HomeMy WebLinkAboutMINUTES - 02281989 - 2.4 r '
TO: BOARD' OF SUPERVISORS
FROM: Phil Batchelor, County Administrator
DATE: February 22, 1989
SUBJECT: Fire District Special District Augmentation Fund Allocation
Formula (Return to Source)
Specific Request(s) or Recommendations(s) & Background & Justification
RECOMMENDATIONS: .
1. Adopt a .policy of allocating supplemental funds for building and staffing new
fire stations with priority consideration for districts that contribute
more to the Fund than they receive through the normal allocation process and/or
whose cities support and participate in the financing plans.
2. Request the County Auditor-Controller and the County Administrator, in conjunction
with the fire districts, to consider the development of a new comprehensive
financial report which would identify, as part of annual budget review, all
aspects of fire district financial information as outlined in the attached report
from the County Fire Chiefs' Association.
3. Direct the County Administrator to work with fire districts to identify and pursue
additional revenues sources with the objective of reducing SDAF receipts to an
amount equal to the amounts contributed to the Fund. Progress toward achieving
this objective would be reported to the Board on an annual basis.
4. With the exceptions recommended above, continue the current method of allocating
Special District Augmentation Funds (SDAF) on the basis of demonstrated need.
FINANCIAL IMPACT:
To the extent that new revenue sources are identified and obtained by the districts,
the recommendations of this report would result in additional supplemental allocations
to districts in need of expansion.
CONTINUED ON ATTACHMENT: X YES Signature:
Recommendation of County Administrator
Recommendation of Board Committee
Approve Other
Signature(s):
Action of Board on: Approved as Recommended Other X
REFERRED proposed Fire District Special District Augmentation Fund
Allocation "Return to Source" formula to the Finance Committee for
further review, and REQUESTED County Counsel to report to the Finance
Committee on the legal aspects .
Vote of Supervisors: I HEREBY CERTIFY THAT THIS IS A TRUE
AND CORRECT COPY OF AN ACTION TAKEN
X Unanimous (Absent I II ) AND ENTERED ON THE MINUTES OF THE
Ayes: Noes: BOARD OF SUPERVISORS ON DATE SHOWN.
Absent: Abstain:
Attested: February 28 , 1989
cc: CAO Phil Batchelor, Clerk of
Auditor-Controller the Board of Supervisors
County Counsel and County Administrator
County and Independent Fire Districts
Contra Costa County Fire Protection By: ,(,( j DEPUTY
District Commission
Contra Costa County Taxpayers Assn.
REASONS FOR RECOMMENDATION/BACKGROUND:
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In July 1987, the Contra Costa County Fire Chiefs' Association and, approximately one
year later, the Contra Costa County Fire Protection District Five-Year Expansion Plan
Task Force adopted positions recommending that the Board of Supervisors initiate a new
Special District Augmentation Fund (SDAF) allocation process that would result in the
fire districts' share of the Fund being allocated proportionately to the districts
without regard to need. The "Return to Source" proposals of the two groups are
virtually the same, with the exception that the Chiefs' Association proposal would
provide an allocation to the San Ramon Valley Fire Protection District. The
Consolidated Task Force proposal restricts allocations to those districts that are
currently eligible for and are receiving SDAF allocations.
As a result of these proposals, your Board requested the County Administrator to
analyze the two proposals and determine the impact on the districts of implementing
either proposal.
The projected impact of a return to source policy will vary depending on the
assumptions made about variable factors such as: the fiscal year in which the
proposal would apply, whether the proposal applies to both operations and capital
expenditures, the amount of funds available for distribution, and whether the San
Ramon Valley Fire Protection District is included in the allocation process.
The presentation in this report regarding the impact of a return to source policy is
based on the Consolidated Task Force proposal which excludes San Ramon Valley from the
allocation process. San Ramon Valley is not included in the return to source
illustration because it has become financially independent over the last several years
and has not required augmentation funds for maintenance of basic service levels. In
fact, the District has been able to expand to meet the needs of the community without
allocations from the Special District Augmentation Fund.
The analysis of the proposal revealed that almost half of the County and independent
fire districts would experience significant revenue reductions under the proposal.
