11a Formation of a Fire Protection DistrictMEMORANDUM
TO: CITY COUNCIL
FROM: RIKI HEATH, INTERIM FIRE CHIEF – FIVE CITIES FIRE AUTHORITY
SUBJECT: DISCUSSION AND RECOMMEN DATION REGARDING FORMATION OF A
FIRE PROTECTION DISTRICT ADOPTION OF A FIRE SUPPRESSION
BENEFIT ASSESSMENT BY THE FIVE CITIES FIRE AUTHORITY
DATE: FEBRUARY 14, 2012
RECOMMENDATION:
It is recommended the City Council: 1) discuss and provide a recommendation to the Five
Cities Fire Authority (Authority) Board of Direct ors (Board) with regard to formation of a fire
protection district and adoption of a fire supp ression benefit assessment; and 2) provide
direction to the Council/Board representative to communicate the City’s recommendations
at the next Authority Board meeting on February 24, 2012.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
Staff’s goal was to generate sufficient funding to create a capital replacement fund and to
add three engineers, one battalion chief and one clerical position, which equaled
approximately $1.1 million. An engineering study to establish an assessment district could
cost up to $50,000.
BACKGROUND:
Several months ago, the Authority Board task ed staff with exploring the possibility of the
formation of a Fire Protection District and/or adoption of a Fire Suppression Benefit
Assessment, both mechanisms directed at further revenue generation necessary for the
provision of fire protection services by the Aut hority. Consistent with the Board’s direction,
staff has employed the services of consultants in two areas; 1) the actual process (Terrain
Consulting, Inc.) and 2) specific legal expertise related to either task (Colantuono & Levine).
At the January 20, 2012 meeting, the Authority Board directed staff to bring this item to the
three (3) component jurisdictions for discussion and recommendation. After the individual
jurisdictions have the opportunity to review an d discuss this item, it will return to the
Authority Board for further action.
Below is the summary of the two potential avenues to be considered by the City Council.
Staff will be prepared to respond to any questions or provide further information as required.
Agenda Item 11.a.
Page 1
CITY COUNCIL
POTENTIAL FORMATION OF A FIRE PR OTECTION DISTRICT OR A LEVY
FEBRUARY 14, 2012
PAGE 2
ANALYSIS OF ISSUES:
Formation of a Fire Protection District :
The initial step in formation of a Fire Protection District is either a petition signed by twenty
five percent (25%) or more of the registered voters for the proposed district area or an
application to the Local Agency Formation Commission (“LAFCO”) by each of the
jurisdictions. This in turn would require separate actions by the cities of Arroyo Grande,
Grover Beach and by the Oceano Community Services District (potentially through the
County Board of Supervisors).
Following the adoption of resolutions of a pplication to LAFCO by the jurisdictions, the
matter would move before the LAFCO Board for an approval which, depending on the
process, may result in a much simplified protest hearing or an election by the residents
affected by the district. If the district is proposed to be funded by a special tax, both
formation of the district and the proposed special tax may be included in a single ballot;
however, a two-third vote would be required for the special tax, which would then also effect
the question of the district itself. If no specia l tax is proposed, formation of the district is
determined by a simple majority vote.
Adoption of a Fire Suppression Benefit Assessment :
Another avenue is the pursuit of a Fire Suppression Benefit Assessment which, as a
revenue generating activity, is authorized under the Joint Powers Agreement as a function
that can be undertaken by the Authority Board. However, a Fire Suppression Benefit
Assessment cannot fund paramedic services and related equipment or apparatus.
Therefore, an assessment can fund fire suppression services, but not other life-safety
services. As proportionality is required between the amount of assessment and the special
benefit derived by each property from those services funded, a detailed analysis needs to
be performed and a written engineer’s report needs to be obtained to support the amount of
the proposed assessment.
