Quarterly Report: 2012, January - March (Q3), Saint George

Community:
Saint George 
Staff:
Michele Aranguiz  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of St. George 
Population:
114  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/1/2012 
Community Sanitation Overview:
The piped water and wastewater system was constructed by National Oceanic and Atmospheric Administration (NOAA) during the 1950s. Four wells provide water for the community and the harbor with 250,000 gallons of storage. Sixty residences are connected to the system and are plumbed. The city provides refuse collection services. 
RUBA Status & Activities This Qtr:
St. George has committed to undertake a two year RUBA agreement, in order to address deficient indicators on the RUBA assessment completed in September. Anchorage LGS staff traveled to St. George February 6-10, 2012 to initiate this process. RUBA staff presented at a St. George city council meeting, addressing Bridge Loan debt(repayment resolution), the necessity of certification for the water plant operator, acceptance of codified version of city ordinances (by resolution), and the need for a CY 2012 budget. The city council met quorum, with two members attending telephonically from Anchorage. It was significant that the community was committed to establishing a quorum at the meeting, as this has proved challenging for them in the past. Much of the information presented at the meeting was new to council members; the RUBA agreement, Bridge Loan program, debt situation, long term listing on the Significant Non-Compliance (SNC) list and lack of water quality testing were explained in detail. St. George City Council passed a resolution assigning funds to begin repayment of the Bridge Fuel Loan debt. A major element of this week-long onsite visit related to creating dialog and supporting community meetings - in collaboration with Department of Transportation (DOT) Coastal Engineers Carter and Smith - to solicit community input on the proposed harbor project. The St. George Harbor had originally been designed by Engineer Harvey Smith in the 1980s, based on a Danish design well suited to the crashing surf and difficult weather conditions of the Bering Sea. The original design was adapted during construction in order to decrease costs, and elements were removed that specifically addressed the intense conditions, resulting in a harbor that is dangerous and difficult to enter. A return to the concepts of the earlier design would render the harbor viable, both for commercial fishing and crabbing vessels and for moorage of smaller local craft. The community meeting attracted many participants, and feedback on plans was dynamic and interactive. Commercial crab fishermen were contacted and participated in brainstorming - a rare collaboration at the planning stages of a project which will impact both populations. Accounting services for the city have been transferred to an Anchorage firm. Requests to the community for updated quarterly financial statements and IRS tax information authorization have not been fulfilled. Many of the essential indicators of the RUBA assessment cannot be passed without the regular release of quarterly financial statements. As of this writing, the water pipes of the St. George distribution system have frozen. Unusual freezing temperatures and blizzards have impacted the distribution system, and made repair difficult. Remote Maintenance Worker (RMW) Doug Abbas is currently on the island, supporting new Water Operator/Manager Laurence Prokopiof with this crisis. The clinic and the school have had to close due to frozen pipes. The new operator is registered to attend upcoming Water Operator training in Fairbanks. He is receiving invaluable onsite training through the presence of RMW Abbas. 
RUBA Activities for the Coming Qtr:
RUBA staff will continue to be available to provide any assistance requested to enable St. George to satisfy the essential and sustainable indicators.
Scores:
 
Essential Indicators:
15 of 27
Sustainable Indicators:
11 of 27
Total Score:
26 of 54

Finances

Essential Indicators
Answer Question
No 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.
Yes The utility is current in paying all water/wastewater electric bills.
No 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.
No A monthly manager's report is prepared.
No Budget amendments are completed and adopted as necessary.
Finances Comments
RUBA staff worked with the mayor and accountant onsite to create a realistic and balanced budget for FY12, during the initial RUBA assessment visit in September 2011. A final version of this budget has not been presented to city council or submitted to the RUBA program. The city council has not been having monthly meetings, and has not had regular updated financials. The proposed 2012 budget needs to be reviewed by the council and adopted. High payroll expenses will need to be evaluated, as the city's operating budget is not balanced. The scarcity of viable employment on the island has led the city to employ many residents for city positions. In evaluating actuals vs. budget, this mode of operating is unsustainable. Decisions to scale back city employment positions (or balance the budget in some other way) requires open discussion and debate, in the form of taking on a commitment to empowering the city council and the community with ongoing, scheduled city council meetings and work-groups.

