Quarterly Report: 2010, January - March (Q3), Nikolai

Community:
Nikolai 
Staff:
Tammy Helms  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Nikolai 
Population:
88  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
5/10/2010 
Community Sanitation Overview:
All 47 households and facilities use individual wells; of these, only 2 units lack plumbing. Thirty-three homes, including 10 new HUD housing units north of the airport, are connected to the piped sewage system. The remaining 15 homes use septic tanks. Funds have been requested for a master plan to rehabilitate the washeteria, develop two new wells, upgrade the landfill and expand the piped sewer system. 
RUBA Status & Activities This Qtr:
On February 8, 2010 Anchorage RUBA staff traveled to Nikolai to conduct a RUBA management assessment. Following the completion of the assessment, RUBA staff worked with the city clerk to set up their QuickBooks accounting processes for utility billing and the electric billing. The city recently took management of their electric utility back from a contractor they had hired to run that utility. The city subsidizes the wastewater department with the fuel and electric revenue. Once the December and January electric invoices were entered in QuickBooks, RUBA staff trained the clerk on how to create monthly statements for the customers. RUBA staff then worked with the clerk to reconciled October-December 2009 bank statements. RUBA will continue to monitor Nikolai and provide assistance to meet all managment indicators of the assessment. 
RUBA Activities for the Coming Qtr:
DCRA staff will continue to work with the City of Nikolai as needed to ensure the council has all the necessary assistance to meet the sustainable management indicators.
Scores:
 
Essential Indicators:
27 of 27
Sustainable Indicators:
16 of 23
Total Score:
43 of 50

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
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.
No Budget amendments are completed and adopted as necessary.
Finances Comments
The City of Nikolai drafted and adopted the FY10 budget with RUBA assistance. The budget includes expenditures for the sewer department. The city's budget has been entered into QuickBooks and the city clerk prepares a monthly financial report that compares actual income and expenditures to the budgeted amounts for the council monthly. The City of Nikolai owns and operates the electric utility; they are current with the electric bill for the septic system. The City of Nikolai receives fuel via Brooks Fuel on an as needed basis. All fuel orders are paid in full upon arrival. As noted previously, the City of Nikolai does not charge residents for sewer service as only a small portion of the community is on the system. They have instead chosen to subsidize the sewer utility through the fuel and electric sales revenue. Although the council does not receive a prepared monthly financial report that compares actual income and expenditures to the budgeted amounts the office has separate reports that, when compared, show the utility's year-to-date figures are at a level equal to those budgeted. Manager/operator reports are given verbally when requested from the council; however, because of the small labor pool in Nikolai, many council members either work for the city or donate time to the city to complete needed jobs or tasks.

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.
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 does not have an adopted collection policy for the sewer utility because they do not charge the customers. They do, however, have an adopted collection policy that they actively and consistently enforce for the electric and fuel utilities; these utilities subsidize the sewer utility. The city utilizes QuickBooks for accounts receivable, accounts payable and payroll. The QuickBooks system is set up properly and has been a tool to reliably keep the city's finances in order. Currently bills are issued on a regular basis by the 5th of every month in accordance to the city's billing and collection policy. Monthly bank reconciliations are completed for each bank account then printed and filed for historical data. The city purchasing system requires prior approval from the mayor or city clerk dependant on the purchase amount. Once approval has been given, a purchase order is issued; however, currently it is not compared to the budgeted amounts.

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 city uses the QuickBooks accounting program to accurately track, calculate and report payroll tax liabilities. Liabilities are submitted monthly and the quarterly reports are completed and mailed to the IRS on time. Due to inactivity of the council from 2004 until 2008, the IRS deemed them non-complaint; however, since that time the city worked with the Tax Payers Advocate's office to clear up the issue.

Personnel System

Essential Indicators
Answer Question
Yes The utility has a posted workers compensation insurance policy in effect.
Sustainable Indicators
Answer Question
N/A 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.
N/A The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation.
N/A 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.
N/A 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 Nikolai has a posted workers' compensation insurance policy in effect from 7/1/09 to 7/1/10 with AMLJIA. The city's current hiring process is historical and is not written. Job notices are posted with the job title and description for 10 days. Interested applicants apply at the city office. There is currently no probationary period for employees. Personnel folders contain: I-9, Job Application and Letter of Acceptance. Training opportunities to staff are provided as funds allow or opportunities by other sponsors come 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
The City of Nikolai is known as the entity that owns and operates the utility, and is active in policy making for the utility. The council has been actively enforcing the fuel and electric utility policy. The clerk has attended a QuickBooks training class sponsored by the RUBA program. Employees that operate the various utilities have completed trainings that have adequately prepared them to operate the utilities. The City of Nikolai has adopted the necessary ordinance to give it the authority to operate. The Nikolai City Council meets as required and complies with the Open Meeting Act for all meetings.

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.
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.
Yes 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
Currently, the City of Nikolai does not have a utility operator that is certified however, they are actively working toward the necessary certification. The city has within the city office a preventative maintenance plan for the existing system. The City of Nikolai is currently not taking part in AMLJIA monthly safety meetings or other means of safety meetings. Historically, the utility operator reports to the mayor, vice-mayor or city clerk when there is a problem or he can foresee one. The utility operator and council attempt to keep needed critical spare parts on hand but they currently have no actual written list.