Quarterly Report: 2011, July - September (Q1), Hydaburg

Community:
Hydaburg 
Staff:
Lawrence Blood  
DCRA Regional Office:
 
Gov't Type:
First Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Hydaburg 
Population:
353  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
2/2/2011 
Community Sanitation Overview:
The City operates a level 1 water distribution and wastewater collection system and a level 2 water treatment system. The Hydaburg River provides city water, which is treated and piped throughout the City. Piped gravity sewage is treated at a secondary treatment plant with an 800' outfall to Sukkwaw Strait. Over 95% of all homes are plumbed. Funds have been requested to construct a new dam to increase the water supply. The City is exploring options to improve waste disposal. Alaska Power and Telephone Co., based in Skagway, owns and operates diesel power systems in Hydaburg and Craig, which provide electricity to many Island communities.  
RUBA Status & Activities This Qtr:
In July, RUBA staff met with the city administrator to discuss progress made on a RUBA work plan to address deficient essential and sustainable management indicators. RUBA staff scheduled a travel date in August to visit the community and conduct a current assessment subject to certain goals. The agreed upon goals include that the water operator receive formal training and actively pursue the necessary certifications, continued enforcement of the utility ordinance and collection policy, and adoption of the FY11 budget. The city administrator and mayor have drafted the budget, however it has not been introduced at a public hearing. ON August 4 and 5, 2010, Juneau RUBA staff traveled to Hydaburg to meet with city officials and complete a RUBA management assessment. The city administrator, city clerk, contracted CPA, and water operator were able to provide RUBA staff with documentation that they are meeting all essential indicators for the first time in many years. Additionally, the city has made significant improvements in the utility colelction rate and is due to install updated piping and metering equipment at the water treatment plant next month. The city will continue to work actively towards obtaining the necessary certification for the utility oeprators and to put systems in palce to ensure the utility's long-term sustainability. The city's ability to pass the RUBA assessment is an important achievement becasue it establishes the city's eligibility to apply for and receive sanitation project funding. As a condition for maintaining their current RUBA status, the city will need to submit financial and management documents to the RUBA program on a quarterly basis. Effective September 10, 2010, the Department of Environmental Conservation's Drinking Water Program rescinded the Boil Water Notice issued for Hydaburg's Public Water System in October 2008. The lifting of the boil water notice is another step in the city's efforts to advance their financial, managerial, and technical caacity in the administration of public sanitation facilities. The lifting of the boil water notice also allows the water system to meet an additional RUBA sustainable indicator. The water system is now assessed as operating at the proposed leved of service. In November, RUBA staff assisted the clerk in the development of an appeals process for utility customers who believe that their utility services were disconnected unfairly. The city recently began enforcing the utility billing collection policy by disconnecting water services for non-payment in accordance with their utility ordinance. In response to the service disconnections, there have been several instances where aggrieved customers have threatened and verbally abused utility staff. With input from the mayor, RUBA staff and the city clerk have initiated the drafting of an ordinance establishing an appeals process for the city council to consider.  
RUBA Activities for the Coming Qtr:
RUBA staff will provide ongoing support to help the utility maintain it's current level of management capacity and provided assistance for the unmet sustainable indicator. As a condition for maintaining their current RUBA status, the City will need to submit financial and management documents to the RUBA program on a quarterly basis. Goals for this quarter include: Reviewing water utility rates, and schedule the billing clerk for RUBA QuickBooks training.
Scores:
 
Essential Indicators:
27 of 27
Sustainable Indicators:
25 of 27
Total Score:
52 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
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 Hydaburg uses the fiscal year of July 1 through June 30; however, the municipal code stipulates a fiscal year of January 1 through December 31. The fiscal year 2011 budget was adopted by a non-code ordinance on July 20, 2010. The budget is separated by funds with each fund listing proposed revenues and expenses. The funds included in the FY11 budget are: general fund, capital project fund, harbor deferred maintenance, water sewer upgrade, water sewer and garbage, and harbor and docks. The budget ordinance compares the proposed FY11 budget to the adopted FY10 budget; however, it fails to include a comparative statement of actual expenditures and revenues for the preceding fiscal year, which is recommended by RUBA and required by Hydaburg Municipal Code. Recent city council meeting minutes show that financial information is being reported on a monthly basis. The monthly financial statements include a balance sheet and a budget verses actual profit and loss. Electricity is provided through Alaska Power and Telephone Company. A visual inspection of the most recent electricity billings verifies that the city is current with all electricity accounts for the water and wastewater utilities. The city has two-275 gallon fuel tanks for heating fuel, located at city hall and the water treatment plant. The city receives fuel deliveries from Petro Marine in Craig. The city usually maintains a one to three month fuel supply. The city has adequate funds available and purchases fuel as needed. The governing body is fully aware that user fees do not produce sufficient income to cover operating expenses or repair and replacement costs. It has been a general practice for the city to subsidize the utility's operating expenses and repair and replacement costs through other sources. The adequacy of the subsidy and the council's willingness to supplement the water, sewer, and garbage funds is evidenced through a $31,000 general fund transfer into the FY11 utility budget and the allocation of $50,000 from the FY11 Community Revenue Sharing payment. FY11 revenues and expenses are in line with budgeted projections. The council continuously monitors the budget and makes occasional budget amendments to accommodate for increased or decreased revenue and/or expenditures. The last budget amendment adopted by the governing body was on July 20, 2010. A review of city council meeting minutes for the last year shows that the mayor, administrator, city clerk, and public works foreman routinely provide both written and verbal reports on operational and financial issues surrounding the water, sewer and garbage utilities.

