1. CALL TO ORDER 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL OF BOARD MEMBERS All members present 4. NEW BUSINESS a. Review and discussion of the 2010/2011 Fiscal Year Budget. Don Howard opened the meeting to talk about the alterations and changes made from the first Work Session Budget documents. He explained that administration and the union have sat down and spoke for further changes. Don requested the Board Members take this time to review the attachment containing Items Removed from the Initial Expenditure Budget and Items Added to the Revenue. There was a discussion about the budget draft attachment. Don talked about the increase in Wildland Income noted, informing the Board Members of notable drought in Idaho, Montana, parts of Nevada, Oregon, and Northern California. Even one assignment up there is very valuable for SFD income. Don spoke about the changes made to the budget worksheet. There was a discussion about the 3 tax levies represented on the budget worksheets. A 2.55 mil rate keeps the income as close to the same as it is this year. A 2.475 tax levy represents exactly halfway between the high and low levy marked on the budget sheet. Don talked about levy rate changes and what the capital-carry forward would be with each rate. Don asked if there were questions. Dan Atkinson stated administration has done a lot of work and changes on the budget since the last work session with a small tax levy raise while keeping step increases and health insurance the way it stands. Don talked about the apparatus replacement program and the importance of staying on schedule. He said if we wait too long it can ‘ball’ up - even after a year. The changes to the budget reflect putting off purchasing the sedan and one 4x4 pickup. There was discussion about replacing the 2000 F550 engine that typically goes out of district on Wildland assignments. Don does not think we should sell the suburban because it will bring in such a low amount. Gary asked about disposing of the water tender. Don explained this tender is of construction-grade water tender. It got us through the ISO rating. The apparatus committee would like to buy a new one. He would prefer a tactical tender. This tender is a standard and very difficult to shift making it a driving concern. Jim Doskocil asked if the biggest reason for placement were safety issues. Don replied yes. Jim asked if we can go over the projections. Tina Dillahunty spoke about capitol carry-forward, and if we leave everything the way it is even on this budget that by 2013 all capitol carry forward would be used. Tina explained the budget worksheet. Rick asked what the plan is. Don said we have to look at this differently and year’s before-hand. He commented it would be nice to make $625,000 on Wildland Assignments as they did in the past, but for now we will be dependent on capitol carry forward - we believe - until 2014. Gary Selig said he is not seeing cost increase to show inflation. Don explained these figures are hard. Gary talked about his concerns with inflation on fuel, oil, tires and other items. Jerry asked what formula was used for expenses. Tina explained that some items are not increased and stay on a flat line. Others, like Medical Insurance, show a 15/15/10% increase for the following three (3) consecutive budget years. She said some figures can only be a best guess. There was a discussion about property valuations and the mil rate. Tina said it depends on whose you look at. Tina spoke of her personal assessed values and how they did not represent the true changes seen over the district. Rick asked about (overall) percents. Don explained we are using projections from the county. Over 5 years they project a 22-25% decrease in value assessments. In Maricopa County they are experiencing a 45% (and more) drop in their assessed valuations. There was a discussion and explanation of how the budget worksheets do show the percentage drop in valuations over the fiscal years. Jerry questioned our ability to ask for an over ride, much like the Flagstaff Unified School District (FUSD). Don said based on real property taxes and projections listed, as a Board it is up to you (the board) to set the mil rate. He reminded them that a 3.25 is the highest SFD can vote on. Don said one of his concerns is that there is no building taking place; onlt11 permits have been taken out in this district. The Navajo Nation casino is still being negotiated. If we acquire a contractual agreement it would be approximately 200,000 dollars in revenue. Rick made comment as to how he believed that could help 4 to 5 years out. Rick talked about borrowing money over short periods of time to use in ways needed. Dan Atkinson asked about personnel in the next 4-5 year period. Don said our staff numbers would remain the same. If the Navajo Nation casino went through we would have to add about 15 people, with a projected opening date of fall, 2011. Gary wanted to know the counties thoughts on capitol carry-forward and a maximum mil rate. Don said we cannot put ourselves in a position where we are spending more than we are receiving. The County does not have any real control over SFD unless we are doing things unethically or illegally. The fiduciary responsibility falls under the Board. Don said unless we could cover all the costs in respect to the Navajo casino we would not have a staffing increase. Don still believes that if we lose 3 firefighters we should not replace them all the way up to 2014. There were discussions about the proposed shop and training facility. Jerry suggested we still proceed with the shop and training site. We could generate a small amount of money from the new maintenance facility, but a new plan has to be built. Gary also agreed the shop is needed, but the total cost is the difficult part. He spoke of the cost of ‘lifters’ needed for the shop. Don reminded the Board these costs are included in the budget. As today, plans are for a 15 year mortgage at 