Quarterly Report: 2011, January - March (Q3), Shishmaref

Community:
Shishmaref 
Staff:
Iura Leahu  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Shishmaref 
Population:
609  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/4/2011 
Community Sanitation Overview:
The city of Shishmaref provides water and sewer (flush and haul), watering point, honey bucket bin rentals hauling (HBBR) and washeteria services, which include public showers, laundromat and water sale services. The main clients are the city residents, school, clinic and other non-profit and for-profit businesses. There is some residential plumbing currently in use. There are approximately 15 homes that utilize an above ground septic system. Most residents haul their own water from the washeteria. In the summer, most residents collect rain from rooftops. In the winter, residents simply chop off chunks of ice from one of two ponds located about five miles away from the city, load it into their snow machines, and take it to their homes. The school, local health clinic, city hall and garage use common water and sanitary sewer systems. At this time, neither the city nor the garage has systems that are operational. The city garage has the heavy equipment, fire truck, the Shishmaref emergency services office and the city lodge. The water is being treated at the treatment plant located in the washeteria. The city uses the pumphouse distribution plant to transport water to the businesses listed above. Both the washeteria and pumphouse have separate water storage tanks. The treated water is delivered to these buildings via water pipes. The generated waste is transported through sewage pipes to the sewage lagoon located approximately 300 yards away from the buildings.  
RUBA Status & Activities This Qtr:
The RUBA Program in the Nome region filled the vacant position in December 2010 and onsite assistance to Shishmaref resumed in January 2011. Shishmaref has signed a RUBA assistance agreement. The agreement states that RUBA staff will travel quarterly to Shishmaref to provide onsite training and guarentees RUBA staff access to all city records and that a minimum of two city staff will be available for onsite training. A work plan with goals and timelines is agreed to between Shishmaref staff and RUBA staff when the assistance agreement is signed. Anchroage and Nome RUBA staff traveled to Shishmaref on January 20-21, 2010 to conduct a RUBA management assessment. RUBA staff also conducted city council training while in the community per their request. As of January 21, utility services and city finances are in good standing, however, the city struggles with lack of revenue sources to cover growing expenses. Currently the city is subsidizing the washeteria, water, and wastewater services. The city asked RUBA to help codify their city code. Shishmaref city requested RUBA staff from Nome and Anchorage travel to Shishmaref on January 18-21, 2011 to conduct the RUBA assessment and provide general government training to members of the city council. RUBA staff discussed the RUBA assistance agreement and management assessment with the council. The city of Shishmaref had signed a RUBA assistance agreement in May 2010 expiring in May 2012. RUBA staff toured the water plant and the pumphouse distribution plant. The RUBA assessment was completed during the visit. The utility met all the essential indicators as well as all but five sustainable indicators. RUBA staff and the city council agreed to work together on several projects in the next four months. Due to severe cold conditions this winter, the water and wastewater pipes that bring water to the local clinic are frozen. The city delivers water to the clinic by truck. The city will not be able to fix the water pipes until summer. Services at the clinic were not discontinued. The waste generated by the clinic is being hauled by the city daily or as needed. Shortly after the onsite visit, the city bookkeeper resigned and the position has not been filled yet. However, the city clerk stated that the city council will discuss a pull of applicants during the regular council meeting on April 5, 2011. On February 24, 2011, RUBA staff met with the Nome based Remote Maintenance Worker (RMW) to discuss the unmet sustainable indicator regarding maintaining the inventory control and critical spare parts lists. The RMW stated he would provide assistance in those areas. He also reported that the utility functions very well and provides good safe drinking water to the residents.  
RUBA Activities for the Coming Qtr:
Nome RUBA staff will make at least one trip to the city to work with the city council and city staff to meet the essential and sustainable indicators identified in the quarterly RUBA report. RUBA staff assistance for the next five months will consist of the following: 1. Design of the organizational chart 2. Codify the code of ordinances 3. Review Year to Date (YTD) revenues to those budgeted 4. Assist the utility create and maintain an inventory control and critical spare parts list 5. Meet with the city council to provide training on rate setting and review user fees rates
Scores:
 
Essential Indicators:
26 of 26
Sustainable Indicators:
21 of 26
Total Score:
47 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.
No 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.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
Shishmaref oeprates the utility service an enterprise. The utility is compliant with the essential indicators of the utility finance. As of January 21, 2011, the utility and city finances are in good standing. The city, however, struggles to receive the necessary utility related revenues to cover the operating expenses. As per the FY11 budget, the expected utility revenues are less than the expected expenditures. To address this fiscal problem, the city council made a decision to subsidize the washeteria services by transferring money from other funds, such as the Payment in Lieu of Taxes (PILT). As per city officials, the city clerk, city bookkeeper, and the new utility clerk prepare monthly financial reports and submit them to the city council on monthly basis. The regular scheduled meeting minutes of December 6, 2010 show that the city council was aware of the financial difficulties of the washeteria. The council scheduled a budget work session for December 17, 2010 to address washeteria salaries, which were short by $17,000.00. The minutes indicated that the governing body proposed cutting the water plant operator's work hours. The bookkeeper provided RUBA staff with the last three months' monthly financial reports. The city council is active in the budget activity process and it has a good grasp of the fiscal reality of the city and utility. The council makes informed decisions regarding utility finances because it receives and reviews monthly financial reports indicating the conditions of city's and utility's finances. As a result, the city council proposed a budget amendment for the fiscal year 2011. Due to increases in revenues originating from Alaska Village Electric Cooperative (AVEC) reimbursement, revenue sharing, telephone and electric Co-op, PILT, training reimbursement and fuel sales, the governing body made amendments to both revenues and expenditures for the remaining fiscal year 2011. On February 9, 2011, the governing body adopted the budget amendment ordinance.

