Quarterly Report: 2014, April - June (Q4), Yakutat

Community:
Yakutat 
Staff:
Ryan Wilson  
DCRA Regional Office:
Juneau regional office 
Gov't Type:
Non-Unified Home Rule Borough 
Borough:
City and Borough of Yakutat - CBY 
Agreement?
No 
Agreement Date:
 
Entity:
City and Borough of Yakutat - CBY 
Population:
622 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
1/16/2014 
Exp Date:
 
Last Updated:
6/27/2014 
Community Sanitation Overview:
The City and Borough of Yakutat, a non-unified home-rule borough, provides water and wastewater services to most of the community. Water is derived from three wells, treated with calcium hypochlorite, stored in a tank elevated in the middle of town, and then gravity-fed to customers. The water treatment system is not classed; however, the water distribution system, the wastewater collection system, and the wastewater treatment system are all rated Class 1. There are more than 290 active hook-ups, though some of these hook-ups serve multi-family homes. During winter months, the water plant produces on average 280,000 gallons of treated water per day. The average during the summer is about twice as much due to fish processing plant operations and other fish-related activities. Several leaks throughout the water distribution system have been repaired over the past few years, and the system is being gradually upgraded from polyvinyl chloride (PVC), ductile iron, and asbestos pipe to high-density polyethylene (HDPE) pipe. Water usage is decreasing steadily with these upgrades. The only metered customer is the fish processing plant; all other customers pay a flat rate. Several customers leave water running in winter months to avoid freezing. The community has nine wastewater lift stations and a primary wastewater treatment system. The City and Borough of Yakutat also operates and manages a solid waste dump and recycling service and a harbor/dock. It owns and/or leases certain enterprises, or the property under these enterprises’ facilities, such as a boat fueling depot, fuel distribution and sales, a fish processing plant, and three small docks. 
RUBA Status & Activities This Qtr:
This quarter, RUBA staff visited the City and Borough of Yakutat in May to do a rate study. The rate study was well received by the assembly and the community increased their water utility rates by approximately 65 percent from $51 to $84. This increase will allow the community to sufficiently cover operating expenses and repair and replacement costs with no additional subsidies. Prior to the acceptance of the new rate, the city was subsidizing the cost of water utilities with Community Revenue Sharing funds, Payment in Lieu of Taxes program, and other grant funds.Also during the trip, RUBA staff went on a tour of the water utilities in the community and identified a need for additional lift station pumps in all seven of the community's lift stations. During the quarter, RUBA staff provided the Consumer Confidence Report (CCR) data to the community and the iWriter link and encouraged them to complete and distribute the report by the July 1 deadline. RUBA staff coordinated with the community to get the HPB IRS - 8821 Tax Information Authorization form in order to help with federal tax compliance issues. RUBA staff also coordinated with the Village Safe Water engineer in an effort to resolve issues with secondary and backup pumps in all seven of the wastewater lift stations throughout the community.  
RUBA Activities for the Coming Qtr:
In the coming quarter, RUBA staff will continue to work with the the City and Borough of Yakutat on a number of issues. The community has recently hired two new water operators who are very interested in water operator certifications. RUBA staff will work to coordinate with the community to get the water operators the certifications needed. Per the request of RUBA staff, the community has demonstrated that they plan on appropriating sufficient funds in the FY15 budget to make this happen. RUBA staff will continue to provide additional assistance as requested by the City and Borough of Yakutat, and plans on assisting in the training of the new water utility manager upon hiring.
Scores:
 
Essential Indicators:
26 of 26
Sustainable Indicators:
24 of 27
Total Score:
50 of 53

