CITY COUNCIL: Resolution Amending Carmel/Carmel Valley/Ambulance Authority Joint Powers Agreement with Carmel Valley Fire District

Meeting Date: July 7, 2009
Prepared by: Rich Guillen

City Council
Agenda Item Summary

Name: Consideration of a Resolution amending the Carmel/Carmel Valley/Ambulance
Authority Joint Powers Agreement with Carmel Valley Fire District.

Description: The Carmel Valley Fire District is managed by the Salinas Rural Fire Protection District. Salinas Rural staff recently completed a financial analysis of the Carmel Regional Fire Ambulance (CRFA) operations, which showed some duplication of effort that caused CRFA costs to be higher than expected and placed both the Carmel Fire District and the City in the position of subsidizing each other from time to time, creating an imbalance on how revenues and expenses are shared.

The CRFA Board of Directors reviewed the attached amended JPA and the Fire Services Agreement and recommended to their respective legislative bodies that the agreements be approved. The only action needed by the City is to approve the JPA.

Overall Cost: If managed appropriately, it is likely that the current City subsidy of $400,000 will be less in future years without reduction in ambulance response time or decline in ambulance service levels.

Staff Recommendation: Staff recommends approval of the Resolution amending the JPA with Carmel Valley Fire District.

Reviewed by:

Rich Guillen, City Administrator Date

CITY OF CARMEL-BY-THE-SEA
STAFF REPORT
TO: MAYOR McCLOUD AND COUNCIL MEMBERS
FROM: RICH GUILLEN, CITY ADMINISTRATOR
DATE: JULY 7, 2009
SUBJECT: CONSIDERATION OF A RESOLUTION AMENDING THE CARMEL/CARMEL VALLEY/AMBULANCE AUTHORITY JOINT POWERS AGREEMENT WITH CARMEL VALLEY FIRE DISTRICT

RECOMMENDATION
Adopt the resolution amending the Carmel/Carmel Valley/Ambulance Authority Joint
Powers Agreement (JPA) between the City and the Carmel Valley Fire District.

BACKGROUND
The Carmel Valley Fire District is managed by the Salinas Rural Fire Protection District.

The Salinas Rural Fire Chief Mike Urquides has administrative oversight of the Carmel Valley Fire District. Over the past several months, since taking over this duty, Chief Urquides and Salinas Rural staff completed a financial analysis of the Carmel Regional Fire Ambulance (CRFA) operations. The financial analysis shows some duplication of effort that can be eliminated. This duplication of effort has caused CRFA costs to be higher than expected and placed both the Carmel Fire District and the City in the position of subsidizing each other from time to time, creating an imbalance on how revenues and expenses are shared.

The CRFA Board held two recent meetings to review and provide policy direction on maintaining the CRFA authority and adopting a budget for Fiscal Year 2009/2010. At the second meeting, the CRFA Board of Directors reviewed the attached amended JPA and the Fire Services Agreement and took action to recommend to their respective legislative bodies that the agreements be approved. The only action needed by the City is to approve the JPA.

STAFF REVIEW
JPA amendment (to be approved by the City and Carmel Valley Fire District) CRFA attorney, William Ross, prepared the proposed amendments under the direction of Chief Urquides. The amendments are written to update and represent the way that CRFA will operate in real time from this point forward:

• Article 1 eliminates Big Sur from the authority since it is no longer a member agency;

• Article 8(a) requires that Authority Ambulance Units are located within the geographic boundaries of the City and Carmel Valley Services Region;

• Article 11 defines the timeline for the annual budget adoption for the upcoming
fiscal year;

• Article 16(c) shifts the responsibility of fee collections to the City;

• Article 18 defines the term of the JPA agreement which becomes effective upon approval by both the City and the Carmel Valley Fire District and continue until June 30, 2009; and

• Article 21 allows for additional agencies to join the JPA.

