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

Community:
Hoonah 
Staff:
Lynn Kenealy  
DCRA Regional Office:
Juneau regional office 
Gov't Type:
First Class City 
Borough:
 
Agreement?
No 
Agreement Date:
 
Entity:
City of Hoonah 
Population:
798 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
5/22/2013 
Exp Date:
 
Last Updated:
4/17/2014 
Community Sanitation Overview:
Hoonah is a primarily Tlingit native community located on the northeast of Chichagof Island, 40 miles west of Juneau. Water for the community is derived from Gartina Creek, a surface water source. It is then treated and piped to homes and facilities across Hoonah. Nearly all homes in the community are fully plumbed. The City of Hoonah operates and manages a Class 2 water treatment plant and a Class 2 wastewater treatment system, as well as a landfill, a garbage haul service, a harbor, and a dock. There is also a publicly-owned tank farm in Hoonah that is leased to, and operated and maintained by, a private entity. 
RUBA Status & Activities This Qtr:
RUBA staff visited the City of Hoonah this quarter to work with the city council, which is the decision-making body for the water and wastewater utilities, and city and utility staff around areas including Open Meetings Act, parliamentary procedures, conflict of interest, resolutions and ordinance, budgets, and financial reports. RUBA staff has also assisted this quarter with an application for a petition to recall the mayor, assisting city staff with the appropriate paperwork and procedures. The city has hired a new city administrator this quarter, and RUBA staff provided some training regarding Alaska state laws and maximum local self-government. RUBA staff also attended the Sanitation Deficiency Systems meeting, where Hoonah was discussed pertaining to wastewater discharge issues, wastewater treatment complications, and necessary system improvements. The city was praised for having very good water treatment operations. Finally, the City of Hoonah adopted its 2014 budget in late December 2013, and provided the FY14 budget to RUBA staff this quarter. The city is on the calendar year of January 1 through December 31. 
RUBA Activities for the Coming Qtr:
In the coming quarter, RUBA staff will continue to assist with the mayoral recall process. Additionally, the city has applied for Sanitation Deficiency Systems funding, and therefore RUBA staff will assist with conducting a collection rate study. RUBA staff will provide other training and assistance as needed.
Scores:
 
Essential Indicators:
26 of 26
Sustainable Indicators:
26 of 27
Total Score:
52 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 City of Hoonah’s fiscal year follows the calendar year and the FY14 budget was adopted in December 2013. Budget estimates are made based on previous years' totals while incorporating expected deviations in the upcoming year. RUBA staff has only been provided with a copy of the budget ordinance’s cover page, and not specific figure; therefore, RUBA staff is not able to determe whether the FY14 is balance or realistic, whether repair and replacement funding has been appropriated or whether actual year-to-date income and expenses are in line with budgeted amounts. Relevant indicators in this section have therefore been marked ‘No’. The FY13 budget classified all expenditures and revenues into categories of general fund, administration, elected officials, employee housing, public works, roads, police, EMS, fire, youth and parks, and harbor. It then breaks down these budget categories into more specific sections. The public works category of the budget includes water, wastewater, and garbage sections and itemizes all anticipated expenses and revenues for each of these services. The budget shows that water service revenue will come from hook-up and service fees and inter-fund subsidies. A subsidy specifically from the city’s general fund to the water department was necessary in years past, but no longer is; nonetheless, the budget category remains in place in case future subsidies from the general fund are needed. Budget utility expenditures include salaries, retirement, workers’ compensation insurance coverage, travel, membership dues, electricity, gas and oil, office supplies, licensing, testing charges, chemicals, maintenance, freight, and others. Most budgeted expenditures are anticipated at or slightly above the previous year’s actual totals. Similarly, most budgeted revenues are anticipated at or slightly below the previous year’s actual totals. A budget amendments are passed as needed. A budget committee, which includes at least two council members, meets once per month and provides recommendations to the city council based on their review of a balance sheet and profit and loss report provided by the city treasurer. The profit and loss report compares budgeted and actual income and expense amounts. The recommendations made by the committee are generally accepted at the following full city council meeting. Additionally, the treasurer discusses one of the municipal grants at every budget committee meeting, and provides a verbal report. A verbal treasurer’s report is also given to the city administrator who then submits a written manager's report to the council addressing any financial discrepancies or concerns. Each department head is responsible for ensuring they remain within their budgeted expense allotment, and reports to the city administrator if there are concerns. The city administrator then passes these concerns on to the budget committee. The utility receives its electricity from Inside Passage Electric Cooperative (IPEC), which bills the city monthly. The city provided RUBA staff with proof of electricity bill payment. Fuel is available from private businesses in the community and the city budgets sufficiently to cover fuel purchases each year. Revenue is sufficient to cover all water, wastewater, and garbage service costs, including a repair and replacement costs. The utility is considering raising rates in 2015 in order to begin financing a capital replacement fund.

