Quarterly Report: 2008, July - September (Q1), Hydaburg

Community:
Hydaburg 
Staff:
Lawrence Blood  
DCRA Regional Office:
 
Gov't Type:
First Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Hydaburg 
Population:
369  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
10/17/2007 
Community Sanitation Overview:
The City operates a level 1 water distribution and wastewater collection system and a level 2 water treatment system. The Hydaburg River provides city water, which is treated and piped throughout the City. Piped gravity sewage is treated at a secondary treatment plant with an 800' outfall to Sukkwaw Strait. Over 95% of all homes are plumbed. Funds have been requested to construct a new dam to increase the water supply. The City is exploring options to improve waste disposal. Alaska Power and Telephone Co., based in Skagway, owns and operates diesel power systems in Hydaburg and Craig, which provide electricity to many Island communities.  
RUBA Status & Activities This Qtr:
RUBA staff continues to provide Hydaburg with assistance on financial management, budget development and other assistance as requested, however, over the last few quarters, there has been little or no improvement in management capacity. Hydaburg has yet to complete its FY05 audit or FY08 budget. Until the community has a functional budget there is very little that can be accomplished. Hydaburg is an economically distressed community to the point where employees are not being paid and the City cannot afford basic supplies. In addition to the financial problems, the community is experiencing considerable internal strife, which is severely hindering their ability to resolve issues.  
RUBA Activities for the Coming Qtr:
RUBA staff will continue to work with the community in the area of financial management. RUBA staff will also continue to work with the utility on the accomplishment of identified goals along with providing ongoing technical support. The identified goals are: 1. Complete the FY05 audit 2. Identify all sources of revenues for the utility including an accurate accounts receivable on utility user fees. 3. Complete an accurate estimate of expenditures for the coming year and develop an accounts payable system that will track those expenditures. 4. Review and update the existing collections policy 5. Secure a workers' compensation insurance policy
Scores:
 
Essential Indicators:
1 of 27
Sustainable Indicators:
0 of 27
Total Score:
1 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.
No 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
The City has not yet adopted an FY08 annual budget. Until the budget is finalized and adopted by the council, the City does not meet any of the essential or sustainable indicators involving budget issues. The City is currently charging $40 per month for water, sewer, and garbage. Adequate financial statements to verify sufficient revenues to cover expenses and repair and replacement cost were not available. Through conversations with City staff, RUBA learned that the utility is not receiving enough revenue to meet its current expenses. The City's FY04 financial audit (the latest audit available) indicates that the utility was operating at a deficit at that time. The Manager is not presently preparing written reports, however he routinely provides oral financial and status information to the City Council at monthly meetings. The community has no bulk fuel storage facility. Due to past financial problems with creditors, the City receives fuel from a vendor on a cash only basis.

Accounting Systems

Essential Indicators
Answer Question
No The utility has adopted a collection policy and actively follows it.
No The utility bills customers on a regular basis.
No An accounts receivable system is in place which tracks customers and reports past due accounts and amounts.
No An accounts payable system is in place.
No 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.
No 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.
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 community is currently using QuickBooks for their accounts receivable, accounts payable, and payroll. The community uses a manual receipt book system to record incoming funds, which is later entered into QuickBooks. The City is experiencing some problems with QuickBooks that could probably be resolved with some additional QuickBooks training. The City Clerk reported problems with calculating payroll taxes and was unable to set up the system to receive sales tax revenues. The City is several months behind on reconciling its bank accounts. The Administrator is responsible for the approval of purchases; however, there is no visible system for the written pre-approval of purchases.

Tax Problems

Essential Indicators
Answer Question
No 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
<none>

Personnel System

Essential Indicators
Answer Question
No 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.
No 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.
No 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.
No 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
Workers' compensation insurance through Alaska Municipal League JIA was cancelled on 11/30/04 due to non-payment. A new policy has not been purchased.

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.
No The utility has an adequately trained manager.
No The utility has an adequately trained bookkeeper.
No The utility has an adequately trained operator or operators.
No 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.
No The policy making body meets as required.
No The utility complies with the open meeting act for all meetings.
Organizational Management Comments
The inertia of problems over the past few years will take time to overcome. The completion the FY05 audit will release state funding to pay off a substantial amount of debt. The Council still has some hard decisions to make on rates, collections policy, staffing, and funding priorities of municipal services. These decisions will be critical for the sustainability of the water/sewer and other services.

Operation of Utility

Essential Indicators
Answer Question
No 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
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.
No 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.
No 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 is on the Significant Non-Compliance (SNC) list because it does not meet the Long-term 1/Enhanced surface water treatment rule.