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HomeMy WebLinkAboutIR 7487 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7487 T v 0 September 4, 1990 if R? To the Mayor and Members of the City Council Subject: FIRE SERVICE AGREEMENT WITH THE CITIES OF BENBROOK AND WESTOVER HILLS During the Pre-Council meeting on August 7, 1990,, staff discussed with the City Council Bpi il a proposal to contract for fire service using a formula that would be based on a "hazard potential factor". In addition, municipalities would be able to determine the level of service they wish to receive. The formula would work as follows: Fort Worth's per capita cost of fire protection population of the city to be protected hazard potential factor level of service to be provided. The City has been providing protection to the City of Westover Hills since 1987 and charging a fee based on this formula. However, the formula has never been formally adopted. The City of Benbrook has been receiving fire service from the City of Fort Worth for a portion of their city from Stations 23 and 30 since 1980. Both cities used their respective bond funds to jointly construct the two stations. Benbrook con- tributed $300,000 toward the construction of each. They were to recover their costs, plus interest, over a period of time and then transfer title of the sta- tions to Fort worth. Benbrook would then be able to exercise several options in order to continue receiving fire service. All of the credits are used up on Station 23 and Benbrook has continued to receive fire service under the original formula. They still have about $10,373 in credits remaining on Station 30. The City Council has requested that staff develop a methodology that would allow cities to be assessed for the cost of fire services on approximately the same ba- sis as that borne by Fort Worth citizens, based on property taxes. Attached is a memorandum from the 'Management Services Director that details the methodology and calculates the resulting cost for Benbrook and Westover Hills. In addition, a copy of a letter from the City Manager of Benbrook requesting continuation of fire service under the original formula has also been attached. Staff will await City Council guidance on how to proceed with this matter. In the meantime, if additional information is desired, it will be supplied upon re- quest. David Ivor City Manager DAI/sf sm:ir-fire ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS SUMMARY OF ATTACHMENTS 1. COPY OF LETTER FROM THE CITY MANAGER OF BENBROOK REQUESTING THAT THE CITY CONTINUE PROVIDING SERVICE TO BENBROOK BASED ON THE FORMULA INCLUDED IN THE ORIGINAL CONTRACT. 2. A LEGAL OPINION FROM ASSISTANT CITY ATTORNEY HUGH DAVIS REGARDING THE OPTIONS AVAILABLE UNDER THE CONTRACT. 3. MEMORANDUM FROM CHARLES BOSWELL CALCULATING THE SERVICE FEE BASED ON THE PROPERTY TAX RATE. 4. PROPOSED TERMS AND CONDITIONS FOR A CONTRACT BASED ON USE OF THE "HAZARD POTENTIAL FACTOR". A. EXHIBIT Al - CALCULATION OF PROPOSED FEE AT LEVEL 4 USING THE HAZARD FORMULA AND THE FEE USING THE ORIGINAL FORMULA B. EXHIBIT A2 - NUMBER OF RUNS INTO BENBROOK FROM STATIONS 23 AND 30 C. EXHIBIT B - SERVICE AREA FOR STATION 23 D. EXHIBIT C - SERVICE AREA FOR STATION 30 E. EXHIBIT Dl - CALCULATION OF THE PROPOSED FEE AT LEVEL 2 USING THE HAZARD FORMULA F. EXHIBIT D2 - NUMBER OF RUNS INTO WESTOVER HILLS G. EXHIBIT E - FACTORS USED TO DETERMINE THE HAZARD POTENTIAL H. EXHIBIT F - FACTORS USED TO DETERMINE THE LEVEL OF SERVICE -. . atu of benbrooW P'p Y.N,:, August 28, 1990 Mr. Bob Terrell Assistant City Manager City of Fort Worth 1000 Throckmorton Street . ~ .. _~r~.^ ^~ 76102 RE: Renewal of Fire Protection Contract for Fire Stations No. 23 and No. 30 Dear Bob: It is my understanding from talkitig with you that the Fort Worth City Council has not taken any action on extending the fire protection service agreements at Fire Stations 23 and 30. 1 want to again express Benbrook0s desire to extend both contracts. It is our desire to enter into multi-year contracts (or a single multi- year contract for both stations) with the City of Fort Worth. It is our preference that the payment made to Fort Worth be based upon Option 11a, which is set forth in both contracts (City Secretary Contract Nos. 11497 and 11498) . However, an alternative payment schedule acceptable to both Benbrook and Fort Worth will certainly be considered. This is the arrangement which you and I have been discussing during the past year. As you know, last summer the City of Benbrook paid to Fort Worth the sum of $94,693.00 for services incurred at Station 23 through September 30, 1989. We agreed to pay that amount as our fair share for the services received, although the notification for cost An%creases was .