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Capacity Indicator: Finances
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Essential Indicators
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Yes
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All revenues and expenses for the utility are listed in the utility budget. |
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Yes
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The utility has adopted a balanced realistic budget. |
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No
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Monthly financial reports are prepared and submitted to the policy making board. |
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Yes
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The utility is current in paying all water/wastewater electric bills. |
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Yes
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The utility has on hand a year's adequate fuel supply or it has a financial plan to purchase an adequate supply. |
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No
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The utility is receiving revenues (user fees or other sources) sufficient to cover operating expenses. |
Sustainable Indicators
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No
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The utility is receiving revenues (user fees or other sources sufficient to cover operating expenses and Repair & Replacement (R) costs. |
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No
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YTD revenues are at a level equal to or above those budgeted. |
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No
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YTD expenditures are at a level equal to or below those budgeted. |
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No
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A monthly manager's report is prepared. |
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No
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Budget amendments are completed and adopted as necessary. |
| Finances Comment: |
Gustavus' fiscal year runs from July 1 to June 30. The last budget received from the city was for FY11. Subsequent budgets have been requested, but not yet received. As of FY10, the municipal budget is a segmented set of smaller budgets for all city departments, committees, and business-type activities, with each having its own income and expense projections. The budget ordinance does not include a comparative statement of actual expenditures and revenues for the preceding fiscal year, nor does it include a budget summary of consolidated revenues and expenditures for the city as a whole.
Both the Gustavus Community Network (GCN) and the Gustavus Solid Waste Disposal and Recycling Center (GDRC) are accounted for independently. Both budgets adequately illustrate revenues and expenses for each utility service and have revenue projections equal to expenditures after a general fund transfer is applied.
The Gustavus Code of Ordinances requires that the treasurer provide a balance sheet, as well as a profit and loss budget overview, to the city council each quarter. The city clerk, acting as the treasurer, follows this guideline by submitting an accrual-based budget vs. actual profit and loss statement and a detailed profit and loss statement to the utility advisory committees at their quarterly workshops.
The city is not currently providing back-up documentation. Therefore, it is not possible to confirm the above indicators at this time. However, the clerk has previously confirmed that the city is up-to-date with its payments to the Gustavus Electric Company. While approximately 90% of Gustavus' energy needs are met by its hydroelectric facilities, the community also has a privately-owned and operated bulk fuel facility. That facility is comprised of gasoline, aviation fuel, #1 diesel, and #2 diesel storage tanks. The city has adequate funds available and purchases fuel as needed from its vendor, Gustavus Dray. The city reports that the Gustavus Dray fuel facility consistently meets the fuel capacity needs of the community. Dray reported during the last Fuel Watch that they were able to keep up with all fo the fuel needs of the community, obtaining fuel by barge when needed.
The community offsets the cost of providing internet and solid waste disposal services by charging user fees. Utility user fee revenues account for 100% of the internet enterprise and approximately 59% of the solid waste disposal utility budget. The governing body has elected to subsidize the solid waste utility with an annual appropriation. The last financial reports that were received showed that the city had sufficient general fund revenues to sustain the solid waste utility and that the subsidy is sufficient to cover operating expenses and repair and replacement costs. The city has also established a reserve fund for the Gustavus Community Network and a landfill closure fund for closing and opening new cells at the solid waste disposal and recycling center.
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Capacity Indicator: Accounting Systems
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Essential Indicators
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Yes
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The utility has adopted a collection policy and actively follows it. |
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Yes
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The utility bills customers on a regular basis. |
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Yes
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An accounts receivable system is in place which tracks customers and reports past due accounts and amounts. |
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Yes
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An accounts payable system is in place. |
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Yes
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The payroll system correctly calculates payroll and keeps records. |
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Yes
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A cash receipt system is in place that records incoming money and how it was spent. |
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Yes
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The utility has a cash disbursement system that records how money was spent. |
Sustainable Indicators
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Yes
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A chart of accounts is used that identifies categories in a reasonable, usable manner. |
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No
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Monthly bank reconciliations have been completed for all utility accounts. |
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Yes
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The utility has a purchasing system that requires approval prior to purchase, and the approval process compares proposed purchases to budgeted amounts. |
| Accounting Systems Comment: |
The city has adopted a collections policy, which is outlined in Title 6 of the Gustavus Code of Ordinances (GCO). The policy clearly refuses service to non-paying customers. The Gustavus Disposal and Recycling Center (GDRC) will only accept checks collected when the customer disposes solid waste at the facility and the Gustavus Community Network operates with pre-paid membership fees. In the latter system, a customer may purchase a monthly, quarterly, or semi-annual membership. Prior to the end of the membership period, the customer will receive an email invoice and reminder to renew their membership. If the customer fails to renew their membership 20 days after the end of the membership period, the customer's internet service is automatically disconnected.
The Gustavus Community Network (GCN) primarily receives customer payments through FreeSide, an online payment system. FreeSide is a billing and account administration package, specifically designed for Internet Service Providers. Customer payments and records are maintained with the FreeSide software. These payments are directly deposited into the GCN bank account. The corresponding deposits are reported to the city clerk monthly which are then recorded into QuickBooks as 'GCN income'.
