Quarterly Report: 2007, October - December (Q2), Chignik Lake

Community:
Chignik Lake 
Staff:
John Nickels  
DCRA Regional Office:
 
Gov't Type:
Federally Recognized Tribe 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
Chignik Lake Village 
Population:
117  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
1/23/2007 
Community Sanitation Overview:
Well water is piped directly to 32 households. An old wood staved storage tank has been dismantled and a large steel storage tank has been constructed farther from the community, at a higher elevation and close to a series of new wells. As part of the project, a new water treatment facility will also be built. The school has its own well. Approximately 70% of the homes are plumbed. Fifteen HUD homes are connected to a central sewer system with a waste pump and lagoon; the remainder use individual septic systems. Funds have been provided by VSW to develop a water and sewer Master Plan. Refuse is disposed of by residents in the new landfill. A power consolidation project was recently finished that generates power year-round from school district owned equipment, and is distributed to the community by Chignik Lake Electric. IGAP funded a project to install Powerstat prepay electric meters for residents in the village, which was completed in early 2006. 
RUBA Status & Activities This Qtr:
Contact with the community during the final quarter of 2006 was via telephone, fax and email. A RUBA assessment report was issued Nov 2 after a draft report was submitted to the community September 20. Distribution of the final report was purposely delayed to allow time for village staff to respond to deficient indicators with documentation of improvements made. Despite contact with the community by RUBA and Alaska Native Tribal Health Consortium (ANTHC) staff, no documentation or comments were received by early November, and the final report could not be postponed further. About a week later, RUBA staff received a courtesy copy of a letter to the community from the sanitation engineers advising the community that failure to correct deficient essential indicators would result in termination of the unfinished project. Shortly thereafter, RUBA staff received by fax a FY-07 budget and other financial information for the water sewer utility. In response to questions, a detailed explanation of the deficient indicators and what would be required to correct them was emailed to the community and project engineers November 20. Later, while working on corrections it was discovered that electrical and labor costs were far higher for the utility than what were budgeted, and that there were insufficient revenues to cover these expenses. December 14, RUBA staff offered further assistance to the community in resolving the outstanding management issues through a RUBA work plan and agreement. To date there has been no response to that offer.  
RUBA Activities for the Coming Qtr:
RUBA staff will continue to provide assistance to the community staff as they work to correct deficient RUBA essential indicators and improve the management of their utilities. Progress on the remaining sustainable indicators will be monitored and encouraged.
Scores:
 
Essential Indicators:
17 of 27
Sustainable Indicators:
18 of 27
Total Score:
35 of 54

Finances

Essential Indicators
Answer Question
Yes All revenues and expenses for the utility are listed in the utility budget.
No The utility has adopted a balanced realistic budget.
No Monthly financial reports are prepared and submitted to the policy making board.
No 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.
No 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
An FY-07 budget for the utility was adopted, however it was later found to contain significant errors involving understated expenses and insufficient revenues. The budget will need to be amended to include more realistic revenue and expense projections. At the time of the assessment, electrical use by the water sewer utility had not been billed for some time, and there was an overdue balance from an earlier period. Water utility electrical use needs to be billed like any other customer, and the water utility needs to show that the electric bill is being paid. An excel spreadsheet was created to be used as a financial report to the council which incorporates month to date and year to date revenue and expense data with the FY-07 budget. A similar spreadsheet was created for reporting accounts payable to the council, and copies of these with data through November, 2006 have been received by RUBA. In the case of the monthly financial report, however, the data is incomplete without the above-mentioned electrical expense.

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.
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
There are significant amounts owed on many accounts to the utility. Efforts to collect on these delinquent accounts have been unsuccessful; however, the council is in the process of including water sewer payments with the Power Stat system used for the electric utility. A percentage of each electric/ water/ sewer payment would go toward any past due amounts. When implemented, this should resolve the collections issue. The Village Council Administrator, who is responsible for accounting functions, utilizes QuickBooks Pro accounting software. The utility is billing its customers regularly, and a system to track receivables is in place. All bills are sent separately. The administrator has created a form to report accounts payable, and has begun to present this to the council. There is a chart of accounts, and the administrator reports that monthly bank reconciliations are being done, however there is no purchasing system in place that utilizes any prior approval or coordination with a budget. Supplies and parts are reportedly ordered by the operator as needed and billed to the Village Council without prior approval from the administrator.

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.
No 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
Village Council staff have informed RUBA that they are current with federal and state reporting and tax payment requirements, however, the community's name appears on a list of outstanding federal tax liens dated 6/19/06. According to the list, the lien was recorded 2/16/06. In speaking with the current and past village administrators, RUBA staff has learned that this lien results from a contractor's errors in filing federal tax reports and making deposit payments during a road project in their community. The contractor had received grant funds that were to be used for, among other things, payment of road project payroll tax, and was filing with the village's EIN. The community feels that through no fault of their own, they have been left with this lien that should be paid by the contractor. They are now attempting to collect the total lien amount from the contractor.

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
Workers compensation insurance policy was secured February 15, 2006. The community has adopted employee policies and procedures, including a hiring process, job descriptions, and performance evaluations. The administrator reported in a letter received October 20, 2006 that written performance evaluations are now done for office staff, but not for the maintenance position. The administrator requested the council to evaluate this position, and it is unknown whether it was done, or if a probationary period for new hires is utilized. Personnel folders have been reportedly updated. Employment recruitment is done within the community first, as hiring locally solves the housing problem. When the need arises and an opportunity is presented, employees are encouraged to attend job-related training.

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.
No The utility has an adequately trained manager.
No 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 Chignik Lake Village Council owns and operates the community's utilities; they meet regularly, and have demonstrated an interest and willingness to adopt the necessary policies and rules to operate them. The village administrator has provided RUBA with an organizational chart showing all positions and programs within the village. In the area of utility rate collections, there is a large amount of overdue customer debt, indicating a failure to enforce the collections portion of the utility ordinance. A plan to include water sewer utility payments in the Power Stat system used by the electric utility should resolve this issue. The administrator, who performs many of the day to day management tasks, as well as the clerk, have both received training in fulfilling requirements of the PCE program, however both positions would benefit from further training in utility management, and the QuickBooks program.

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".
Yes 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 administrator reported that the operator for the water/sewer utility is Operator In Training (OIT) certified. The utility appears to be operating at a level of service acceptable to the community with the operator providing routine verbal status reports to the administrator. The current CCR has been completed, the utility is not on the current SNC list, nor has the utility suffered any major problems due to management. The utility would improve its operation if there were monthly written operations and maintenance reports from the operator, and lists for inventory and critical spare parts were maintained. Safety would be enhanced with regular safety meetings and the implementation of a safety manual. The RMW visits regularly and the Bristol Bay Native Association provides technical assistance as needed.