Quarterly Report: 2014, October - December (Q2), Aleknagik

Community:
Aleknagik 
Staff:
Barbara Higgins  
DCRA Regional Office:
Dillingham 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
Yes 
Agreement Date:
12/27/2011 
Entity:
City of Aleknagik 
Population:
227 (2012 DCCED certified estimate) 
Assessment Status:
Assessment Completed 
Assessment Date:
12/21/2011 
Exp Date:
12/27/2013 
Last Updated:
1/7/2014 
Community Sanitation Overview:
Aleknagik is located at the head of Wood River on the southeast end of Lake Aleknagik, 16 miles northwest of Dillingham. The majority of the roughly 49 homes in the community are plumbed and draw water from individual wells. Approximately 12 households do not have water or wastewater service. Some residents haul water from the community center and a few are served by a spring well catchment system. Wastewater tanks, leach fields, and a public wastewater lagoon are used for wastewater disposal. The North Shore section of the community uses 11 shared effluent pumps (REP units) which discharge into a piped wastewater system. Nushagak Electric Cooperative in Dillingham provides electricity to Aleknagik. 
RUBA Status & Activities This Qtr:
This quarter RUBA staff advised the city on measures for properly using public funds to acquire new city property according to the Aleknagik's municipal code, and assisted the city in drafting related property acquisition ordinances. Aleknagik’s city administrator attended the RUBA Program’s Organizational Management for Rural Utilities training in Anchorage December 9-13. New RUBA staff was temporarily assigned to the community on December 19 and has since communicated with city staff the benefits of completing an updated utility management assessment and RUBA agreement in an effort to maintain eligibility for sanitation project grant funding. Further, RUBA staff has reviewed the city’s financial reports, council meeting minutes, operator certification requirements, and workers’ compensation insurance coverage to ensure that essential and sustainable indicators are still being met. On December 20, RUBA staff was notified that the city has hired a new bookkeeper. The bookkeeper holds a degree in finance and has worked as a professional accountant. The bookkeeper has already helped the city clerk complete reconciliations for the months of October and November. RUBA staff had not received authorization to request federal tax information, or a response from the State’s Department of Labor and Workforce development to a request for tax information, in time for the writing of this report. Therefore RUBA staff has been unable to verify that federal and state tax filings and deposits have been made; relevant tax indicators have been marked accordingly.  
RUBA Activities for the Coming Qtr:
RUBA staff will continue to work to determine that the city is current in its tax filings and deposits, and to assist the community in addressing any tax issues outstanding. The city has mentioned to RUBA staff the need for assistance updating utility personnel documents, determining the effects of acquiring additional land on the city’s sanitation services, completing an ordinance codification effort, and addressing certain problems in its QuickBooks files. RUBA staff has offered to travel to the community in the coming quarter to provide this assistance, and to update the city’s utility management assessment, once formally requested by the city.
Scores:
 
Essential Indicators:
22 of 24
Sustainable Indicators:
22 of 25
Total Score:
44 of 49

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.
Yes Monthly financial reports are prepared and submitted to the policy making board.
N/A 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.
Yes YTD revenues are at a level equal to or above those budgeted.
Yes 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 Aleknagik follows the State Fiscal Year running from July 1 to June 30 and adopted its FY14 budget timely by non-code ordinance on May 14, 2013. The budget compares projected FY14 income and expenses alongside actual FY13 values, allowing the utility to ensure that allocations for this fiscal year are realistic. Water and wastewater service expenses, which include salaries, payroll taxes, repair and maintenance costs, fuel, insurance, and other necessary appropriations, are grouped separately in the budget from other city functions. The city expects to spend approximately $13,500 providing water and wastewater services in FY14, but to generate less than $2,000 in user fees. The remaining expenses are met with subsidies from the city’s general fund which originate from the Community Revenue Sharing and Payment in Lieu of Taxes (PILT) programs, local taxes, and profits from other city services. The administrator and bookkeeper provide the city council with detailed monthly financial reports. These reports compare actual year-to-date revenues and expenses with the budget, and include graphs and diagrams tracking income and expenses over time. In addition to the budget’s repair and replacement line item, there is a separate Repair and Replacement account in to which funds are being set aside to meet future sanitation infrastructure needs in the community. A review of city council meeting minutes shows that the administrator provides a written managerial report on the utility at its regular monthly meetings.

