), and a 40% cut to the solid waste budget with the elimination of what appears to be an employee's position. According to the budget, the city plans to more than double its sales tax revenue and increase enterprise revenue by 18%. This appears to be an unrealistic projection considering that the city has not fully enforced its sales tax or utility bill payment policies in previous years. City officials have verbally acknowledged expectations for grant funding this fiscal year; however, financial reports submitted to RUBA staff do not reflect these additional funds. The city's budget is not currently being updated in their QuickBooks files. Thus, they are not presently able to provide a Budget vs. Actual report for their council meetings. City officials have been active in seeking assistance from RUBA staff to revise and enforce sales tax collection policies and utilities collections policies in order to increase revenue. While draft ordinances to changes these have been worked up, changes have yet to be proposed to the city council. The number of utility customers who pay monthly bills on time and in full remains very low. Considering these financial challenges, the utility's long-term sustainability is in question. Nonetheless, the city continues to maintain that it has a financial plan to purchase diesel fuel as necessary and to pay its water/wastewater electric bills. Fuel availability has not been an issue this quarter, though the rising cost of fuel is a constant concern.

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
Title 13 of the Angoon Municipal Code (AMC) outlines the city's utility bill collection policy. According to that policy, bills are to be sent out by the tenth day of each month. Bills are considered delinquent if payment is not received by the last day of that month. Customers can pay their bills by mail, in person at city hall, or through scheduled credit card payments. RUBA staff also confirmed with the accounts receiveable clerk that the city also provides an incentive for customers who pay in advance. Customers who pay for six months of utilities receive a discount of one month free. Title 13 of the AMC also contains the current collections policy for delinquent customers. Due to lack of disconnection infrastructure, the current collections policy is not being enforced, and city officials seek to revise this collections policy and replace the disconnection penalty with more viable repercussions, such as financial penalties, threat of installing disconnection taps for delinquent clients, or a small claims court policy. Water, sewer, and garbage service rates in Angoon are differentiated in such a way that assigns rates to specified customer categories. Generally, those categories consist of residential citizens, senior citizens, commercial, and public facilities. Each customer pays a specific flat rate for the three utility services together as outlined in the utility's price list. Utility bills include the customer's name and address, the dates of service provided, the amount due, and any unpaid balance carried forward from previous months. When customers pay their bill, they receive a numbered receipt which details the form of payment, the date the payment was received, who it was received by, and payment purpose. All payments are entered into the QuickBooks accounting system which is used to track utility customers and maintain both the accounts receivable and accounts payable systems. Currently, accounts receivable and accounts payable are accounted for on two separate QuickBooks files which do not communicate with one another. This has caused much confusion when printing up monthly financial reports, and with ensuring finances are accurate and in order. City staff is working with RUBA staff and with the QuickBooks Hotline on consolidating the two computer systems into one QuickBooks file. Purchases are requested with a standardized, numbered purchase request form. These forms must be reviewed and approved by the mayor and matched with a separate purchase order record kept by the bookkeeper. The purchase order record lists the particular order number, the date, who requested the purchase, what the purchase was for, and whether it was approved. All purchases are matched to the appropriate city department and supplier using a simple four- or five-digit code. The city also utilizes a standardized set of timesheets to identify all necessary employee information, the funding department, any annual or sick leave used, and leave balances. The timesheets must be signed by the employee and the supervisor at the end of each time period. Additionally, there are formal, written leave application request, payroll advance request, and check request forms that must be completed by city employees. The utility bank accounts are reconciled each month and records of all bank statements are kept in a secure, organized filing cabinet.

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 city's bookkeeper uses QuickBooks to calculate, track, and report its payroll tax liabilities. The Internal Revenue Service's taxpayer Advocacy Office has confirmed that Angoon is current in its federal tax reports and filings and the IRS has no liens against the city as of March 5, 2012. The Alaska Department of Labor and Workforce Development confirmed that all state tax payments are current as well.

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.
No The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation.
No 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.
No The utility has a probationary period for new hires that includes orientation, job training/oversight, and evaluations.
Yes The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The City of Angoon has a workers' compensation insurance policy with the Alaska Municipal League Joint Insurance Association (AMLJIA) valid through June 30, 2012 and covers work-related accidents and occupational diseases up to the Alaska statutory limits for each occurrence. Proof of coverage is posted in three areas including City Hall, the city shop, and the water treatment facility. Personnel folders are well-organized and contain all necessary INS forms, IRS forms, acceptance letters, and records of any disciplinary actions. However, the city continues to work with AMLJIA to adopt a personnel policy for all city employees. The city staff is currently completing a questionnaire which will serve as an outline for creating a personnel policy. Training opportunities are provided to city staff as funding allows. The city clerk, accounts receivable clerk, and planning technician have all travelled to various RUBA trainings in the past year.

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.
No The policy making body enforces utility policy.
Yes The utility has an adequately trained manager.
Yes The utility has an adequately trained bookkeeper.
No 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
The city does not fully enforce the utility bill collections policy set forth under Title 13 of the Angoon Municipal Code (AMC). City officials have requested assistance from RUBA staff to draft ordinances for a revised collections policy. The city council meets on the third Tuesday of each month as required by the AMC. In order to faithfully comply with Alaska's Open Meetings Act, the city clerk posts notices for these meetings at least twenty-four hours in advance in three public places. The utility is managed by the city's mayor, who has attended city council trainings and is versed in the general operations of the city's utility systems. The city employs an accounts receivable clerk who assists the bookkeeper. The accounts receivable clerk completed the RUBA 32-hour Elected Officials UTM course in March, 2011, and a 24-hour introductory QuickBooks class in April, 2011. The accounts receiveable clerk, the city clerk, and the planning technician also attended the RUBA 32-hour Personnel Management for Rural Utilities training in Sitka July 25-29, 2011. The city of Angoon employs two utility operators, John Silva and Jeremy Martin. The previous quarter, Jeremy Martin successfully earned a provisional Class 1 water distribution certification. He and John Silva will continue towards further certification necessary to operate the water treatment, water distribution, and wastewater collection systems. Both operators currently receive technical guidance from utility support engineers with the Alaska Native Tribal Health Consortium.

Operation of Utility

Essential Indicators
Answer Question
Yes 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".
No The utility is not on the "Significant Non-Complier" (SNC) list.
No The utility maintains an inventory control list.
Yes The utility maintains a critical spare parts list.
Operation of Utility Comments
Jeremy Martin, one of the utility's opeartors, recently earned a Class 1 water distribution provisional certification. Both Martin and John Silva, the other water operator, are actively working towards further necessary certification. The city's water utility nonetheless remains on the EPA's Significant Non-Compliance (SNC) list for its continued high levels of disinfectant by-products (DBPs). In order to be removed from the list, the utility must not have any DBP violations for one quarter and must complete one round of valid lead and copper samples. The State of Alaska's Department of Environmental Conservation Division of Environmental Health states that Angoon's water treatment plant may require further upgrades in order to address these elevated DBP levels, though a final plan for such upgrades has not been made. The water treatment facility was recently upgraded from a Class 1 system to a Class 2 system with the addition of new facility components. During that upgrade, the utility was able to secure a collection of critical spare parts that are kept on hand at the facility. These parts were recently itemized in a critical spare parts list with the help of the ANTHC utility support engineer. The operators, however, do not currently maintain a full inventory control list. A safety manual is available on site and safety meetings are held at least once a month with the utility operators and utility manager (the city's mayor). Records of such meetings are recorded in a safety meeting log maintained by the utility manager.