-Act q.-ven as prov.-JAed -Ln the contract. The . payment of this amount'resulted. in anunanticipated additional cost of $47,000. 00 to Benbrook last year. Due to severe budgeting problems we need to avoid unanticipated expenditures such as this in the future if at all possible. Subsequently, we entered into a one year extension of the Fire Station 23 agreement in order to give us time to negotiate a multi- year contract for both fire stations. At that time, we also discussed the need of Benbrook and Fort Worth to know, at least thirty days prior to the end of the fiscal year, what our costs and revenues would be under any multi-year renewal contract. Bob as previously stated, it is my opinion that such a mutual fire protection agreement is in the best interest of both cities. However, because Fort Worth has yet to determine the cost of these 911 VVinncottRnad ° P.O. Box 26569 ° Banb/ook. TX7012G ° AC/817 249-3000 fire protection services for the coming years, Benbrook is in the precarious position of not knowing the amount to budget for these contracts. Therefore, we are budgeting approximately the same amount paid for fire protection services during this current year, expiring September 30, 1990. I hope that we can negotiate a long term agreement that will allow each City to properly budget for the coming fiscal years. If you need any additional information or if I can be of further assistance regarding this matter, please let me know. Sincere Ken Neys el c City-Manager KN/sb OFFICE OF THE CITY ATTORNEY THE CITY OF FORT WORTH 1000 THROCKMORTON FORT WORTH,TEXAS 76102 917-870,7600 TO: Bob Terrell , Assistant City Manager FROM: Hugh W . Davis, Jr . , Assistant City Attorne4we- DATE: August 21 , 1990 RE Questions Concerning Fort Worth Fire Service Contracts with the City of Benbrook In your IOC of 20 August 1990 , you have asked for a review of City Secretary Contracts 11497, 17432 ( concerning fire station 23 ) and 11498 ( fire station 30 ) with regard to advising the City Council on the following questions: 1 . Does the City Council have the right to reject the option selected by Benbrook f6r continuation of fire service; 2. Depending on the option selected, can Benbrook require that their cost be calculated based on the original formula; 3. Can the City , as a condition for continuation of fire service , require that Benbrook agree to a revised/new formula; and 4. What action can be taken and in what timeframe if there is a failure to agree on a formula or contract amount . My brief answers are: 1 . Probably not without abrogating the current contracts . 2 . Yes , within the current contractual framework . 3. Yes , but probably not within the current contractual framework _ 4 . a ) Timeframes: the station 23 contract expires Sept . 30 , 1990 the station 30 contract expires at an unspecified date fairly early in FY 90--91 ; for administrative and accounting purposes , the cities treat it as extending automatically to the end of the fiscal year ( as was done with station 23 ) . b ) Action by council/staff the contracts expire by their own terms; no council action is required to terminate , and council may not terminate them earlier except with Benbrook 's consent . negotiations concerning renewal or revision or new contract( s ) Background Since you are familiar with the history of these contracts , I will note only that the Benbrook City Manager 's letter to us, dated 7/20/89 was effective as notice that Benbrook intended to exercise option ( a ) under section 11 of both original contracts upon each 's expiration and that section 5 of the continuation contract for station 23 ( #17432 )with appendices embodies that option for station 23. 1 . Rejection of a Benbrook option Both of the original contracts hav'e** identical terms for continuation of fire service in their respective sections 11 : It is understood and agreed that prior to the termination of this agreement , the City of Benbrook and the City of Fort Worth may provide for continued fire protection services by agreeing to one of the following options: a. Benbrook may continue the terms and provisions of this agreement by providing cash payment to Fort Worth based upon the same proportion formula , with costs recomputed annually. b. Benbrook may continue the existing contract with the provision that an additional service area may be included within the corporate limits of the City of Benbrook , provided, however , that the proportionate costs shall be adjusted in accord with the formula found on Exhibit "a" should a new area be served . c - Benbrook may pay its share of the annual costs of operating this station by providing the cost of salary and other benefits for an appropriate share of Fort Worth's manpower to be utilized for this station _ d . Benbrook may add on to this station at its own costs and man the new addition with its own personnel at no cost to Fort Worth and with no 110— charges being assessed against Benbrook for having done so . 