RUBA Community Status Report

Community Name: Metlakatla Indian Community


Community:

Metlakatla Indian Community

RUBA:

Yes

Staff:

Rocky Estrada

Agreement:

No

DCA Region:

Juneau

Agreement Date:

Region:

Southeast

Exp Date:

Govt Type(s):

Indian Reservation

Borough:

Unorganized

Assessment Date:

3/25/2009

Population:

1405

Active Community:

Yes

Date Updated:

10/3/2013


Community Sanitation Overview:

Metlakatla Indian Community (MIC) is a federally-recognized tribe of the Annette Island Reserve. The community is located on the west coast of Annette Island, 15 miles south of Ketchikan. The tribe provides piped water and piped gravity sewer to community residents. Most homes are on the main water supply, which is fed from the Chester Lake complex. However, some homes in the airport area are supplied with untreated water from the Yellow Lake complex. The community's sanitation systems include a Class 2 water treatment system, a Class 1 water distribution system, a Class 1 wastewater collection system, and a Class 1 wastewater treatment system with aerated lagoons and effluent discharge through an ocean outfall. Residents in the airport area, however, utilize individual septic tanks. There is also a landfill on the island. Hydroelectric power is provided by Metlakatla Power and Light.

RUBA Status
and Activities
this Quarter:

This quarter, RUBA staff worked to try and verify Metlakatla Indian Community (MIC)'s compliance with federal and state tax requirements, workers' compensation insurance coverage, and utility operator certification. The community remains in compliance with nearly all essential and sustainable indicators of the RUBA Assessment. Nonetheless, RUBA staff continues to offer management training to utility staff in effort to correct any deficiencies in the Assessment and to ensure the longer-term sustainability of the community's utilities.

 

Capacity Indicator: Finances

Essential Indicators:

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:

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.

Comment:

Metlakatla's fiscal year runs from October 1 through September 30. By March 1 of each year, a budget committee including the mayor, the executive treasurer, and two council members at large meet to prepare a preliminary budget for submission to the council. The mayor presents the preliminary budget with a detailed justification for each line item and submits it at the first regular council meeting in May. No later than the first regular council meeting each July, the council adopts its final budget. If the council fails to adopt a final budget, the previous fiscal year's budget remains in effect until the new budget is adopted. The water, sewer, and solid waste budgets are included in the general fund budget. The general fund is the primary operational fund for the community and is used to record activities which are not supported by federal or state grants. Governmental activities included in the general fund are general government administration, public safety, public works, health and social services, and business-type activities. The latter fund includes such enterprises as the local smoke shop, the water bottling plant, cable TV service, gaming activities, hatchery operation and harvest, fish packing, and boat loans. Upon comparing prior year revenue and expenses to current year projections, the budget appears to be justified and realistic. The treasurer makes verbal financial reports to the council on a monthly basis. Meeting minutes verify that written reports are provided at quarterly finance committee meetings. However, utility finance reports do not compare budget projections against actual expenditures. As a condition for satisfying the monthly financial report essential indicator, the treasurer will enter utility budget information into the accounting system. This will make it possible to provide budget versus actual financial reports to the council. The community depends primarily on Metlakatla Power and Light for hydroelectric power service. This service is comparatively much cheaper than the diesel generator-sourced electricity of neighboring communities and most Metlakatla residents utilize electric heating systems. The community does nonetheless have a back-up diesel generator to guarantee continued utility operations during power outages. A visual inspection of the most recent electricity billing records verifies that the utility is current with all electricity accounts for the water and wastewater systems. The community has a bulk fuel facility owned by Annette Island Gas which is sufficient to meet the community's needs. The utility maintains small fuel storage tanks and purchases fuel from Annette Island Gas as needed. The community offsets the cost of providing water, sewer, and garbage services to the local population by charging a combined rate of $45 per month for water, sewer, and garbage. Apartment complexes, senior housing, and other units are charged specific rates depending on their size. A flat business rate of $59.40 per month is charged for all businesses regardless of size or amount of water used. This includes large water users such as school district buildings, Annette Island Packing Company, and the water bottling plant. Utility rates have not been reviewed or adjusted in over four years. Though utility-related expenses exceed revenues each year, the governing body elects to subsidize the water, sewer, and solid waste services with general funds. The primary source of general fund subsidy comes from community gaming activities. The general fund subsidy is stable and sufficient to cover operating expenses and repair and replacement (R and R) costs. Budget amendments are made throughout the year as necessary.

 

Capacity Indicator: Accounting Systems

Essential Indicators:

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:

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.

