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Fire Services Fiscal Review
MESSAGE FROM THE CITY MANAGER
In October 2016, the City Council authorized the release of a Scope of Work to conduct a Fire Services Fiscal Review. This webpage will be a repository of any information collected and actions taken regarding the effort.
HISTORY AND OVERVIEW
The effort first began in 2013/14 when the Town sought out data for its Local Municipal Services webpage. The Local Municipal Services webpage is designed to inform residents about the various services and service providers they use as residents of the Town. When preparing the webpage, an issue arose related to the property tax revenue received by the Fire District from Atherton residents. It was thought that perhaps revenues could have outpaced the cost to provide fire services to the community. The District’s 2016/17 Budget reflected 8,547 Calls for Service in 2015. The map of each call with the Town’s boundary superimposed is shown below (the underlying call image is from the District's 2016/17 Budget Document) (PDF).
The image reflects that the bulk of calls for service from the Fire District are provided to areas outside of the Town of Atherton.
After publishing the webpage, the Town sought separately to clarify the data with the Fire District and asked the District for more detail. Over the intervening time, there was correspondence back-and-forth via email and ultimately, a formal request for data and a formal response from the District (PDF). As part of the District’s response, the District had recently updated an analysis of their property tax revenue from the various jurisdictions within their District. The District had their consultant, MuniServices, extract the data for Tax Rate Areas within Atherton (PDF). That Report provided in summary that the District receives $11.8 million a year in property tax revenue from the residents of the Town of Atherton (after ERAF). The Report also identified that Atherton was responsible for 31.7% of the District’s total property tax revenue - the County making up 15.6%, Menlo Park 47.1% and East Palo Alto, 5.6%. While the Town made up 31.7% of the District’s revenue, Atherton residents make up 8% of the District’s population of 90,000 and potentially a lesser amount of calls for service as shown in the map above.
The Council wanted to know with more specificity, what the costs were to provide services to Atherton residents. In response to this question, the District advised that they did not collect data in that way and were unable to provide a detailed answer. Acknowledging that response, but still seeking an answer to the query, the Council directed that staff put together a potential scope of work to get at the data they were seeking. The District advised that while they would not be actively participating in the Study itself, they would continue to provide whatever information they had available via their website.
The proposed Study focuses on three areas:
First, wat revenue does the District receive from property taxes from Atherton residents? That question has essentially been answered by the District. The purpose of the question is to determine the actual amount of property taxes that the District receives solely from Atherton residents.
Second, what are the actual costs for services received by Atherton residents? To get to that data, the consultant will have to extract the cost of services attributable to the Town and its population and land use demographic. Because the District serves multiple independent agencies within its own District boundaries, they do not segregate services (or data) by jurisdiction. The District provides services District-wide. As a result, the consultant will have to parse the data by jurisdiction to the maximum extent possible, inclusive of any overhead and special services provided by the District, District-wide. For example, while the Town only has 1 Fire Station within the Town’s boundaries, the residents are actually serviced by 5 or more Stations using the “closest unit” model of response. The consultant will have to look at the community as a whole and segregate out those costs from all Stations attributable to the Town.
Data from the District was provided to the potential RFP respondents for calls for service from October 2015 to October 2016 (PDF). During this year period, there were 517 calls, the call breakdown is as follows:
|Incident Type||# of Calls||%|
|Fire Response (cooking fire, property fire, vehicle fire, grass fire, etc.)||8||1.54%|
|Rescue & EMS (medical assist, EMS, vehicle accident) - note: the District assists but does not transport||242||46.80%|
|Hazardous Condition (no fire - power lines, short circuits, gas leak, etc.)||16||3.09%|
|General Service Call (water problem, smoke/odors, animal rescue, public assist)||103||19.92%|
|Good Intent Calls (cancelled enroute, no incident found, etc.)||55||10.63%|
|False Alarm/False Calls||93||17.98%|
|Total Calls|| 517||100.00%|
Third, to allow residents to get a true comparative, the consultant is tasked with a third task of determining what the cost of services would be if the Town itself were responsible for providing the services independent of the District. It is anticipated that this cost would likely be more than the cost of services provided by the District due to economies of scale.
The City Council has been clear that the intent of the analysis is not to consider providing services independent of the Fire District; nor is the Town seeking to gain any additional revenue share. At this stage, the intent is data gathering.
However, if after the results, the District and Town are able to identify different service levels or service needs for the Town and have a conversation about how to address those needs that would be a positive outcome. Also, if the residents of the Town wish to address the issue in some other way, the Council would be participants in those conversations as well.
