|
Rural and Small Water System Self-Assessment for
Capacity Development |
|
Minnesota
Rural Water Association
217 12th Avenue Southeast
Elbow Lake, MN 56531
Phone: 800-367-6792
Fax: 218-685-5272
www.mrwa.com
E-mail:
mrwa@mrwa.com |
|
Information for Capacity
Development
Questionnaire |
Every
water system in this nation should have the managerial, financial and
technical capacity to comply with the federal Safe Drinking Water Act.
Good management and good operations cannot be regulated into existence,
people make them happen. Thus, every Board member, council member,
owner, and manager need to know certain critical aspects of their water
system and how they affect its operations. To this end, the Minnesota
Rural Water Association has developed a self-assessment tool for water
systems that will identify the critical areas and focus on improvements
that could be made in their operations. This instrument is intended to
be used in two ways:
In a public water system board or council
meeting
By a private water system’s owner
Its
purpose is to inform owners or board or council members of their
existing managerial, financial and technical capacity and areas that may
be strengthened. It is important to stress that this assessment is to be
conducted by the water system. It is solely the choice of the water
system whether this assessment is to be shared with any regulatory
agency.
Special consideration was given to the very small privately owned
systems. Some questions will be difficult for such entities to answer.
However, regardless of the size of system, Rural Water field staff will
be available to assist in both administering this instrument and in
improving any area.
A
lengthy process involving several hundred rural water field staff, water
managers, operators and board members developed this questionnaire. For
each of the three areas of capacity development, participants were asked
the top ten indicators of sufficient capacity for that area. These
results were compiled and evaluated by a National Rural Water
Association (NRWA) committee. The committee also reviewed capacity
development instruments from several states and their Finance Centers.
The questionnaire was then reviewed by a distinguished group of field
staff and field tested in four states.
A successful business
must be capable of dealing with any change that occurs in its
environment. Some of these changes may be perceived as threats or
opportunities. Regardless, having the appropriate financial, managerial
and technical resources at your disposal allows every threat to become
an opportunity. Extending your facilities to add customers, reacting to
the impact of new Safe Drinking Water Act (SDWA) regulations or a host
of other issues may require new financing. Losing customers to an
adjoining urban area dramatically impacts a water system. All of these
situations can be opportunities with sound business planning that will
come through completing this document.
|
The following discussion shows the
importance of each question.
Remember, if you have any
difficulty with any of these questions or need further examples
of any of these items, please call the Minnesota Rural Water
Association. |
 |
Very
simply stated, water systems provide water to homes and businesses and
receive money for it. When the bottom line is positive-- that is you get
more money in than you send out-- you get to stay in business. When the
bottom line is negative-- that is when you send out more money than you
take in--you will not be in business long. Budgeting is an important
part of the process allowing projections of the expected income and
expenses for the upcoming year. This will show if sufficient funds will
be available to pay the bills. The budget should be written and reviewed
with the financial statements.
If your
assets (the value of all your money and property) are greater than your
liabilities (the value of all you owe), your water system is solvent.
The more assets exceed liabilities, the more funds that can be put aside
for replacing equipment and future construction. In the event
liabilities exceed assets, you should have a plan that will quickly
correct the problem. To do otherwise may result in bills being unpaid
and eventually bankruptcy. Your last audit is a good place to find
these numbers because it is based on the accrual accounting method. This
is the established method of determining your true financial picture.
A
long-range financial plan establishes financial goals and is a roadmap
detailing how your water system will remain financially healthy and
achieve these financial goals.
Having
reserves and properly accounting for depreciation are fundamental to
keeping your water system healthy. Often reserves are designated for
future projects. Funding depreciation is a method of setting aside funds
to replace equipment or facilities.
A
capital improvement plan details how funds will be used to replace items
as they wear out and when new items will be purchased to upgrade the
system.