3- Action - timeframe This question is more managerial and political in nature _ No council action is required by either contract . As stated above , however , the station 23 contract ( 17432 ) expires the last day of September 1990 . if a revised cost formula or a different option is desirable , then negotiations should probably commence immediately . Assuming it is administered analogously to the original station 23 contract , the station 30 contract ( 11498 , which Internal Audit indicates will generate $56 ,639 .61 in revenue after credits for FY '90-91 ) will remain in effect until September 30 , 1991 , so there is more time available , but it is probably unrealistic to think that the contracts will not be dealt with together ( see section 3 of Contract No . 17432 ) , for example. ) A ( practical ) recommendation would be to renew the station 23 contract for one year , ( Internal Audit calculates our FY 90-91 revenues at $70,281 .91 ) and at the same time advise Benbrook that a new cost formula will be necessary for continuation of fire service past the expiration date of the 2nd station 23 extension and the station 30 contract ( i .e. 30 September 1991 ). Benbrook and Fort Worth can begin working on negotiations for a new consolidated fire service contract covering both 23 and 30 and utilizing whatever cost formula the Council directs . If an agreement can be reached , so be it . if not , Benbrook will at least have a year to get up to speed on taking the 23 and 30 areas into their fire department 's coverage . I hope this has satisfactorily answered your questions . Feel free to contact me at 7630 if I can assist further . cc: Wade Adkins, City Attorney H. L . McMillen , Fire Chief 4 A 006"TY OF FORT WORTH, TEXAS OFFICE OF MANAGEMENT SERVICES To: Bob Terrell , Assistant City Manager 1000 THROCKMORTON FORT WORTH,TEXAS 76102 From: Charles R. Boswell , Director 870-85500 AREA CODE 817 Office of Management Services Date: August 27, 1990 Subject: FEES FOR FIRE DEPARTMENT SERVICES In response to your request for development of a methodology whereby communities might be assessed for the cost of fire services on approximately the same basis as that borne by Fort Worth citizens, the following is provided. BASIS FOR CALCULATION The calculation explained here was developed' in an attempt to establish an estimated property tax rate that Fort Worth taxpayers are charged for fire protection services and then to apply that rate to the tax base of other communities wishing to purchase 000" these services. A beginning assumption is that all General Fund revenue sources (property taxes, sales taxes, franchise fees, fines, etc. ) are fungible and not spe- cifically targeted only in support of certain functions. Likewise, the budgeting of expenditures for General Fund services is usually based on need, not the amount of offsetting revenue generated by particular functions. Step One The total revenue budget for the General Fund for 1989-90 is $227,351,738. Revenues restricted for debt service total $44,413,107. Subtracting the debt service revenue from the total leaves the sum of $182,938,631 which can be considered operating reve- nue for purposes other than debt service. Further subtraction of the $4,082,023 of undesignated General Fund balance and transfers that were used to balance the 1989-90 budget yields net operating revenues for operations of $178,856,608. Step Two The direct budgeted cost of the Fire Department for 1989-90 is $36,306,617, the indi- rect cost allocable to the Fire Department from the David M. Griffith and Associates cost allocation plan for Budget 1987 is $9,222,869, and the depreciation expense for 1989-90 based on a 40-year life of the facilities for which cost information has been developed is $1,112,250. Dividing this amount by our operating revenue figure yields a percentage of $26.08%. At this point an assumption is made that the 26.08% figure, applicable