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

Community:
Kobuk 
Staff:
Margaret Hansen  
DCRA Regional Office:
Kotzebue regional office 
Gov't Type:
Second Class City 
Borough:
Northwest Arctic Borough 
Agreement?
No 
Agreement Date:
 
Entity:
City of Kobuk 
Population:
159 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
1/6/2005 
Exp Date:
 
Last Updated:
4/2/2014 
Community Sanitation Overview:
Sanitation utilities in Kobuk are operated and managed by Alaska Rural Utilities Collaborative (ARUC). They have a piped water and wastewater system. A 30 foot well provides water, which is treated and can be hauled by residents from the washeteria. The washeteria is non operable but the watering point is still in operation. Waste is disposed of at the new sewage lagoon. A new landfill was completed. AVEC operates and maintains the electric utility in Kobuk. A new back up generator was funded and installed using Community Development Block Grant funds,(CBDG). ARUC used IHS grant money the summer of 2011 to weatherize the water plant, and to repair a fuel line from the bulk fuel tank to the water plant to minimize operator labor to haul fuel in the winter. They completed an update to the existing sanitation facilities master plan. ANTHC received a grant for $401,873 for Biomass Boiler design and construction to supply heat to the community water treatment plant and water distribution system and alleviate dependence on diesel for heating, thus reducing heating costs. This project is to begin summer of 2014. ARUC is working with NANA to develop a local business within the community to buy wood and store biomass fuel.  
RUBA Status & Activities This Qtr:
On January 23, 2014, Kotzebue LGS staff traveled to Kobuk to work with city staff on financial management and assist with year-end tax reporting. Upon arrival, LGS staff met with the city administrator and clerk: a list of task was created and prioritized. While city staff balanced the payroll journal for the fourth quarter and the cash receipt journal, Kotzebue staff contacted Hewett Packard support for help to fix their new copier, fax and scanner machine. LGS staff then reviewed the employee compensation records and prepared a worksheet to make sure that all quarters balances to the 941 submitted. It was discovered the first and third quarter tax reports needed to be amended. LGS staff worked with city staff in amending the employee compensation records and the 941’s. LGS staff also reviewed the monthly financial reports, bank reconciliations and journals. In reviewing the bank reconciliation, additional revenue needed to be added to the month of July and August revenue because of the fuel transfers. The following day LGS staff worked with the administrator on completing the four months of financial reports for the new fiscal year to present to the council. LGS staff also continued training the clerk on bank reconciliations and balancing the fourth quarter tax report. By the end of the on-site, four months of financial reports were done, two 941’s were amended and the year-end tax reports balanced to the employee compensation records. LGS staff will continue to provide assistance as requested. Kotzebue staff provided assistance in reviewing the accural leave form of the administrator. We went through the leave earnings and leave taken to help in coming up with the current balance of leave she has on the books. Kotzebue staff provided assistance in reviewing the accural leave form of the administrator. We went through the leave earnings and leave taken to help in coming up with the current balance of leave she has on the books. Kotzebue staff reviewed a letter the city received regarding year end tax reports for 2012. The quarterly tax reports were filed but SSA did not receive the W-3 or the W-2's submitted to its employees. The administrator is currently looking for the file. It may be that she sent them to IRS instead of SSA.  
RUBA Activities for the Coming Qtr:
Kotzebue staff will provide on site training and assistance to the new Mayor and staff on their FY 15 budget and to meet their revenue sharing requirements.
Scores:
 
Essential Indicators:
26 of 26
Sustainable Indicators:
26 of 26
Total Score:
52 of 52

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.
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.
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.
N/A Budget amendments are completed and adopted as necessary.
Finances Comments
In reviewing the ARUC monthly financial reports that are submitted to the council and budget, it shows that all revenues and expenses are listed for the utility as adopted as a balanced realistic budget showing an 95 percent collection rate. The financial report and budget does show that they do have sufficient funds to purchase a year's adequate supply of fuel and are receiving enough revenues to cover operating expenses. The reserve account has grown to $95,325.96 so believe that adequate funds for major repair and replacement costs are in place. In reviewing the financials, it does show that they are receiving enough revenues to cover their expenses.

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
ARUC actively follows the collection policy and bills customers on a monthly basis. They do have a system in place to track customers and report past due amounts to the council, a accounts payables and a cash receipt system that records how money was received and spent and receives approval prior to making purchases by making sure that they are budgeted before completing a check request for approval. Bank reconciliations are done before completing their monthly financial report in comparison to the budget which they uses as a chart of accounts.

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
They have a system in place to accurately calculate, track, and report payroll tax liabilities and according to the completed tax authorization form, they are current in filing tax reports and making deposits.

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
Their is a posted workers compensation policy posted in the city office building in effect until July 2014. As for ARUC, their workmen's compensation policy is in effect until October 2014. The city has adopted a policy reviewed by AML and utilizes their assistance when needed for personnel terminations. In these policies they have an adequate written hiring process and keeps their personnel files current with all required paperwork. All job descriptions are on file for all positions and ARUC performs probationary and annual evaluations as scheduled who also provides on site training.

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 city council has adopted necessary ordinances and knows that ARUC is the entity to oversee the operations of the utility who has been active in following through with their policies, organizational chart, meeting as require following the open meetings act. Kotzebue staff has on file ARUC's organizational chart. ARUC has trained the plant operators who plans on attending the training session in Sitka to become certified this fall. The city staff has budgeted to attend any RUBA classess offered in Kotzebue this fiscal year.

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".
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
They have had turnover in operators but are working towards getting their certification and follow the written preventative maintenance plan for their existing sanitation facilities. The rehired operator provides a monthly report to the council. The utility manager routinely spot checks the facilities to make sure the maintenance is getting done. Since ARUC came on board they have held safety meetings and no major outages has occured so they are operating at the level they are proposed. They have completed their CCR and are not on the SNC list, they also seem to maintain an inventory and critical spare parts list.