There are many necessary controls that insure the financial integrity of
your
water system. Having monthly financial statements will assist in
managing activities. Having them reviewed by the governing board,
council or owner is also important, because they have a fiduciary
responsibility for their water system. Most public water systems are
required to undergo some type of audit. This audit will show the
accuracy of the monthly financial reports. Written financial policies
assure that matters are dealt with in a consistent fashion. Reviewing
the financial reports will show when it is time to review the rate
structure.
Your rate structure
should produce enough income to cover your current expenses, replacement
costs for existing equipment and structures, produce sufficient reserves
and meet all your contractual obligations. If it does not, it should be
adjusted immediately.
It
should be reviewed on an annual basis to determine if it is sufficient
for the upcoming year.
All your contractual
obligations must be met. Otherwise you will not be considered
financially sound.
The
ownership or governance structure of your water system dictates the
legal obligations that must be followed. You should be aware of your
responsibilities as an owner, a council member or board member, as they
are all different.
For
municipalities and non-profit organizations, it is important that the
by-laws and covenants effecting the entity be kept up to date and
changed when necessary. They should be dated with the last time they
were changed.
Public entities are often required to meet on a regular basis. Minutes
of these meetings are usually required.
Public entities are typically required to have an annual budget
presented and approved by the governance.
All
water systems are required to have an IRS ID number.
Water systems should
have written operational policies. This insures that customers are
treated equally and does much to avoid lawsuits. Policies should be kept
up to date reflecting actions of the governance body and changes in
state and federal laws.
The
person in charge of the water system should be clearly defined. If more
than one person is employed, there should be a staffing chart or
communications chart. There should also be written, up to date,
personnel policies. These insure that every employee is treated
consistently and fairly.
There are over forty
federal agencies that are involved in some aspect of water. Remaining in
compliance with all these federal and state regulations is important yet
often complex.
Your water source can be surface, ground, purchased water or any
combination of the three. Each of these sources has different
requirements you must be aware of.
Example, in the western states, you must have sufficient and secure
water rights.
Good planning requires that you continually evaluate your source to
determine if it is adequate to deliver the amount of water required not
only for the present but also into the future.
A source water or
groundwater/wellhead protection plan is a good idea. Land uses in the
area supplying water for a public water system can, and do, impact water
quality. Increasingly, more and more water systems are taking steps to
protect their water source by planning, ordinances and other land use
controls.
All
water systems must meet the requirements of the SDWA and other such
standards set by your state.
All
water systems should have clearly defined service areas. Some states
certify service areas and others do not.
Plans
for operations and maintenance are recommended to prevent problems of
memory and employee turnover.
All
certification requirements imposed by the state and county governments
must be met.
The majority of water systems in this state belong to the Minnesota
Rural Water Association for very obvious reasons. They offer help when
you need it. Training on a variety of subjects and technical assistance
at your doorstep are but two important reasons to be a part of this
organization.
Keeping your water loss
at a very low level is a well-recognized method of keeping costs down.
Your water loss should be below 15 percent.
For water systems
with a limited source or that purchase water, a conservation plan
insures that this limited product is used to its greatest benefit. For
systems that serve more than 1,000 persons a Water Conservation and
Emergency Plan must be submitted to the Minnesota Department of Natural
Resources.
Accurate maps are a
necessity for all well run systems. Relying on human memory is not
efficient and only lasts one generation.
All operators must
have the level of certification required for their system. In addition
to certification, operators should attend training to assist them in
maintaining their skills at their highest level. Water operators are
encouraged to increase their certification level to the highest class
you can be.
This will prepare you
in the event a major redesign of your facility is done and that
improvement increases your system classification. Minnesota Rural Water
Association training sessions are an excellent source of information and
a method of staying current.
Emergency plans are needed! Planning for all contingencies allows vital
water service to be continued during a time of crisis.
Facility service manuals are another method of insuring that water
systems continue to operate properly even with a change of personnel.
