Quarterly Report: 2014, January - March (Q3), Mekoryuk

Community:
Mekoryuk 
Staff:
Fred Broerman  
DCRA Regional Office:
Bethel regional office 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Mekoryuk 
Population:
201 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
8/7/2012 
Exp Date:
 
Last Updated:
4/2/2014 
Community Sanitation Overview:
The City of Mekoryuk has a population of about 215 and manages the water treatment plant and washeteria. In the 1970s, the community had an underground piped water system installed that failed due to winter freeze ups. Later, the city received an early version of the Cowater Flush Tank and Haul? water and wastewater systems which is still being used in ninety-six homes and eleven commercial establishments. Homes do not have washers and less than half city residences have working baths or showers. Therefore, the washeteria is used by nearly all city residents. The city has a nine million gallon lined reservoir, a hundred and twenty-five thousand gallon water storage tank, and a 4.2 acre wastewater lagoon. The Lower Kuskokwim School District has its own well but uses the city's wastewater lagoon. The city would like to be considered for funding for a piped water and wastewater system. 
RUBA Status & Activities This Qtr:
Bethel RUBA staff sent out quarterly RUBA information requests on March 19, 2014. The city provided most of the documents that were requested. Bethel RUBA staff attended March 25, 2014 joint tribal-city council meeting in which the city council was considering an ordinance to raise water and wastewater haul and washeteria rates. Dissolution of the city government was also discussed at the meeting. During the discussion about the raising water haul and washeteria rates city council indicated it wanted to give utility workers a raise, but residential customers were not keeping current on their flush and haul payments. The mayor also highlighted the costs of running the washeteria and the cash shortfall the city was incurring each month by continuing to keep it open. Even with the well documented presentation, nearly all public comment was against raising the rates. Bethel RUBA staff was called on during the discussion and provided insights and lessons learned from other city and tribal governments operating washeterias. When the meeting's discussion turned to dissolution of the city government Bethel staff pointed out that Community Revenue Sharing and PILT payments were currently being used to subsidize the $64,000 year-to-date washeteria revenue shortfall. RUBA staff asked if the tribe had funding to cover these expenses if the IRA became the owner of the waterplant/washeteria once the city was dissolved. 
RUBA Activities for the Coming Qtr:
Bethel staff is available to work with the municipality's administrative staff to bring the city's RUBA essential and sustainable indicators into compliance.
Scores:
 
Essential Indicators:
17 of 27
Sustainable Indicators:
16 of 27
Total Score:
33 of 54

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.
No 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
A copy of the City of Mekoryuk's FY 2014 Operating Budget and accompanying ordinance is on file at the Bethel regional office and it appears to be balanced and realistic. Minutes for December 2, 2013, and January 2 and February 3, 2014 city council meetings were provided. The minutes mentioned city council reviewing and accepting monthly financial reports for November, and December 2013, and January 2014. The city administrator provided the Bethel RUBA regional office with the city's FY14 budget/multi-month financial report spreadsheet updated through February 2014. The financial report indicates that after 8 months into FY14 the utility is not receiving revenues (from customer payments) equal to or above those budgeted and year to date expenditures are running higher than what were budgeted. The city's overall revenues do not look like they will keep up with the pace of its expenditures. An April 2, 2014 phone conversation with Alaska Village Electric Cooperative (AVEC) indicated that the city has a $634 30 day past due balance on its electric accounts. On September 3, 2013, the city received 18,000 gallons of heating fuel from the Seattle Support Center. On September 5, 2013 the administrator indicated the city should have enough heating fuel for the winter of 2013/2014. The city's FY14 budget does not have a repair and replacement line item for the water and sewer department.

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.
No 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.
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
No 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
An electronic copy of 'City of Mekoryuk Water and Sewer Utilities Credit and Collection Policy and Procedures' adopted on November 11, 2009 is on file at the Bethel regional office. A more recent ordinance '2012-03 Mekoryuk Washeteria Increase' adopted on June 18, 2012 establishes new rates for washeteria services. According to the administrator, the city has established an unwritten policy that if a residential account for water and wastewater services has a balance over $79.30 (the cost of two water or wastewater hauls) the city will not provide the next water or waste haul until the balance is paid down by $39.65 or $32.50 for seniors. However, during a joint city-tribal council meeting held on March 25, 2014, city council informed about sixty community members that the city was considering an ordinance to raise it rates for its water and wastewater haul services because utility workers needed a raise and residential customers were not keeping current on their payments. A March 20, 2014 accounts receivable aging report for the utility supports city council concerns, showing significant 30, 60 and 90 past due balances on customer accounts. During the joint council meeting community members expressed concerns about the city double billing customers. When cash is received for utility payments, the customer receives a receipt and the transaction is entered into QuickBooks. The city does not have an accounts payable system in place capable of showing all vendors that money is owed to. A chart of accounts was provided by the city administrator on September 5, 2013. However, categories listed in the chart of the accounts do not mimic the categories found on the FY14 budget so the two can be easily compared. The city's chart of accounts needs streamlined so it is nearly identical to line item budget categories. An in-house check request is required when an employee needs to purchase parts, supplies and equipment. The city provided the Bethel RUBA regional office with statements and reconciliation summaries to its general checking account for January and February 2014. An undated city document titled 'Purchasing Procedures' is on file at the Bethel regional office.

