|The City has recently struggled with being able to meet all of their accounts payable including making electric payments on time and purchasing heating fuel. On June 26, 2007, the City had their electricity disconnected due to non-payment. This service disconnection to City hall, water, and wastewater treatment facilities could cause the release of raw sewage into Kootznahoo inlet and result in a shortage of drinking water and no fire protection. Inside Passage Electric Cooperative is willing to workout a repayment plan with the community, however there is concern that the City does not have the financial resources to enter into a repayment agreement and fulfill their obligation.
The FY07 budget was adopted by the City council on October 20, 2006. The water enterprise fund is primarily funded through user fees. This fund is budgeted to receive $30,000.00, which is a slight increase over FY06 actual revenue. The fund has $83,400.00 in budgeted expenditures, which is $3,371.00 below FY06 actual expenditures. The water fund is budgeted to operate at a $53,400.00 deficit with no other sources of revenue identified to subsidize operations. The combined water, wastewater and garbage funds are budgeted to operate at a $63,625.00 deficit.
The Mayor provides the Council with verbal status reports on the utility. The Council does not make budget amendments during the fiscal year. Once the Council has adopted the budget, it remains the same until the next year's budget is prepared.