Quarterly Report: 2013, April - June (Q4), McGrath

Community:
McGrath 
Staff:
Jedediah Smith  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of McGrath 
Population:
315  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
7/24/2013 
Community Sanitation Overview:
McGrath operates a piped water system that serves nearly all 178 households; a few homes have individual wells or haul water. The FAA operates its own water system. The majority of residents use individual wastewater tanks; a limited city wastewater system serves approximately 34 homes. Funds have been requested to expand the piped wastewater system to the 144 houses and businesses currently using wastewater tanks. McGrath is poised to begin substantial upgrades of its water treatment plant. Design and engineering phases of this project are complete. Erosion control is a critical issue, as the water treatment facility is located next to the river. The cost of moving the facility would triple the costs of the upgrade. The city has applied for funding to complete their erosion control project, ensuring the integrity of the water treatment facility. 
RUBA Status & Activities This Qtr:
The City of McGrath contacted RUBA staff regarding the language contained in the city's bed tax ordinance. Staff reviewed the ordinance with the state tax assessor and determined the ordinance was sufficient, though made some minor recommendations to strengthen the language. After further discussion with the administrator, RUBA staff determined the city is having challenges with compliance and enforcement of the ordinance. RUBA staff referred to similar ordinances in other communities. RUBA staff will continue to work with the administrator on enforcement alternatives as requested. 
RUBA Activities for the Coming Qtr:
RUBA staff will continue to work with McGrath city staff as requested.
Scores:
 
Essential Indicators:
24 of 26
Sustainable Indicators:
27 of 27
Total Score:
51 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 administrator and clerk are making final preparations for the FY14 budget, which is expected to pass the city council prior to July 1. The City of McGrath adopted the FY13 operating budget on June 26, 2012 with Ordinance 12-05. The water utility revenues exceed the expenses and the city carries a surplus of approximately $30,000. The council had previously received a profit and loss statement for the monthly financial report. The council is receiving budget vs. actual reports at the monthly meeting, based on previous recommendations from RUBA staff. The budget includes a line item for repair and maintenance costs, but does not include a fund for the replacement of the system. A bill from the McGrath Light and Power Company indicates the utility is current in its electric payments. The City of McGrath received its annual fuel delivery in July. A manager's report is prepared monthly for the council. Budget amendments are completed and adopted as necessary.

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
The utility has adopted a collections policy which is described in the McGrath Code of Ordinances 13.04.440. The city provided RUBA staff with a sample water utility bill. Customers are billed on a regular basis. The city uses QuickBooks Pro 2012 to track all financial transactions of the utility and other city finances, including accounts payable and payroll. The city maintains a comprehensive and organized chart of accounts that address appropriate line items. Purchases for the utility are discussed between the administrator and lead operator to confirm the purchase is necessary and also to identify if funds are available in the budget. Decisions outside of budgetary line items are made based on the determination of necessity and available general funds.

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.
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
As of June 18th, McGrath had not returned a signed authorization to request tax information. According to the Department of Labor on June 18, McGrath had not made its quarterly payment. McGrath is not listed in the April 2013 lien watch report.

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.
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 has purchased a Workers Compensation policy through Alaska Municipal League Joint Insurance Association (AMLJIA). The policy is effective from July 1, 2012-June 30, 2013. RUBA staff was provided with copies of the utility's personnel policies and job descriptions. The City of McGrath has an employee handbook that has a hiring and evaluation process, reference to personnel folders, a 90-day probationary period for all new hires, and promotions or transfers and other important information for a newly hired or rehired city employee. The city encourages employee training.

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
McGrath owns the utility and has an ordinance code 13.04.010 which addresses service provided standards for the water utility and clearly states what and how services are provided. The McGrath city council members are active in policy making for the utility and enforces those polices. The city administrator acts as the utility manager, the utility foreman reports to the city administrator. The city administrator has over six years experience with the City of McGrath. The administrator has been awarded the 2005 Alaska Water and Wastewater Management Association (AWWMA)System Manager of the Year and has been recognized by Tanana Chiefs Council for outstanding dedication to the McGrath Water System. The utility foreman has three plus years of experience and has been with the city for the last year. There are two water operators employed by the city. One operator has certification in Water Treatment 1 and Water Distribution 1, which expired on December 31, 2012. The other operator has certification in Water Distribution II and Water Treatment II valid through December 31, 2015. and has met the required continuing education units. The bookkeeper has been at the position for over two years and is a certified municipal clerk with the Alaska Association of Municipal Clerks and also has attended clerks training presented by Alaska Municipal League (AML).

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
In addition to the utility foreman, there are two water operators employed by the city. One operator has certification in Water Treatment II and Water Distribution II, which expires on 12/31/2015. The second operator has a Level I provisional certification. The city also hopes to take on a volunteer through Alaska Job Corps who would like to acquire working hours in order to become eligible for a Level I exam and certification. Utility employees hold regular safety meetings and have a safety manual on hand. The utility has not had any significant outages due to management issues. The utility maintains a monthly preventative maintenance checklist for the water utility. The checklist includes maintenance of the river pump, inspection of chemical feed pump and injection point for fluoridation, inspection of chemical feed pumps for chlorination system and clearing sediment, inspection of tank farm valves, alarm panel battery backup system and pressure relief valve in the boiler. The City of McGrath has a current Consumer Confidence Report on file at the utility. The city is not on the April 2013 Significant Non-Compliance list. The utility has an inventory control list and critical spare parts list and copies were provided.