Quarterly Report: 2010, October - December (Q2), Anderson

Community:
Anderson 
Staff:
 
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Anderson 
Population:
295  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
2/22/2010 
Community Sanitation Overview:
All homes have individual wells, septic systems, and plumbing. Water is also derived from a well at the Anderson School. A permitted recreation vehicle (RV) disposal lagoon and sludge disposal site is provided by the city. Residents hire a private septic pumping company when their systems need maintenance; the company deposits the waste into the city owned lagoon. There is a Village Safe Water project proposed to connect all building to a piped wastewater system. Construction of this has not started. 
RUBA Status & Activities This Qtr:
On October 8, 2009 Fairbanks RUBA staff members, Jeremy Johnson and Brendan Smyth, met with City of Anderson staff to complete a RUBA Assessment of Management Capacity Indicators. Gathering information for the assessment was an extremely easy process for a number of reasons, three of which are (1) the office staff is very well organized; (2) there are few distractions in the office; and, (3) the city currently does not provide any utility services so some criteria were not applicable. RUBA staff made paper and electronic copies of necessary documentation for analysis when creating the actual assessment. Specific documents used in this report are on file in the Fairbanks office. The City of Anderson has requested that RUBA continue assistance in the areas of codifing the city ordinances and providing oversite for the November regular election. City council members are the governing board for the soon to be piped wastewater system.  
RUBA Activities for the Coming Qtr:
As a road system community I anticipate a day visit to assist in updating thier code book. I have been working on this project independently and hope to schedule a visit in January for one on one training and project review.
Scores:
 
Essential Indicators:
24 of 26
Sustainable Indicators:
21 of 26
Total Score:
45 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.
No 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 Anderson has a budget that is easy to read and lists all the revenue and expenses by department. The budget is balanced and realistic. Based on last fiscal year the budget is appropriate. Costs are assigned to each department to pay their share and, as a helpful tool, the current budget line items are compared to the previous fiscal year amended totals. Monthly financial reports are created and prepared for the policy making body. The city has not entered the budget into QuickBooks so it is not using the standard reports that QuickBooks can generate. Instead, the city exports income and expense reports into Excel and the provided report contains all the necessary information: the budget, monthly totals, year-to-date, and the balance. In fact, the reports which show the monthly income/expenses provides more information then the standard QuickBooks report as those do not show financials by month. Another report that the treasurer provides is one titled Bills to be Paid. This report shows which invoices need to get paid and also any purchase orders that need to be authorized. The report details the vendor, purpose, amount, and which city department is responsible for payment. The treasurer does not attend city council meeting (the council does not want to pay overtime) so the financial reports are provided by the city clerk who also gives a verbal report. RUBA staff suggested that the treasurer provide a written report to accompany the financials as this will benefit both the city clerk and the entire council. The city does not have any outstanding bills to be paid, bills are entered into QuickBooks as they are received and the accounts payable report is zero. Fuel is purchased from a local (Nenana) vendor as needed. Since Anderson is on the road system, it has the benefit of lower fuel costs and immediate access. The city has plenty of money allocated for heating fuel purchase and the city is receiving revenue to cover operating expenses. The only utility the city currently has is the lagoon and it is on track to stay within the budget. The lagoon budget has a 10% savings line item ($10,000) allocated. The lagoon department (environmental) is expected to cost $25,605 with sewage lagoon revenue fees expected to be $80,000. The FY10 financial reports that RUBA has reflect data for July and August only. By annualizing the current financial reports and comparing them to the budget and the last certified financial statement, it indicates that the community is on the right track. Year-to-date (YTD) revenues are above those budgeted but YTD expenditures are not below what is budgeted. For two months of data, the city should be at 16% of budget but they are at 23.68%. A draw back to only having two months of current data does not allow for a trend to easily be established or mitigate any seasonal anomalies. Based on historical financial analysis, the City of Anderson will stay with in the budget and revenues and expenditures will equal the budged amounts.