Accounting Systems

Essential Indicators
Answer Question
Yes 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 city’s utility ordinance was adopted in June 2008 and includes procedures for collecting on delinquent accounts and the signing of repayment agreements. A review of accounts receivable reports by RUBA staff shows that utility bills are issued within the first six business days of each month as required by the utility's billing procedures, but that there are some customers with accounts more than 90 days past due. The city has demonstrated that it is actively seeking to collect on these accounts. The city uses QuickBooks Pro 2013 for its bookkeeping functions, including generating customer invoices, recording customer payments, processing payroll, and tracking accounts payable. Utility staff are proficient in using QuickBooks and the city’s newly-hired bookkeeper has educational and professional background in finance and accounting. The city clerk writes a receipt for any income received and a copy of each receipt is kept in sequentially-numbered receipt books. Once a week, new data from the receipt book is entered into the utility's computerized accounting system. All payments by the utility are made by check or credit card. Every check issued includes an amount, an expense account, and a description of the payment’s purpose. The data for every check written is recorded in a check register. All credit card statements are reconciled and expenses classed in the QuickBooks file. A copy of paid invoices is kept in the vendor files. The utility's chart of accounts identifies all asset accounts (un-deposited funds, bank accounts, and accounts receivable), all liability accounts (current, long-term, and payroll liabilities), and fund balances. Income and expense accounts are identified in a manner that matches the income and expense line items in the budget. Bank reconciliations are current. The utility adopted a purchasing policy in 2002. The policy requires approval from the mayor for purchases.

Tax Problems

Essential Indicators
Answer Question
Yes The utility has a system to accurately calculate, track, and report payroll tax liabilities.
No The utility is current on filing tax reports.
No 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 uses QuickBooks accounting software to calculate, track and report payroll tax liabilities. The State's Department of Labor and Workforce Development confirmed on December 30, 2013 that the City of Aleknagik is current in its employment security (ESC) tax filings and deposits. The city is also not listed on the September-October Lien Watch report. However, RUBA staff had not received authorization to request federal tax information in time to note in this report whether the city is current in making its federal tax filing and deposit requirements. Relevant indicators have been marked 'No' until such verification can be made.

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.
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.
Yes The utility provides training opportunities to staff as needed and available.
Personnel System Comments
RUBA staff verified on December 23, 2013 that the city has a valid workers’ compensation insurance policy through the Alaska Municipal League Joint Insurance Association (AMLJIA) and notice of coverage has been posted at the city office. A copy of the City of Aleknagik’s personnel policies, where were formally adopted January 2012 and address all necessary personnel matters, is on file with RUBA staff. Job descriptions are up-to-date and outline each employee's required duties; RUBA staff has copies of these job descriptions, as well as employee evaluation forms, on file. The council performs employee evaluations on an annual basis. RUBA staff has verified during a recent on-site visit to the community that personnel files contain all the required forms. City staff have attended various RUBA courses and a review of council meeting minutes shows that the city is supportive of employees gaining the training they need. The FY14 budget allocates appropriate funding to utility staff travel and training costs.

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.
Yes 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
The utility ordinance identifies the city as owner and operator of the sanitation utilities available in the community. A review of meeting minutes confirms that the council, the utility’s governing body, reviews utility policies and rates on an annual basis and makes changes as needed. Meeting minutes also confirm that the council takes an active role in enforcing utility policy. The city administrator fills the role of utility manager, developing and supervising the utility budget, overseeing the utility clerk, and providing monthly reports to the governing body. The city clerk has three years of on-the-job experience and has attended a QuickBooks training class sponsored by the RUBA Program. She maintains all of the utility accounting systems in a professional and timely manner. The city administrator has successfully completed various RUBA courses, including Planning Management for Rural Utilities and Organizational Management for Rural Utilities. The utility’s bookkeeper has educational and professional experience in finance and accounting. The city has an organizational chart, a copy of which is located in the city’s business plan. Regular council meetings are held once a month; special meetings are held as needed. Copies of meetings-related documents through November 2013 show that they are held in accordance with Alaska’s Open Meetings Act.

Operation of Utility

Essential Indicators
Answer Question
N/A 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.
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.
N/A The operator provides status reports to the manager on a routine basis.
N/A The utility has completed and distributed its "Consumer Confidence Report".
Yes 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
The City of Aleknagik operates a wastewater lagoon and pumping service, but does not provide any sanitation service which requires a certified operator or the completion of an annual Consumer Confidence Report. The city has no sanitation utility listed on the October 2013 Significant Non-Complier (SNC) list. City staff have a basic preventative maintenance plan on file for the services they do offer, but no evidence has been shown to RUBA staff of an inventory control or critical spare parts list.