Quarterly Report: 2013, April - June (Q4), Gambell

Community:
Gambell 
Staff:
Iura Leahu  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Gambell 
Population:
677  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
7/24/2013 
Community Sanitation Overview:
The City of Gambell has operated a piped water and wastewater system since the 1990s. All water and wastewater piping is underground. The water source is a shallow aquifer at the base of the Sevuokuk Mountain. In the last several years, the system has undergone several upgrades, including construction of a 1.3 million-gallon water storage tank, upgrading lift stations, and installation of a Greensand filtration system. The wastewater system is a gravity collection system with three lift stations and a lagoon for wastewater treatment. One hundred twenty-one residential homes and thirteen public and commercial buildings are now connected to the piped water and wastewater system. Forty three homes in the original town site are not connected to the piped system and their residents haul water and use honeybuckets.  
RUBA Status & Activities This Qtr:
This quarter, Nome RUBA staff had email and telephone contact with the city clerk, mayor and utility clerk regarding the management, operation, and maintenance of the water and wastewater utility. RUBA staff met with the remote maintenance worker to discuss the utility shutdown in June of 2013. RUBA staff, members of the utility board, the mayor, utility staff, and representatives from state agencies met in a technical assistance provider teleconference to addressed ongoing and near-term water and wastewater projects, operator training and certification program requirements, daily, monthly, and quarterly sampling requirements, as well as RUBA compliance. RUBA staff sent letters requesting monthly financial reports and meeting minutes to update the RUBA assessment. RUBA staff was not provided with written documentation to update the assessment this quarter, but verbal reports on the meetings, agendas of the utility board, actions taken by the board, and the city council have been relyed. The mayor and the utility clerk successfully completed the Elected Officials Management for Rural Utilities training held in Nome in April 2013. Last quarter, the final phase of installation of the Greensand filtration system was completed. The Village Safe Water engineer cautioned that the new filtration system will be more expensive than the bag filters the system used in the past. The system will now be in compliance with the requirements of the Department of Environmental Conservation and residents will have better water quality. The engineer encouraged the primary operator to sign up for training to be in compliance with regulations.  
RUBA Activities for the Coming Qtr:
This coming quarter, Nome RUBA staff plans to travel to the City of Gambell to perform an on-site RUBA assessment of management capacity indicators. The current assessment is due to expire this coming quarter.
Scores:
 
Essential Indicators:
22 of 26
Sustainable Indicators:
15 of 27
Total Score:
37 of 53

Finances

Essential Indicators
Answer Question
Yes All revenues and expenses for the utility are listed in the utility budget.
Yes 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
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.
No A monthly manager's report is prepared.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
The Gambell Water Treatment System previously adopted its FY13 budget and more recently its FY14 budget. The utility budget was included in the overall city budget and it was submitted to the State of Alaska as required by law. The utility lists revenues of $259,747 and expenditure of $230,905 for the FY14, leaving a surplus of over $28,000. The list of items in the operating expenditures section of the budget is comprehensive and includes funds allocated towards personnel services, training, facility expenses, supplies, equipment, and parts. The expenditures do not include the fuel expense, which is a large expense. For the FY14 budget, the city council approved a subsidy of about $42,000 to pay for the utility's fuel needs. For many years, the city council has heavily subsidized the utility using the Norton Sound Economic Development Corporation Community Benefit Sharing payments to subsidize the utility. The city council voted to continue appropriating subsidies to the utility this fiscal year. The council approved approximately $70,000 of the Community Benefit Sharing payment to pay for the utility's fuel. The utility has sufficient fuel to last until the next fuel delivery. The recent increase in user fees has cut the deficit by $28,000, leaving the fuel expense at around $42,000. The utility clerk has not provided monthly financial reports comparing year-to-date revenues and expenditures to those budgeted to the newly established utility board. The utility does not receive sufficient revenues from user fees to cover operating expenses and repair and replacement costs. The city council provides the utility with subsidies to assist it in difficult financial times. The year-to-date revenues are not at the level equal to or above those budgeted and the year-to-date expenditures are not at a level equal to or below those budgeted. The utility clerk, who is also the utility manager, provided the city council with a verbal monthly report on the operation and management of the utility.

Accounting Systems

Essential Indicators
Answer Question
Yes The utility has adopted a collection policy and actively follows it.
No 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.
No 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
Gambell Water Treatment System's billing and collection procedures are included in the utility ordinance which was adopted in 1996. According to the utility ordinance the utility board is responsible to review the water and wastewater rates on a periodic basis and the rates should be published in a separate 'Schedule A' page. Nome RUBA staff has a copy of the utility ordinance. The last quarter, the city council has raised user fees for residential customers, small commercial, large commercial, and the local school as recommended. RUBA staff cannot confirm whether the utility bills customers on a regular basis. The utility uses QuickBooks for accounting and financial management of utility revenues and expenditures. RUBA staff and the RUBA QuickBooks contractor trained the utility clerk to use the new QuickBooks utility file. The accounts receivable and payable are properly set up and functioning. The utility had unpaid bills last quarter. To its credit, the utility has paid off all taxes owed to the IRS and the State of Alaska. The utility clerk was trained to write a receipt for any income received. A copy of every receipt is kept in a permanent receipt book. The utility clerk was advised to enter the new data from the receipt book into the QuickBooks accounting system each Friday. The utility clerk uses QuickBooks created checks to make payments. The QuickBooks chart of accounts identifies all asset accounts and all liability accounts, as well as fund balances. With the assistance of the QuickBooks contractor, the utility clerk reconciled the bank account; however, monthly bank reconciliations have not been completed in the past.