A
sanitary survey is an onsite review by the Minnesota Department of
Health of the water source, and the facilities, equipment, operation,
and maintenance of a public water system. A sanitary survey is meant to
identify problems, which may affect the safety of the water. The survey
is based on a physical inspection of the water system and how the system
is operated and maintained.
Violations of the SDWA
are serious and should be corrected immediately. Last year less than ten
percent of the water systems exceeded a maximum contaminant level or an
action level. Most violations are for monitoring and sampling. While
these violations are not as serious as exceeding a contaminant level,
they should be promptly corrected. Steps should be taken to insure that
this type of incident is prevented.
Safety programs are designed to protect employees and the public. Water
systems have many potentially dangerous situations that can be
eliminated with a little planning.
It is the responsibility of every water system to offer quality service
and be responsive to customer needs. To do otherwise is to invite
trouble.
The following questionnaire will allow you to focus on several critical
aspects of the operation of your water system. We hope some of these
questions will be thought provoking and challenging. If you have found
that additional information is needed to answer all the questions, or
you need assistance in understanding some of the suggestions offered,
please call the Minnesota Rural Water Association.
Water systems must strive to improve every aspect of their operations.
By using this questionnaire on an annual basis, your water system can
see the changes that have been made and how the improvements have
brought better water, better service and better prices to your
customers.
|
Self-Assessment for Capacity Development |
Background:
The
Safe Drinking Water Act requires new public water supply systems or
systems applying for state revolving loan funds to demonstrate certain
capabilities. Those water systems must have the technical, managerial
and financial capability to meet present and foreseeable regulations,
provide adequate water service and operate as financially viable
entities. This responsibility is referred to as “Capacity Development.”
The
Minnesota Rural Water Association feels it’s important that all public
water systems have appropriate technical, financial and managerial
capacities. However, we feel it is essential that smaller public water
supply systems recognize that their systems are most vulnerable in their
ability to demonstrate Capacity Development.
The
following self-assessment provides your public water system with the
opportunity to review and assess the various areas that are generally
considered as critical, basic components in achieving and maintaining
Capacity Development. We encourage you to complete this assessment to
demonstrate that your system is prepared to meet its present and future
obligations as a viable public water system. We also encourage you to
complete this assessment on an annual basis since changes occur very
rapidly on water systems. A few of the following questions may not be
applicable to your system depending on its ownership type. In those
cases, it is appropriate to ignore those questions. The Minnesota Rural
Water Association is ready to assist you in preparing and meeting these
new challenges. Your professionalism and commitment will help rural
water be the leader of the new millennium.
| System: |
_______________________________________________________________ |
| Type of system
ownership (municipal, districts, homeowner association, co-op,
etc.) |
|
__________________________________________________________________________ |
|
Is system a for-profit or non-profit? |
____________________________________________ |
|
Formed under what statute? |
________________________________________________ |
|
Name of person in charge (Owner, Manager,
President) |
______________________________ |
|
Address |
_______________________________________________________________ |
|
Phone number |
____________________________________________________________ |
|
Number of connections __________________ |
Population served_______________________ |
Financial
|
Are you on target with budgeted income and
expenses? |
Yes |
No |
|
From last audit are current total assets greater
than your liabilities? |
Yes |
No |
|
If not, do you have a plan to change the
situation? |
Yes |
No |
|
Do you have a long-range financial plan? |
Yes |
No |
|
Are you following it? |
Yes |
No |
|
Do you adequately fund depreciation or have other
reserves? |
Yes |
No |
|
Do you have a capital improvement plan? |
Yes |
No |
|
Financial controls (check all boxes that apply) |
|
|
|
Monthly
financial statements |
Yes |
No |
|
Monthly review
of financial statements by board, council or owner |
Yes |
No |
|
Annual audit |
Yes |
No |
|
Written
financial policies |
Yes |
No |
|
Do you review
your rate structure annually? |
Yes |
No |
|
Does your current rate structure produce income
to cover: |
|
|
|
Current
expenses |
Yes |
No |
|
Replacement
costs |
Yes |
No |
|
Reserves |
Yes |
No |
|
Are all contractual obligations being met? |
Yes |
No |
Management
|
Indicate your governance structure (i.e. elected
board, council, appointed, sole ownership, etc.) |
|
______________________________________________________________________________ |
|
Are by-laws, resolutions, ordinances and/or
covenants up-to-date, if applicable? |
Yes |
No |
|
Date of last
review? ___________________________ |
|
Does governing body meet on a regular basis? |
Yes |
No |
|
Are minutes of meetings available? |
Yes |
No |
|
Is an annual budget prepared and reviewed at
board or council meetings? |
Yes |
No |
|
Do you have a federal ID number from the IRS? |
Yes |
No |
|
Do you have written operational policies (i.e.
