RUBA Community Status Report

Community Name: Hydaburg


Community:

Hydaburg

RUBA:

Yes

Staff:

Rocky Estrada

Agreement:

Yes

DCA Region:

Juneau

Agreement Date:

10/29/2012

Region:

Southeast

Exp Date:

10/29/2014

Govt Type(s):

1st Class City

Borough:

Unorganized

Assessment Date:

9/18/2012

Population:

376

Active Community:

Yes

Date Updated:

10/4/2013


Community Sanitation Overview:

The City of Hydaburg is located on the southwest coast of Prince of Wales Island, 45 air miles northwest of Ketchikan. It is connected by paved road to several other communities on the island. Water is derived from the Hydaburg River, treated, and piped throughout the community. Funds have been requested to construct a new dam to increase the water supply. Piped gravity wastewater is treated at a secondary treatment plant with an 800-foot outfall to Sukkwaw Strait. More than 95 percent of homes in Hydaburg are plumbed. The city operates a Class 2 water treatment system, a Class 1 water distribution system, and a Class 1 wastewater collection system. These system classifications are determined by the State of Alaska's Department of Environmental Conservation, Division of Water based on the type of components found in the treatment plant and the number of connections served by the water distribution and wastewater collection systems. Alaska Power and Telephone Co., based in Skagway, owns and operates diesel power systems in Hydaburg and Craig, which provide electricity to many Prince of Wales Island communities.

RUBA Status
and Activities
this Quarter:

This quarter, Juneau RUBA staff traveled to the City of Hydaburg, to assist with tax compliance issues, financial reporting improvements, and revisions to budget categories for clarification purposes. The city is now meeting RUBA indicators pertaining to adopting a balanced and realistic budget. This will assist in managing finances over the course of the year, and ensure the community is managing its water utility in a financially sustainable manner. The city is attempting to identify new sources of revenue, in the face of decreasing federal and state funding sources. RUBA staff assisted in finding information and drafting paperwork for new means of collecting revenue for the city, including appropriate ordinances to adopt a Motor Vehicle Registration Tax, increasing the city's sales and use tax from three percent to five percent, and amending the city's traffic code to collect on traffic violation fines within the community. RUBA staff also attended a special meeting of the city council, and met with the water utility's primary operator and manager. Staff provided evidence of 2012 CCR completion, and discussed the disconnection of a recently installed corrosion control system, due to the taste and feel of the water. The city's turbidimeter has returned from repairs and is now working again. Water quality over the summer has been a struggle, due to great fluctuations in the amount of rainfall affecting the water. The city also has several wastewater issues, particularly a temporary outfall into an area utilized by community members for fishing and recreation. ANTHC has allocated about half of the money needed to install lift stations and make necessary improvements to the wastewater collection system to eliminate the need for the temporary outfall. RUBA staff will be recommending a follow-up visit from the RUBA sponsored QuickBooks hotline in order to train the new treasurer and assist in final conversions to the city's new QuickBooks file, and will provide other assistance as requested. RUBA staff also attended the city council meeting and provided information to the council regarding RUBA. Additionally this quarter, RUBA provided remote assistance with personnel issues, audit and tax issues, codification, the FY14 budget, and staff changes.

 

Capacity Indicator: Finances

Essential Indicators:

Yes

All revenues and expenses for the utility are listed in the utility budget.

Yes

The utility has adopted a balanced realistic budget.

No

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:

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.

Comment:

The City of Hydaburg adopted their FY14 budget by non-code ordinance on June 18, 2013. The overall budget is balanced. The budget is divided into separate funds with each fund listing anticipated revenues and expenses. The funds include a general fund, a capital project fund, a harbor deferred maintenance fund, a water wastewater upgrade fund, a water-wastewater-garbage fund, and a harbor and docks fund. Each fund's budget compares proposed income and expenses to the previous year's adopted figures and include comparative statements of actual expenditures and revenues for the preceding fiscal year as required by Hydaburg Municipal Code. Though, the adopted budget does not include proposed transfers from other fund sources for any of the account funds, staff have indicated that community revenue sharing is being used to cover the costs. The FY14 Water, Sewer, and Garbage fund budget anticipates $121,540 in income from monthly user fees, although only $105,305 was received in FY13. This is a realistic amount as the city is now at a 100% collection rate. Anticipated expenses total $257,747, while the utility expended $282,172 in FY13. The reason for lower expenses is due to the eleminiation of overtime for water employees. Additionally, the budget does not show any money from other fund balances being transferred to cover the anticipated net loss. Collection rates of the utilities have increased over the past year and the council increased their rates in November 2012 based on the rate study conducted by RUBA staff. The rates increased from $40 to $80 each month. This increase will help, but likely will not fill the gap discussed above, though community revenue sharing will sufficiently cover the gap. The utility fund budget does list most costs associated with sanitation services in Hydaburg. Line items for the primary operator's salary and benefits, repairs and maintenance, travel, water treatment and testing supplies, emergency parts, vehicle gas, electricity, telephone, and various other expenses are all included. However, the city also employs a second, part-time operator whose salary and benefits are not budgeted in the utility fund. This salary is accounted for in other departments such as Public Works or Sewer and Garbage. Monthly financial reports are not being provided to the council members in the meeting packet. Year-to-date figures cannot be accurately compared to what has been budgeted until the Quickbooks files are fixed. However, the mayor, city administrator, public works foreman, treasurer, and clerk all routinely provide both written and verbal reports on operational and financial issues concerning the water, wastewater, and garbage utilities. The city is current on paying its electric bills. The city has two 275-gallon fuel tanks for heating fuel which are located at city hall and the water treatment plant. Funds have been allocated in the budget to purchase heating fuel from Petro Marine every one to three months.