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.
No 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
As this quarter's financial statements have not been recieved from the new accounting firm, RUBA cannot attest to the design of the community's accounting systems. Until RUBA has direct contact with the current accountant, it is unknown what financial systems are in place and how they are functioning. The payroll, accounts payable, accounts receiveable, and cash receipt systems were in place during the September 2011 assessment. The city council adopted a utility ordinance that includes a collections policy on September 24, 2008. The city uses a pay as you go system for water, electricity and waste costs for residential customers, thus eliminating collections issues for residential customers. However, St. George has a collections policy in place for commercial customers and it has not been consistently enforced; some commercial customers are in arrears. Utility rates have not been adequately raised to compensate for increased fuel costs. This issue needs to go before the city council, and devoting a portion of each council meeting to utility issues (structural, financial, and visionary) is critical. Much of the grant funding requested by or expected by St. George is related to utility projects. The water distribution infrastructure needs attention; sections of the waste distribution system were created in different eras and are aging and failing. Alternative energy projects (windmills) are also intended by the community, and grant monies in place. Granting agencies are concerned about switching capacity and generator integration with the windmills, and the city is poised to complete substantial infrastructure improvements before funds will be released.

Tax Problems

Essential Indicators
Answer Question
Yes The utility has a system to accurately calculate, track, and report payroll tax liabilities.
No 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
There are no recorded liens for the City of St. George. St. George currently has Federal tax liabilities, and will need to include a repayment schedule into any budget calculations for the upcoming year. St. George is not up to date on its reports to Department of Labor for unemployment taxes. Tax liability is unknown until that department receives current reports. As with other aspects of St. George city management, tax liability needs to be openly reported in regular city council meetings.

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.
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.
No The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The City of Saint George has workers' compensation with Alaska Municipal League Joint Insurance Association(AMLJIA) through June 2012. St. George paid a substantial balance owed in July 2011, and are currently up to date with their payments. The utility's adopted personnel policy is comprehensive and includes all the necessary items though it may need up-dating since there is reference to full-time employees being allowed to use comp time in lieu of overtime. New hires have a six month probationary period. Employees receive paid leave and paid holidays. Job descriptions are maintained for all positions. There is not an active practice of regular employee evaluation and feedback. During the on-site assessment, RUBA staff encouraged the development of once yearly formal employee evaluation, to include both written and verbal feedback. As a result of a small labor pool and geographic isolation, many city and utility positions on St. George are held by employees without job-specific training or experience. St. George does not have a line item in the budget to support employee training opportunities. With critical utility management roles being filled primarily by those willing to take on responsibility, offering encouragement and financial support for training and credentialing those employees would be a recommended personnel practice.

Organizational Management

Essential Indicators
Answer Question
Yes The entity that owns the utility is known; the entity that will operate the utility is set.
No 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.
No 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.
No The policy making body meets as required.
Yes The utility complies with the open meeting act for all meetings.
Organizational Management Comments
A utility ordinance was adopted by the city council on September 24, 2008. The city council does not meet monthly as required by the city's code of ordinances and State Statutes Title 29. This lack of regular city council meetings is a core issue for St. George. This creates a situation in which critical issues which impact the community are not reaching the council for discussion and shared decision making. The Saint George city council is currently not adequately involved in the budgetary or financial affairs of the city.

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.
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.
No 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.
No 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 utility does not have a safety manual nor do they hold safety meetings. A preventative maintenance plan was adopted by the St. George City Council on June 19, 2009, but is not adequately funded or consulted. There have been no major outages of the utility due to managerial errors. St. George is listed on the January 2012 SNC list. The issue is primarily a lack of water sampling; the utility manager confirms that St. George currently does not do water sampling, testing, or treatment at all. The SNC report specifies: 'System received violations for TCR, Nitrate, lead and copper, VOC and SOC monitoring.' The mayor cites geographic inaccessibility and weather impacted flight delays as contributing to the difficulties of maintaining a regular and compliant testing schedule. Frustration with the process has apparently culminated in simply abandoning any sort of water monitoring program. A new water utility operator has stepped up to the task, and was registered for initial Small Water Systems training in Bethel. The crisis of the frozen pipes required that he stay on island, and registration has been switched to an upcoming training in Fairbanks. With water treatment specific training, RUBA staff hopes that the new operator will be able to restore a regular testing schedule. RUBA staff strongly recommends that the city support the utility operator in working toward operator certification. This community requires an operator who is capable, and skillful in the improvisational and creative maintenance required for this aging water distribution system in a very geographically isolated community. The utility does not produce or distribute a 'Consumer Confidence Report' as water is not sampled or tested.