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
Yes 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
The City and Borough of Yakutat follows the fiscal year July 1 through June 30. The FY15 budget was proposed as of June 19, 2014, but is scheduled to be adopted on June 26. The FY14 budget met all RUBA indicators. If FY15 is similar to the FY14 budget, the water/wastewater utility portion of the budget should list all necessary revenue and expense categories. Water utility revenues in FY15 are expected to be far greater than those received in previous years. There will be sufficient revenue generated through user fees to cover operating expenses after the implementation of rate increases. However, the community is in dire need of additional lift pumps for all seven of their wastewater lift stations. These pumps are costly, and in prior years the City and Borough of Yakutat did not receive enough money to cover the pump replacement and maintenance costs. Subsidies have been used in in the past to make up this difference, but much of the subsidy being provided by the general fund is coming from federal funding sources which are not guaranteed year-to-year, such as those originating from the Payment in Lieu of Taxes (PILT) program. The new utility rate, and the increase in revenue provided should help compensate for the money needed to replace secondary lift pumps, and provide a backup pump for each of the seven pump stations in the coming year. The utility has adopted a rate schedule based on class types, which include a domestic flat rate, a commercial flat rate, and commercial metered rates. Due to a recent rate study provided by RUBA staff, Yakutat has increased their water/wastewater rate by approximately 65 percent, the increase will effectively go from the previous amount of $51 to $84 in July 2014. This increase in revenues for water utilities, will allow the community to sufficiently cover operating expenses and repair and replacement cost without additional subsidies. Single-family dwellings will be charged a flat rate of $84 per month for water/wastewater utilities, $105 for commercial rates. The Fish Plant is the only metered operator in the community. The utility’s finance director provides profit and loss reports to the assembly at its monthly meetings. The report identifies for each budget category the current month income/expense amount, year-to-date figures, budgeted figures, total budget variances, and the percentage of total budgeted amount remaining. The financial reports are accompanied by a manager’s report, which discusses any peculiarities on the financial report and any issues which might warrant a budget amendment. RUBA staff has confirmed with the finance staff that this will be a continued practice for the FY15 budget and monthly meetings that proceed it. The municipality owns and operates the community’s electric company, Yakutat Power. This enterprise is run separately from the water/wastewater utility and other operations of the municipality, and thus the municipality is billed by the power company monthly for its own power usage. Each department or enterprise is billed separately. When a bill is received, the finance director codes each bill to the corresponding account. RUBA staff was provided evidence that electric bills have been paid and coding is accurate. The municipality also owns the community’s bulk fuel equipment and property, and leases these out to Delta Western, who operate all fuel sales. Delta Western receives barges which top off the bulk fuel farm on a regular basis. The municipality projects adequate expenses for fuel needs and includes these in the annual budget for each enterprise and department.

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
Yakutat Municipal Code Chapter 11.30 provides collections policies for the community’s water/wastewater utility. Section 11.30.100 permits the borough to shut off water to any premises delinquent on payment for 60 days after the bill is mailed. However, it does not require shut-off, as this is not always possible; not all customers have shut-off valves, and those that do are not necessarily known to the utility. Rather, section 11.30.130 provides for a delinquency collection policy including small claims court and liens. The billing clerk reports that the bill is sent out by the 15th day of each month, and payment is due 30 days thereafter. Bills not paid within 60 days of the billing date are considered delinquent. Delinquent customers are notified by either certified letter or phone call. If payment is not made at this point, an additional certified letter is sent with a specified time period for payment to be completed. If payment is not complete by this time, the customer is sent to small claims court, and payment is then generally forced through Permanent Fund Dividend (PFD) or wage garnishments. The collection policy has been successful in ensuring a high collection rate. At this time, most delinquent accounts are customers no longer residing within the community. The utility uses the Abilia accounting system, which tracks all accounts receivable, accounts payable, and payroll. Accounts receivable is maintained by the billing clerk and assistant billing clerk. Bills are sent out by the assistant billing clerk, and receivables are managed by the billing clerk. Cash is frequently received as payment for utility bills. When a customer pays in cash, the payment is recorded in a duplicate cash receipt book and the customer is provided with a copy of the receipt. The payment is then entered into the accounts receivable system and posted to the appropriate customer account. All deposits are sent to the bank once per month, as there is no bank within the community. Payroll is completed semi-monthly. All employees complete a timesheet which is signed by department heads or the manager. The finance director then codes each timesheet to the appropriate department and processes payroll and withholdings. Accounts payable is maintained by the finance director. When invoices come in, they are placed in a folder and input all at once, including coding. An invoice report is run at the end of the week which is double checked for accuracy. Payments are then posted, checks printed and signed by the borough manager, and copies placed in the appropriate folders. There is no cash disbursement within the borough, other than a $500 petty cash system, which is maintained and reconciled regularly by the finance director. When utility staff need to place a work order, a borough work order form is completed and submitted to administrative personnel. The work order must be signed off by the borough manager, and is then submitted to the financial director for finance action. There is an adjoining work order log maintained by the finance director which matches up to a work order form number, and includes information such as date submitted, date completed, department, and task description. The finance director assigns all expenses to the appropriate budget category, and ensures there is sufficient funding in each category to complete the work requested. Bank reconciliations are completed monthly by the finance director, and evidence was provided as such. The borough is audited annually.

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
Abilia accounting software is used to calculate and track payroll tax liabilities. The software also reports and makes payments through the Electronic Federal Tax Payment System (EFTPS). The State of Alaska Department of Labor and Workforce Development granted employment security tax clearance for the municipality on May 30, 2014. Due to some timing issues with the HPB IRS - 8821 Tax Information Authorization form for Yakutat, RUBA staff was not able to confirm recent federal tax compliance for the City and Borough of Yakutat. However, Yakutat has been consistantly compliant in past quarters.