In order to illustrate the magnitude of the adverse impact of a return to source
policy a scenario was developed by the County Administrator using the actual budget
and Augmentation Fund figures for fiscal year 1988-1989 with the assumption that the
formula would apply to the total amount of the fire districts' share of the
Augmentation Fund, less certain administrative costs and a reserve for contingencies.
The application of a return to source formula as outlined above would result in
certain districts receiving substantially more than they actually received under the
current allocation method as shown on the attached Schedule A on page 4. However, six
county and independent fire districts would have experienced the following reduced
funding for operations and capital:
Reduction as a
District Funding Reduction percent of budget
Bethel Island $133,753 38%
East Diablo 37,091 5%
Kensington 208,838 17%
Riverview 486,004 6%
Rodeo-Hercules 149,058 11%
West County 142,891 7%
In view of the severe adverse impact of the proposal on some districts, the County
Administrator's Office developed the following three alternative proposals designed to
maintain basic allocation levels but provide for a partial allocation on a return to
source basis.
1. Automatic Base and Growth Allocation - This proposal would only apply to the
operations portion of the fire districts' share of SDAF. The proposal would
guarantee each fire district a base year allocation equal to the prior year's
operations allocation plus a share of the SDAF growth based on a return to source
concept. An application of this alternative is shown on the attached Schedule B
on page 5.
The example used to illustrate this alternative is based on actual 1988-1989
allocations to date and. a redistribution of the growth revenue on a return to
source concept. If all available operating funds for 1988-1989 were allocated
pursuant to this proposal, the return to source amounts would be substantially
higher. However, under either scenario a formula allocation method would have
allocated more funds to some districts than they actually needed and in other
cases less would be allocated than needed to maintain services.
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2. Automatic Base and Possible Growth Allocation - This proposal would be very
similar to No. 1 above except that the allocation of SDAF growth would not be
automatic but would be subject to the review and approval of the County
Administrator and the Board of Supervisors.
3. Need Plus Restricted Supplemental Allocations - This is basically the current
allocation method but would provide supplemental allocations to those districts
that contribute more to the Fund than they receive through the usual allocation
process.
The County Administrator's Office requested the Chiefs' Association to review the
findings of the return to source analysis and to consider other alternatives to the
return to source proposals with the objective of identifying a proposal that would
minimize adverse effects on the districts but provide an allocation process that would
be acceptable to the districts and the County Administrator's Office for
recommendation to the Board of Supervisors.
The Chiefs' Association referred the issues to its Capital Outlay Committee for review
and recommendation. The Committee met in conjunction with the County Administrator's
Office on several occasions over the past few months. The Committee considered a
number of alternate proposals in addition to the ones proposed by the County
Administrator, but was unable to arrive at a consensus recommendation to the Chiefs'
Association. The Association subsequently discussed the issues at length at three
separate meetings which resulted in the adoption of the attached Findings and
Recommendations from the Association.
The Association's recommendation to maintain the present allocation method, subject to
certain conditions, supersedes the early recommendation that the Board establish a
return to source policy. The Association changed its position on the return to source
proposal because of the severe impact on approximately half of its member districts
and the lack of a consensus to make substantive changes in the allocation process.
Although the Association was unable to agree on a distribution formula, it did
recognize the problems of districts such as Consolidated Fire that are net
contributors to SDAF and are unable to finance their five-year plans.
The Consolidated Five-Year Expansion Plan Task Force comprised of representatives of
the six cities served by the District, the United Professional Firefighters Local
1230, the County Taxpayers Association, and the Consolidated Board of Fire
Commissioners took the position that Consolidated Fire should receive its
proportionate share of the fire district's portion of the Augmentation Fund as a
precondition to establishing a benefit assessment or other means of financing the
Five-Year Plan.
In view of the concerns of Consolidated Fire and the position of its Task Force, the
Chiefs' Association adopted a two-fold recommendation to deal with the issue. The
Association recommended that the Board formalize and continue the allocation of
supplemental funds for new stations and personnel to net contributor districts such as
Consolidated Fire. Additionally, the Association recommended that efforts be made to
provide more supplemental funding for districts such as Consolidated by requiring
districts to seek other financial resources, thus reducing the demands on the
Augmentation Fund.