to all operat- ing revenue, is also applicable to property tax revenues. Mr. Bob Terrell August 27, 1990 Page 2 Step Three If 26.08% is applied to the estimate of current tax collections for operating and maintenance, a figure of $11,075,636 is derived. Step _f_pqr To generate $11 million in revenue requires approximately 8 cents on the property tax rate. The conclusion can be made that 8 cents is approximately the amount on the tax rate that is used to support Fire Department's direct cost, indirect cost and depreciation on capital improvements. Application--to Other Cities Since we have determined that 8 cents is the tax rate associated with Fire Department costs in Fort Worth, we can apply this rate to the net taxable assessed valuations of other cities to determine the dollar amount they should contribute for services from the Fort Worth Fire Department. Westover Hills: Net Taxable AV = ($171,784,482/$100) x 8 cents = $137,427 Benbrook: Net Taxable AV = ($646,797,523/$100) x 8 cents = $517,438 If additional information is needed, please let me know. Sincerely, Charles R. Boswell , Director Office of Management Services CRB:bmf CITY OF BENBROOK AND WESTOVER HILLS FIRE SERVICES CONTRACT PROPOSED GENERAL TERMS AND CONDITIONS 1. Combine the contracts for Stations 23 and 30 into one master agreement. 2. Approve the use of a formula that uses "hazard potential" as a primary factor in determining the cost of service. 3. Allow contracting municipality to determine the level of service it wishes to receive. 4. The hazard potential factor will never be less than the 1.0 factor applied to the City of Fort Worth. 5. Authorize a five (5) year contract that will provide for annual adjustments in costs based on any changes in the factors included in the formula or level of service provided. a. Fort Worth's per capita cost will be adjusted annually based on changes in the previous year's experience as it relates to the Fire Department's budget. b. Annual updates of population will be based on the later Council of Government projections, the latest census data, or physical surveys by the Fort Worth Fire Department. c. Any changes in the coverage requirements at the time the contract is approved could result in the Fort Worth City Council increasing the hazard potential factor, depending on the type of development or type of changes that take place. 6. Authorize a contract with the City of Benbrook for fiscal year 1990-91 in the amount of $149,975, based on the formula provided as Exhibit A. a. Level 4 service will be provided. b. The area served will be the same as that covered in the original con- tracts for Stations 23 and 30 (See Exhibits B and C) c. Credit Henbrook for the $10,,373 in recoverable costs on Station 30, resulting in a net amount due during fiscal year 1990-91 of $139,602. d. Require Benbrook to transfer title of the Station 30 building and property to the City of Fort Worth once the remaining credits are used., 7. Authorize a contract with the City of Westover Hills for fiscal year 1990-91 in the amount of $96,183 based on the formula Provided as Exhibit D Proposed 1990-91 Fire Protection Charges to Benbrook 1989-90 Adopted Fire Department Budget 36,306,617 Indirect Costs(17%of Personal Services) 5,309,474 Depreciation 1,112,250 Debt Service 845,000 Total 43,573,341 Population of Fort Worth (Per COG) 451,950 Per Capita Cost of Fire Protection 96.41 Benbrook 1990-91 Costs Proposed Current Contract Fort Worth Per Capita Cost of Fire Protection 96.41 Benbrook Population to be Protected 7,778 Benbrook Hazard Potential Factor 1.00 Benbrook Level 1 Cost 749,877 Level 2 Cost(90%) 674,889 Level 3 Cost(60%) 449,926 Level 4 Cost(20%) 149,975 137,293 Less Remaining 1990-91 Credit for Sta.30 10,373 10,373 Net Contract 139,602 126,920 EXHIBIT Al Fire Department Calls to Benbrook August 1, 1989 - July 31, 1990 Station 23 Station 30 Incident Type Benbrook All Calls Benbrook All Calls Fires 8 220 30 220 Overpressure 0 1 0 2 EMS 0 553 2 429 Hazardous Conditions 7 64 8 50 Service Call 1 106 3 86 Good Intent 6 102 12 93 False Calls 5 278 25 164 Un'known 0 4 0 11 Others 0 70 1 48 Station Total 27 1,398 81 1,103 Percent In Benbrook 1.93% 7.34% Total Calls In Benbrook (Combined) 108 Total Percent 4.31% Cost Per Run $1,293 (Based on Net Contract, Level 4 Service, Proposal 2) Fort Worth Cost Per Run $775 (All Incidents) EXHIBIT A2 Clara o tlr i L czo11 Gi r.•c� �a : e arb��Y lr-- o dorm EXHIBIT B 4 Paula .- ; c) STA IQ 23 C2 rs.i�_y_r� i° 1Qs2lS # men 1� r u. 