|Klawock Municipal Code Section 10.01.240 provides that any customer over 60 days past due be turned over for collection or disconnected, and an 8 percent interest rate charged. This collection policy is not currently being followed. However, an unwritten policy is being enforced with a positive outcome thus far -- 105 percent collection rate for FY14 as of May. City staff hopes to amend municipal code to reflect the current enforcement procedures. Amending ordinances have been drafted and proposed to the city council. The current process involves billing customers on the first of every month, then placing door hangers on the homes of residents who have not paid within the time allowed in the bill. Delinquent customers either pay the amount owed in full or come to the city office and sign a pay-back agreement plan, which includes making each monthly payment plus an amount toward the past-due amount. The specific amounts involved in this pay-back agreement are arranged between the customer and the city administrator, and are specified in writing. There are some delinquent accounts which are likely to be considered “bad debt” and will require council write-offs.
As of February 2014, 31 customers have customer pay-back plans. In the month of February, 8 customers received shut-off notice door hangers. By the end of the day, most of these customers had come into the office to either pay or agree upon a payment date or arrangement. This rate is an improvement from 36 shut-off notices monthly one year ago.
The current city administrator, who serves as the utility manager, has extensive experience in financial management and is working to fully reconcile past years’ accounts. Previous practices did not meet RUBA standards nor generally accepted accounting practices, though accounting practices in the past few years have drastically improved and meet or even exceed RUBA indicator standards at this time.
The City of Klawock utilizes the Cougar Mountain accounting system, with some accounting elements being maintained in writing, such as the check ledger. Appropriate segregation of duties is instituted among city finance staff, and staff only have access to sections of the Cougar Mountain account which are appropriate and necessary for their positions and duties. A chart of accounts is maintained including a fund account code followed by the category, each classified as either asset, equity, liability, etc. Reconciliations are completed monthly by the city administrator, though reconciliations are a bit behind at this time, as bringing reconciliations for previous years up-to-date is taking priority.
The city’s accounts receivable clerk sends out bills then accepts payment via hand-delivery, mail, or credit card. A dual-verification system is in place for acceptance of all cash, with receipts being made in triplicate, the incoming amount being applied to the appropriate account. All cash is maintained in the safe and verified by two employees and attached receipts. The city administrator takes all cash to the bank on a regular basis.
The city’s accounts payable clerk follows a similar approval process to the purchase order system. A purchase order form is signed by the appropriate department supervisor and city administrator. The city administrator then provides a purchase request to the accounts payable clerk, who codes the expense to the appropriate department and provides payment. The purchase request form is in triplicate: pink remains in the purchase request book, yellow goes to the accounts payable clerk, and white goes to the appropriate vendor. There is no cash disbursement.
Payroll begins with each employee’s timecard, which is signed by the supervisor. The payroll clerk processes the time cards, and then the city administrator verifies each one. The clerk then processes all appropriate withholdings and produces a check for each employee.|