5% interest. Tina explained the budget worksheet and how she grouped the buildings and vehicles together in the future budgets (time constraints before this meeting). As years go by the cost of borrowing goes up from interest and Tina has projected this in the budget. There was a discussion about former borrowing of prime interest money through the County and the benefits thereof. There was a discussion about the property market as it stands today. Don spoke about house prices. He believes these drops are close to bottoming out. Rick talked about the federal government financing homes that have been lost by home owners. Rick said people will be allowed to finance the houses they have lost at the lower assessed value rate, making short sales even lower. Don said the market place is doing this naturally, but it is still better to keep these people in their homes, even if it is a lower market value. Tina said the County has already brought down assessed valuations, but these people are upside down in their mortgage. Tina said the County is already showing these figures because of what they are assessing these homes at. There was a discussion about the loan for Station 36 and the engine. The balloon payment is due next year. The intention has always been to refinance before that time. Don, Tina and Sam recommend refinancing it over a 20 year period. Rick asked if the department qualified for an upside down loan. Tina agreed this was a good question. There was a discussion held about what type of equipment could be held for lien leverage. There was other equipment placed on this loan. Tina discussed solutions. There was a discussion held on the saving with refinancing. Dan thinks it best to refinance this year. There was a discussion about the mil rate. Dan said his initial reaction is to go to a 2.55; however it makes an increase in the tax bill. Tina clarified saying with a 2.55 mil rate the taxes would remain about the same. 2.475 would eventually make a decrease for the taxpayers. Jerry talked about the questions and replies from the tax payers; they know their valuations have gone down. If you alienate the taxpayer now, you will have difficulty getting a good response from them in the future. Jerry doesn’t think we should ask for the same amount of money as we did last year. We cannot proceed as if looking at the norm. There was a discussion about a change with Tina’s title. (See attachment) Rick’s concern was the cost to the department when she reaches Step 10 with the new title. Rick doesn’t think this is the best time to do this, nor something we can do now. Rick would like to hear discussion on this. Dan said we give others in the department a raise but not her. Rick talked about her being topped out; it is a hard pill to swallow. Tina topped out 2 years ago. Her title has been changed over the course of her 19 year career with SFD. When Summit merged with Timberline-Fernwood in 2001her title became office manager. Tina said the difference today is to see what the new position’s responsibilities are, not who is in it. Don replied if this were a private industry she would be in upper management. She has more authorization than Battalion Chiefs. There are other districts who have given this title. Don said Tina is qualified for this position and has done this job description for some time. Dan talked about his personal CPA, the qualifications he held, and the difficulty to replace him. Dan said Tina would have to be replaced by more than one person. His concern is her not getting a pay increase over the past two years when she is such a vital part of this department. There was a discussion about one other person in the department who is ‘topped out’ in salary. Rick said if we make this position now, we have to live with it for the next 5 years. Rick said he is trying to cut all the ways he can. Rick thinks at some point we will not be able to give anyone a raise. Jerry talks about the salary schedule and said it is tough when you are young, and you reach your maximum salary. He said the FUSD School Board added steps for those who have capped out. Jerry doesn’t think it is right for her to be capped out in this position. Don explained one of the differences between Tina’s position and firefighters is that firefighters can move up in rank. Tina has acquired a tremendous amount of experience. Don knows this is a difficult thing to look at now, but in terms of experience in an office, you don’t have the layers to move up on as you do on the ‘line’. Gary suggested the possibility to ‘milk out’ the budget to give Tina a raise, and re-debate it again later. Jerry suggested rather than a salary schedule, Jerry would like to debate her raise like it was done as a contract for Don. Don said that would certainly be an option. He said this department has grown and we are functioning with a much larger budget; this is not a sleepy little old fire department anymore with many complexities. Preston talked about longevity pay with those topped out. After 10 years it is a percent that is added. Next year Buck Ashbrook, Patrick Burns and Mike Gillespie will top out on their salary schedule. Dan commented and implied the step system could be changed in the future. Preston said they (firefighters) know about being topped out going into the department. He spoke about how different departments do their step system. Dan said we have the option to set up a different type of policy for changing the step system. Wherever we are at in the step system, we are not locked into it, and it is open for discussion. Rick said this is not the time to add personnel cost; it is hurting us now in order to maintain personnel. Dan wants to see it more even across the board, and suggested we can adjust to what we need. He believes those topped out should get a raise. Don talked about Phoenix Departments and Longevity Steps. Rick talked about the cost of living. He was topped out for approximately 20 years, afterwards only