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.
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.
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 and Borough of Yakutat receives workers compensation insurance through the Alaska Municipal League Joint Insurance Association (AMLJIA) and is paid for a policy June 30, 2014. Proof of coverage is posted in three workplace locations throughout the community. Title 3 of the Yakutat Municipal Code is the personnel policy for the community. The policy has been reviewed by the municipal attorney. All employees up until a few years ago had read the policy and sign form attesting they had read the document. However, this has not been completed with more recent employees. Chapter 3.12 addresses hiring processes, including directions on recruitment, advertisement, selection, interviews, references, and preferences. Chapter 3.16 discusses probationary appointment, and requires all employees begin with a six- to twelve-month probationary period. Performance evaluations are discussed in Section 3.40.020, and are required either once or twice a year, depending on the position. A sample evaluation form was also provided, which provides a point scale evaluation system evaluating different job and skill expectations, a discussion of employee accomplishments, employee goals and objectives, and additional comments. During the RUBA visit to the community in May, water operator staff made it known that they did not currently have a job description anywhere on file. RUBA staff consulted with the utility manager about this problem, but has not been notified of any progress with this issue. The finance director also maintains all personnel files, which include at a minimum an I-9, W4, copy of identification, and memorandum of hire (letter of acceptance). Job applications have not been maintained for employees who have been with the city for an extended period, and are not being completed with all new employees. The utility encourages training and educational opportunities for all employees; refer to the Organizational Management section of this report for more information on this topic.

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 and Borough of Yakutat owns and operates the community’s water/wastewater utility. Municipal code chapter 11.30 addresses the utility, including its ownership, rules, regulations, and authority. The borough assembly is the policy-making body for the utility and meets for one regular meeting monthly, as well as additional special meetings as needed. All meetings are noticed in accordance with the Open Meetings Act and minutes are approved and maintained in the city office. The borough assembly adopted an organizational chart in August 2008, which lays out boards and committees, and clearly portrays lines of supervisory authority for all employees within the borough and utility. There are two new water utility operators for the City and Borough of Yakutat. The utility manager has worked in his current position for eight or nine years, but is retiring in September 2014. The utility manager intends to hire a replacement before retiring. The two new water operators do not have any certifications, but have shown enthusiasm to obtain the certifications needed. RUBA staff worked with finance staff to include additional money in the FY15 budget for travel and per-diem associated with the water operator certifications. Administrative staff and finance staff have completed relevant certifications and are encouraged to attend trainings whenever available. The utility billing clerk attended the RUBA Financial Management for Rural Utilities training in January 2014. The assistant billing clerk attended the same training in March 2014.

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.
No The utility maintains a critical spare parts list.
Operation of Utility Comments
The two newly hired water operators, and the city government, have given verbal confirmation that they will actively pursue necessary water operator certifications. Both of the new water operators for the City and Borough of Yakutat were hired in April and early May respectively. The utility maintains a written preventative maintenance program including daily, weekly, monthly, quarterly, semi-annual, and annual tasks. A copy of the plan is available on file. The plan is carried out by the water operator and supervised by the primary water operator. Status reports are provided regularly to the borough manager, who passes information along to the assembly as needed. An inventory control list and critical spare parts list has been created through the asset management system, with the assistance of SouthEast Alaska Regional Health Consortium (SEARHC); however, during the May RUBA visit, the computer that had the inventory list was missing. The computer was found and RUBA staff confirmed that it was returned to the city government. The Consumer Confidence Report data file for 2014 has been given to the community, and the community has been encouraged, by RUBA staff, to complete and distribute the report by the July 1 deadline. The utility has not been on the Significant Non-Complier (SNC) list for several years and conducts water testing monthly, as required. The City and Borough of Yakutat has a Safety and Health Policy Plan for Public Works Department, which all utilities follow, as adopted in June 2008. The plan covers topics including a safety plan, worksite analyses, hazard prevention and control plan, safety and health training plan, incident procedures, record keeping, confined space plan and other like plans regarding specific procedures such as excavation work, emergency action plan, hazard communication program, lockout/tagout program, equipment procedures, personal protective equipment plan, respiratory protection program. All personnel are required to participate in the adjoining training plans for each item relevant to them, and a certificate of acknowledgement and completion is completed and placed in their personnel file. Additionally, the utility participates in the monthly AMLJIA safety meeting via teleconference. This serves as an opportunity for personnel to remain fresh and informed on all matters of safety, and also provides a cash discount on the cost of the utility’s insurance.