connection, cut-off, payments, etc.)? |
Yes |
No |
|
Are policies up-to-date? |
Yes |
No |
|
Is the person in charge clearly defined? |
Yes |
No |
|
If applicable, is there a staffing chart
(organizational chart)? |
Yes |
No |
|
Are there written personnel policies? |
Yes |
No |
|
Are they up-to-date? |
Yes |
No |
|
Is system in compliance with all state and
federal laws? |
Yes |
No |
Technical
What is your water
source? Surface __________ Ground __________ Purchased __________
|
Are water rights sufficient and secured? (For
Western states) |
Yes |
No |
|
If purchased, does your supplier have a source
water protection plan? |
Yes |
No |
Is the quantity of water available from your
water source adequate for the
next five years? |
Yes |
No |
|
Does your source meet or exceed SDWA standards? |
Yes |
No |
|
Does or will it meet standards without extensive
treatment? |
Yes |
No |
|
If not, are you aware of: |
Yes |
No |
|
What treatment is or will be required? |
Yes |
No |
|
Treatment costs? |
Yes |
No |
|
Operator skills required? |
Yes |
No |
|
Likely contaminates that may affect your system
in the future? |
Yes |
No |
|
Is your service area clearly defined? |
Yes |
No |
Does your system have a plan for operations and
maintenance?
(Examples: line flushing and storage tank maintenance) |
Yes |
No |
|
Have all the certification requirements for
operations been met? |
Yes |
No |
|
Is your operator certified? |
Yes |
No |
Is the system aware of the benefits of industry
related service organizations
such as the Minnesota Rural Water Association. |
Yes |
No |
|
Does the system calculate and control water loss? |
Yes |
No |
|
Does your system have a conservation plan? |
Yes |
No |
|
Does your system have accurate maps of
distribution system? |
Yes |
No |
|
Do your operators have the appropriate level of
certification? |
Yes |
No |
|
Do your system personnel attend appropriate and
current training sessions? |
Yes |
No |
Is your system required to have an approved
emergency plan?
If so, give date of last review:
___________________________________ |
Yes |
No |
|
Does your system have and use facility service
manuals? |
Yes |
No |
|
Have you corrected the deficiencies noted on your
last sanitary survey? |
Yes |
No |
|
Has your system had a violation of the SDWA in
the last year? |
Yes |
No |
Does your system periodically review safety
programs?
(i.e. OSHA requirements, etc.) |
Yes |
No |
Does your system strive for quality service and
to be responsive to
customers needs? |
Yes |
No |
If you had
difficulty answering any question or answered "no" to any of these
questions, we encourage you to contact us. Your water system should set
up a strategy to resolve all issues that could not be answered
positively. The attached information addresses some of the critical
issues raised on this questionnaire. The Minnesota Rural Water
Association is committed to providing the technical assistance and
resources that can assist with your system's Capacity Development.
For more information contact Minnesota Rural
Water Association at 800-367-6792.
|
Copyrighted
by the National Rural Water Association
for use by NRWA state associations.
2915 South 13th
Duncan, Oklahoma 73533
580-252-0629
E-mail: mail@nrwa.org
|
|