The GDRC discourages and rarely handles cash payments. When a cash payment is received, the transaction is recorded in the daily log and the manager then takes the cash to the post office to exchange it for a postal money order. Checks and money orders are turned over to the city clerk for deposit into the GDRC bank account. The utility rarely extends credit to customers using the facility. The only exception to the immediate payment for service policy is when a particular business has prearranged with the manager to be invoiced for solid waste services.
Customer payments, invoices, and records are maintained in Excel and reported to the clerk monthly to be entered into QuickBooks. Invoices for solid waste services are given at the time of delivery. Reminder notices on past-due amounts are sent out monthly and future services are denied until prior obligations are met. The city clerk also reconciles the utility's bank account monthly and uses QuickBooks to manage the city's accounts payable and payroll systems. It is not presently possible to confirm that monthly bank reconciliations are being completely. However, they have in the past been consistently maintained.
Gustavus uses a purchase order system for all purchases and maintains a cash disbursement system to track expenditures. Department heads complete purchase orders which are then submitted for approval. The clerk, mayor, and vice-mayor have approving authority over these purchase orders. The clerk reports that purchase orders are compared to the budget, and very close attention is given to the remaining budget and anticipated future expenditures.
Further, the city has an adequate chart of accounts, which is a customized version of the standard QuickBooks version. Some accounts have been added to accommodate the enterprise funds and to allow financial transactions to be properly classified. The chart of accounts lists all of the accounts in the general ledger and is identified by a four digit reference number.
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Capacity Indicator: Tax Problems
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Essential Indicators
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Yes
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The utility has a system to accurately calculate, track, and report payroll tax liabilities. |
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No
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The utility is current on filing tax reports. |
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No
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The utility is current on making tax deposits. |
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No
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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 Comment: |
Gustavus uses QuickBooks Pro to calculate, track, and report its payroll tax liabilities. QuickBooks Pro also allows the treasurer to makes electronic payments using the Electronic Federal Tax Payment System (EFTPS).
The city has not authorized RUBA staff to obtain federal tax information from the Internal Revenue Service (IRS) despite several requests. On March 19, 2013, RUBA staff confirmed with the Alaska Department of Labor and Workforce Development (ADOLWD) that the city is in compliance with its employment security tax. The community has not received any correspondence from the IRS or from ADOLWD requesting any further documentation within the last year.
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Capacity Indicator: Personnel System
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Essential Indicators
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Yes
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The utility has a posted workers compensation insurance policy in effect. |
Sustainable Indicators
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No
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The utility has adopted and uses a Personnel Policy, which has been reviewed by an attorney, AML or Commerce for topics and language. |
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No
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The utility has adequate written job descriptions for all positions. |
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Yes
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The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation. |
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Yes
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The utility has an adequate written hiring process. |
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Yes
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The utility has personnel folders on every employee that contain at least: I-9, Job Application and Letter of Acceptance. |
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Yes
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The utility has a probationary period for new hires that includes orientation, job training/oversight, and evaluations. |
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Yes
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The utility provides training opportunities to staff as needed and available. |
| Personnel System Comment: |
Current coverage for workers compensation insurance was verified through Alaska Public Entity Insurance Company (APEI). That policy is effective as of December 12, 2012 and covers work-related accidents and occupational diseases up to the Alaska statutory limits for each occurrence. The city clerk has posted proof of coverage at the city hall, the Solid Waste Disposal and Recycling Center (DRC), and the fire hall. In addition to workers' compensation insurance, the APEI municipality insurance policy includes general liability, automobile, and property insurance coverage.
The city has adopted a personnel policy in Title 3 of the GCO. However, the policy has not been updated since 2004 and the city has not consolidated its policy into an employee handbook. The policy also does not provide adequate guidance for employees in the areas of hiring, conditions of employment, compensation, evaluation, discipline, grievances, employee benefits, travel, or training. The utility further lacks written job descriptions for all of its employees.
The city does, however, keep records relating to its employees in a personnel file. RUBA staff reviewed sample personnel files and found that they are well-organized and contain all the necessary employee documents. The city clerk has also confirmed that all employee files are considered strictly confidential.
