Quarterly Report: 2010, October - December (Q2), Nelson Lagoon

Community:
Nelson Lagoon 
Staff:
Julie Dirks  
DCRA Regional Office:
 
Gov't Type:
Federally Recognized Tribe 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
Native Village of Nelson Lagoon 
Population:
69  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
2/22/2010 
Community Sanitation Overview:
Water is derived from a lake about 10 miles from Nelson Lagoon and is treated. Water storage capacity is 850,000 gallons. All homes are connected to the piped water system. Individual septic systems enable households to have complete plumbing. A new washeteria was completed in August 1999. The water system needs major improvements, including repair of the distribution system, replacement of about 3 miles of distribution line, and a new storage tank. There are no garbage collection services, but a landfill is available. Construction on water intake and a pump house is due to begin construction in 2010. 
RUBA Status & Activities This Qtr:
Anchorage RUBA staff traveled to Nelson Lagoon on October 27-30,2009 at the request of Justine Gunderson, Administrator of the Nelson Lagoon Village Council. The purpose of the trip was to conduct a RUBA management assessment and provide on-site training. Documentation received from Village Council staff does not support essential indicator requirements at this time. On December 4, 2009 the final report was released and distributed and a work plan will be drafted to provide assistance in meeting noted deficient indicators. RUBA staff prepared an organizational chart, draft utility budget, and draft utility ordinance for the Nelson Lagoon Village Council to consider. Example personnel policies, job descriptions, preventative maintenance plan, and a template for compliling a spare parts inventory was provided to the administrator. Additional indicators will be addressed as soon as possible. No response from the Village Council was received regarding the assessment or additional information provided as of the end of the quarter. RUBA staff will continue to contact Nelson Lagoon and offer assistance as their funded project will not continue without input from council staff. 
RUBA Activities for the Coming Qtr:
Followup to see if any of recommendations have been implemented. Maintain regular contact with community. Provide technical assistance as requested.
Scores:
 
Essential Indicators:
12 of 27
Sustainable Indicators:
8 of 27
Total Score:
20 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 Nelson Lagoon Village Council has included the water utility with the Nelson Lagoon Electrical Co-op. No budgets are prepared or approved by the Village Council for the water utility. A set of books for the co-op are maintained separate from the Village Council operations. Revenue and expenses for the water utility are tracked separately from those of the electric utility within the utility accounting system. A profit and loss statement by class indicates that as of October 28, 2009 the water utility had revenue in the amount of $2,100 and expenses totaling $42,797.33. Because of the low revenue that was posted, it may be that water utility revenue is not being classified correctly when cash receipts are recorded in the accounting system. From the information provided, it cannot be determined whether the utility is bringing in enough money to cover operating expenses for the water utility. The majority of the expenses are for wages and payroll taxes. There is no indication of where the money to cover the excess expenses was derived. Fuel is delivered to the village annually. Sales and distribution are managed by the Nelson Lagoon Corporation. The Administrator reported that they have difficulty making payments to the Corporation for fuel purchased to support the water utility.

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.
No 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.
No 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.
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 Village Council collects payments for water through a pre-paid metering system that was installed for use by the electric utility. There are no account receivables for the water utility since no bills are required to be issued. Customers purchase cards from the utility. The amount of the card is scanned to the customer's meter. The water utility charges a flat $99 per month for water service. Each day the pre-pay meter will deduct $3.30 for water service from the customer's balance. The system rates are set through system software by the utility and the customers' meters are reset whenever there is a change through the scanning of a 'penny' card. QuickBooks is used to perform accounting for the Nelson Lagoon Village Council. The Village Council has several sets of books or data files set up for various functions of the Council. Only the financial reports for the electrical co-op were provided. The reports provided indicate that the electrical co-op revenue and expenses are tracked separately from the water utility. However, the low amount of posted revenue for the period January through October may be an indication that revenue is not being correctly classified to the water utility when cash receipts are posted to the accounting system. The balance sheet shows that utility assets, liabilities, and equities are combined for both utilities. There is no formal written purchasing policy. Annual orders and repairs are all authorized and approved by the administrator. The Village Council operates on a calendar fiscal year with the new fiscal year to begin January 1, 2010.

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
IRS 941 quarterly reports indicate that payroll tax deposits are made and no payments are required with the reports. On November 16, 2009 the Alaska Department of Labor reported that the Nelson Lagoon Village Council had filed all quarterly ESC reports through September 30, 2009 and had a very small credit balance on account. On November 17, 2009 the Internal Revenue Services reports that the Nelson Lagoon Village Council is in compliance with federal employment tax filings and deposits. There are no tax liens against the Village Council.

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.
Yes The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The Administrator reports that workers compensation coverage through Pippel is current from 11/1/09 through 11/1/10. However, no documentation of coverage was provided or made available at the time the assessment was completed. The Village Council has not adopted personnel policies or approved job descriptions for employees. Some positions have specific requirements and certifications which are considered when hiring employees. Training for utility staff is provided as opportunities and funding is 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.
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.
Yes 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.
Yes The policy making body meets as required.
No The utility complies with the open meeting act for all meetings.
Organizational Management Comments
The Nelson Lagoon Village Council is a traditional tribal council. No elections are held for seats on the council. Members are appointed by the remaining members until they resign or are otherwise unavailable to serve as council members. The Village Council meets as there is a need to meet. All council operations are managed by the administrator who has 30 plus years of experience managing the organization. Bookkeeping is performed by a bookkeeper with a certified public accounting firm based in Anchorage and is available as a backup for the local bookkeeper. The present bookkeeper has held the position for five years. The Village Council has not adopted utility regulations to give it authority to operate the water utility. Meeting minutes that document activity of the policy making body were not provided.

Operation of Utility

Essential Indicators
Answer Question
Yes 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
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.
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.
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
A trained primary and backup operator are employed by the Village Council. The primary operator has held the position for three plus years. The primary operator holds certification at the Water Distribution P level until 12/31/09. The Administrator reports that the Water Operator provides her with regular verbal reports. It is not known whether the Village Council receives a report on the status of the water system. The Nelson Lagoon water utility appears on the August, 2009 Significant Non-Compliance (SNC) list with a Stage 1 distribution chlorine reporting violation. A preventative maintenance plan for the existing water treatment system has not been adopted.