receiving COLA raises as an Engineer with the City of Flagstaff. There was a discussion about the City of Flagstaff and where they stand at this time fiscally. Jim requested the Union Representative speak. Garett Hall spoke about their discussion with Benefit Logic about Medical Health Care coverage. They talked with Benefit Logic about a higher deductible and the option to give the guys with families a savings of approximately $100 a month. Real figures cannot be given out this early in the year, per Benefit Logic, and they are puzzled as to what information they will be able to give out during these controversial times. The Union spoke about all the guys taking a future ‘hit’ in their personal insurance costs to help those with families. There was a discussion about the exhorbant cost a firefighter has to pay to cover his family per month. Garret said the Union was pleased with the opportunity the Chief gave them to go over the budget and budget cuts. Jerry said there are not many areas where we can make significant cuts, but he would rather not consider a salary freeze. Instead, Jerry suggested not giving the entire pay increase and splitting the difference of the two levies to 2.475. He talks about his concern about building a training facility and having to tell the taxpayer we have done everything we can to lower their costs. Chairman Doskocil said there are a number of items that need to be decided; mil rate, salary, and the training facility. Rick thinks we need the maintenance facility but is not convinced we need a training facility. He suggested keeping the Deputy Chief (DC) position open only until January of 2011 and spoke of the money that could be saved. There is the possibility that someone can promote up. Rick said the Battalion Chiefs and Line Personnel will have to step up and fill the Deputy Chiefs shoes. The Maintenance facility cannot go over budget and get out of control. Possibly we can look at building a training facility next year. Rick talked about the DC position, saying Sam Whitted was to be hired for Wildland and Administration. He said if we have to cut him to keep people on the truck then this is what we need to do. Don said we need good leadership. Rick said if everything was hunky dory he would not bring this up about Sam, Tina or the training facility. Somewhere we have to slow it down to see how the economy is doing and to be fiscally responsible, in his opinion. Don said we cannot make any final decisions at this time because this is only a work session. Gary wants to hear more about the loan consolidation for wiggle room. Gary is on the fence about the water tender. If it is really for safety, then he agrees. Sam talked about the tender and what the difference is with what they want to buy in the future. Gary is curious about the publication section in the budget and wonders if there are any cuts can be made in this area, but noted these costs are really pennies to all the other needs (in comparison). There was a discussion about the maintenance facility and subjects related. Don said the next steps will be to consider all that has been spoken about. Don discussed amounts for salary increases, and payments for the maintenance facility. Dan asked about outside sourcing for the maintenance facility and what income could be made. There was a discussion about how much money is allotted for outside maintenance repairs. Dan understands we have to take care of our own equipment first, but this money could be turned around for our benefit. Dan talked about the expense per year for the facility, but the opportunity to generate income, save money, and make working conditions safer are important. There was a discussion of the importance of staying on the apparatus maintenance schedule. Dan Atkinson said he is not asking for hard numbers now, but hopes by the April 20th Board Meeting ball park figures can be given concerning this possible income. Jerry asked about adding personnel in maintenance. Mike Apodaca spoke about his schedule managing the SFD fleet and the training he does. He said it is important for everyone to step up and help, wishing Keith Klassen was available to work at Station 33 all the time. Someone asked about the possibility of maintenance charging for classes with the expertise they have. Mike Apodaca explained complications and time crunches. However, we would be able to pick up warranty work on other vehicles. Keith said the interest is out there. Rick said it is time to delegate some of your work out for help. Keith will get numbers to the Board concerning outside sourcing income. Sam talked about where we are now. If we take on additional work we will need someone else in the shop. Additional work equals additional costs. Don talked about the space needed to store equipment. Don reminded the Board that the apparatus schedule and maintenance facility have been discussed for two years. Some people say we don’t have a plan and we don’t know what we are doing, but if you look at the minutes (in entirety) you will see we do. Don talked about the apparatus plan and the way it is working to date. Don said we can choose to fall apart in our direction, decide not to give pay raises, or we can find out what we are made of and come together. How are we going to get through 2013/2014? Don thinks these are the projected years we have to get through. He believes the employees have the Summit Fire interest at heart, including everyone who has posted their budget. There was a discussion about Mike Apodacas ability to respond to fire. Rick asked if Mike wants to, and thinks that he would help in an emergency basis. Rick said this is only a thought. Mike explained that he would like to, and has been needed on a couple calls for water tender operations. He has his FFI & FFII certificates, but it is a legal logistic of the fire department. Don further explained that Mike is on the Arizona State Retirement System (ASRS) not PSPRS, that he would like him