Quarterly Report: 2014, January - March (Q3), Anchor Point

Anchor Point 
Glen Hamburg  
DCRA Regional Office:
Anchorage regional office 
Gov't Type:
Water Systems 
Kenai Peninsula Borough 
Agreement Date:
Anchor Point Safewater Corporation 
2041 2013 Department of Labor Estimate 
Assessment Status:
Assessment Completed 
Assessment Date:
Exp Date:
Last Updated:
Community Sanitation Overview:
Anchor Point is located in the Kenai Peninsula Borough at mile 156 of the Sterling Highway. Its sanitation utilities are owned, operated, and managed by the Anchor Point Safewater Corporation, a non-profit corporation formed under Chapter 10.20 of state statute. The corporation's services include Class 1 water treatment, an unclassified piped distribution system, a bulk drinking water distribution point, and a standard use coin-operated drinking water distribution point. Approximately half of the residences in Anchor Point are connected to the piped distribution system; the other half rely on individual wells, water deliveries, or the local distribution point. 
RUBA Status & Activities This Qtr:
This quarter, RUBA staff traveled to Anchor Point to conduct a utility management assessment for Anchor Point Safewater Corporation. The community's last assessment was conducted in 2006. The updated assessment recommended the corporation adopt an annual operating budget, hold board meetings in accordance with its own bylaws, prepare and distribute monthly financial reports to board members, and post proof of workers' compensation insurance coverage as required by state law in order to ensure the longer-term sustainability of sanitation services in the community and to maintain eligibility for sanitation project grant funding. RUBA staff also invited corporation staff and officials to RUBA-sponsored utility management trainings this quarter. 
RUBA Activities for the Coming Qtr:
RUBA staff will continue to offer assistance to the corporation in adopting an annual budget, holding monthly board meetings, preparing monthly financial reports, and posting proof of workers' compensation insurance coverage. RUBA staff will also continue to invite corporation staff and officials to utility management trainings and provide any other support requested.
Essential Indicators:
21 of 26
Sustainable Indicators:
20 of 27
Total Score:
41 of 53


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.
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.
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.
Yes Budget amendments are completed and adopted as necessary.
Finances Comments
Anchor Point Safewater Corporation’s fiscal year follows the calendar year. Because the corporation has not adopted its CY14 budget, budget-related indicators in this section have been marked ‘No’. It is also not possible without a budget to determine whether the revenues the corporation receives are sufficient to cover operating, repair, and replacement costs, and so those indicators are marked ‘No’. Further, the corporation was not able to demonstrate at the time of the assessment that board members have, even in prior years, received financial reports comparing year-to-date actual incomes and expenses to budgeted amounts; therefore, the indicator concerning monthly financial reports has also been marked ‘No’. RUBA staff has communicated the importance of an annual budget and of ‘budget vs. actual’ financial reports to corporation staff and is available to provide any assistance needed to draft and implement them. Nonetheless, a CY13 profit and loss budget overview provided by the corporation shows that in the previous fiscal year income generated entirely by user fees and the sale of parts to customers was sufficient to cover operating expenses. The report also shows that the corporation tracks income sources and expenses by type, and that money has been spent on maintenance, repairs, training, building and workers’ compensation insurance, payroll taxes, and routine water quality testing. RUBA staff has also confirmed with corporation staff that the utility is current in its own electrical ills and that funds are available to purchase necessary fuel. A review of meeting minutes shows that the corporation’s president, who serves as utility manager, does give comprehensive verbal reports at board meetings. However, those meetings typically only take place twice or three times a year, despite the corporation’s bylaws requiring monthly meetings. The indicator related to monthly manager’s reports has therefore been marked ‘No’.

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 corporation’s standard use coin-operated watering point requires pre-payment. The nearly 60 customers who are either connected to the treatment plant with the limited piped distribution system or purchase bulk water for commercial delivery are billed monthly. A January 2014 accounts receivable aging summary shows that 10 customers have balances more than 60 days past due, representing by one measure an 83 percent collection rate. However, nearly as many customers have pre-paid for their water service. As explained further in the ‘Organizational Management’ section of this assessment, the utility has effective utility bill collection, repayment, service termination, and reconnection policies outlined in its adopted utility ordinances. The utility’s primary operator reported to RUBA staff that customers are indeed disconnected for lack of payment in accordance with these policies, though the need to do so is rare. Customers have the option of paying their monthly bills by check, cash, or credit card, with some having opted for an automatic monthly credit card charges. Customers who make one-time payments are appropriately issued a receipt and payment verification is also available to customers enrolled in the auto-pay option. The primary operator is in charge of collecting the coins paid at the watering point and bringing them to the utility clerk’s office for counting and deposit. The corporation uses QuickBooks for all of its accounting functions, including the tracking of accounts receivable and payable and processing payroll. The utility clerk has received formal QuickBooks and accountancy training, as noted later in this assessment. Given the small size of the corporation and its limited staffing, the operator is authorized to make routine purchases independently using an issued debit card, with such purchases being reviewed by the utility manager and accounted for by the utility clerk against a comprehensive chart of accounts. A standard purchase order process is used for the acquisition of major items, such as new pumps for the treatment system. Because the corporation has not yet adopted its CY14 operating budget, the last sustainable indicator of this assessment is marked ‘No’.

