Quarterly Report: 2011, April - June (Q4), Galena

Community:
Galena 
Staff:
 
DCRA Regional Office:
 
Gov't Type:
First Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Galena 
Population:
470  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
8/3/2011 
Community Sanitation Overview:
Water is derived from wells and is treated. There is a 200,000 gallon reservoir and a community leach field. Sixty one customers are connected to the fully piped system and fifty four customers have water delivered. Some customers only have water delivered as they have private septic systems while others pay the city to dispose of waste water on an as needed basis. The City began operating the landfill, located on the former Campion AFS grounds, in 1997. In September of 2010 the city acquired a used water delivery truck to replace the previous vehicle which was at risk of being inoperable.  
RUBA Status & Activities This Qtr:
This quarter communications with the city has consisted of phone and email support. The city signed a RUBA assistance agreement on January 17, 2011. The ANTHC project engineer submitted a grant application to connect approximately 20 homes to piped water. The city manager contacted RUBA staff about noncompliance issues, specifically the financial indicator and tax issues. For the application to be accepted the city needs to be 100% compliant with the essential indicators. RUBA staff worked with the city staff extensively over the phone and email to obtain the current status. 
RUBA Activities for the Coming Qtr:
No travel currently scheduled but a late summer on site visit is desired.
Scores:
 
Essential Indicators:
26 of 26
Sustainable Indicators:
24 of 26
Total Score:
50 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.
Yes YTD expenditures are at a level equal to or below those budgeted.
Yes A monthly manager's report is prepared.
N/A Budget amendments are completed and adopted as necessary.
Finances Comments
The FY12 Budget was passed on June 27, 2011. It is balanced, the revenue is expected to be $3.06 million and expenses are expected to be $1.49 million. It is also, mostly, realistic; the FY11 actual income was $3.48 million and expenses were $2.52 million. During the last city council meeting the four RUBA required financial reports were provided to the city council. The four reports that should be at every regular city council meeting are the Balance Sheet, Accounts Payable, Accounts Receivable, and Budget vs. Actual. If these reports are not provided to the council monthly then the VSW funds could be suspended. The city verbally agreed to purchase bulk fuel from Crowley but the last that RUBA heard, the city did not write a contract. The fiscal year just began, six days ago, as if this writing, therefore YTD revenues and expenditures are at adequate levels.

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.
No 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 of Galena uses QuickBooks Enterprise Solutions for all of its financial and accounting needs. The in-house accounting staff consists of one person, the receptionist who sends out customer bills and receives payment. A CPA from Anchorage was recently hired, she is a former Mikunda, Cottrell employee. A collection policy is in place; city ordinance states that all city services will be discontinued for non-payment until payment is made. The city is reinstating a finance charge on delinquent accounts. As of June 14, outstanding customer payments for the last three months total $82,246 and approximately 26 customers have unpaid balances greater than 90 days which is more than the collection/disconnection policy allows. The accounts payable aging summary report for FY11 shows that the city is keeping current with bills, which is an improvement from the last assessment in 2008 which showed the city as being delinquent with vendors. The city has outstanding debt, primarily a result of the base closure, but successfully received a one percent, 15 year loan, with the Alaska Municipal Bond Bank for a total amount of $2.45 million. As is standard with all QuickBooks products, an adequate system is in place for tracking, recording, and reporting transactions. A wire bound receipt book is used for all customer payments and the receipt is given to the customer while they are in the office. The receipt book is used to enter payments against the customer balance into QuickBooks; this is a daily occurrence. Day-do-day purchases have been restricted; the city is taking a firm stance on purchases to control expenses. All purchase requests must be approved by the city manager who, along with the clerk, are the only employees with access to city debit cards. The budget vs. actual report shows that expenses are now greater than budgeted, which indicates that the purchases are not being compared 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
QuickBooks accurately calculates and reports payroll taxes. As of June 27, 2011 the Department of Labor deemed the city compliant. On June 29, 2011 the IRS deems the city 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.
Yes The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation.
No 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
Workers compensation insurance is provided through the Alaska Municipal League Joint Insurance Association and is in effect until July 2011. RUBA has a faxed copy of the notice of workers compensation insurance coverage in the Fairbanks office. The personnel policy and procedure manual is comprehensive; a copy is provided to each new hire with a signature page that acknowledges receipt and is filed in the employee's personnel folder. RUBA staff has copies of job descriptions for city positions. The annual evaluations are based on the job description. RUBA staff and city staff were not able to locate a specific written hiring process. The current process is that a vacancy notice is posted in town at four locations and the notice is read on the local public radio station for ten days. Applicants submit their application and if there is more than one applicant, a list of interview questions is created for the interviewer. Galena Personnel Policies and Procedures Title 15.10.430 (A)(1) (this Title 15 document is separate from the Galena Code of Ordinances as Title 15 in the code has to do with building and construction) states that there are to be two separate personnel files for each employee, one public and one confidential. Between the two files, all necessary documents are retained. Included in the confidential files are evaluations, which are done after the six-month probationary period. New hires are provided with orientation and job-training, to the extent needed for the position. The personnel manual states that 'the city encourage[s] employees to avail themselves of training and educational opportunities directly applicable to their city positions in order that they may provide more effective service to the public.'

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 is the owner of the water and electrical plants (Galena Code Title 13) and city employees operate both utilities. The city council is the policy making body, the city manager oversees the day-to-day management of staff. Mr. Ben Koontz is the utility manager, he received the TCC operator of the year award for 2010. The city council is very active in setting and enforcing utility policy, as is supported by council meeting minutes. The city manager and 'utility manager' are fulfilling the job duties. The city uses an Anchorage based person to assist in completing the financial director duties. The cost for the service is large and the time necessary to fulfill the job functions cannot be met on a periodic, visiting basis. The financial billing clerk has attended QuickBooks training and is adequate; to ensure that details are not missed it is recommended that bills, payroll, and other accounting functions be carried out away from distractions. The city has an organizational chart that shows the current structure, the policy making body (city council) meetings are open to the public with the exception of executive sessions as allowable by law.

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".
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
Operators have a level two water treatment certificate but no operators have a water distribution certificate. A level 2 certificate is required and the operators will continue to gain the training and experience level required. During the last quarterly report at least one operator had a distribution certificate. A preventative maintenance plan is located in the plant. The utility manager provides operation and maintenance reports to the city manager who includes them in a report for the council. AMLJIA provides telephonic safety meeting which are attended by city staff. Operations of the utility are functioning as intended and no major outages have occurred. The most recent CCR has been completed and RUBA obtained a copy. The city is not on the SNC list dated April 2011.