Comment:

The community has adopted three separate collection policies which are contained in the Metlakatla Law and Order Code, Title 5, Chapter 6 for water service, Chapter 7 for wastewater service, and Chapter 8 for solid waste service. The community follows its collection policy and actively pursues delinquent utility accounts. This collection policy is somewhat flexible and contains several discretionary methods for collection of past due accounts. The community does not favor water service disconnection and will do so only as a last resort. One successful collection method used by the utility is to discontinue a customer's cable TV service until the water utility bill is paid. The utility also uses Permanent Fund Dividend (PFD) reassignments and has used the tribal court system to enforce collections with some customers. The utility bills customers each month with statements that include water, sewer, trash, and cable TV charges. Water, sewer, and trash fees are a combined charge while cable TV is listed separately. The statement clearly shows both current and past due amounts but does not indicate a due date. The utility sends out delinquency notices ten days after an account becomes delinquent. The community is currently using a source code-based accounting program by Timpanogas Technologies, a program originally intended for educational entities. The finance officer and executive treasurer both report that the program has adapted well to the needs for local government functions, including utility billing. All accounts receivable, accounts payable, and payroll process are managed with the Timpanogas Technologies software. Timpanogas Technologies is not a new company, but continues to support the software with updates and provides annual IRS Circular E updates. The account receivables system documents customer payments and reports past due accounts with the corresponding monetary amounts. The aging report includes all customers and shows total amounts due as well as 1-30 days, 30-60 days, 60-90 days, and over 90 days past due. Yet, the aging report does not provide a cumulative total for all accounts. The tribe uses a purchase order system for all purchases and maintains a cash disbursement system to track expenditures. Department heads complete purchase orders which are then submitted to the purchasing department where the costs are compared to remaining budget funds and the purchase is either approved or denied. The invoice is attached to the appropriate purchase order and checks are issued once a week. The Chart of Accounts provided to RUBA uses a ten digit number system. The finance director reports that this system has worked efficiently for a number of years. Monthly bank reconciliations are completed by the treasurer.

 

Capacity Indicator: Tax Problems

Essential Indicators:

Yes

The utility has a system to accurately calculate, track, and report payroll tax liabilities.

Yes

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.

Comment:

The community submitted federal tax information request form to RUBA staff on time. RUBA staff submitted the request form but was sent back due to incorrect information on the form. A correct form was sent to the community but was not returned. Last quarter, RUBA staff was informed that the utility has not paid the correct amount for two 2012 quarters. RUBA staff informed the community in July 2013 and was told by the community that they discussed this with the IRS and was given an extension. RUBA staff confirmed on August 30, 2013, that the State of Alaska gave tax clearance to the community.

 

Capacity Indicator: Personnel System

Essential Indicators:

Yes

The utility has a posted workers compensation insurance policy in effect.

Sustainable Indicators:

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.

No

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.

Comment:

Current coverage for workers compensation insurance was verified through Alaska National Insurance Company. The policy is effective from October 1, 2012 through September 30, 2013. The community has a well established and implemented personnel management system including an adopted personnel policy handbook. The handbook provides standards for the tribe and its employees in the areas of hiring, conditions of employment, compensation, evaluation, discipline, grievances, employee benefits, travel, and training. Every employee is required to submit a signed statement that they have read and understand this handbook. The community has job descriptions that cover staffing, wage and salary administration, and training for all positions. The job descriptions are up-to-date and expressly outline each employee's required duties. However, according to the employee handbook, employee job descriptions are identified merely as guidelines. The handbook sets the expectation that the job descriptions will normally change over time and are not fixed community policy. Employees are expected to perform duties and handle responsibilities that are not part of their normal job. The community provides a rudimentary annual evaluation for all employees which are only loosely related to the employee's actual job description. The simplified performance appraisal is a one page, preprinted form that uses a scale of one through five to evaluate work quality, productivity, job knowledge, reliability, attendance, independence, creativity, initiative, adherence to policy, interpersonal relationships, and judgment. RUBA staff believes there is inadequate space for the supervisor to provide meaningful written feedback concerning their job performance. The community has a personnel officer who remains involved throughout the entire hiring and firing process. A prescribed hiring and termination process is defined in the personnel policy and in Title 5, Chapter 9 of the Metlakatla Law and Order Code. All personnel are employed as 'at-will' employees. The utility advertises job positions internally first. If the position remains vacant, it is then advertised locally. The community follows Public Law 93-638, Section 7, (b) which allows for a Native hiring preference. The community utilizes this provision to offer preference Alaska Natives and American Indians in all phases of employment, which includes, but is not limited to, hiring, promotions, transfers, and training opportunities. The community gives further hiring preference to Metlakatla Indian Community members and spouses of members. The community keeps records relating to employees in a personnel file. These personnel files are well organized and contain all the necessary employee documents. The community has received significant deficiency findings on their annual financial audits over the last few years for not having I-9 employment eligibility forms in the personnel files. The personnel officer has satisfactorily explained that in accordance with local policy, certain records are kept in separate files, such as records relating to I-9 requirements. All files connected with an employee are considered strictly confidential and are kept in a secure room and in a locked filing cabinet. The personnel officer reports that access to the personnel records are limited to only the employee, to those who have a job-related need to know, and to those who have been authorized by the employee to see the file. A probationary period for new employees last up to 90 days from the date of hire. During the probationary period, an employee may be terminated without advance notice and without cause. Upon satisfactory completion of the probationary period, the employee then becomes a permanent employee. Formal training opportunities are limited and are provided to employees only when funding is available.

