CC 2018-05-29_05a FCFA_MOAMEMORANDUM
TO: CITY COUNCIL
FROM: JIM BERGMAN, CITY MANAGER
BY: STEPHEN LIEBERMAN, FIRE CHIEF
SUBJECT: CONSIDERATION OF APPROVAL OF FIVE CITIES FIRE AUTHORITY
MEMORANDUM OF AGREEMENT AMENDING THE FIVE CITIES FIRE
AUTHORITY JOINT EXERCISE OF POWERS AGREEMENT AND
GENERAL COUNSEL CONFLICT WAIVER
DATE: MAY 29, 2018
SUMMARY OF ACTION:
Approval of Five Cities Fire Authority (FCFA) Memorandum of Agreement (MOA) and
associated General Counsel Conflict Waiver will allow adoption of proposed fiscal year
2018-2019 FCFA operating budget and define a timeline to adopt revisions to the existing
Joint Exercise of Powers Agreement (JPA), including funding allocations, and the
potential reorganization of the existing organization.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
No direct financial impact is anticipated with the staff recommendation. The City Manager,
Administrative Services Director and City Attorney will likely be engaged in ongoing
meetings to support the FCFA Board of Directors and the City Council in adoption of JPA
revisions and potential reorganization.
RECOMMENDATION:
It is recommended the City Council approve the Memorandum of Agreement and General
Counsel Conflict Waiver.
BACKGROUND:
The Five Cities Fire Authority Board of Directors adopted a five-year strategic plan in 2017
and included several priority components of the plan into the draft budget for fiscal year
2018-19. This information has been included in Arroyo Grande’s draft budget (along with
the other member communities). In April of this year, the Oceano Community Services
District (OCSD) Board of Directors adopted their portion of the proposed budget
contingent upon the unanimous approval of the attached Memorandum of Agreement by
the three member communities. The OCSD has recognized that projected revenues for
the 2018-19 fiscal year will be insufficient to cover their portion of FCFA operating
Item 5.a. - Page 1
CITY COUNCIL
CONSIDERATION OF APPROVAL OF FIVE CITIES FIRE AUTHORITY MEMORANDUM
OF AGREEMENT AMENDING THE FIVE CITIES FIRE AUTHORITY JOINT EXERCISE
OF POWERS AGREEMENT AND GENERAL COUNSEL CONFLICT WAIVER
MAY 29, 2018
PAGE 2
expenditures and the OCSD will be considering a revenue measure to increase available
revenues.
ANALYSIS OF ISSUES:
The FCFA “Managers Working Group,” comprised of the two City Managers, District
Manager and attorneys, met several times to amend the content of this document to
represent the interests of all three communities. As the MOA is considered an amendment
to the FCFA JPA, the document requires approval by all three JPA participating agencies.
Approval within each agency does not need to be unanimous, but all three agencies must
approve the amendment.
Key components of the MOA include:
Provision for “good faith” efforts to consider amendments to the JPA including the
funding formula
Should efforts to amend the existing JPA not be agreed upon by April 1, 2019, then
any member agency may withdraw
If the remaining parties cannot agree upon amendments by April 1, 2019, the JPA
shall be terminated by December 31, 2019
Modifications of withdrawal language to release a withdrawing party from future
lease payments for apparatus/equipment they will not retain when they leave the
organization
Provision allowing two agencies to enter into a new agreement and operate under
the trademarked name, Five Cities Fire Authority
Provision for “good faith” efforts to establish a distribution of major assets and
future obligations of the parties by April 1, 2019, in preparation of a potential
withdrawal or termination.
Provision to allow the current FCFA General Counsel (who also represents Grover
Beach) to continue to represent both organizations
Acknowledgement of existing conflict waiver associated with legal representation
Mr. David Hale serves in the capacity as both General Counsel for the FCFA and City
Attorney for the City of Grover Beach. Mr. Hale has requested that all member
communities review and approve the attached conflict waiver document.
ALTERNATIVES:
1. Approve the Memorandum of Agreement Amending the Five Cities Fire Authority
Joint Exercise of Powers Agreement and General Counsel Conflict Waiver;
2. Do not approve one or both documents;
3. Provide direction to staff.
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CITY COUNCIL
CONSIDERATION OF APPROVAL OF FIVE CITIES FIRE AUTHORITY MEMORANDUM
OF AGREEMENT AMENDING THE FIVE CITIES FIRE AUTHORITY JOINT EXERCISE
OF POWERS AGREEMENT AND GENERAL COUNSEL CONFLICT WAIVER
MAY 29, 2018
PAGE 3
ADVANTAGES:
Approval of the proposed documents will define a finite timeline to implement revisions to
the existing JPA document, including the funding formula. Should one or more member
communities not agree to proposed changes, the timeline provides options for withdrawal
or termination of the JPA. In addition, approval of the proposed documents allows the
FCFA to move forward with adoption of the budget as envisioned in the Strategic Plan,
which enables the FCFA to address significant staffing and service level challenges.