to be in the PSPRS system, but his primary job is not a firefighter and therefore it cannot be done legally. Administration looked into this some time ago. Don said we take care of him for any overtime hours he has. There was a discussion about safety apparel, safety equipment and other costs to the department. Rick thinks pencils could be sharpened in this area. There was a discussion about some of the equipment and prices that are listed on the budget worksheets. Rick reiterated he is making suggestions. Don agrees we need to look at project coordinators and ask them to cut another 10 to 15% off their budgets, but knows that a number of the expenses cannot be cut. Rick would like these figures to go back to the program managers. Rick said we can cut back on meals for board meetings, and on who and how many board members go to the Arizona Fire District Association conferences for a couple years until we get everything back on line. Rick doesn’t think the taxpayer need to pay for his dinner under these tough times. Don reminded the Board that most times administration and other folks work up until 6 o’clock to be ready for these board meetings, and believes a little bit of food goes a long way. Sometime ago we made big cut-backs on the food costs for meetings. Dan talked about the Deputy Chief position and believes this decision is something we don’t have to decide on this year. We waited a very long time to get a deputy chief. Sam takes a lot off of Don’s load. Gary said we are trying to keep all the positions we have, and as Don said we don’t have to pull the panic button now. Gary said our budget is projections, so we can do this on a year by year position. Dan is impressed with Sam; he is a good leader, good communicator, and compliments the Chief. We are able to cover each other, especially if we are going out on the Wildland calls, and we need to concentrate on the Wildland Division. Don said he has spoken with Preston Slayton and Chris Fennell about this. Sam reminded the board members for Wildland calls we generate income from even a single resource (Tina, Don, etc). Sam said it is important to send whatever resources out that we can, and clarified the charge for any person is a ‘loaded rate’ (including all retirement costs, etc.). There was further discussion about Sam’s position of Deputy Chief and the cost. Rick said we can leave this position open for awhile. Rick said maybe this wildfire season will go good. Jim talked about the positions at Flagstaff Fire Department being cut (training officer). Jim said it takes a good shop to keep the apparatus going. He believes everyone is agreement for a new shop. Jerry asked about the next step. Chief Howard summarized areas to target; refinancing figures for Station 36 and other options through Tina, narrowing the mil rate, and asking project coordinators to review their budgets for more cost cuts. Don said he would like more direction from the Board about the mil rate. A discussion was held about the mil rate and dollars per mil rate. Jerry and Jim agree the tax payers should see a decrease in their tax bill. Rick said his belief was they wanted the tax to stay the same; what was most important is that is does not go up. Dan asked to see the numbers reflecting a 2.52 mil rate. The next budget workshop will include information on this number. Don said he did not know they (board members) did not want to raise the mil rate. Rick said we need to discuss the personnel issues of Tina and Sam, saying they design the box, and then we go by the space in the box. He wants the budget gone through again with a maintenance shop income shown. Don said that will be a questionable figure, and will not be substantial for this year. Rick suggested if we go to a 2.52 mil rate it will relieve our personnel issues and let us break even. Rick spoke again about the cost for a deputy chief and the step increase for Tina. Rick said we could fix all these issues if personnel could decide how much cost they are willing to cut. Dan said things will get more difficult as these years approach, but said we don’t have to make as hard of decisions this year, nor make them tonight since we have discussed this for 2.5 hours. These kind of decisions need to be made at a later date. Jerry said the mil rate and personnel costs will set in motion a direction for the coming years. Dan said we are still talking about using Blue Cross Blue Shield insurance while not even discussing other options after our price was increased by 30%. Dan is talking about the quotes we received from other medical companies; we have not brought it on the table yet. Jim said the other policies were discussed but they did not compare apples and apples. Don said this is a large organization with many options. We want the board to be fully informed. This all takes a good amount of time. Don needs to talk more with the union. Dan talked about his own personal experience of having to change his insurance many times in the last 12 years; sometimes these types of things have to be done. Preston spoke about the numbers they received from BCBS. Preston said the Union is open to looking at other options, but at this time of the year the numbers are not available. Rick said we will have these medical insurance numbers through December. Don stated we will have another work session after the April 20th Board meeting to get the budget finalized by mid-May. The budget will be based on low end numbers with a mil rate option of 2.52 and 2.55 for reference. 5. CALL TO THE PUBLIC: There was no answer to the call to the public. 6. ADJOURNMENT: Jerry Loynachan made a motion to adjourn and there was a second motion by Gary Selig. The vote was unanimous and the meeting ended at 8:40 pm. Respectfully Submitted, Joann Benninghoff |
8905 N. Koch Field Rd. Flagstaff, AZ 86004 E-mail: sfdadm@infomagic.net
Phone: (928) 526-9537
Fax: (928) 526-2750
Fax: (928) 526-2750
2010-2011 Budget Work-Session #2 March 30, 2010 |