Fire Impact Fee Nexus Study by the Fire District
The issues were further complicated in 2015 when the District completed an Impact Fee Nexus Study and sought to have Atherton, Menlo Park, East Palo Alto and the County adopt the Study and thereby impose a new fee on Atherton residents. The District itself could not impose the fee so each respective jurisdiction was required to impose the fee on behalf of the District. Because the Town would be adopting the Impact Fee Nexus Study independently and vouching for its analysis of need, more data was required to validate the need to impose fees on Atherton residents when the question of property taxes versus cost of services was still unanswered.
Responses to the Town's Request for Proposal were due at 4 pm on March 31. The Town received 4 bid responses:
Staff reviewed the proposals and recommended Matrix Consulting Group to the City Council at the April 19 Council Meeting. The Council awarded the professional services agreement to Matrix Consulting Group and a Kick-Off Meeting was held on May 10.
Project Leads for Matrix Consulting Group are:
Matrix Consulting Group has hosted initial meetings with the Town and the Fire District to begin gathering data. Matrix will begin with data collection, interviews, and development of a baseline descriptive profile. Following data collection, Matrix will conduct an operational analysis, to include support services, of the current fire response network. Following the operational analysis, Matrix will conduct a financial analysis and develop options for fire service delivery. Once a draft report is complete, Matrix will assist the Town with disseminating the information out to the community via a series of community and stakeholder meetings. It is anticipated that the work effort will take between 14 and 16 weeks.
Tasks 1 through 3 have been completed and the completed report is part of the Agenda Item below for January 17, 2018. Matrix completed Tasks 1 through 3 of the Study on budget at $49,500. On March 21, the Council authorized the completion of a Task 4 for the Project. Matrix completed Task 4 for the Project on budget at $13,500. The Task 4 Report is due to be presented to the CIty Council on July 18.
- October 19, 2016 - Review of Scope of Work for a Fire Services Fiscal Review and Authorization to Release a Request for Proposal
- April 19, 2017 - Approval of a Budget Amendment and Award of Consultant Services Agreement to Matrix Consulting Group for the Fire Services Fiscal Review
- January 17, 2018 - Fire Services Fiscal Review - Provide Review, Feedback and Direction on Next Steps
- February 21, 2018 - Fire Services Fiscal Review - Provide Review, Feedback and Direction on Next Steps
- March 21, 2018 - Fire Services Fiscal Review - Review Task 4 Proposal; Discuss Moving Forward with Task 4; and, if appropriate, Approve the Scope of Work and Authorize Staff to Move Forward with Task 4
- July 18, 2018 - Review of Fire Services Fiscal Review Task 4 and Discussion on Next Steps
- RFP - Fire Services Fiscal Review (PDF)
- RFP - Attachment 1 - Fire District Staff Report (PDF)
- RFP - Attachment 2 - Alarm Data - 10/1/15 - 10/1/16 (PDF)
- MPFPD CAFR June 30, 2015 (PDF)
- November 4 Letter to City Manager from Fire Chief - Data Collection (PDF)
- Map - Tax Rate Areas - Parcel Level (PDF)
- Tax Rate Area Spreadsheet (PDF)
- Fire Board Committee Liaison Assignments - 10/18/16 (PDF)
- Notes from the Fire Services Fiscal Review Subcommittee Meeting - 10/11/16 (PDF)
- LAFCO - Preliminary/Working Draft Document of Surrounding Agency Cost of Fire Services (PDF)
- HDL Atherton Assessed Values FY 2016/17 - 10/6/16 Email (PDF)
- Property Tax Revenue - Atherton - MPFPD (PDF)
- MPFPD FY 2016/17 Budget (PDF)
- Muni-Services Presentation - MPFPD - 2/16 (PDF)
- Fire District Board Agenda - 9/20/16 (PDF)
- Board Meeting Staff Report - 9/20/16 (PDF)
- Board Meeting Attachment - A (PDF)
- Board Meeting Attachment - B (PDF)
- Board Meeting Attachment - C (PDF)
- Board Meeting Attachment - D (PDF)
- Board Meeting Attachment - E (PDF)
- Board Meeting Attachment - F (PDF)
- Board Meeting Attachment - G (PDF)
- Board Meeting Attachment - H (PDF)
- Mayor's Letter to Fire District - 10/7/16 (PDF)
- Board Response to Atherton Correspondence - 10/7/16 (PDF)
- Fire Services Fiscal Review Study FINAL - January 9, 2018 (PDF)
- Fire Services Fiscal Review Staff Report to City Council - January 17, 2018 (PDF)
- Letter to Atherton Community - Fire Services Fiscal Review - January 18, 2018 (PDF)