 

Capacity Indicator: Organizational Management

Essential Indicators:

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.

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:

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.

Comment:

The Metlakatla Indian Community owns and operates the water, wastewater, and solid waste utilities. The council is the formal governing body and meeting minutes verify that it is actively engaged in making decisions on behalf of the utilities. Meetings are held the first Tuesday of each month with additional work sessions if necessary. Metlakatla is unique in Alaska in that it is a federally-recognized Indian tribe, occupying reservation land. In 1891, Congress set aside the Annette Island Reserve. The Metlakatla Indian Community organized under Indian Reorganization Act of 1934. Its constitution and by-laws established a local government with provisions for a twelve-member council and a judiciary. At the same time, the community adopted a corporate charter. These documents established a local government system for the community. Therefore, Metlakatla is a political subdivision within Alaska that has been created by federal rather than state law. Over time, the council has adopted all the ordinances necessary to own and operate utility services. Title 5, Chapter 6 of the Metlakatla Law and Order code establishes the policies and procedures for the operation and maintenance of the community water supply system, Title 5, Chapter 7, for sewage disposal system, and Title 5, Chapter 8 for solid waste system. The council generally supports and enforces the established utility policies. However, once the policies are set, there is no annual review to ensure that the policies are still up-to-date and are meeting the needs of the community. RUBA staff was informed that it has been several years since the council has reviewed utility policies such as ordinances, personnel policy, and water rates. The manager for the sanitation utilities is the public works director. By ordinance, management responsibility for all public works utilities, including the water, wastewater, and solid waste services, are delegated to the director of public works. The community operates a Class 2 water treatment system. The State of Alaska's Department of Environmental Conservation (DEC) Division of Water reports that the treatment system's current operator, Gerald Johnson, is not certified at the necessary level. Water and wastewater utility staff consists of four other public works employees that help operate and maintain the sanitary systems under the supervision of the public works director who has the appropriate level certification for the Class 2 water treatment system. At present, there are no certified operators for the Class 1 water distribution, wastewater treatment, and wastewater collection systems. The current finance director has held the position since 1992 and is responsible for the maintenance of the books for all community services. Previous education and experience of the finance director includes positions as a business manager and as a fund accountant. The community provided RUBA staff an organizational chart that reflects the current structure. The chart illustrates the Metlakatla Indian Community as a hierarchical-type organization with a direct relationship between supervisors and subordinates.

 

Capacity Indicator: Operation of Utility

Essential Indicators:

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:

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.

No

The utility maintains an inventory control list.

No

The utility maintains a critical spare parts list.

Comment:

The community currently has uncertified operators maintaining the Class 1 water distribution, wastewater treatment, and wastewater collection systems. The public works director reports that the operators are, however, working towards their Level 1 certification. To maintain the criteria for the operator certification essential indicator, the uncertified operators must demonstrate that they are actively seeking the necessary certifications to operate the utility by attending training courses, online training courses, or preparing for the Level 1 exam. The utility operators consult with the public works director on a regular basis and provide verbal status reports when significant issues arise. Written O and M reports are provided monthly. The public works director frequently visits the facilities and conducts random spot checks for maintenance items. The operators meet daily and the manager holds safety meetings to discuss safety issues before engaging in potentially hazardous operations. The public works director acknowledged that a proactive safety training program would be worthwhile. He stated that it is his intention to start a more formalized safety training program on a regular monthly schedule and take advantage of the training material that Alaska National Insurance provides free to its members. There is a safety manual located at the water treatment facility, as well as a preventive maintenance plan for the sanitation facilities contained within the utility operations manual. Although, the utility does not maintain inventory control or critical spare parts lists. Still, the utility maintains a sufficient level of supplies and tools, but due to the community's island location and dependence on air and ferry service, the level of critical spare parts may be inadequate to prevent a service outage. The public works director reports that the water utility is operating at the proposed level of service. Neither the water nor wastewater utility has suffered any major problems or outages due to management issues. The water utility provides drinking water quality information to its customers and is not listed on the Environmental Protection Agency's Significant Noncompliance List.

RUBA Activities for the Coming Quarter:

In the coming quarter, RUBA staff will continue to offer RUBA assistance as needed or requested to maintain and improve Metlakatla's utility management practices. RUBA staff have been invited to visit the community and to possibly conduct a rate study in the future. RUBA staff will reach out to the community to find out when they could conduct a rate study and a new RUBA assessment