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CC 2022-08-09_11a FCFA Status Update PP Presentation Five Cities Fire Authority Status Update: Oceano Measure A-22 & Wind Down Period 08/09/2022 1 Background The Five Cities Fire Authority (FCFA) was formed on July 9, 2010, through a Joint Exercise of Powers Agreement (JPA) City of Arroyo Grande, City of Grover Beach, Oceano Community Services District (OCSD) The FCFA provides integrated and efficient fire and emergency medical services to the three communities, serving approximately 40,000 residents 08/09/2022 2 In 2017, the FCFA Board of Directors adopted a five-year Strategic Plan The Strategic Plan outlines investments necessary to replace obsolete capital equipment, and provide staffing levels to ensure appropriate levels of service for the three member agencies 08/09/2022 Background 3 In June 2019, an amendment (Second Amendment) to the JPA was approved, altering the funding formula used to determine each member community’s share of costs The alterations were to go into effect if OCSD was successful in passing a special tax measure in 2020 The Second Amendment also identified a “wind-down” process and timeline should the measure fail 08/09/2022 Background 4 OCSD placed a special tax measure on the March 2020 ballot, Measure A-20 The measure failed, falling 10 votes short of the 66.67% necessary to enact the special tax Following the outcome of the OCSD’s ballot measure, a Third Amendment to the JPA was approved in July 2020 08/09/2022 Background 5 Under the terms of the Third Amendment, costs to the City of Arroyo Grande for fire service were to remain the same $2,580,955 per fiscal year, through at least June 30, 2022 OCSD was required to place a new special tax measure on the ballot for the primary election in 2022 08/09/2022 Background 6 Oceano Measure A-22 If Measure A-22 passed, the new funding formula set forth in the Second Amendment to the JPA would take effect July 1, 2022 If Measure A-22 failed, the City’s cost would remain the same through a one-year wind down period (and related work program), resulting in OCSD no longer being a part of the JPA effective June 30, 2023 08/09/2022 7 Measure A-22 was placed on the ballot in Oceano by OCSD in June 2022 Measure A-22 failed to gather a two-thirds majority vote, with final results certified on July 7, 2022, as follows: Yes 775 57.75% No 567 42.25% 08/09/2022 Oceano Measure A-22 8 Wind-Down Period The period between certification of the June 2022 election results and June 30, 2023, is defined as the “wind-down period” in the JPA The Cities of Arroyo Grande and Grover Beach may negotiate a new or modified JPA and maintain the right to use the trademark name of “Five Cities Fire Authority” 08/09/2022 9 March 1, 2023 Estimate as to the distribution of all other assets June 30, 2023 Oceano CSD exits JPA Prior to October 1, 2023 Post-Dissociation reconciliation of: Assets Liabilities Any party owing funds shall pay such funds 08/09/2022 October 1, 2022 Determination of equipment and physical assets February 1, 2023 Estimate as to the distribution of: Debt Employment Liability Pension/PERS All other post-employment obligations Wind Down Period Tasking 10 10/6/2022 FCFA Wind Down Period Flow Chart 11 Wind Down Process A summary of the wind down process was shared on July 15, 2022, with the FCFA Board of Directors and separately with the FCFA Managers Group (City/General Managers of the three member agencies) The Managers Group will meet regularly to oversee the implementation of the wind-down process and expected dates of completion for each work program task 08/09/2022 12 Fire Service Future A separate process will occur between Arroyo Grande and Grover Beach to determine the desired level of fire and emergency medical services and funding needs for the respective communities City Manager led discussions will include negotiations regarding potential modification or dissolution of the JPA and various options for consideration of contract service delivery 08/09/2022 13 Updates Staff will provide regular updates to the City Council An agenda item on the status of the process will be presented to Council this Fall for input and direction, with anticipated completion in early 2023, before completion of the wind down process required by the Third Amendment 08/09/2022 14 Recommendation Receive and file the update on the results of the Oceano Fire Tax Measure A-22 from the June 2022 election and the process of the wind-down period as defined by the Third Amendment to the Five Cities Fire Authority Joint Exercise of Powers Agreement 08/09/2022 15