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.
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
Both the city bookkeeper and the utility clerk do an excellent job collaborating together in order to keep track of accounts receivable, payable and collections. The utility clerk is responsible for the cash receipt system and collections. The clerk sends out monthly utility bills to customers and offers a payment plan option to delinquent customers. The utility clerk passes along the financial information to the city bookkeeper, who uses QuickBooks Pro 2010 to generate monthly financial reports, prepare monthly bank reconciliations and track payroll liabilities. Her financial management experience reflects a high level of accuracy and excellent record keeping skills. In spite of her skills, the bookkeeper looks forward to attending a RUBA sponsored QuickBooks training. Both the utility clerk and the bookkeeper provided access to the financial instruments and documents used in their daily work. The city clerk reported that all purchases are made in accordance with the budget. The QuickBooks Pro monthly financial reports are converted to Excel spreadsheet format which makes them much easier for council memebers to read and understand.

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
As of January 25, 2011, the Department of Labor and the IRS reported that the city is current on filing state and federal tax reports and making federal tax deposits. The city and the utility uses QuickBooks Pro 2010 to accurately calculate, track, and report payroll tax liabilities. The city has no past tax liabilities or liens recorded.

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.
Yes The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The city and the utility has general liability and workers' compensation coverage. The workers compensation insurance is purchased through Alaska Municipal League Joint Insurance Association (AMLJIA) that is valid until July 1, 2011. The city and the utility follow the personnel policies in the day-to-day management of personnel. All city departments, including the fuel sales and washeteria, use the city's comprehensive personnel policies. Although the city's code of ordinances contains written job descriptions, written procedures on personnel evaluation and hiring, the code of ordinances needs to be reviewed, updated, and codified. Currently, the city clerk is working on codifying the code of ordinances. RUBA staff in Nome obtained a copy of the code of ordinances and will work with the city clerk on completing this project within the next four months. The city maintains personnel files for all the city employees. The city clerk reported that the city does not have an I-9 for each employee, but it is in the process of updating all employees' files to include I-9. The city and the utility have a probationary period for new hires that includes orientation, job-training/oversight and evaluation, which is completed after ninety days of an employee on the job. The city and the utility provide training opportunities to staff as funds are available.

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
No 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
Shishmaref's utility is operated as an enterprise. It has a utility board which consists of members of the city council. The board is active in policy making and the city enforces the utility policies as per the code of ordinances. The city clerk and members of the city council reported that the board has monthly utility meetings. The utility has a certified water operator, who is the manager and is supervised by the city clerk. The council hears monthly oral reports on the operation, finances and management of the utility from the operator. There is also an alternate water operator who works part-time or as needed. The alternate operator provided a tour of the washeteria and the two water treatment facilities to RUBA staff. The operator was proud to hold his job because the utility has provided good clean water to the residents. The city has a current organizational chart posted on the wall of the city clerk's office. The chart needs some corrections. RUBA staff photographed the chart and will work with the city clerk to create an organizational chart in word document to be included in the code of ordinances. The utility has a bookkeeper who keeps track of the utility finances. The bookkeeper is a full-time employee. She has held this position for the last three years. The city council plays an active role in policy making. Public meeting minutes show that the council discusses the utility finances and adopts budget amendments to facilitate the operation of the utility without creating interruption in services. RUBA staff discussed rate setting to ensure that the honey bucket bin rentals, watering point, school and clinic rates are sufficient to cover the operating costs of the water plants and the sewer/water haul system. The city was negotiating the idea of raising the rates with the school and clinic. However, the council reported that a rate increase would have a major impact on the school's and clinic's ability to provide high quality services to the community and students. The city council asked for more assistance in setting rates.

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.
N/A 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 utility has a lead and an alternate water operator. The lead water operator is certified and is pursuing CEU's to maintain his certification. The alternate water operator does not have a certificate but he has attended classes, has been actively working towards certification and has a total of approximately five years of experience as a water operator. The utility has a preventive maintenance plan and a safety manual. According to members of the utility board, the utility holds monthly safety meetings by phone. The safety meetings are provided by the Alaska Municipal League Joint Insurance Association (AMLJIA). The utility has not suffered any major problems or outages for many years. The operator provides oral status reports to the city council and meets all required regulations. The utility is not on the Significant Non-Compliance list. The utility does not maintain an inventory control list and a critical parts list. RUBA staff recommended that the governing body address this problem. RUBA staff advised the governing body to contact the remote maintainance worker or the engineer assigned to the city to ask for assistance in creating an inventory control list.