One of the main purposes for the above amendments is to allow both City staff and the Salinas Rural Fire staff to develop a succession plan to stabilize the finances and operations of CRFA. The most significant result is that each agency member will pay its fair share for the ambulance services rendered within its agency boundaries. More significantly, no member agency will be required to subsidize the other. Fire Services Agreement (to be approved by CRFA and Carmel Valley Fire District)

The purpose of the Fire Services Agreement is to define the operations relationship between the Carmel Valley Fire District and the CRFA. The salient business points of this agreement are as follows:
• The term of the agreement will commence on July 1, 2009 and end on June 30, 2010;

• Payments for services rendered by Carmel Valley Fire District will be paid on a monthly basis; and

• Costs for services rendered by either agency will be based on actual costs for utilization of personnel or fair market value equipment rental.

This agreement will essentially keep ambulance expenses “cost neutral” to the Carmel Valley Fire District. In addition, it will have each agency pay its fair share for services rendered under this agreement.

FISCAL IMPACT
Salinas Rural Fire staff performed an extensive financial analysis of the CRFA operating budget. Imbalances were discovered in the revenue distribution on two fronts. The first is that collection of transportation costs was based on geographic area. This means that if the Carmel Valley ambulances were called to transport a person in the City, the revenues would be distributed to the City and not reimbursed to the Carmel Valley Fire District which, in fact, provided the service. The City-stationed ambulance experienced the reverse situation.

On the expense side of the operations budget, several duplication-of-effort costs were identified, meaning that the Carmel Valley Fire District was paying twice for certain expenses related to CRFA. This expense duplication included such items as overtime, uniform allowance, contract labor, telephone service, liability insurance, administrative staff, legal services, auditing, and travel/training. The cost of the duplicated services is just under $93,000.

Effective July 1, 2009, the City staff will have administrative oversight of the CRFA. This includes annual budget preparation, accounts payable, payroll, human resources and agenda preparation. The Carmel Valley Fire District previously handled these responsibilities.

SUMMARY
The amended JPA and shift of administrative oversight will take some careful stewardship by City staff. Existing City financial policies and practices will be used for the day-to-day management of the CRFA. If managed appropriately, it is likely that the current City subsidy of $400,000 will be less in future years without a reduction in the ambulance response time or a decline in ambulance service levels.

CITY OF CARMEL-BY-THE-SEA
CITY COUNCIL
RESOLUTION 2009-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA AMENDING THE CARMEL/CARMEL VALLEY/AMBULANCE AUTHORITY JOINT POWERS AGREEMENT WITH CARMEL VALLEY FIRE DISTRICT
_______________________________________________________________
WHEREAS, the City of Carmel-by-the-Sea is a member of a Joint Powers Agreement (JPA) with Carmel Valley Fire District; and

WHEREAS, the staff of the Salinas Rural Fire Protection District, which has administrative oversight for the Carmel Valley Fire District staff completed a financial analysis of the Carmel Regional Fire Ambulance (CRFA) operations indicating a duplication of effort; and

WHEREAS, this duplication of effort has caused CRFA costs to be higher than expected and placed both the Carmel Fire District and the City in the position of subsidizing each other from time to time, creating an imbalance on how revenues and expenses are shared; and

WHEREAS, the CRFA Board held two meeting to review and provide policy direction on
maintaining the CRFA authority and adopting a budget for Fiscal Year 2009/2010; and

WHEREAS, the board took action to recommend to their respective legislative bodies that the agreements be approved.

NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA DOES:

1. Approve the amended Carmel/Carmel Valley/Ambulance Authority Joint Powers Agreement with Carmel Valley Fire District (Attachment “A”).

PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF CARMEL-BY-THE-SEA this 7th day of July 2009 by the following roll call vote:

AYES: COUNCIL MEMBERS:
NOES: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:

SIGNED:

______________________
SUE McCLOUD, MAYOR

ATTEST:

_____________________
Heidi Burch, City Clerk