DISADVANTAGES:
No disadvantages of approving the MOA and General Counsel Conflict Waiver have been
identified.
ENVIRONMENTAL REVIEW:
No environmental review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted at City Hall and on the City’s website in accordance with
Government Code Section 54954.2.
Attachments:
1. Memorandum of Agreement Amending the Five Cities Fire Authority Joint
Exercise of Powers Agreement
2. General Counsel Conflict Waiver
3. Five Cities Fire Authority Staff Report – May 18, 2018
4. Oceano Community Services District Staff Report – April 25, 2018
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Memorandum of Agreement (MOA)
Amending the
Five Cities Fire Authority
Joint Exercise of Powers Agreement
This agreement is entered into by the Cities of Arroyo Grande and Grover Beach, and the
Oceano Community Services District, which are hereinafter referred to as the Parties. This
amendment to the Joint Exercise of Powers Agreement, dated June 7, 2010 (“Amendment”),
includes the following terms and provisions relating to the operations of the Five Cities Fire
Authority (“FCFA”), which operations shall continue as provided in the Joint Exercise of Powers
Agreement (“JPA” or “JPA Agreement”).
1. Each Parties’ contributions for funding the Fiscal Year 2018/19 FCFA budget
shall be:
a.City of Arroyo Grande $ 2,523,661
b. City of Grover Beach $ 1,798,108
c.Oceano Community Services District $ 987,362
2. For Fiscal Year 2018/19, staffing shortages shall be operationally managed by the
Fire Chief with updates provided to the Board of Directors. Such staffing shortages may result in
temporary closure or reduced staffing at fire stations.
3. During Fiscal Year 2018/19, the Parties shall act in good faith to meet and confer
for the purpose of considering amendments to the JPA including, but not limited to,
modifications to the funding formula contained in Exhibit B of the JPA Agreement (“Funding
Formula”), the provisions regarding member withdrawal, and future staffing levels beyond Fiscal
Year 2018/19, so that the JPA may be amended to meet the needs of each of the Parties. If the
Parties cannot agree upon amendments and a restructured JPA by April 1, 2019, then any
member agency may withdraw pursuant to the terms of this Amendment. Notwithstanding the
potential withdrawal of a member agency, if the remaining Parties cannot agree upon
amendments and a restructured JPA by April 1, 2019, the JPA shall be terminated as of
December 31, 2019, and assets and liabilities shall be distributed by and among the Parties
pursuant to Sections 4 and 5 below.
4. During Fiscal Year 2018/19, the Parties shall also act in good faith to meet and
confer in order to do the following by April 1, 2019, in preparation for the potential withdrawal
of a member agency and/or termination of the JPA:
a.Establish a distribution of assets currently owned and/or in the possession
of the JPA, including, but not limited to major pieces of apparatus and capital
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equipment, which will allow all three Parties to maintain sufficient apparatus and
capital equipment to establish an independent fire service; and
b. Establish the obligations of the Parties to pay future obligations that were
incurred by the FCFA prior to July 1, 2019, including, but not limited to, those
future obligations related to lease payments on Engine 2 and 3 and future
pension/PERS obligations.
c. Notwithstanding the forgoing, the Parties mutually agree and understand
that as a result of the withdrawal of a member agency or the termination of the
JPA, no Party shall be obligated to future payment lease obligations for any
Engine that does not remain in the custody, control, and possession of that
agency.
5. If the Parties are unable to agree upon amendments and a restructured JPA by
April 1, 2019, then the Parties shall act in good faith to meet and confer to finalize the
distribution of all assets currently owned and/or in the possession of the JPA not established for
distribution in accordance with Section 4.a above, such as additional tools, machines, parts,
supplies, communication devices, computers, office equipment supplies and furnishings, by
December 31, 2019.
6. Upon mutual agreement of the City Manager of Grover Beach, the City Manager
of Arroyo Grande, and the General Manager of Oceano CSD that the Parties are making progress
towards JPA amendments and working in good faith, the April 1 deadlines contained within this
Amendment will be extended for a period not to exceed six (6) months and will result in a
corresponding extension of time of the December 31, 2019 deadline so as to always allow an
eight month wind down for distribution of assets and establishment of new services. This
extension may be handled administratively with no requirement of board approval from any of
the Parties.
