|The city has not yet adopted an FY10 annual budget. The budget is drafted and was scheduled to go to the council for first reading on December 8, 2009; however, the council failed to achieve a quorum and the meeting was postponed to an unfixed date. Until the budget is finalized and adopted by the council, the city does not meet any essential or sustainable indicators involving the budget.
The administrator has previously made only verbal financial reports to the council on a monthly basis. Until recently, there were internal errors with the QuickBooks program which caused inaccurate information to appear on the financial reports. The city hired Tammy Stromberg, CPA of Aurora Corporate Enterprises Inc., as an independent contractor to correct the problems with the QuickBooks program. After months of working on the accounting system, the contractor reports that there are still a few problems but the accounting system is now generally accurate and useful. The city has started using three separate profit and loss statements to communicate financial information to the council on the enterprise funds, general fund, and capital projects. The Administrator understands that as a condition for passing the monthly financial report essential indicator, the utility budget information must be entered into the accounting system. This will make it possible to provide budget versus actual financial reports to the council on a monthly basis.
Electricity is provided through Alaska Power and Telephone Company. A visual inspection of the most recent electricity billings verifies that the city is current with all electricity accounts for the water and wastewater utilities through November 2009.
The city has two 275 gallon fuel tanks for heating fuel, located at city hall and the water treatment plant. The city receives fuel deliveries from Petro Marine in Craig on an as needed basis. The city usually maintains a one to three month fuel supply however theft of fuel from the city tanks has become an increasing problem. There are locking caps on the tanks and the city attempts to keep the tanks locked however on occasion they have found the locks cut. The administrator recently replaced the locks with a higher security type which he hopes will solve the fuel theft problem. The city has adequate funds available and purchases fuel as needed.
The governing body is fully aware that user fees do not produce sufficient income to cover operating expenses or repair and replacement (R and R) costs. It has been a general practice for the city to use whatever sources of money that are available to subsidize utility's operating expenses. The city has in the past had to resort to deferring payment of other city obligations to ensure the continued operations of the water treatment plant. The administrator and mayor have expressed their desire to start enforcing the city's collections policy and addressing the utility rates that have not been changed in several years. In December 2009, the mayor published and sent out a newsletter informing residents of the new utility bill collection procedures that will be imposed starting January 1, 2010.
The city administrator, who also serves as the utility manager gives both verbal and written status report to the council at monthly meetings. Written reports are usually timely and comprehensive. The administrator recently completed a 44-page report identifying financial and maintenance concerns with the water, wastewater, and solid waste utilities.