Quarterly Report: 2008, January - March (Q3), 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:
203  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/7/2008 
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. Unfortunately a few of the essential indicators have not been met at this time. RUBA staff is available to assist the City with their attempt to meet all of the essential indicators and will help them move forward on any pending projects.  
RUBA Activities for the Coming Qtr:
The City of Nondalton have not met all of the essential indicators however, RUBA staff plans to provide assistance in every area that assistance is requested. RUBA staff is available to provide on-site training or via phone or email.
Scores:
 
Essential Indicators:
18 of 27
Sustainable Indicators:
24 of 27
Total Score:
42 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.
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.
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.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
The City of Nondalton adopted a FY08 Budget appropriations ordinance on May 10, 2007. According to the former city administrator, the utility expects to generate $79,702.00 in revenues from a variety of sources as well as customer generated funds. Other source funds will include fees received from the refuse haul service, land lease revenues and a mail contract. Even though these funds are earmarked to support the utility they are not listed as such in the FY08 appropriations ordinance. With expenses in the amount of $75,855 the utility is very close to becoming self sustaining. However, on review of the customer account print outs discrepancies are evidenced in billings. The current city administrator states she has not received training on the new software QuickBooks and as such she acknowledges accounts may not be accurate. With out an accurate snapshot of accounts receivable (customer accounts) it is difficult to determine the financial status of the utility account and the collection rate could not be determined at this time. The city administrator gives the council a verbal monthly report and provides the council with a monthly profit and loss report generated from the QuickBooks Pro system however; if the accounts are inaccurate the verbal reports are inaccurate. Anchorage RUBA staff was contacted in December of 2007 and notified that the City of Nondalton was experiencing a fuel delivery emergency situation. The city was able to have the fuel delivered just before Christmas. According to the administrator, the city has enough fuel on hand and is doing well with their fuel sales. The city will continue to replenish their fuel supply as needed.

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.
No 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.
No 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 accounting software, QuickBooks Pro 2007 version is utilized consistently. The NEBS receipt system is still being utilized to document customer payments. The citys chart of accounts is set up through QuickBooks program. Payroll taxes currently are not calculated correctly because the city has not subscribed to the QuickBooks Pro fiscal tax updates. 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.
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
The IRS has deemed the City of Nondalton non-compliant with federal taxes because they owe federal taxes for the last quarter in 2007. The city may also owe additional taxes that have not yet been posted. The first quarterly reports were due to the IRS on March 15, 2008. Staff may want to contact their tax advocate and find out if and how much money is owed for the first quarter. The City of Nondalton is 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 Workers Compensation policy purchased through Umialik Insurance Company. The policy has an active date of May 23, 2007 through May 23, 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.
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 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 has oversight of the utility and maintains the books for the utility. In the past the City of Nondalton struggled with collection of payments from its customers. A creative seasonal strategy was suggested and 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 total number of allowed hours/worked per week is 40 and the length of employment allowed is up to a 4 week period. 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). If the city absorbs the insurance costs and employment taxes the contract is not reflecting the true cost to the city. The process seems fairly straight forward however, the utility's customer records are very difficult to decipher. The city administrator will need to revisit all these accounts and assure accuracy. Additionally, upon review of the utility budget each service (i.e., water, sewer and refuse haul) appear to have an overall credit balance. This would indicate that all customers are paying or certain individuals are prepaying. Customers that are reported to have a negative balance are in fact reflecting a credit balance. Without access to each customer account it is impossible to determine the exact status of the utility account. 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 for VSW Funding. The utility maintains an inventory control list and a critical spare parts list is prepared and on file.