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 City of Hoonah utilizes the Caselle electronic accounting system to track all city and utility finances, accounts receivable, and accounts payable. All incoming moneys are received by the city clerk, who then provides a daily log to the treasurer. Information and transactions are tracked and moved by the treasurer, who also completes remote deposits of cash received. The treasurer then sends confirmation documentation back to the clerk who verifies all payments received. The only cash maintained by the city is $200 in change for cash payments received. This money is only accessible to the city clerk for tracking and maintenance. Payments may be received by cash, check, or credit card. A chart of accounts is maintained in the city's Caselle file, including assets, liabilities, and equity for all departments. All accounts payable are tracked by the city treasurer. Each department head is responsible for remaining within their budgeted allotment. If an expense is under $500, the department head completes a purchase order and provides this to the treasurer for purchase and payment. Expenses between $500 and $10,000 require the mayor’s signature on the purchase order before the treasurer may approve purchase or payment. All purchases over $10,000 require city council approval. As an additional distribution of responsibilities and oversight, the city treasurer may not sign checks, complete purchase orders, or access cash. The utility charges an inclusive monthly fee for water, wastewater, and garbage services at a rate of $122.84 for standard residential customers, $74.30 for senior residential customers, and varying prices for commercial customers. Food service providers are charged $400 each month, while the cold storage facility and the swimming pool are charged at metered rates. A review of a customer account aging report in May 2013 showed that the utility had an almost 93 percent bill collection rate. The city's building permitting code requires all new buildings to install water meters. At some time in the future, the utility hopes to install meters on all remaining buildings, and begin billing all customers at a metered rate. The city treasurer sends out bills on the first of the month for the prior month. Payments are due on the final day of the month the bill is sent. If the balance is carried over for five days, the account becomes delinquent. At that point, the customer must pay both the previous month’s bill and current bill in order to end delinquency status. On the 15th of the following month a shut off list is generated and compared with all payments to ensure it is accurate. The water operator then places door hangers on all delinquent customers' homes requesting that they come into the city office to pay their delinquent water bills. Water for all delinquent customers is shut off three to four days later. Disconnected customers are issued a letter informing them that they must pay their balance in full before water may be turned back on. Utility staff report that most delinquent customers pay their balances before the shut-off day. However, if a customer fails to pay off the delinquent account after shut-off, the process for small claims court is engaged. The city is also currently in the process of garnishing four customer permanent fund dividends, due to delinquency and non-payment of past accounts. These practices are consistent with the billing and collections policy as provided in Title 13 of the Hoonah Municipal Code. RUBA staff has verified that the city treasurer completes bank reconciliations monthly.

Tax Problems

Essential Indicators
Answer Question
Yes The utility has a system to accurately calculate, track, and report payroll tax liabilities.
Yes The utility is current on filing tax reports.
Yes 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
The city utilizes the Caselle accounting software program to calculate and manage tax payments. The State’s Department of Labor and Workforce Development reported to RUBA staff on March 4, 2014, that the city is current with its employment security (ESC) tax filings and deposits. RUBA staff also confirmed on March 17, 2014, that the city is current with its federal tax responsibilities as well. There are no tax liens against the city.

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 of Hoonah receives its workers’ compensation insurance from the Alaska Municipal League Joint Insurance Association (AMLJIA) and posts proof of coverage in all locations employees regularly work. RUBA staff has confirmed that the policy is currently valid. The city has an employee handbook which was last updated in October 2011 and has been reviewed by both AMLJIA and RUBA staff. The handbook includes all categories encouraged by this report’s indicators, including a personnel evaluation process, a hiring process, and employee orientation. The city clerk maintains all personnel files, including I-9, job applications, letters of acceptance, and evaluations. The city also keeps job descriptions for all filled positions, as well as several positions which are not currently being utilized, in case they become necessary in the future. All employees are encouraged to attend training. Water operators are fully certified to the appropriate level and maintain their Continued Education Units (CEUs) as required by the Department of Environmental Conservation. The former city administrator, who resigned in June, had successfully completed the RUBA Program’s Planning Management for Rural Utilities training and, along with the mayor, the Personnel Management for Rural Utilities training. The finance director has completed the RUBA Financial Management for Rural Utilities course. The city clerk attends the yearly Alaska Municipal Clerks conference, and every office staff attends the yearly Alaska Municipal League (AML) conference. Once hired, the new administrator will be encouraged to attend trainings as well.

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 of Hoonah owns and operates the community's water and wastewater systems, as provided by Title 13 of the Hoonah Municipal Code (HMC). The city council is the policy-making body for the utility. The council meets once per month for regular meetings, as well as throughout the month for various workshops. Public notification is posted prior to all workshops and committee, regular, and special meetings in compliance with the Open Meetings Act. Utility policies, as detailed in HMC Title 13, are enforced by city staff and overseen by the council. Utility management is shared by the mayor and the public works director. The utility's manager and financial officer have both been with the city for longer than three years. All utility staff are adequately trained and encouraged to attend further training, as demonstrated by the details provided in the Personnel Management section of this report. The city maintains an organization chart titled “City of Hoonah Organizational Structure”, which clearly delineates chain of command, supervision, and lists all employees of the city. The organizational chart is consistent with job descriptions.

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.
No 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 water utility has one primary and two back-up water operators. The primary water operator holds Level 2 water treatment and distribution certification, while the back-up operators are bot certified in Level 1 water treatment and distribution. The primary water operator is also certified in Level 2 for wastewater collection and treatment, and one of the back-up operators is certified at level 1 for wastewater collection and treatment. The water utility was built by the Alaska Native Tribal Health Consortium (ANTHC), who has also provided the utility with an operation and maintenance manual. That manual includes a preventative maintenance plan. The manager speaks with the water operator regularly, and visits and checks out the plant a few times a week. The utility has not suffered any major problems, excepting a pump failure which is once again operational. The system operates at the level of service proposed and is not on the January 2014 Significant Non-Complier (SNC) list. The primary water operator completes the CCR reports as needed. The water operator maintains computer Excel documents of inventory and critical spare parts lists and updates them as needed. The operator is currently in the process of converting to the Check-Up Program for Small Systems (CUPSS) system, with remote assistance included. The utility has an OSHA-provided safety manual on hand and previously held safety meetings regularly. However, as of about two years ago, they stopped attending the AMLJIA safety meetings, and have not commenced with any regular safety meeting system since this time.