Quarterly Report: 2012, July - September (Q1), Galena

Community:
Galena 
Staff:
 
DCRA Regional Office:
 
Gov't Type:
First Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Galena 
Population:
470  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
10/26/2011 
Community Sanitation Overview:
Water is derived from wells and is treated. There is a 200,000 gallon reservoir and a community leach field. Sixty one customers are connected to the fully piped system and fifty four customers have water delivered. Some customers only have water delivered as they have private septic systems while others pay the city to dispose of waste water on an as needed basis. The City began operating the landfill, located on the former Campion AFS grounds, in 1997. In September of 2010 the city acquired a used water delivery truck to replace the previous vehicle which was at risk of being inoperable. An ANTHC project is underway to connect Native homes on Louden Loop to piped water. 
RUBA Status & Activities This Qtr:
This quarter communications with the city has consisted of phone, email, and in-person support. The city signed a RUBA assistance agreement on January 17, 2011. The ANTHC project engineer submitted a grant application to connect approximately 20 homes to piped water, the main water line is in the process of be buried next to the road; construction has stopped for the winter. RUBA staff visited the community on September 26-27, 2011 and determined that the budget that was initially provided was locally and informally called an 'interim' budget to meet state requirements; the budget was never provided to the State of Alaska for the purpose of obtaining Community Revenue Sharing and Payment in Lieu of Taxes. RUBA also determined that financial reporting is inaccurate, see the following financial section. 
RUBA Activities for the Coming Qtr:
A potential visit was discussed for December.
Scores:
 
Essential Indicators:
22 of 26
Sustainable Indicators:
21 of 26
Total Score:
43 of 52

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
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.
No YTD expenditures are at a level equal to or below those budgeted.
Yes A monthly manager's report is prepared.
N/A Budget amendments are completed and adopted as necessary.
Finances Comments
RUBA was given a FY12 Budget, which was passed on June 27, 2011. During an onsite visit RUBA was informed that the city never provided the budget to the Community Aide section which they have always done in the past, the state is holding Revenue Sharing and PILT funding for the city until the budget, audit and other documents are submitted. The budget was never provided because it is being called an 'interim' budget which was used to meet RUBA requirements. The city manager stated he did not want to submit the 'interim' budget to the state because it is not a useful or accurate document. The city manager stated that he is waiting for the council to meet and finish creating the budget. During the June 14 city council meeting one council member made a motion to have specific financial reports provided in council packets at each meeting, no other council member seconded and the motion failed. Financial reports are not provided to the council. The city has not had a qualified financial director on staff for quite some time. The bank accounts have not been reconciled since March 2011 and the QuickBooks indicates that the checking account is negative $467,515, this is likely not correct but is a result of poor management. If the bank accounts were reconciled then direct deposits and credit card payments will be entered into QuickBooks.

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.
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 City of Galena uses QuickBooks Enterprise Solutions for all of its financial and accounting needs. The in-house accounting staff consists of one person, the receptionist who sends out customer bills and receives payment. A CPA from Anchorage was extended an offer of employment but that did not come to fruition. It is highly recommended that the city hire additional financial staff. The most recent audit makes this recommendation as well. Bank accounts have not been reconciled since March 2011. The QuickBooks checking account shows that the city is negative $467,515, this is not accurate. Deposit transactions occur electronically and unless a financial director manually enters them into QuickBooks the financial reports will continue to be grossly inaccurate. Purchases for most city employees requires prior approval, the exception is with the city manager. The bank statements reflect unusual purchases for items such as two transactions for Mt. McKinley Animal Hospital and Amazon.com; back up for these was not located and the audit findings also cite a lack of internal control

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
QuickBooks accurately calculates and reports payroll taxes. As of September 23, 2011 the Department of Labor deemed the city compliant. On September 27, 2011 the IRS deems the city compliant.

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.
No 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
Workers compensation insurance is provided through the Alaska Municipal League Joint Insurance Association and is in effect until July 2012. RUBA has a faxed copy of the notice of workers compensation insurance coverage in the Fairbanks office. The personnel policy and procedure manual is comprehensive; a copy is provided to each new hire with a signature page that acknowledges receipt and is filed in the employee's personnel folder. RUBA staff has copies of job descriptions for city positions. The annual evaluations are based on the job description. RUBA staff and city staff were not able to locate a specific written hiring process. The current process is that a vacancy notice is posted in town at four locations and the notice is read on the local public radio station for ten days. Applicants submit their application and if there is more than one applicant, a list of interview questions is created for the interviewer. Galena Personnel Policies and Procedures Title 15.10.430 (A)(1) (this Title 15 document is separate from the Galena Code of Ordinances as Title 15 in the code has to do with building and construction) states that there are to be two separate personnel files for each employee, one public and one confidential. Between the two files, all necessary documents are retained. Included in the confidential files are evaluations, which are done after the six-month probationary period. New hires are provided with orientation and job-training, to the extent needed for the position. The personnel manual states that 'the city encourage[s] employees to avail themselves of training and educational opportunities directly applicable to their city positions in order that they may provide more effective service to the public.'

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.
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 is the owner of the water and electrical plants (Galena Code Title 13) and city employees operate both utilities. The city council is the policy making body, the city manager oversees the day-to-day management of staff. Mr. Ben Koontz is the utility manager, he received the TCC operator of the year award for 2010. The city council is very active in setting and enforcing utility policy, although they are not active in the city's financial status, as is supported by council meeting minutes. The city manager and utility manager are fulfilling the job duties. The city does not have an adequate bookkeeper. The city has an organizational chart that shows the current structure, the policy making body (city council) meetings are open to the public with the exception of executive sessions as allowable by law.

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
Operators have a level two water treatment certificate but no operators have a water distribution certificate. A level 2 certificate is required and the operators will continue to gain the training and experience level required. During the last quarterly report at least one operator had a distribution certificate. A preventative maintenance plan is located in the plant. The utility manager provides operation and maintenance reports to the city manager who includes them in a report for the council. AMLJIA provides telephonic safety meeting which are attended by city staff. Operations of the utility are functioning as intended and no major outages have occurred. The most recent CCR has been completed and RUBA obtained a copy. The city is not on the SNC list dated July 2011.