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Q CiE - �y i- ii�d©ufJues trf Proposed 1990-91 Fire Protection Charges to Westover Hills 1989-90 Adopted Fire Department Budget 36,306,617 Indirect Costs(17%of Personal Services) 5,309,474 Depreciation 1,112,250 Debt Service 845,000 Total 43,573,341 Population of Fort Worth (Per COG) 451,950 Per Capita Cost of Fire Protection 96.41 Westover Hills 1990-91 Costs Proposed Current Contract Fort Worth Per Capita Cost of Fire Protection 96.41 Westover Hills Population to be Protected 750 Westover Hills Hazard Potential Factor 1.48 Westover Hills Level I Cost 106,870 103,832 Level 2 Cost(909/6) 96,183 Level 3 Cost(60%) 64,122 Level 4 Cost(20%) 21,374 EXHIBIT D1 Fire Department Calls to Westover Hills Total Calls August 1, 1989 - July 31, 1990 18 Cost Per Run $5,344 (Based on Level 2 Service) Fort Worth Cost Per Run $775 (All Incidents) EXHIBIT D2 EXHIBIT E Hazard Potential Factor The Hazard Potential Factor determines whether the area to be covered has a greater or like fire protection factor as Fort Worth. The Factor is based on an assessment of. 1). Varying types gf properties in the area to be protected. This includes a survey of small homes and businesses which have a minimal potential to escalate beyond a first alarm assignment; larger homes,light industrial areas,and other properties that have a potential for escalation to a higher alarm level; industrial areas,hazardous operations,high-rise buildings,large public assembly areas, and institutional properties where life hazard is above average and other properties where the potential to escalate to a maximum response is high. 2). Transportation Routes. Transportation routes are factored due to the special problems railroads,highways, and major traffic routes can add to fire protection efforts. 3). Open Land. Both developed and undeveloped open land is included since fires in these types of areas require special kinds of equipment and, at times,large numbers of manpower. In evaluating this category,consideration is given to area, accessibility,and ground cover. 4). Other Fire Protection Factors. This includes water supply,fire and building codes and their enforcement,sprinklers,standpipes,and smoke and heat detectors. 5). Special Factors. Any special factors unique to potential protection areas and inconsistent with the Fire Department's experience. All ratings of the potential protection area are done based on the relationship of each factor to the"norm"of Fort Worth. A rating of I means that a factor is approximately the same as is common to like factors in the City of Fort Worth; a greater hazard factor would receive a higher rating. Under no circumstances would the Hazard Factor be less than the 1.0 factor applied to the City of Fort Worth. EXHIBIT F Level of Service to be Provided The final factor in the formula allows a the client city to choose one of four levels of service to be provided by the Fire Department. Level I Full fire protection service, including full fire suppression; emergency medical first responder services; inspection of all schools, water hydrants,commercial establishments, and churches; arson investigation; bomb squad; fire safety education; hazardous materials response; emergency management; all other fire services received by Fort Worth residents. The cost of Level I service is based on the full per capita cost of Fort Worth fire protection. Level 2 Full fire suppression service,emergency medical services first responder service,inspection of water hydrants,and hazardous materials incident response. Level 2 service is provided for 90% of the full per capita cost of Fort Worth fire protection. Level 3 Nearest one-alarm assignment. For this level of service the Fire Department will respond the nearest one-alarm assignment,which includes,on average, two Pump companies, one Ladder company, and one District Officer. This level of service does not include emergency medical first responder service or hazardous materials response. Level 3 service is provided at 60% of the per capita cost of Fort Worth fire protection. Level 4 The nearest one company response to fire emergencies and motor vehicle accidents. This Level does not include emergency medical services except for those initial actions that may be necessary at a motor vehicle accident. The cost for Level 4 service is 20% of the full per capita cost of Fort Worth fire protection. (Note: Percentages used to calculate the costs of levels of service are base on the cost of operating and performing the allied services to City of Fort Worth residents)•