If this is the process desired by the Board, the first step would include a resolution ordering
an assessment engineer to prepare a written engineer’s report which has very specific
detailed requirements. Once the report is completed, it is presented to the Board and
considered for preliminary approval by resolution at a noticed public hearing. If adopted,
the resolution will set a second public hearing on the proposed assessment to consider
weighted protests. Ballots are weighted based on the financial obligation of the affected
property. Proposition 218 notice and protest procedures would be applicable to this process
and the assessment can be adopted if the ballots submitted before or at the public hearing
do not outweigh those in opposition. If a weighted majority favors the Benefit Assessment
District, it may be imposed.
Agenda Item 11.a.
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CITY COUNCIL
POTENTIAL FORMATION OF A FIRE PR OTECTION DISTRICT OR A LEVY
FEBRUARY 14, 2012
PAGE 3
Public Opinion Survey :
The results of the survey indicated that voters and property owners are somewhat price
sensitive with respect to the proposed fire and emergency services measure, especially
when their attention is focused on the tax rate. At the highest tax rate tested ($93 per year
per property), 55% of respondents indicated that they would vote in favor of the measure.
Incremental reductions in the tax rate resulted in incremental increases in support for the
measure, with 62% of respondents indicating that they would support the measure at an
annual tax rate of $66 per property.
The number of $1.1 million was selected at random as suggested by Terrain Consulting,
Inc., and was determined by using the following figures:
Additional Personnel :
3 Engineers with total compensation 358,188.00
1 Battalion Chief with total compensation 159,152.00
1 Clerical Staff with total compensation 76,000.00
Total $593,340.00
Capital Replacement Items :
Fire apparatus replacement 480,034.75
Other capital items replacement 47,881.17
Total $527,921.92
Grand Total :
Additional Personnel 593,340.00
Capital Replacement Items 527,921.92
Total $1,121,261.90
Several consultants were recommended by Mr. Colantuono for the engineer study
regarding the benefit assessment. Harris & Associates was able to provide the following
estimate over the phone breaking the study into two phases:
Phase I: A preliminary assessment feasibility analysis to determine what percentage per
parcel can cover the cost for fire suppression along with the types of risks associated with
that parcel = $20,000 to $25,000;
Phase II: The remaining balance of the engineer’s repo rt determining the level of support
from the community. Total cost including Phase I = $50,000 to $75,000.
ADVANTAGES:
As indicated, there are a number of advantages and disadvantages associated with the
formation of a Fire Protection District and the alternative of pursuing a Fire Suppression
Benefit Assessment. The Council should carefully consider several points in providing
feedback to the Authority Board and to staff.
Agenda Item 11.a.
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CITY COUNCIL
POTENTIAL FORMATION OF A FIRE PR OTECTION DISTRICT OR A LEVY
FEBRUARY 14, 2012
PAGE 4
The creation of the District with an elected board would remove all of the responsibilities
and obligations the City currently has as a member of the Authority for services provided by
the Authority. Depending on how the financing for the District is stru ctured, it is possible
that the formation of the District could limit the amount of funds the City pays to the District
for services in the future by guaranteeing a set amount of the General Fund Property Tax to
be shared with the District. This arrangement would assist with budgeting in future years.
The Fire Suppression Benefit Assessment woul d be subject to a Proposition 218 process
and, thus, would not need to be scheduled at the same time as a general election. Both
current and future fire suppression costs could be included as a part of the assessment and
the amount of the assessment could be tied to changes in the Cost of Living index which
could limit the need to seek additional increases.
DISADVANTAGES:
The City may be more removed from the decision making process associated with the
provision of services. Proceeding with a fire suppression benefit assessment would require
the retention of an assessment engineer, which could prove costly, and a breakdown of the
cost of providing fire suppression services versus emergency medical services would have
to be developed.
ALTERNATIVES:
The following alternatives are provi ded for the Council’s consideration:
• Recommend to the Authority Board to initiate the process for formation of a Fire
Protection District;
• Recommend to the Authority Board to initiate the process for imposition of a Fire
Suppression Benefit Assessment;
• Recommend to the Authority Board not to pursue either option; or
• Provide other direction to staff.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The agenda was posted in front of City Hall on Thursday, February 9, 2012. The Agenda
and report were posted on the City’s website on Friday, February 10, 2012. No public
comments were received.
Agenda Item 11.a.
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