Although there is not unanimous agreement about an approach, the recommendations
before the Board address the most pressing issues of funding based on need and giving
special consideration to additional needs of net contributor districts.
The recommendations of this report were discussed with representatives of the United
Professional Firefighters Local 1230 and the County Taxpayers Association because of
the County-wide application of the report. The President of Local 1230, Mike Price,
was not able to comment on the report without discussing its contents with the union
membership. Donald Christen, Executive Vice President of the Taxpayers Association
stated that the recommendations of the report seemed reasonable in view of the severe
consequences of implementing a return to source policy.
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SCHEDULE A
Consolidated Task Force
"Return to Source" Proposal
Fiscal Year 1988-1989
V
Return To Increase
Contribution Receipts from SDAF Source (RTS) (Reduction)
District To SDAF Operations Capital Total Allocation(A) Based on RTS
Bethel Island $ 88,014 $ 213,725 $ 6,448 $ 220,173 $ 86,420 $( 133,753)
Byron 150,058 -0- 2,110 2,110 147,184 145,074
Contra Costa
County 13,065,868 7,457,967 1,641,240 9,099.207 12,824,595 3,725,388
Crockett-
Carquinez 89,774 76,193 6,668 82,861 88,220 5,359
East Diablo 400,851 306,232 124,250 430,482 393,391 ( 37,091)
Kensington 354,389 556,769 -0- 556,769 347,931 ( 208,838)
Moraga 1,271,244 976,529 52,250 1,028,779 1,247,689 218,910
Oakley 249,637 52,199 52,170 104,369 245,082 140,713
Orinda 1,662,125 1,064,983 58,150 1,123,133 1,631,403 508,270
Pinole 104,897 56,135 -0- 56,135 103,073 46,938
Riverview 4,003,328 3,690,515 724,899 4,415,414 3,929,410 ( 486,004)
Rodeo-Hercules 382,657 524,670 -0- 524,670 375,612 ( 149,058)
Tassajara 89,274 42,074 6,645 48,719 87,545 38,826
West County 1,016,326 1,108,697 31,850 1,140,547 997,656 ( 142,891)
Total $22,928,442 $16,126,688 $2,706,680 $18,833,368 $22,505,211 $3,671,843
(A) Based on allocating 80% of the total 1988-1989 SDAF less amount allocated for
administrative support and a 1% reserve. The net amount of $22,505,211 is allocated
proportionally on the basis of contributions to SDAF.
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SCHEDULE B
AUTOMATIC BASE YEAR ALLOCATIONS AND
RETURN TO SOURCE OF SDAF GROWTH REVENUE
(Reduction)
Base SDAF RTS 1988-1989 Allocation Increase
Operations Allocation 87-88 Base & Based
District 1987-88(A) 1988-1989 88-89 RTS Actual(B) on RTS
Bethel Island $ 255,133 $ 5,326 $ 260,459 $ 241,808 $ 18,651
Byron 0 9,071 9,071 0 9,071
Contra Costa
County 8,020,196 790,347 81$810,543 9,058,725 (248,182)
Crockett-Carquinez 52,051 5,437 57,488 90,235 ( 32,747)
East Diablo 256,201 24,244 280,445 362,399 ( 81,954)
Kensington 662,941 21,442 684,383 556,769 127,614
Moraga 990,178 76,892 1,067,070 1,145,029 ( 77,959)
Oakley 69,161 15,104 84,265 69,049 15,216
Orinda 1,206,652 100,539 1,307,191 1,281,226 25,965
Pinole 83,808 6,351 90,159 56,135 34,024
Riverview 3,936,292 242,159 43,178,451 4,238,142 ( 59,691)
Rodeo-Hercules 632,843 23,148 655,991 524,670 131,321
Tassajara 25,915 5,395 31,310 42,074 ( 10,764)
West County 1,356,724 61,483 1,418,207 1,268,772 149,435
Total $17,548,095 $1,386,938 $18,935,033 $18,935,033 0
(A) Includes 1986-1987 year end funds allocated in July, 1987, in the amount of
$1.6 m.
(B) Includes 1987-1988 year end funds allocated in July, 1988, in the amount of
$2.8 m.
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