Quarterly Report: 2012, October - December (Q2), Lower Kalskag

Lower Kalskag 
Eli Jacobson  
DCRA Regional Office:
Gov't Type:
Second Class City 
Agreement Date:
City of Lower Kalskag 
Assessment Status:
Assessment Date:
Exp Date:
Last Updated:
Community Sanitation Overview:
An 85-foot well provides water, which is treated and piped to most homes and the school. The school, clinic, and over 40% of homes use individual septic tanks and have complete plumbing. A 10,000-gallon community septic tank allows for piped sewage collection to part of the village. Funds have been requested to connect the 20 remaining homes using septic tanks to the piped sewer system, due to effluent ponding. The community also needs a washeteria and watering point. Refuse is burned or buried at a new landfill located between Kalskag and Lower Kalskag. Electricity is provided by AVEC. 
RUBA Status & Activities This Qtr:
Alaska Rural Utilities Collaborative provides full management and operation services to Lower Kalskag's water and sewer system. On the week of December 12-16, 2011 two council members attended the Elected Officials workshop in Bethel. 
RUBA Activities for the Coming Qtr:
RUBA staff will continue to verify Federal Tax status, State tax status, and workers compensation insurance status on a quarterly basis.
Essential Indicators:
23 of 27
Sustainable Indicators:
25 of 27
Total Score:
48 of 54


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.
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.
Finances Comments
Alaska Rural Utility Collaborative developed a balanced budget on behalf of the City of Lower Kalskag for the utilities. ARUC produces monthly financial statements that includes a year-to-date total for each line item.

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 utility charges a flat rate for residential customers. The rate is $80 for sewer per month for sewer services. Commercial services are charged $170 per month and private party sewage dump in the lagoon are charged $50. Bills are sent at the end of every month. They are considered unpaid 25 days later. Not less than 15 days prior to ARUC's intention to disconnect services for delinquent bills, door hangers are deliered to alert customers of the scheduled date that services will be shut off. Payment plans are offered for delinquent bills. Through the MOA, ARUC has the authority to change customer rates. The rate changes must be set up to generate revenues in excess of expenses with adequate funds to cover repair and replacement reseves and must be balanced. Prior to implementation of the new rates, they will be presented to the Owner's governing body.

Tax Problems

Essential Indicators
Answer Question
No 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
On December 29, 2011 the IRS deemed that The City of Lower Kalskag is out of federal tax compliance. The IRS states that the City of Lower Kalskag has not filed returns for the first three quarters of 2011. The state Department of Labor (DOL) was contacted on December 14, 2011. DOL stated that Lower Kalskag is current on their Employment Security Contributions account. Lower Kalskag is not on the Lien Watch dated September-October 2011. This tax information pertains to the management of the utility only.

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 utility has a worker's compensation insurance policy through Alaska Municipal League Joint Insurance Association Inc. for the period from 7/01/2011 through 7/01/2012. On December 14, 2011 RUBA staff contacted AMLJIA. A representative of AMLJIA stated that Lower Kalskag is current on payments. The insurance covers all employees of ARUC including the operators in Lower Kalskag. All ARUC employees follow the YKHC adopted personnel policy. This policy was reviewed by an attorney. Employees are at-will hire. An evaluation is performed at 90 days and one year from hire. The blank evaluation form is attached to the position decription and presented to the employee upon hire. All new hires attend a corporate orientation for 2 1/2 days in Bethel for instruction regarding company policies, procedures, and department specific orientation. Onsite training is also provided.

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 Lower Kalskag signed a Memorandum of Agreement with YKHC-RUC to opearte the utility. The MOA was signed for two years with option for renewal. YKHC-RUC has an advisory board that meets three times a year to recommend policy and procedures via letters of support to the YKHC Board of Directors. The YKHC Board of Directors has the authority to set rates, adopt ordinances, policy and procedure for the Lower Kalskag utility. The RUC Manager also is diligent in personally attending city council meetings of all RUC communities. ARUC hired Lee Piper as project manager/accountant. The project manager is responsible to oversee the accounting procedures for all RUC communities. YKHC finance department tracks and issues payroll.

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
Current operator certifications may be found online. A 'Safety Guidelines for Utility Oeprators' guide is provided to all operators. Safety training is provided in conjunction with regularly scheduled opeartions training. The utility has not suffered any major problems/outage due to management issues. Water and sewer services are offered to residents and the elementary school. The high school maintains its own well. A project to change the pressure system for the entire system is planned for this winter.