Quarterly Report: 2008, July - September (Q1), Angoon

Community:
Angoon 
Staff:
Lawrence Blood  
DCRA Regional Office:
 
Gov't Type:
Second Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Angoon 
Population:
497  
Assessment Status:
 
Assessment Date:
 
Exp Date:
 
Last Updated:
10/17/2007 
Community Sanitation Overview:
Angoon is located in Southeast Alaska on Admiralty Island and is connected via the Alaska Marine Highway System. The City of Angoon operates and manages a piped water and sewer system. The city council is the policy making body for the utility. Surface water is derived from the Tillinghast Lake Reservoir, is treated, and piped throughout the community. The City of Angoon has operated a piped water system since 1977. Greater than 95% of homes have complete plumbing. Piped sewage is processed at a secondary treatment plant that flows to an ocean outfall. On a weekly basis, the City collects and deposits refuse at a municipal landfill located approximately two miles from Angoon. The Inside Passage Electric Cooperative (IPEC) provides electricity.  
RUBA Status & Activities This Qtr:
Juneau RUBA staff traveled to Angoon twice this quarter to provide technical assistance in creating a balanced and realistic FY08 budget. The City has recently experienced a series of serious financial problems resulting from an inadequate annual budget process. It was the intention of RUBA staff to assist in the budget process by analyzing historical data and past budget performance. The recent efforts in creating a FY08 budget have been impeded by the resignations of the Mayor, City Clerk and finance staff. When the situation stabilizes, RUBA staff will continue to assist the community in creating a balanced budget and in addressing other deficient essential indicators. 
RUBA Activities for the Coming Qtr:
RUBA activities for the coming quarter will include: 1) Addressing the deficient essential indicators that were identified in the latest assessment of management capacity indicators. 2) Continue to provide support for increasing collection rates and pursuing delinquent water utility accounts.
Scores:
 
Essential Indicators:
11 of 27
Sustainable Indicators:
9 of 27
Total Score:
20 of 54

Finances

Essential Indicators
Answer Question
No All revenues and expenses for the utility are listed in the utility budget.
No The utility has adopted a balanced realistic budget.
No Monthly financial reports are prepared and submitted to the policy making board.
No The utility is current in paying all water/wastewater electric bills.
No The utility has on hand a year's adequate fuel supply or it has a financial plan to purchase an adequate supply.
No The utility is receiving revenues (user fees or other sources) sufficient to cover operating expenses.
Sustainable Indicators
Answer Question
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.
No A monthly manager's report is prepared.
No Budget amendments are completed and adopted as necessary.
Finances Comments
The City continues to struggle with being able to meet all of their accounts payable including making electric payments on time and purchasing heating fuel. On June 26, 2007, the City had their electricity disconnected due to non-payment. The City worked out a repayment plan with the Inside Passage Electric Cooperative; however there is concern that the City does not have the ongoing financial resources to fulfill their obligations and will continue to have problems. The City has not yet completed their FY08 budget. Until the budget is completed and adopted by the Council, the City fails to meet the criteria of several essential and sustainable indicators. In completing the FY08 budget, the City is encouraged to consider historical data and past budget performance. Previous City budgets were essentially unrealistic. The City budgeted for the potential income from enterprise funds by budgeting what was billed to the customers vs. what was actually collected. The City currently has a 39% collection rate which created a huge disparity between budgeted income and the end of year actual income. The Council does not make budget amendments during the fiscal year. Once the Council has adopted the budget, it remains the same until the next year's budget is prepared.

Accounting Systems

Essential Indicators
Answer Question
No The utility has adopted a collection policy and actively follows it.
No 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.
No 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 Council recently reviewed and updated the utility's collection policy; however, there is little enforcement on delinquent accounts and the provisions contained in the policy are not routinely followed. Utility bills are not sent out on a regular basis and follow-up procedures are not being adhered to. As a result, the utility has a large number of accounts that are 90 days past due with a total outstanding accounts receivable in excess of $300,000.

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
With the turn-over in finance staff, the City was unable to locate any copies of their 941 filings. The community is believed to be current on their tax deposits because of an overpayment last year. The City does have other unpaid payroll liabilities including child support which was withheld from an employee and has not yet been turned over to the State.

Personnel System

Essential Indicators
Answer Question
No 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.
No The utility has adequate written job descriptions for all positions.
No The utility has adopted and follows a written personnel evaluation process that ties the job description to the evaluation.
No 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.
No The utility has a probationary period for new hires that includes orientation, job training/oversight, and evaluations.
No The utility provides training opportunities to staff as needed and available.
Personnel System Comments
The City's workers' compensation insurance was cancelled due to nonpayment. The utility has an adopted personnel policy included in the public services ordinance. The utility has well organized personnel files containing the necessary INS forms, IRS forms, acceptance letters and any disciplinary actions. The utility is lacking written job descriptions and a formal evaluation and hiring process.

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.
No The policy making body enforces utility policy.
No The utility has an adequately trained manager.
No The utility has an adequately trained bookkeeper.
No 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
No 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
There has been recent employee turnover in the City's bookkeeper and accounting clerk positions. The bookkeeper position is currently vacant. The City does not have a written organizational chart that reflects the current municipal structure. The City Council meets as required and complies with the Open Meetings Act.

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
No 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.
No 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.
No The utility maintains a critical spare parts list.
Operation of Utility Comments
The utility is on the Significant Non-Compliance (SNC) list because it does not meet the Long-term 1 / Enhanced surface water treatment rule and was issued a notice of violation (NOV)on January 5, 2007. On August 9, 2007, Department of Environmental Conservation (DEC) sent a letter concerning the continued non-compliance with the requirements contained in the January 5th notice of violation (NOV). The letter addressed two specific violations. The first violation was issued for failure to report the results of regular turbidity and chlorine monitoring and the second violation was for failing to have an operator certified at the appropriate level. The letter indicated that further failure to address the NOV would result in DEC taking formal legal action and/ or assessment of administrative penalties. The community was able to address one of the violations by acquiring a working chart recorder that was surplus equipment from the City of Kake and by filing turbidity and chlorine reports on a timely basis and on the appropriate forms. The violation concerning having an operator at the appropriate level has yet to be rectified. The City will need to either hire a certified level II operator or seek approval of an Alternate Method of Supervision Plan (AMOS). The City has taken the initial steps of putting together a draft Alternate Method of Supervision Plan and has contacted a level II water treatment operator in the City of Hoonah who may provide utility supervision if the plan is approved. The utility maintains very few critical spare parts and has an inadequate level of supplies and chemicals. The operators do not maintain an inventory control or critical spare parts list. The utility operators have expressed several concerns with safety including the physical condition of the water treatment plant, exposure to chemicals and the lack of communications outside of the city offices.