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

Community:
Galena 
Staff:
Jeremy Johnson  
DCRA Regional Office:
Fairbanks regional office 
Gov't Type:
First Class City 
Borough:
 
Agreement?
Yes 
Agreement Date:
4/3/2013 
Entity:
City of Galena 
Population:
483 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
8/5/2010 
Exp Date:
4/2/2015 
Last Updated:
4/17/2014 
Community Sanitation Overview:
Water is derived from wells and is treated. There is a 200,000-gallon reservoir and a community leach field. Sixty-one customers are connected to the fully-piped system and fifty-four customers have water delivered. Some customers have private wastewater systems while others pay the city to dispose of wastewater on an as-needed basis. The city began operating the landfill, located on the former Campion Air Force Station grounds, in 1997. In September 2010 the city acquired a used water delivery truck to replace the previous vehicle which was at risk of being inoperable. The wastewater pumper truck is old, with an estimated 200,000 miles on it; the odometer broke many years ago at 136,000 and the public works department provided the estimated miles. The city has submitted a request to the legislature for funding of both a wastewater truck and a solid waste truck as both of the vehicles break down frequently.  
RUBA Status & Activities This Qtr:
On January 28, RUBA staff traveled to Galena. RUBA staff worked with the city clerk to research costs associated with purchasing and drafted a request for both trash and wastewater pumper trucks. The city has a combination of both piped and delivered/hauled water and wastewater. The wastewater pumper truck is from 1998 and has an estimated 200,000 miles on it. With the expansion of hauled services that are planned for the summer of 2014, the city will not be able to keep up with the demand. RUBA staff also discussed with the city manager the status of the power plant funding and how progress is coming with Alaska Energy Authority (AEA) for replacing the utility; the electric utility subsidizes the water utility greatly. AEA believes that funding of $700,000 for design of a new power plant will be approved. Prior to departing the community, RUBA staffed provided the city manager and clerk a written draft of the research and request for the trash and pumper truck. A review of the December electric Power Cost Equalization (PCE) report was completed and after a few corrections this report was ready for submission. Further, RUBA staff discussed land zoning, planning, platting and steps to reestablish the planning commission. The city is interested in developing a new subdivision and to make existing, platted, vacant lots available for development to encourage residents to move away from the downtown area which is more prone to flooding. This could result in an expansion of water utility service. In February, the new interim city manager contacted RUBA staff for advice, discussion, and ideas. The manager had two personnel issues and asked RUBA staff to review and edit letters and emails which will be provided to city staff. RUBA staff suggested that AMLJIA also be involved. 
RUBA Activities for the Coming Qtr:
An on-site visit is scheduled for April 1-4. During that visit, RUBA staff plans to provide training to newly-elected officials and advise in staff restructuring.
Scores:
 
Essential Indicators:
24 of 27
Sustainable Indicators:
25 of 26
Total Score:
49 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.
N/A Budget amendments are completed and adopted as necessary.
Finances Comments
The revenue to the city has dropped because many customers have been without water, wastewater, and electric services due to the May 2013 flood, and not all customers have services reestablished. Electric is mentioned because this is the prime income source for the city and revenue generated from electric services subsidizes all other functions, including the water utility. Even 10 months after the flood, locally-generated revenues are not back to where they historically were; homes that were destroyed are not going to be rebuilt until summer 2014. For this quarter the water and wastewater income is above the budgeted amount. The city purchased less fuel this year than in previous years, but, due to the reduced electric customer base, this has not yet been a problem but the city has had discussions with both Crowley and Ruby Marine to get quotes in the event the city will need to purchase more fuel before the spring 2014 barge season. Expenses are below budget, at 72 percent.

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.
No 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 city uses QuickBooks 2013 Enterprise Solutions and has contracted with a Fairbanks based bookkeeping firm for assistance. In Galena, city staff enter bills for payment, receive customer payments, and generate utility bills. Customers are billed on a regular basis. Utility staff actively enforce the adopted utility bill collections policy by disconnecting electric customers for failure to pay on any city service. During the on-site visit in January 2014, one of the goals was to implement a purchasing system which compares the purchase to the budget. While the actual expenses are below the budgeted amount RUBA staff is uncertain if the purchase request form that was provided is the cause. During the next on-site visit in April 2014, staff will research this further and be in a better position to determine if the sustainable indicator can be changed.

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
The IRS reported on March 25, 2014 that the City of Galena is compliant with federal tax deposit requirements. However, the State’s Department of Labor and Workforce Development has not confirmed that employment security tax payments are current. Relevant indicators in this section are therefore marked ‘No’.

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
Workers compensation insurance for FY14 is provided through Alaska Municipal League Joint Insurance League (AMLJIA). The personnel policy and procedure manual is comprehensive; a copy is provided to each new hire with a signature page that acknowledges receipt and is filed in the employee's personnel folder. The city is active in personnel management and RUBA staff maintains copies of job descriptions for city positions. Annual evaluations are based on the job descriptions. A specific written hiring process was created in 1996. The current process is that a vacancy notice is posted in town at four locations and the notice is announced on the local public radio station for ten days. Applicants submit their application and if there is more than one applicant, a list of interview questions is created for the interviewer. Galena Personnel Policies and Procedures 15.10.430(A)(1) states that there are to be two separate personnel files for each employee, one public and one confidential. Between the two files, all necessary documents are retained, including copies of evaluations done after an employee’s six-month probationary period. New hires are provided with orientation and job-training, to the extent needed for the position. The personnel manual states that “the city encourage[s] employees to avail themselves of training and educational opportunities directly applicable to their city positions in order that they may provide more effective service to the public.” The city manager has proposed personnel changes, specifically regarding employee pay. Some employees’ pay is not in accordance with the adopted salary schedule. Future changes for the council to consider are the combination of the clerk and manager positions. Ordinance 2013-08 was introduced to amend the personnel policies regarding employee leave accrual.

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
The city is the owner of the water and electrical plants, as outlined in Galena Code Title 13, and city employees operate both utilities. The city council is the utilities’ policy-making body, while the city manager oversees the day-to-day management of staff. The city council is active in setting and enforcing utility policies as evidenced by council action last quarter to increase the electric rate and by the introduction of Ordinance 2013-07 which would create standards for required connections and piping of the hauled water delivery system. The city hired a city manager in April 2012 and his last day was February 23, 2014. The interim city manager, Shanda Huntington, is fulfilling the job duties to oversee the staff which operate the utilities. The city has an organizational chart that shows the current structure. City council meetings are open to the public, with the exception of executive sessions as allowable by law.

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
The city’s utility operator has all current certificates. Both the city and base water operators are current with certification. The city is not on the most recent, January SNC list. A preventative maintenance plan is located in the plant. The utility manager provides operation and maintenance reports to the city manager who includes them in a report for the council. AMLJIA provides telephonic safety meetings which are attended by city staff and the city electric operator attended a multi-day risk management training in Anchorage. Operations of the utility are functioning as intended and no major outages have occurred.