7. Upon termination of the JPA or the withdrawal of an agency, any two agencies
subject to the JPA Agreement may agree, without consent of the third agency, to continue
operating under the FCFA name and branding and/or reestablish the FCFA under a new
agreement and operate under the FCFA name and branding.
8. The Parties understand and acknowledge that consistent with the Joint Exercise of
Powers Agreement and the conflict waivers contained therein, dated June 7, 2010 and the signed
waiver agreement, dated May 18, 2018, between the FCFA Board, the City Council of the City
of Grover Beach, the City Council of the City of Arroyo Grande and Board of Directors of the
Oceano Community Services District, the Grover Beach City Attorney, David Hale is
representing the Five Cities Fire Authority as General Counsel and the City of Grover Beach as
City Attorney in regards to the performance of the tasks identified in this Amendment. To the
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extent said representation may result in a potential or actual conflict of interest pursuant to
Section 4. E. (7) of the JPA Agreement, the Parties hereby waive the requirement that Mr. Hale
withdraw from representing either Party and agree to sign the conflict waiver agreement,
attached as Exhibit “A”, manifesting the subject waiver to the JPA Agreement Section 4. E. (7)
and that the signing by the parties herein of the subject conflict waiver agreement is a
representation by the parties the subject conflict waiver is in compliance with the California
Rules of Professional Conduct, section 3-310 and has adequately advised them of the potential
conflicts contained within the subject representation. Moreover, the City of Arroyo Grande and
Oceano Community Services District are represented by independent legal counsel which has
reviewed the conflict waiver and advised them regarding said agreement.
9. To the extent there is inconsistency between this Amendment and the JPA, the
terms of this Amendment shall control, including but not limited to JPA Sections 4.E.(7), 6.B,
8.B.(3), and Section 17.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and attested by their proper officers hereunto duly authorized, and their official seals to be hereto
affixed, as of the day and year first above written.
CITY OF ARROYO GRANDE CITY OF GROVER BEACH
By: __________________________ By: __________________________
_______________, Mayor _______________, Mayor
Attest: Attest:
_____________________________ ______________________________
_______________, City Clerk _______________, City Clerk
OCEANO COMMUNITY SERVICES DISTRICT Attest:
By: ___________________________ ______________________________
_________________, President ______________, Board Secretary
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STAFF REPORT
TO: Chair and Board Members MEETING DATE: May 18, 2018
FROM: Stephen C. Lieberman, Fire Chief/Executive Officer
SUBJECT: Consideration of Board Support for the draft "Memorandum of Agreement
Amending the Five Cities Fire Authority Joint Exercise of Power
Agreement" and the General Counsel's Conflict Waiver
RECOMMENDATION
It is recommended that the Five Cities Fire Authority Board of Directors support the Memorandum of
Agreement amending the Five Cities Fire Authority Joint Exercise of Power Agreement and the General
Counsel's Waiver and forward the documents to their member communities for approval prior to the
adoption of the member community operating budgets.
BACKGROUND
At the March 16, 2018 Five Cities Fire Authority (FCFA) board meeting, the "Strategic Plan" version of a
draft budget was unanimously selected as the preferred draft to share with the member communities for
fiscal year 2018-2019 budget planning.
On April 25, 2018, the Oceano Community Services District (OCSD) Board of Directors adopted a
resolution approving their community's portion of the "Strategic Plan" draft budget subject to the approval
of a Memorandum of Agreement (MCA) with the cities of Arroyo Grande and Grover Beach. The Oceano
Community Services District (OCSD) has recognized that projected revenues for the next fiscal year will
not cover their portion of planned expenditures and the District Board will need to consider a ballot
measure to increase revenues to cover the cost of fire protection. The ballot measure will be presented to
the community's voters in November 2018, well after the required deadline to adopt an operating budget.
Due to the associated timing issue, the OCSD has conditioned their approval of the fiscal year 2018/2019
"Strategic Plan" budget on the approval of the MCA. The resolution stipulates that if the MCA is not
approved by the other member agencies, the OCSD Board would support the "Status Quo" draft budget.
The FCFA "Managers Working Group" has met several times to discuss and propose revisions to the
original draft MCA document created by the OCSD. Consensus agreement among the group (and legal
counsel for each community) was reached on May 10, 2018. As the MCA is considered an amendment to
the Joint Exercise of Power Agreement (JPA), the document requires unanimous approval by all three
member communities along with their approval of FCFA General Counsel's Conflict Waiver.
Key components of the draft MCA include:.
•Provision that requires "good faith" efforts to consider amendments to the JPA including the
funding formula
•Provision to allow the current FCFA General Counsel (and City of Grover Beach City Attorney) to
continue to represent both organizations.
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