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Capacity Indicator: Organizational Management
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Essential Indicators
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Yes
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The entity that owns the utility is known; the entity that will operate the utility is set. |
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Yes
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The policy making body is active in policy making of the utility. |
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Yes
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The policy making body enforces utility policy. |
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Yes
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The utility has an adequately trained manager. |
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Yes
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The utility has an adequately trained bookkeeper. |
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Yes
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The utility has an adequately trained operator or operators. |
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Yes
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The utility has adopted the necessary ordinances (or rules and regulations) necessary to give it the authority to operate. |
Sustainable Indicators
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No
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The utility has adopted an organizational chart that reflects the current structure. |
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Yes
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The policy making body meets as required. |
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Yes
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The utility complies with the open meeting act for all meetings. |
| Organizational Management Comment: |
The mission of the Solid Waste Disposal and Recycling Center and its subsidiary, the Community Chest, is to reuse locally or to recycle as much material from the community's waste stream as possible. Nonreusable or nonrecyclable items are disposed of in the community's permitted landfill or waste is shipped out of the community. The Solid Waste Disposal and Recycling Center began operation in 1994, when the Gustavus Community Association received a permit to operate a landfill facility. In 1998, the Gustavus Community Association opened a thrift store known as the Community Chest. The purpose behind the Community Chest was to reduce the amount of waste deposited into the landfill. The Community Chest accepts reusable household items such as used clothes, household goods, books, hardware, and small electronic devices to be resold through their volunteer-staffed store, with all proceeds benefiting local projects. After the community incorporated as a second class city in 2004, the Gustavus Landfill and Community Chest became a city department under the oversight of the Solid Waste Disposal and Recycling committee.
In 1996, Gustavus was one of six Southeast Alaska communities to connect to the internet as part of the SEAKNET program. Grants through the Alaska State Library and the National Technological Infrastructure Administration paid for the initial set-up, connection and a year of basic operating costs. By July 1997, Gustavus SEAKNET was completely self-supporting through user fees and became a function of the Gustavus Community Association. In January 2002, the network switched to a satellite service and was renamed Gustavus Community Network (GCN). After the community incorporated as a second class city in 2004, the Gustavus Community Network (GCN) became a city enterprise.
The operational structure of the Solid Waste Disposal and Recycling Center (DRC) and the Gustavus Community Network (GCN) is that of an advisory utility board. The GCN and the DRC have board members appointed by the city council. Municipal code allows the utility board to set fees and prices for services. The utility board assumes most of the responsibility for the utility, while the council retains the right to make the final decision on all actions.
The city council is the formal governing body and meeting minutes verify that it is actively engaged in making decisions on behalf of the utilities. The city council meets on the first and third Thursdays of each month for work sessions and the second Thursday for regular council meetings. The council holds additional work sessions or special meetings when necessary. The city complies with open meeting requirements and posts meetings in accordance with local code and state statutes. Meeting notices are posted at the city hall, grocery store, and post office at least five days in advance of the meeting.
The council has adopted all the ordinances necessary to own and operate the utility services. Title 6, Chapter 3, of the GCO establishes the policies and procedures for the operation and maintenance of the Disposal and Recycling Center (DRC). Title 6, Chapter 5, establishes the municipal Internet Service known as the Gustavus Community Network.
The city does not have a current organizational chart for the utility services.
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Capacity Indicator: Operation of Utility
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Essential Indicators
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Yes
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The utility operator(s) are actively working towards necessary certification. |
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Yes
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The utility has a preventative maintenance plan developed for the existing sanitation facilities. |
Sustainable Indicators
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Yes
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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. |
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No
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The utility has a safety manual and holds safety meetings. |
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Yes
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Utility facilities have not suffered any major problems/outages due to management issues that are unresolved. |
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Yes
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The utility is operating at the level of service that was proposed. |
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Yes
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The operator provides status reports to the manager on a routine basis. |
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Yes
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The utility has completed and distributed its "Consumer Confidence Report". |
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Yes
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The utility is not on the "Significant Non-Complier" (SNC) list. |
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Yes
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The utility maintains an inventory control list. |
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Yes
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The utility maintains a critical spare parts list. |
| Operation of Utility Comment: |
The Gustavus Disposal and Recycling Center (GDRC) manager is certified through the Solid Waste Association of North America (SWANA) as a certified landfill manager. SWANA is a national professional association which sponsors an annual conference, conducts training, and awards credentials for solid waste management professionals. The community has a Class A small water system, and is operated by a Level 2 certified primary operator and two backup operators. Certifications will expire 12/31/14. The primary water operator has met all CEU requirements.
The manager of the GDRC has a preventative maintenance plan for utility vehicles and landfill heavy equipment. There is also an Occupational Safety and Health Administration handbook on sight. While GDRC employees report being safety-minded, safety meetings are not held regularly.
A daily log of significant activities is indeed maintained and monthly written reports for the city council and the DRC committee are prepared by the GDRC manager. Monthly reports include utility income and expenses, the pounds of solid waste and recyclables processed, the number of customers, the days of operation, and the amount of solid waste shipped out of the community. In addition to the monthly written reports, the manager prepares a detailed annual report for the council, DRC committee, and community members. The annual report provides narrative explanations, detailed customer-usage statistics, and an overview of the financial condition of the utility.
City staff reports that both the GDRC and Community Network are operating at the proposed level of service. Neither utility has suffered any major problems or outages due to management issues.
The community does not currently operate a public water system. Therefore, the sustainable indicators for the Consumer Confidence Report and Significant Non-Compliance list are not applicable to Gustavus' current management practices.
The Gustavus Community Network and the GDRC both have an inventory control list and critical spare parts list. A detailed inventory of utility equipment and spare parts is also maintained at both utilities. These inventory lists provide replacement information, product cost, quantity, and the physical location of equipment and parts.
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