Quarterly Report: 2006, April - June (Q4), Chignik

Community:
Chignik 
Staff:
John Nickels  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Chignik 
Population:
95  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
7/26/2006 
Community Sanitation Overview:
Water is supplied by Indian Creek, which has a dam and a reservoir. Water is treated and piped into most of the homes and the school, and a well is available for back-up water supply. A second system serves the Trident fish processor, the airport area and a few homes, and utilizes a groundwater well as a source. A project now underway will eliminate the dual system by extending a new mainline from a new storage tank at one end of town to the airport at the other end of town. Improvements to the treatment plant will include new filters and upgraded valving and chemical feed equipment. Piped sewage for most of the community is collected in three group systems into community septic tanks and wastewater is discharged via ocean outfall lines. Approximately 45 homes are served, and the remaining few homes use individual septic tanks. An improvement project now underway will replace the multiple system structure with a unified sewer system for the entire community. A new permitted landfill and access road were recently completed. A study is needed to examine the feasibility of hydroelectric generation at Indian Lake. Electricity is provided by Chignik Electric. 
RUBA Status & Activities This Qtr:
RUBA staff visited Chignik Bay May 1-3, 2006, at the request of Mayor Pedersen to assist city staff and council members draft a FY-07 budget. May 2nd, RUBA staff assisted the city clerk with the process of drafting the new budget using the FY-06 budget and a current financial report. We annualized where appropriate, used actual figures when they could be determined, and estimated where we had to. The draft budget for FY-07 was presented to the council that evening, and the group was led through the line items, explaining the process and the thought that went into estimating the various revenues and expenses. There was discussion concerning the accuracy of certain line items, and a few changes were made. There were other items identified that needed revision but required more information. While the draft budget had a deficit, there was general agreement that with some effort it could be made to work, (balance) particularly if some form of revenue distribution from the State occurred. The status of items on a RUBA work plan were also discussed with city staff and the mayor, focusing on those being worked on currently, such as adopting existing job descriptions as part of their personnel policy. As a related issue, their policy refers to performance evaluations, but there has never been an evaluation form available for the purpose. RUBA staff provided sample forms. We also discussed the need for monthly financial reports to the council that at least include year to date information combined with the budget. This has been an issue for quite awhile, and the clerk has agreed to provide the financial information in that format when he begins the new fiscal year with corrections made to how the budget is entered into QuickBooks. Inventories of parts and supplies have been requested of the operator, but have yet to be created. The clerk felt that their utility collections policy lacked direction regarding how the disconnect process should proceed for late payers; we discussed wording changes that would help. Another issue discussed involved an account held by the city with money believed to be utility deposits collected a number of years ago and never returned. It is unknown whether records exist of who paid the deposits, so city staff and council members were unsure of what to do with the money. The issue was researched by RUBA staff with a written response emailed to the mayor.  
RUBA Activities for the Coming Qtr:
RUBA staff will encourage and monitor progress on issues identified in the work plan, as well as the needed changes to the accounting system and a more convenient and easier to read format for the financial reports. Staff will assist, if requested, with a new bulk water rate for a commercial customer, and will follow up with the clerk on revised language for the collection policy regarding the disconnect process.
Scores:
 
Essential Indicators:
27 of 27
Sustainable Indicators:
14 of 27
Total Score:
41 of 54

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
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.
No Budget amendments are completed and adopted as necessary.
Finances Comments
The FY-07 budget is expected to be adopted at a meeting of the city council planned for June 30th. The city clerk reports that since the budget was drafted in May, it has been revised so that it now balances with a small surplus anticipated. The city staff uses QuickBooks Pro 2005 for all City accounting, however the city's enterprises have all been set up as separate companies, rather than as separate departments within one company. This has made it difficult for the clerk to create meaningful financial reports, and the clerk is now working on the necessary changes. Financial reports have consisted of year to date expenses and revenues presented with the current budget separately. This has been awkward and the clerk is looking forward to combining this information into one report after the changes are made to the city's accounting system.

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 uses QuickBooks Pro 2005 for all accounting functions. A new computer system with updated software and needed changes to how the city's accounting is organized, are planned to be implemented shortly after the beginning of the new fiscal year. The Council has adopted a water sewer collection policy for the community and the city staff follows the policy.

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.
Yes 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
Payroll is completed using QuickBooks Pro, which calculates, tracks, and reports payroll tax. The City of Chignik is current in filing tax reports and 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.
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.
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.
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 currently has workers compensation insurance coverage provided by the Alaska Municipal League Joint Insurance Association. There are job descriptions in place for some of the city employees but descriptions are needed for other city positions. Performance evaluations have not been established or put into place by the city staff, however, the mayor recently requested a sample evaluation, which RUBA provided. The city has adopted a Personnel Policy for the community that was revised by the city council on June 15, 1995. The council is now in the process of again revising that policy.

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
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
The clerk does much of the day to day utility management, with oversight by the mayor. The Deputy Clerk has bookkeeper experience and is responsible for the majority of city service billings. The city has three operators with certifications for Water Treatment OIT and Water Distribution OIT. The city staff is currently working on an organizational chart for the city.

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
The Bristol Bay Area Health Corporation (BBAHC) provides training money and encourages operators to continue professional growth. BBAHC sends a remote maintenance worker (RMW) periodically to provide local training and support. City operators are taking part in AML/JIA's Loss Control Incentive Program, which brings operators together via teleconference each month for a safety meeting. The water utility is currently listed as a Significant Non-Complier because of low chlorine residuals in samples taken late last year. Removal from the SNC list could occur in June if there are no further violations.