Quarterly Report: 2012, January - March (Q3), Scammon Bay

Community:
Scammon Bay 
Staff:
Fred Broerman  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Scammon Bay 
Population:
498  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/1/2012 
Community Sanitation Overview:
The City of Scammon Bay operates the piped water and sewer utility and its council is the policy making body. The community's drinking water is derived from an infiltration gallery located on a small fast flowing stream just southeast of the city. The existing water treatment plant has been in place for about 30 years. Scammon Bay is chlorinating its piped water; however their water plant does not have the filtration equipment necessary to bring water from the stream into compliance with state drinking standards. This is due to changes in State of Alaska regulations regarding treatment of water derived from surface sources. Therefore, a boil water notice has been in effect since 2007 and the city system will continue to appear on the Significant Non-Complier (SNC) list until the new water plant is in place. Construction on the city's new water treatment plant is to start in the summer of 2012. Scammon Bay provides piped water and waste water service to sixty-nine residential and six commercial customers, including the school. Less than twenty households pack water and use honey buckets. Due to the design, materials, and age of the city's water distribution infrastructure there have been many leaks, which will continue until the old PVC water and wastewater lines are replaced with high-density polyethylene (HDPE) lines. Cracks and leaks in the distribution lines cause low flow rates in the system which result in residential access lines freezing up in winter. 
RUBA Status & Activities This Qtr:
Bethel regional office RUBA staff visited Scammon Bay's city office March 12 and 13, 2012 to conduct a RUBA assessment. Although the new assessment is not yet complete most of the findings are contained in this quarterly report. Scammon Bay's billing for its piped water and sewer services has been handled by Alaska Native Tribal Health Consortium's Billing Assistance Service since September 2009. Bethel RUBA staff has had a good working relationship with the city's new manager since he was hired in late March of 2011. The manager has been participating in Technical Assistant Provider (TAP) conference calls which helped to bring him up to speed on the city's water and wastewater problems that needed immediate attention. He has also done a good job of working through the past neglect of city business and dealing with its financial problems. He attended a RUBA sponsored Utility Managers Workshop held in Anchorage January 23-27, 2012. Bethel Staff participated in TAP meetings for the community on January 13 and March 17 and 29, 2012 during which RUBA status updates were given for the city. Construction on a new water treatment plant for the community is scheduled to begin in the summer of 2012 with anticipated completion in the fall of 2013. Funding will come through a $4 million Indian Health Services grant (which does not require RUBA compliance) and a $1.7 million from Village Safe Water. ANTHC is requiring the city to become a member of ARUC for Capital Improvement Project funds to be released which are needed to complete the new water treatment facility.  
RUBA Activities for the Coming Qtr:
Bethel staff is willing to work with Scammon Bay's administrative staff to help the city with non compliant RUBA essential indicators.
Scores:
 
Essential Indicators:
23 of 26
Sustainable Indicators:
19 of 27
Total Score:
42 of 53

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.
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
A FY 2012 budget and ordinance adopted on June 22, 2011, is electronically filed at the Bethel regional office. The budget appears to be detailed and balanced and includes revenues and expenses for the utility. An Excel spreadsheet containing monthly financial reports from June-February of FY 2012 was provided. The format of the spreadsheet provides details of the city's revenue and expenditures and breaks out expenditures by departments following the format of the State of Alaska, DCRA City Budget Manual. Minutes from September 6, October 11, November 3, December 6 of 2011 and January 3, 19, February 7, 21 of 2012 city council meetings were provided. During these council meetings, July 2011 through January 2012 monthly financial reports were reviewed. However, the meeting minutes that were provided were not signed as approved by the mayor and attested by the city clerk. An April 25, 2012 fax correspondence from Alaska Village Electric Cooperative indicated that the city is current on all six of its electric accounts. On September 24, 2011, Scammon Bay received 4,500 gallons of heating fuel from Crowley which was paid for through Community Revenue Sharing and Payment in Lieu of Taxes (PILT) funds. On April 6, 2012, the manager indicated that the city had about 2,000 gallons of heating fuel on hand and that it would be enough for their needs until the next barge delivery. A repair and replacement line item was not found in the city's water and wastewater department budget. Manager's reports for December 2011 and January, February and March of 2012 were provided and are electronically filed at the Bethel Regional office.

Accounting Systems

Essential Indicators
Answer Question
No 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
Copies of the City of Scammon Bay Code of Water and Sewer Ordinances adopted on January 8, 2004 and September 13, 2011 are on file at the Bethel regional office. Sections 1.11-1.16 of the January 2004 ordinance address: utility rates, notices, billing and payments, administration and enforcement, discontinuance and restoration of services. Scammon Bay's billing for its piped water and wastewater services has been handled by Alaska Native Tribal Health Consortium's Billing Assistance Service since September 2009. The billing assistance service tracks customers and reports past due accounts and amounts. According to ANTHC's records, the city's collection rates for residential customers for December 2011, January 2012 and February 2012 were 13, 43 and 21 percent respectively. The city manager, hired just a year ago, has started dealing with the customers with delinquent accounts, which is the city's biggest hurdle for RUBA compliance. On March 1, 2012, the manager sent a letter to all water and wastewater customers stating that 'the City will enforce the Water and Sewer Ordinance, and any overdue accounts moving forward will promptly be disconnected'. The challenge of getting customer accounts current follows city council action on September 13, 2011 to raise water and wastewater rates from $30 to $75 a month. This rate increase reflects the council's intentions to eventually have user fees covering all the operational and maintenance costs of running the utility. A chart of accounts from the city's QuickBooks software was provided during the RUBA assessment along with bank account reconciliations for October, November and December of 2011 and January 2012. City ordinances have written purchasing procedures that require prior approval by the city manager.