Tax Problems

Essential Indicators
Answer Question
Yes The utility has a system to accurately calculate, track, and report payroll tax liabilities.
No 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
A March 18, 2014 fax correspondence from IRS indicates the city is not compliant with federal tax payments and reporting requirements for tax year 2009. A March 21, 2014 email correspondence from Alaska Department of Labor's Anchorage office indicates that the City of Mekoryuk is compliant with its Employment Security Tax payments and reporting requirements through December 31, 2013. The city is not listed on the January-February 2014 LIEN WATCH: A Review of Small Community Liens.

Personnel System

Essential Indicators
Answer Question
Yes 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
A Decemeber 18, 2013 query done on the Department of Labor's Worker's Compensation employer database indicates that the city has workers' compensation insurance for its employees through Alaska National Insurance Company. A copy of City of Mekoryuk Utility Policies and Procedures (the city's personnel policy) revised on August 10, 2009 is electronically filed at the Bethel regional office. Documentation that the personnel policy has been adopted by city council has not been provided. Until the Bethel RUBA office is provided with verification that the city's personnel policy has been adopted by city council the first sustainable indicator of this section will be marked 'No'. Written job descriptions for the city administrator, bookkeeper, and washeteria supervisor were provided on July 24, 2012. But job descriptions for the maintenance supervisor, assistant and alternate operators and the washeteria attendants were not provided. Therefore, the sustainable indicator of this section which states: 'The utility has adequate written job descriptions for all positions' is marked 'No'. The city has not provided documentation that it follows a written personnel evaluation process that ties employees' job descriptions to their evaluations, or that it has an adequate written hiring process. Not including city council members, the city of Mekoryuk has about 12 employees. On June 18, 2012, Bethel RUBA staff reviewed three of the city's employee personnel files. None of the three folders had the employee's application or a letter of acceptance and one of them did not have an I-9. For RUBA compliance, all personnel files should contain the employee's application file, letter of acceptance (that includes the wages, benefits, expectations of the employer, classification of job, and date of hire) and a completed federal I-9 form. The city has sent its administrative staff to several RUBA sponsored trainings during the last two years.

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.
No The policy making body enforces utility policy.
Yes The utility has an adequately trained manager.
Yes The utility has an adequately trained bookkeeper.
No 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
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 Bethel regional office has an unsigned copy of the City of Mekoryuk's Flush Tank Haul and Water Haul Tank System Ordinance 94.04 on file. The city needs to provide the Bethel regional office verification that the ordinance has been adopted. A more recent ordinance '2012-03 Mekoryuk Washeteria Increase' adopted on June 18, 2012 establishes new rates for washeteria services. According to the administrator, the city has established an unwritten policy that if a residential account for water and wastewater services has a balance over $79.30 (the cost of two water or wastewater hauls) the city will not provide the next water or waste haul until the balance is paid down by $39.65 or $32.50 for seniors. However, during a joint city-tribal council meeting held on March 25, 2014, city council informed about sixty community members that the city was considering an ordinance to raise the rates for its water and wastewater haul services because utility workers needed a raise and residential customers were not keeping current on their payments. A March 20, 2014 accounts receivable aging report for the utility supports city council concerns, showing significant 30, 60 and 90 past due balances on customer accounts. The city's water treatment plant is classified as a Water Treatment Class I facility. However, the city's washeteria supervisor only has a Small Water System Treated certification. Therefore, the washeteria supervisor will need to pass the Water Treatment provisional test and accrue on-the-job training hours before he can be certified to the level of the city's water plant. On August 30, 2012, city council adopted by resolution an updated organization chart for the municipality which is electronically filed at the Bethel regional office. City council attempts to meet at least monthly pursuant to Alaska Title 29. Public notification of meetings and the manner in which they are conducted are in accordance with Alaska's Open Meeting Act or otherwise stated in local ordinances.

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.
Yes The utility maintains an inventory control list.
Yes The utility maintains a critical spare parts list.
Operation of Utility Comments
The city's water treatment plant is classified as a Water Treatment Class I facility. However, the city's washeteria supervisor only has a Small Water System Treated certification. Therefore, the washeteria supervisor will need to pass the Water Treatment provisional test and accrue on-the-job training hours before he can be certified to the level of the city's water plant. A Draft Operation and Maintenance (OM) Manual dated March 2012 is electronically filed at the Bethel regional office. The OM Manual contains a preventative maintenance plan and a critical spare parts list. An FY 2009-2010 Water and Sewer Inventory Control List is on file at the Bethel regional office. A more recent version should be submitted. The water operator reports to the city administrator the status of facility operations on a daily basis. A copy of the city's 2012 Consumer Confidence Report (CCR) is electronically filed at the Bethel RUBA office along with a certification form signed by the washeteria supervisor on July 22, 2013 indicating the CCR was distributed and posted in the community. The city's water treatment system is not on the January 2014 Significant Non-Complier (SNC) list.