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 Internal Revenue Service (IRS) reported that Gambell Water Treatment System is in compliance with federal employment tax filing and federal tax deposit requirements. No Notice of Federal Tax Lien against the utility has been recorded. The utility is compliant with state employment security contributions. The utility staff uses QuickBooks Pro 2012 to calculate, track, and report payroll tax liabilities.

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.
Yes 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.
No 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.
Yes The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The utility has general liability and workers compensation coverage. The workers compensation insurance is purchased through Alaska Municipal League Joint Insurance Association (AMLJIA) and is valid until June 30, 2014. The notice of insurance was posted in plain view in the utility clerk's office. A copy of the city's personnel policy, which also applies to all utility employees is on file with RUBA staff. The utility follows the personnel policy in the day-to-day management of personnel. Job descriptions are up-to-date and outline each employee's duties. The hiring and evaluation process is described in the personnel policy. The utility maintains personnel files for all employees but does not have a Form I-9 for each employee. The city clerk reported that the city is in the process of updating all employees' files to include the I-9. The city and the utility have a probationary period for new hires that includes orientation, job-training/oversight and evaluation, which is completed after ninety days of a hire. The city and the utility provide training opportunities to staff as funds are available. The city council has been acting as the utility board until this quarter and has been involved in monitoring and overseeing the operation, maintenance, and management of the utility. The city council includes the utility in the city council meeting agendas.

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.
No 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
No 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
According to Title VI of the city's code of ordinances, all city-owned utility systems are the property of the City of Gambell. The code for a utility board has been written; last quarter a utility board has been established and held its first meeting. According to the utility ordinance, the board administers and enforces all rules and regulations pertaining to the utility. In the recent past, the city council and utility staff have not consistently enforced the utility policies, including the collection of past due accounts. As soon as the utility board was established, new user fees for all water and wastewater customers were adopted. The utility clerk is the manager of the utility, but the manager needs training in utility management. Although in the past the utility clerk did not always provide monthly management reports to the city council, this quarter the utility clerk participated in the first meeting of the utility board and provided a verbal management and financial report. Several meetings with representatives of the Village Safe Water Program and Alaska Department of Environmental Conservation have been held in the last several months. Both of these agencies have been closely working with the utility clerk, water operator, and members of the city council to move forward with the planned upgrades. The utility clerk received extensive training in QuickBooks Pro 2012 finance and accounting. The QuickBooks contractor trained the utility clerk in the use of all the necessary bookkeeping functions. After the training, the customers, vendors, employees, and payroll records as well as the accounts recoverable and payable, and all the necessary financial reporting were current. RUBA staff recommended the utility clerk contact the QuickBooks contractor with any question regarding finance and accounting. The city has an organizational chart that needs to be updated to reflect the current chain of command.

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
No 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.
No 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.
No The utility maintains a critical spare parts list.
Operation of Utility Comments
Gambell Water Treatment System does not have a certified water operator, but the main water operator has been actively working towards necessary certification by attending training and taking the test to receive a provisional water treatment and distribution certificate. However, the water operator will have to take several trainings to be in compliance with water and wastewater regulations for a class 1 water treatment system, class 2 distribution, and class 1 wastewater lagoon and wastewater collection system. The utility has an assistant water operator who is not certified. The utility has a preventive maintenance plan that was developed by an engineer. The operator uses checklists to verify that preventive maintenance is performed. The operator submits a written monthly operations and maintenance report to the utility clerk/manager. However, RUBA staff found that a few operations and maintenance reports were missing or incomplete. The utility has a safety manual on file but RUBA staff is not aware of whether the new water operator attends the telephonic safety meetings provide by Alaska Municipal League Joint Insurance Association (AMLJIA). This quarter, the system has suffered a major outage due to management issues. The shutdown of the system was for less than a week, but the shutdown was caused by lack of supervision and management. According to the quarterly significant non-complier list published in April 2013, the utility exceeded the copper level in the water, needs to a new sanitary survey performed, and submit combined 2011/2012 community confidence reports. The community confidence reports have been submitted to the Division of Environmental Health, Drinking Water Program. The utility has an inventory control list, but the list needs to be updated. The utility does not have a critical spare parts list on file. According to the utility operator, the utility has funds to order and replace parts and pumps when necessary.