HomeMy WebLinkAboutMINUTES - 10222013 - FPD SD.1RECOMMENDATION(S):
ACCEPT a report from the County Administrator on the status of District finances.
FISCAL IMPACT:
No fiscal impact. Informational Report only.
BACKGROUND:
The County Administrator's Office has regularly updated the Board of Directors on the status of finances for the
Contra Costa County Fire Protection District. On July 9th, the Board received an update in conjunction with a
proposal to update the formula for distributing Measure H and after learning that the fiscal year 2013/14
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
Action of Board On: 10/22/2013 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:John Gioia, Director
Candace Andersen,
Director
Mary N. Piepho, Director
Karen Mitchoff, Director
Federal D. Glover, Director
Contact: Timothy Ewell,
925-335-1036
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the
Board of Supervisors on the date shown.
ATTESTED: October 22, 2013
David Twa, County Administrator and Clerk of the Board of Supervisors
By: June McHuen, Deputy
cc:
SD.1
To:Contra Costa County Fire Protection District Board of Directors
From:David Twa, County Administrator
Date:October 22, 2013
Contra
Costa
County
Subject:FY 2013/14 CONTRA COSTA COUNTY FIRE PROTECTION DISTRICT FINANCIAL UPDATE
BACKGROUND: (CONT'D)
ad valorem property tax increase would be 5.34% -- up from the 2% projection. Since July, several new events
have taken place requiring an update to the Board.
The County Administrator will provide a presentation to the Board on the status of District finances, discuss
recent events impacting the District and make recommendations going forward. Attached is a copy of the
presentation including a multi-year forecast of District financials, impacts of policy changes from the Contra
Costa County Employee's Retirement Association (CCCERA) on pension costs, and reasons for both concern and
optimism going forward.
CONSEQUENCE OF NEGATIVE ACTION:
This is an informational report only.
CHILDREN'S IMPACT STATEMENT:
No impact.
ATTACHMENTS
Financial Update - PowerPoint Presentation
1Financial UpdateOctober 22, 2013David TwaCounty Administrator
Currently operating 23 Engine companies (down from 30 in 2011)Improved financial conditionBased on decisive actions taken by the Board to reduce ongoing expensesSignificant one-time revenue received in FY 2012/13 ($7.9 million)à$4.65 million from previous SAFER Grantà$1.77 million from Low to Moderate Income Housing Fund (LMIHF) liquidationsà$1.47 million from one-time AB 1484 distributions from RDA Successor AgenciesàPartially offset by $1.26 million repayment to Pittsburg Successor Agency, payable over 3 years ($422k per year beginning in FY 2013/14)2
CCCERA policy changes continue to impact the District significantly District’s current structural deficit remains at approximately $6 - 10 million per year.District remains close to exhausting fund balances by 20173
4Assumptions: 23 Engine Companies, 5% increase in assessed valuation, funding of3 engine companies from SAFER grant (net increase to fund balance for station thatwould have been closed in January 2014).
5
6The District continues to see significant annual increases to pension costs due to a number of issues:¾POB Debt Service increasing annually ($650k /year)¾Impact of CCCERA Depooling (FY 11/12)¾Decrease in assumed investment rate of return from 7.75% to 7.25% (FY 14/15)In FY 2014/15, District pension costs are projected to increase by $9.6 million; $9 million through CCCERA rate increases and $600,000 in POB Debt service increases.
Actuarial Valuation DateFunded Ratio12/31/07 89.9%12/31/08 88.5%12/31/09 83.8%12/31/10 80.3%12/31/11 78.5%12/31/12 70.6%7CCCERA’s Funded Ratio continues to decline contributing to increases in the County and District share of Unfunded Liability.
Actuarial Valuation DateTotal UAAL County Share12/31/07$0.56 Billion$0.47 Billion12/31/08$0.69 Billion$0.57 Billion12/31/09$1.02 Billion$0.85 Billion12/31/10$1.31 Billion$1.09 Billion12/31/11$1.49 Billion$1.24 Billion12/31/12$2.28 Billion$1.89 BillionConsidering the County’s CCCERA, POB ($294 million) and OPEB liabilities ($932 million, of which $130 million is attributable to ConFire) alone, the current challenge exceeds $3.12 Billion dollars.Contra Costa County is the largest employer in the Contra Costa County Employees' Retirement Association representing approximately 83% of the members in the plan8
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In FY 2014/15, for every $1.00 ConFire spends on salary…10…we will spend an additional $1.15 on pension costs…and ANOTHER 52 cents on other benefits
11Total Number Contract Of Employees Expiration DateIAFF Local 1230 243 6/30/2014(United Professional Firefighters)UCOA 13 6/30/2014(United Chief Officers Association)Fire Management – Exempt 4Negotiations with District bargaining units fast approaching…
Increasing Pension LiabilityIncreasing Health Insurance Costs Unfunded Infrastructure /Capital Improvement Needs Labor Negotiations in 2014Continued depletion of Worker’s Compensation funding level (Current Confidence Level at 48%, down from 93% in November 2010)Continued depletion of ReservesImpacts from Federal Government January 15, 2014 – Estimated Gov’t Shutdown dateFebruary 7, 2014 – Estimated Debt Ceiling Default dateImpacts to financial markets could result in additional upward pressure on pension ratesUnknown impacts to County and District Grant Awards12
9In General, Contra Costa County Economy recovering from the Great Recession9Property Tax revenues stabilizing9New Fire Chief Jeff Carman started Yesterday (and is still here!)9SAFER Grant Application Submitted 9Fitch Studies (Fire and EMS) Progressing9Public better engaged in issues surrounding Fire and EMS Delivery13
14•Continue to focus on long term solutions•Manage Salary and Benefit costs •No additional Station Closure required in January 2014•Identify areas to improve service delivery to our residents•Prepare for operational changes to Fire and EMS Services•More difficult decisions ahead, but District much better poised to address issues