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 has an adopted collection policy that is contained in Title 13 of the Hydaburg Municipal Code. In February 2010, the city council committed to enforcing collections on utility bills and discontinuing water service to past due customers. This increased effort on collections has produced a stable source of income for the utility. The collection rate calculated from February 1, 2010, through July 31, 2010, was 94% The city is currently using QuickBooks Pro for their accounts receivable, accounts payable, and payroll. 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 whether it is 1-30 days, 30-60 days, 60-90 days, or over 90 days past due. The city uses a cash receipt log to record incoming cash payments and checks not accompanied with an invoice. Along with the cash receipt log, the customer is provided proof of payment through written receipts. The city uses three different receipt books to separate funds and places account codes on all receipts to ensure incoming cash payments are recorded properly. The city clerk reports that all bank accounts have been reconciled. The city uses a purchase order system, which requires review and signature by the administrator or mayor. To prevent overspending, the approving official compares the proposed purchase against remaining FY11 appropriations prior to approval.

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
The City of Hydaburg uses QuickBooks Pro to calculate, track, and report payroll liabilities and makes electronic payments using the Electronic Federal Tax Payment System (EFTPS). RUBA staff visually inspected the communitys last four 941s (employer's quarterly federal tax returns) and verified electronic debits. The last four quarters' 941s were filed on time. The administrator authorized RUBA staff to obtain federal tax information from the Internal Revenue Service (IRS) and employment security information from the Alaska Department of Labor and Workforce Development (ADOLWD). The City of Hydaburg is deemed compliant with Federal and State tax reporting and deposits requirements.

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
Current coverage for workers compensation insurance was verified through Alaska National Insurance Company. The policy is effective from July 1, 2010 through June 30, 2011. The policy covers work-related accidents and occupational diseases up to the Alaska statutory limits for each occurrence. Copies of the workers compensation policy is posted in accordance with state statute at city hall, harbormaster office, and water treatment plant. The personnel policy was last reviewed and updated by the city council in January 2010. The city keeps records relating to employees in a personnel file. RUBA staff reviewed personnel files on a sample basis and found that the files were well-organized and contain all the necessary employee documents. The city clerk reported that all files connected with an employee are considered strictly confidential. The city has plans to purchase new fire proof and locking cabinets for document storage. The utility has a written hiring procedure with a six-month probationary period for new hires. The job descriptions are up to date and expressly outline each employee's required duties. The city provides training opportunities when outside sources of training funds are available. The city clerk and accounts receivable clerk attended a 32-hour Utility Clerks training in April 2010.

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 of Hydaburg owns and operates the water and wastewater utilities. The city council is the governing body for the water and wastewater utilities. A review of meeting minutes for the last six months verifies that the council is actively engaged in decision making on behalf of the utilities. The council meets on the first and third Tuesday of each month and holds special meetings and additional work sessions if necessary. The city complies with open meeting requirements and posts meetings in accordance with local code and state statutes. The manager for the sanitation utilities is the city administrator. He is adequately trained in the administration and management of the utility. Due to staffing limitations, the day-to-day bookkeeping duties are accomplished by the city clerk. The accounting contractor from Aurora Corporate Enterprises reviews the city clerk's work and provides ongoing bookkeeping training. The contractor also, prepares and presents financial statements to the city council, prepares the city for financial audits, and prepares grant progress and financial reports. In addition to formal operator training courses, the water operator is receiving ongoing hands-on training from the remote maintenance worker (RMW). The council has adopted all the ordinances necessary to own and operate the utility services. Title 13 of the Hydaburg Municipal code establishes the policies and procedures for the operation and maintenance of the community water supply system.

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".
No The utility is not on the "Significant Non-Complier" (SNC) list.
No The utility maintains an inventory control list.
Yes The utility maintains a critical spare parts list.
Operation of Utility Comments
The city operates the following sanitation systems: Level 2 Water Treatment Level 1 Water Distribution Level 1 Wastewater Collection The water operator, Douglas Mathena, has achieved the following certifications: Water Treatment Provisional Expires 12/31/2012 Water Distribution Provisional Expires 12/31/2012 The water operator is working towards achieving the necessary certifications. The operator's provisional water treatment certificate can be upgraded once he meets the level 1 eligibility requirements. In addition to the level 1 water treatment training and testing, the operator completed the intermediate water treatment course on March 18, 2010. The Hydaburg public water system is no longer listed as a 'Significant Non-Complier' as of October 2010. Effective September 10, 2010, the Department of Environmental Conservation s Drinking Water Program rescinded the Boil Water Notice issued for Hydaburg's Public Water System in October 2008. The utility completed and distributed its Consumer Confidence Report (CCR), as required by the Safe Drinking Water Act, on February 2, 2010. In previous two years, the utility had failed to distribute the required Consumer Confidence Reports. To address this deficiency, the utility included both 2008 and 2009 water testing data in the current CCR. The utility has a critical spare parts list but does not maintain an inventory control list. The administrator reports that 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 current level of critical spare parts may be inadequate to prevent a service outage.