Quarterly Report: 2008, April - June (Q4), Nondalton

Community:
Nondalton 
Staff:
Melissa Taylor  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Nondalton 
Population:
196  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
7/31/2008 
Community Sanitation Overview:
The City of Nondalton operates the piped water and sewer system and provides a central watering point for residents to haul their own water. The City Council is the policy making body for the utility. An infiltration gallery at Six-Mile Lake supplies the community with treated water. There are 88,000 gallons of storage capacity. 60 residences are connected to the piped water and sewer system and are plumbed. Refuse collection is provided. A new 5-acre landfill and burn box project were completed in 2005. The INN Electric Cooperative owns a diesel plant in Newhalen and 50 miles of distribution line to connect Iliamna, Newhalen and Nondalton. The Tazimina Hydroelectric Project has recently been completed, and powers the three communities. 
RUBA Status & Activities This Qtr:
Anchorage RUBA staff traveled to Nondalton in March to conduct a management capacity assessment. The last assessment was completed in 2007. Most, but not all, essential indicators were met at the time of the assessment and there have been numerous contacts with city staff, the mayor, and a hired consultant since then. The largest issue involves inconsistent and inaccurate financial records that, despite several attempts by city staff, could not be used to create an accurate financial report. There were also inconsistencies between adopted budget figures and those being shown in financial reports. Since the assessment, the city administrator position has become vacant, but corrections to the financial records have been made by a consultant using manual records, ledgers, and payroll reports. Financial reports over the months of May, June, and July that are accurate and consistant are required and will confirm city staff capacity and reinforce confidence in the financial record keeping system.  
RUBA Activities for the Coming Qtr:
RUBA staff will monitor financial reports and provide assistance as requested.
Scores:
 
Essential Indicators:
26 of 27
Sustainable Indicators:
26 of 27
Total Score:
52 of 54

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.
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.
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
No 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.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
Budget figures for the water sewer utility shown on budget vs. actual reports in April and May did not match those found in the approved budget. There were also inconsistencies in reported expense and revenue amounts between different financial reports. Several attempts to reconcile budget and financial report line item amounts were unsuccessful and brought into question the accuracy of any of the system's financial information. Since late May, there has been city staff turnover and a consultant has made corrections to the financial information using manual records, ledgers, and payroll reports. Financial reports to the council for the months of May, June, and July that are accurate and consistent will confirm city staff capacity and reinforce confidence in the financial records. A balanced and realistic budget for FY09 was adopted by the city council June 10, 2008.

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
The City of Nondalton adopted a revised collection policy in 2006 to include the solid waste disposal, sewage and water. The policy making body works very hard to enforce their policies. Utility customers are billed regularly on or before the 20th of each month. The City utilizes a combination of manual and computerized financial record keeping systems. The QuickBooks Pro 2007 version accounting software is utilized and the NEBS receipt system is also being utilized to document customer payments. The reliability of the computerized accounting information provided is questionable because of the inconsistencies described above, although a consultant has made changes using manual records that over time will hopefully demonstrate staff capacity and reinforce confidence in the financial records. The City's chart of accounts is set up through the QuickBooks program. The City has a purchasing policy whereby all purchase requests are written on a purchase order; the city administrator reviews the budgets and makes purchases accordingly. Any purchases exceeding the proposed budgeted amount will need to be presented to the city council for their approval.

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.
Yes 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
The IRS reported on May 13, 2008 that the City of Nondalton is current with federal payroll tax report and deposit requirements. The City of Nondalton is also compliant with the State of Alaska Quarterly Contributions reports.

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
The City of Nondalton has a current Workers Compensation policy that is effective through June 30, 2008. The City utilizes a personnel policy that was previously reviewed by DCCED; job descriptions are written and all personnel files are neatly organized and contain the required documentation. New hires have a probationary period and employees are given the opportunity to travel for training as needed.

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 of Nondalton is the owner of the utility. The decision making authority and enforcement of the utility policy is vested in the council. The city administrator normally has oversight of the utility and maintains the books for the utility; however, the position is currently vacant and the bookkeeping is being maintained with the assistance of a consultant. In the past, the City of Nondalton struggled with collection of payments from its customers. A creative seasonal strategy was implemented and is as follows: The City of Nondalton may propose a payment solution to an individual who has a rather large balance owed and who has expressed a desire to pay for their services but has no source of income or alternative method of payment other than this agreement. The City agrees to employ and the customer agrees to perform specific (day labor) duties in lieu of a $10 hourly payment for general labor tasks and $20.00 for construction type activities. This employment is considered temporary and seasonal. The City agrees to pay employment taxes and workers compensation insurance for individuals employed under this arrangement. The payment to the worker is in the form of a credit to the customers account. (For example if a customer works 5 hours at $10.00 an hour, $50.00 is credited to their account). The plan is successful in helping to collect past due utility balances, but absorbing the insurance costs and employment taxes means additional expense to the City. To limit the additional expense, the plan should be used only for paying off past due amounts. Some customers with work contracts are reported to have a credit balance. The mayor and the water plant operator see to it that the day to day duties of the plant are performed and defer all of the administrative duties to the city administrator.

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
The City has adopted a safety manual and has scheduled safety meetings. The City of Nondalton has three utility plant operators. Operators have the following certifications. Water Treatment Provisional Water Distribution OIT x 2 Water Treatment OIT x 2 The utility has completed and posted its CCR report and at the present time the City of Nondalton is not on the Significant Non-Complier List. The utility maintains an inventory control list and a critical spare parts list is prepared and on file.