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
Anchor Point Safewater Corporation’s contracted accountant at Aurora Taxes and Accounting uses QuickBooks for its tax processes. A case advocate with the IRS’s taxpayer advocacy service confirmed on February 20, 2014 that Anchor Point Safewater Corporation was in compliance with federal tax reporting and deposit requirements and that there were no recorded notice of federal tax lien against the corporation. The Alaska Department of Labor and Workforce Development also granted the corporation employment security tax clearance on March 21, 2014. The corporation is not listed on the most recent Lien Watch report.

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.
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
RUBA staff confirmed on February 20, 2014 that Anchor Point Safewater Corporation has a valid workers’ compensation insurance policy with Alaska National Insurance Company. However, the corporation’s president acknowledged that proof of coverage is not posted in three places of employment as required by state law. Until proof of coverage is posted as required, this section’s essential indicator is labeled ‘No’. The corporation has adopted and continues to enforce a comprehensive ‘Personnel Policies and Procedures Manual’ which must be read and acknowledged with a signature by new employees, as well as by the employee’s supervisor. The manual addresses all important personnel matters, including the corporation’s hiring policy, conditions of employment, compensation, evaluation, discipline, grievances, benefits, travel and training, safety, and other specific personnel rules and regulations such as conflicts of interest and drug and alcohol use. In accordance with the policy, new hires are placed on a 120-day probationary period and then given a performance evaluation. Continuing employees also receive formal evaluations based on their job descriptions. The Chapter 4, Sections 1-4 of the corporation’s bylaws also define the duties of officers, including the president, vice president, secretary, and treasurer. A new hire checklist helps to ensure that all employees complete an Immigration I-9 form, a W4, and a hiring agreement, all of which are maintained in secure employee files. Employees are given ample opportunity to receive necessary training, as evidenced by the utility manager, primary operator, and utility clerk all having attended at least one RUBA utility management course and by the primary and back-up operators attending pre-certification classes. In CY13, the corporation reports having spent more than $4,300 on employee travel and training.

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.
No The policy making body meets as required.
Yes The utility complies with the open meeting act for all meetings.
Organizational Management Comments
Anchor Point Safewater Corporation is a non-profit corporation which organized in 1989 under Title 10, Chapter 20 of state statute. According to its articles of incorporation, its purpose is to “engage in the design, construction, ownership, and management of a sanitation facility” in Anchor Point in the absence of a city government. The articles state, however, that should Anchor Point ever incorporate as a city, the non-profit will dissolve and the city will assume ownership and operation and management powers over the sanitation utilities. Section 4.1 of the corporations ‘Utility Ordinance for Water Services’ states further identifies that the purpose of the corporation is to protect public health and provide safe drinking water to the community. Section 4.2 clarifies the corporation as the owner of the utility and proceeding sections the utility’s philosophy and responsibilities, customer responsibilities, service fee billing and collection policies, termination of service conditions, repayment plans, and safety, as well as other important management topics. The corporation fully enforces its utility ordinance, shutting off customers for lack of payment as required. The corporation’s board of directors is the utility’s governing body. Copies of its meeting minutes and packets show that that when it does meet it is actively involved in policy-making for the utility; they demonstrate that the board reviews the need for utility rate increases, the acquisition of system parts, the status of grants, regulation compliance, usage levels, operators’ certification progress, maintenance needs, and other issues. Though the corporation’s bylaws require the board meet once per month, as mentioned previously, it typically only meets twice or three times each year. RUBA staff has explained the value of meeting more regularly and of amending corporation bylaws so that they require a meeting schedule appropriate for the utility. When the utility does meet, it posts notices in advance in at least three places, including at the store, the post office, and other community facilities. The corporation’s president, who serves as the utility manager, and its contracted utility clerk are both professional accountants. They, as well as the primary operator, have completed various RUBA utility management courses. The utility clerk is also provisionally certified in water treatment and serves as the backup operator. The primary operator holds Class 2 water treatment certification expiring at the end of 2015, but has already met Continued Education Unity (CEU) requirements. These staff are identified in an organizational chart which is included in the back of the corporation’s utility ordinance.

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 primary operator is fully certified and two backup operators hold provisional certification. Preventative maintenance plans, as well as inventory control and critical spare parts lists, are maintained in organized binders at the water treatment plant. The corporation president makes occasional visits to the treatment plant, regularly visits the contracted accountant’s office, and is in continual communication with the operator and utility clerk. Staff discuss safety issues as they present themselves and a safety manual and safety equipment are on hand; however, regular formal safety meetings are not held and documented. The utility has not suffered service outages because of management issues, is not listed on the most recent Significant Non-Complier (SNC) list, and continues to operate at the level of service promised in its utility ordinance. RUBA staff received copies of the last two years’ Consumer Confidence Reports given to utility customers and submitted to the Alaska Department of Environmental Conservation.