 

Capacity Indicator: Accounting Systems

Essential Indicators:

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:

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.

Comment:

The treasurer and city clerk have been working to increase the collection rate for the City of Hydaburg. Billing statements are processed and mailed every month. The utility administrative staff has begun reaching out to customers, showing willingness to accept partial payments if need be. As a result, they have begun to see an increase in payments over the past year. This might also be a result of the city public works staff shutting off a resident's water service for excessive non-payment. With the rate increase that was just passed in November 2012, the office has experienced some backlash and resentment from the customers. All cash payments received are taken to the post office daily in exchange for money orders. All cash transactions now require duel signatures and all cash and check transactions are logged. The treasurer and city clerk use QuickBooks software to track all accounts payable and receivables as well as to process payroll. The chart of accounts does not match all of the line items in the budget and should be corrected or revised when the budget is revisited. The payroll is accurately computed and employees are paid correctly. The accounts receivable system is also working correctly. Monthly bank reconciliations are up to date. There is a new checks and balance system in place. All computers in the city office are now on a network. In the last three years, 14 different people have held the position of clerk/treasurer for Hydaburg.

 

Capacity Indicator: Tax Problems

Essential Indicators:

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.

Comment:

The City of Hydaburg uses QuickBooks Pro to calculate and track payroll liabilities and makes electronic payments using the Electronic Federal Tax Payment System (EFTPS). The system was upgraded in October 2012 to include the enhanced features of the Federal and State tax reports. The community submitted the federal tax information request form to RUBA staff and it was submitted to the Taxpayer Advocates; due to the federal shut down, the request could not be processed in time. However, the community was in compliance with all federal tax deposits and filings last quarter. The Alaska Department of Labor and Workforce Development stated that the community was non-compliant August 30, 2013.

 

Capacity Indicator: Personnel System

Essential Indicators:

Yes

The utility has a posted workers compensation insurance policy in effect.

Sustainable Indicators:

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.

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.

Comment:

Coverage for workers compensation was confirmed for the period of July 1, 2013 to June 30, 2014. Coverage remains with the Alaska National Insurance Company. There is proof of current coverage posted at the city offices, the water treatment plant and the harbormaster's office. Coverage levels are within statutory guidelines and include work related accidents as well as occupational diseases. The city's personnel policy includes a hiring procedure and a probationary period for new employees but is still vague. The city is in the process of updating the perconnel policy and job descriptions. Records relating to employees are kept in a personnel file. The city provides training opportunities when outside sources of training funds are available. The city clerk has attended the QuickBooks RUBA course; and the city administrator has attended Quickbooks, Personnel, and Planning RUBA trainings. The city has shown support for other utility staff who may seek necessary training opportunities, by appropriating adequate funds for staff travel in the FY14 budget. The city administrator was hired in October, 2012; the clerk in summer 2012; and the treasurer in June 2013. The city's administrator began holding weekly staff meetings on Mondays in order to address ongoing issues among staff, and in order to bring staff closer as a unit.

 

Capacity Indicator: Organizational Management

Essential Indicators:

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:

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.

Comment:

The City of Hydaburg owns and operates the community's water and wastewater utilities and the city council is the governing body of the utility. The council meets monthly and reviews consumer rates for the utility services. Based on recommendations from RUBA staff, a rate increase was passed. The council minutes indicate that they are generally engaged in decision-making on behalf of the utility service. The city's FY14 budget ordinance was adopted by the council on time. The city complies with Alaska's Open Meetings Act by posting meeting notices at least five days in advance in three public places. All ordinances necessary to own and operate the utility services have been adopted. Title 13 of the Hydaburg Municipal Code establishes the policies and procedures for the operation and maintenance of the community water supply system. The city administrator oversees the utility and is adequately trained in the administration and management of the utility. Hydaburg's water operators travel to and participate in relevant water treatment and distribution trainings as needed and receive continual on-site training from a remote maintenance worker (RMW). The city now has a trained bookkeeper who has experience in QuickBooks and with payroll. The bookkeeper would like more financial and tax training.

 

Capacity Indicator: Operation of Utility

Essential Indicators:

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:

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".

No

The utility is not on the "Significant Non-Complier" (SNC) list.

No

The utility maintains an inventory control list.

Yes

The utility maintains a critical spare parts list.

Comment:

The City of Hydaburg has one full-time operator and one part-time operator. The full-time operator is certified by the State of Alaska Department of Environmental Conservation (ADEC) with a Level 1 Water Treatment endorsement expiring December 31, 2015 and a Level 1 Water Distribution endorsement expiring December 31, 2015. He also holds a provisional wastewater collection provisional certificate which expires December 31, 2013 and a wastewater lagoon certificate which also expires December 31, 2013. The part-time operator holds both a Provisional Water Treatment and Provisional Water Distribution certificate. They both expire on December 31, 2013. Hydaburg's water utility is listed on the July 2013 Significant Non-Compliance (SNC) list for elevated levels of disinfectant by-products (DBPs), though the operators continue to work with the Alaska Native Tribal Health Consortium (ANTHC) to improve filter media and system underdrains. The utility completed and distributed its last CCR as required by the Safe Drinking Water Act for the year ending December 31, 2012. The utility has a critical spare parts list but does not maintain an inventory control list. The administrator reports that the utility maintains a sufficient level of supplies and tools, and works in partnership with other communities on Prince of Wales to maintain a system that enables the communities to borrow and replace critical parts from each others' inventories. The inventory list has become an issue, as the storage facility that is used to store the parts has been leased to another entity and some parts are not currently locatable.

RUBA Activities for the Coming Quarter:

In the upcoming quarter RUBA staff will visit the City of Hydaburg and provide both on-site and remote assistance. RUBA staff will continue to work with current staff to further their training.