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.
No 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
No A chart of accounts is used that identifies categories in a reasonable, usable manner.
No 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
In preparation of the wastewater construction project, the city passed Ordinance 08-06 Providing Sewer Service to the City of Anderson which included a section on a collection policy. The council has not yet had the opportunity to follow the collection policy since the utility has not been constructed. As the proposed piped wastewater utility does not exist all supporting material is being based on the existing accounting practices of the lagoon, the assumption being that the same practices will be applied to the utility upon completion. Unlike other communities which have many customers that are billed monthly, the City of Anderson has very few consistent customers. The monthly customers the city does have are billed regularly. The city rents out space to the Alaska Department of Motor Vehicles, and to the US Postal Service, bills are mailed monthly. According to the QuickBooks accounts receivable (A/R) report, a private company, Berry Bros 4X4, rents (rented?) a building from the city, bills were created monthly but not always paid, in fact the business owes four months of rent; the last bill created was in June 2009. In addition to A/R, QuickBooks is utilized for accounts payable and payroll. The city has few cash transactions, mostly for the occasional soda, fax, or copy sale but there is no receipt system in place. This has been identified separately by an auditor from the CPA firm Wilson and Wilson, located in Fairbanks. RUBA understands the perspective of the city, that there are so few sales it is not worth the time to implement a receipt system, the FY10 budget estimates that the copier and fax will each collect $25 (soda sales is not even budgeted). While RUBA understands the hesitance to write receipts for $0.25 or more transactions, since this assessment is extrapolating the current practices onto the future wastewater system, it is imperative to develop a receipt system. It will be most crucial to have this system in place before the first wastewater customer bills are mailed. The city, by using QuickBooks, has a system in place to record how money was spent. For the size of the city and number of services the chart of accounts is extensive and would benefit from being reduced to a more manageable number of accounts. The city has created a utility account but it has not been accessed, there is nothing to reconcile. The city has four other bank accounts which were last reconciled on August 31, 2008 (NBA Savings), July 30, 2009 (General Fund Savings), August 31, 2009 (General Fund FNB), and September 30, 2009 (Grant Fund FNB). The approval process for purchases depends on the dollar amount to purchase. For purchases less that $1,500 the employee can make the purchase directly (with a purchase order), for purchase between $1,500 and $5,000 the council member who is designated the department head authorizes the expense. Expenses greater than $5,000 would need to be approved by the entire council and according to the budget.

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
Copies of the last four quarters of payments, along with the reports have been obtained for both the IRS and Department of Labor. On December 29, 2009 both the IRS and DOL deemed Anderson to be compliant.

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.
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 workers compensation insurance policy is posted in the kitchen/employee break room and is purchased through AMLJIA for the periods of July 1, 2009 through July 1, 2010. The personnel policy is part of the Anderson Code of Ordinances 2.50 and is complete, as are the job descriptions for city positions. According to the clerk, and lack of evaluations in the personnel folders reflects that evaluations have not occurred in a number of years. The personnel policies state that they must occur on the employee anniversary date of hire (AO 2.565.5(b)) in addition to other times. The personnel policy has a written hiring process, which provides the mayor the ability to create the device or devices to be used in evaluating applicants, if they wish. Personnel folders contained every document except for the letter of acceptance. According to the personnel policy, the probationary period is 90 days and it is up to the department head to provide job training, oversight, and evaluations. Training opportunities are available and have been utilized. The treasurer recently attended the RUBA sponsored QuickBooks training in Anchorage during the week of September 21-25, 2009.

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
As established in the wastewater utility ordinance 08-06, the City of Anderson shall own and operate the utility. As before, since the utility has not been created all indicators are being based on the actions of the city council (also the utility board) with respect to management of the existing lagoon. The city council meets regularly and is an active participant in discussions with the Village Safewater engineer and was active in passing the utility ordinance. The city council enforces the existing ordinances for the sewage lagoon. Mr. Scott Thompson is the city maintenance foreman who will assume the duties of the operator; Councilman Mike McKenzie is the Public Works Director and immediate supervisor to Mr. Thompson. Councilman McKenzie would fulfill the duties of the manager. Ordinance 08-06 sections 3 and 5 give the city the authority to operate the system. An organizational chart was printer off from the clerk's computer and it shows the current structure and lines of authority. The city council meets every month and those meetings are open to the public to attend.

Operation of Utility

Essential Indicators
Answer Question
Yes The utility operator(s) are actively working towards necessary certification.
No 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.
N/A 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
Mr. Thompson has current wastewater treatment and collection certificates which will expire 12/31/2010. When asked if the sewer lagoon has a preventative maintenance plan, the response was 'yes and no'. RUBA staff had also inquired with the VSW project engineer, in an email dated October 16, 2009 about the existence of a plan; no response was given. The manager does get monthly reports, or if there is anything of a pressing nature he is provided with updates as necessary. The manager also made onsite visits to view productivity and to inspect the maintenance books. Mr. Thompson gives safety meetings according to the standard operating procedures for the lagoon. There have not been any major problems; the utility is operating as designed. Each building has its own water well; the city does not provide public water and does not have a Consumer Confidence Report. The city is not on the SNC list. The city has on hand some essential parts. It also retains fencing and parts to repair the liner. As the city currently only has a lagoon there are very few parts to keep on hand, when compared to a piped water system.