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.
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
March 21, 2012 email correspondence from Alaska Department of Labor in Anchorage indicated the city is current with filings and deposits for Employment Security Taxes through December 31, 2011. On March 14, 2012 the IRS faxed the Bethel RUBA Office an Authorization to Request Federal Tax Information form showing the city to be delinquent on making 941 tax deposits in 2011. Therefore, because the city is not current on their federal tax requirements 'The utility is current on making tax deposit' essential indicator is marked 'No'. However, the city was not listed on the January-February 2012 LIEN WATCH: A Review of Small Community Liens.

Personnel System

Essential Indicators
Answer Question
Yes The utility has a posted workers compensation insurance policy in effect.
Sustainable Indicators
Answer Question
No 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.
No 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
The City of Scammon Bay is insured by Alaska Municipal League Joint Insurance Association, Inc (AMLJIA). Proof of the workers compensation insurance coverage was verified on the Department of Labor, Worker's Compensation website on March 29, 2012. The personnel policy that the city manager indicated was being used (although the document contains no verification of its adoption) has an adequate written hiring process, gives employees a three month probationary period, and states 'that the probationary period is a time of learning and orientation'. During the March 12-13, 2012 site visit for the RUBA assessment the city manager provided RUBA staff with job descriptions for their city clerk, public safety officer, city manager, water plant operator and other positions not currently filled. The job descriptions and personnel policy are electronically filed at the Bethel regional office. Full access to personnel files was not possible due to the absence of the city clerk during the visit. The city has sent its water operators and administrative staff to trainings within the last year. The new city manager has not yet had opportunity to develop written personnel evaluations that tie job description to evaluation criteria for his staff.

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.
No 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 City of Scammon Bay has water and wastewater ordinances that were passed on January 8, 2004 and September 13, 2011 which indicate that the city is the sole owner of the utility and gives a description of service. Scammon Bay's billing for its piped water and wastewater services has been handled by Alaska Native Tribal Health Consortium's Billing Assistance Service since September 2009. The billing assistance service tracks customers and reports past due accounts and amounts. According to ANTHC's records, the city's collection rates for residential customers for December 2011, January 2012 and February 2012 were 13, 43 and 21 percent respectively. These rates indicate that the city is not enforcing its utility's collections policy. The city manager started working for the city in March of 2011, and has worked as an office manager with Askinuk Corporation, a bookkeeper for Scammon Bay Traditional Council and as an IT specialist with Coastal Villages Region Fund. The city clerk has held her position since October 10, 2010 and worked for four years at Scammon Bay Traditional Council and also at Scammon Bay Schools. The city's water operator now has 'Small Water System Treated' and 'Water Distribution 1' certificates which expire on December 12, 2012. The city's water and wastewater utility is classified by the State of Alaska as having a Class 2 Water Distribution System, a Class 1 Water Treatment System, a Class 1 Wastewater Collection System and a Wastewater Lagoon. The operator is attaining on-the-job experience and certifications necessary to be equivalent to the State of Alaska classification of city's water plant and water treatment facilities. An adopted organization chart for the city was not provided at the time of this writing. The city council is active in the policy making of the utility and usually meets at least monthly pursuant to Alaska Title 29. Public notification of meetings and the manner in which they are conducted are in accordance with Alaska's Open Meeting Act or otherwise stated in their local ordinances.

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.
No The utility maintains a critical spare parts list.
Operation of Utility Comments
The city manager routinely 'spot checks' work done on the water treatment facilities. He interfaces with the operator on a daily basis at which time he receives status reports on the utility's facilities. The city's water and wastewater utility is classified by the State of Alaska as having a Class 2 Water Distribution System, a Class 1 Water Treatment System, a Class 1 Wastewater Collection System and a Wastewater Lagoon. The city's water operator now has 'Small Water System Treated' and 'Water Distribution 1' certificates which expire on December 12, 2012. The operator is attaining on-the-job experience and certifications necessary to be equivalent to the State of Alaska classification of city's water plant and water treatment facilities. A copy of the city's preventive maintenance plan is electronically filed at the Bethel regional office. Copies of the city's 2010 Consumer Confidence Report (CCR) and a certification form signed by the water treatment plant operator on May 27, 2010 indicating the CCR has been posted and distributed in the community are electronically filed at the Bethel regional office. Scammon Bay's water system is on the October 2011 Significant Non-Complier (SNC) list because the water treatment plant does not have filtration equipment to comply with safe water regulations for its surface water source.