July 29, 2015

SPECIAL MEETING – REPLACEMENT LEVY (2003)

CALL TO ORDER @ 10:00 am

ROLL CALL           – Mr. Anderson                          x Mr. Takacs                   x Chief Lutz

x Mr. Frager                              x Mr. Vest                      x Ms. Clapp                                        x Mr. Gauntner                           x Mr. Wayman                        x Ms. Dame                                                                                      

Mr. Wayman welcomed everyone to the meeting and asked Chief Lutz if he had any opening comments to share before the Board addresses Resolution #15-020.

Chief Lutz detailed the Certificate of Valuation received from the Lake County Auditor’s office in regards to Resolution #15-019 which requested current tax valuation and the dollar amount generated by a replacement 4.5 mill tax levy. The total revenue generated by the replacement 4.5 levy is calculated to be $1,623.430. Currently, the total tax paid on a $100,000 home for all existing Fire District levies (6.48 mills) is $200.82. The total tax that will be paid on a $100,000 home for all Fire District levies if the 4.5 replacement levy is passed on November 3, 2015 will be $305.55. (Divide by 2 to calculate the tax on a $50,000 home.)

Mr. Takacs requested that chief Lutz report on his expectations of what the additional tax revenue will be used for and what expenses and services he expects to cut if the replacement levy does not pass in November. (Report was emailed to the Board prior to meeting.)

Chef Lutz stated that, when the levy passes, he will have the ability to hire (6) additional Full Time employees which will give us (6) full time employees on each shift supplemented by 3-4 part time employees. The plan is to hire (3) in 2016 and (3) in 2017 and keep a watchful eye on the budget. Although part time costs are a little lower than full time, part time employees often times have full time positions elsewhere and the expectation that they will show up every day has been a challenge.

If the levy fails, we will have to drop our manning to (7) curing the day, beginning with the Transfer Program which can be cut back to only (12) hours during the night time hours or the program can be cut in its entirety.

Mr. Vest commented that, if we reduce manning, we will have Part Timers without jobs. Chief Lutz said that is not the case, that they would just have less hours. No one will lose their job. In fact, he stated that one of our biggest problems currently is that we do not have enough part timers to fill the schedule.

Mr. Vest stated that he would like to see some changes in the financial reports that are issued to the Board. He asked to see both full time and part time overtime, who is getting overtime, reasons why, and the amount of hours by individual so the Board can keep an eye on this situation. Mr. Vest also asked to see all Transfers (separate from regular EMS calls), all costs associated with Transfers such as fuel, supplies, repairs, etc. He explained that he wants to be able to see that we budgeted “x” amount and where we are within the budget throughout the year. Mr. Takacs stated that what Mr. Vest is looking for cannot always be made available because personnel, vehicles, equipment, etc. are shared by both regular EMS and Transfers and some of these expenses are combined in the accounting system. Mr. Vest asked how he was supposed to track the direction we are going.

Chief Lutz detailed the District’s Income budgets and reported that if any one of these Funds starts to lag, we have a problem.

General Fund (Levies…………….$2,200,000

EMS Fund…………………………….$   950,000 ($550,000 from 911; $400,000 from Transfers)

Capital Fund…………………………$   850,000

The Capital Fund money is obviously there. The EMS money is coming in as budgeted. The problem we have is the money coming into the General Fund from levies. They are not making the production of the 6.48 mills because they haven’t been replaced over the years. That is where the money coming into the district is lacking. By design, 65% of the $950,000 in the EMS fund goes into the General Fund and 35% goes to debt reduction. Lately, however, a portion of the 35% for debt reduction has been funneled into the General Fund in an effort to keep up with expenses. Fire and EMS expenses are split 50-50. The General Fund basically supports this place and the EMS is a supplement to it. The problem is that the tax money is just not there.

Chief Lutz reported that when the Transfer program was started, there were no standing ER’s out there to get stats from and he low-balled the estimated number of calls per year at 500-800. He stated that he had no idea what they were going to pay so he stayed within the 80% that Medicare would cover. Actual call volume is just short of 1,300 and we’re bringing in over $400,000 per year. Chief Lutz assured Mr. Vest that he would make sure he gets the information he requested.

Mr. Vest asked if he is correct in assuming that the budget is broken down with UAN codes. Joann Clapp agreed that he was right. He asked if she had a breakdown of what the codes actually mean. She assured him she had such breakdown. He asked what account the payments from the Village are going into. Chief Lutz replied that, due to shortages in the operations side, the last payment was put into debt reduction. Once the General Fund is back up to speed, these payments will go into the Capital Fund.

Chief Lutz stated that he continually asked how we were doing financially and was always given the answer that we were fine. He stated that it wasn’t until he took over the Chief Fiscal Officers position in Sept., 2014, that his eyes were opened to certain realities which took over 4 months to digest. Reality is that the General Fund is not producing what it’s supposed to be producing.

Mr. Gauntner asked to confirm that, if the levy passes, Chief Lutz will hire (6) more Full Time people which will give us (6) Full Time people per shift. Chief replied that that is correct. Mr. Gauntner asked to confirm that currently we have (4) Full Time people so this will give us (2) more per shift. Chief replied that that is correct. Mr. Gaunter asked to confirm that chief Lutz plans to add 3-4 more Part Timers per shift. Chief replied that he is not adding part time staff, he is supplementing the schedule with 3-4 existing part timers so there will be 9, possibly 10 people on shift per day. “I don’t want to rush into doing any more than that. Currently, we have (4) Full Timers and (7) Part Timers per shift but, as you know, we don’t have the staffing to do that anymore.” Mr. Gauntner interjected saying “because you can’t get the Part Timers to work and that is why you want more Full Timers. You want to go to (6) Full Timers and cut the Part Timers to 3-4.” Chief Lutz replied that that is correct. “I know (6) people will come to work because it is their livelihood. With (7) Part Time, you don’t know who’s going to come to work sometimes”, Lutz commented.

Mr. Frager asked for clarity if the $400,000 number used in reference to Transfer revenues is before or after expenses. Chief Lutz replied that that is the total revenue received after Medicount Management deducts their fee. Mr. Frager followed up by asking if personnel labor cost for running the Transfers are already deducted from the $400,000. Chief Lutz answered, “No, the cost of labor comes out of the General Fund. Costs for dispatch, fuel, vehicle repair, etc. come from the General Fund – 50% from the EMS side and 50% from the Fire side.” Mr. Frager stated then that his point was, at the end of the day, the $400,000 number has not been adjusted to reflect all the costs to run the program. Chief Lutz answered that that is correct.

Mr. Frager stated that the picture he is getting painted at this meeting is that the General Fund is falling short, whereas, at the previous meetings, the issues were that the Part Timers weren’t showing up and the Full Timers are having to do overtime to run the Transfers, which is not how it was set up and is now bleeding the budget. Chief Lutz replied that all three issues Mr. Frager just mentioned are part of the overall problem. With respect to technology costs, Mr. Frager asked where these costs show up in the budget. Chief Lutz answered that these kinds of large dollar equipment come out of the Capital Fund.

Mr. Gauntner asked whether money comes out of the General Fund to add to the Capital Fund annually. Chief Lutz replied, “Yes, normally $200,000 to $300,000 is set aside for the Capital Fund, but not this year.”

Mr. Takacs commented that 8 years ago there was no Capital Fund – we ran out of a checkbook” It was determined by the Board at that time to take a chunk out of revenue annually for big ticket items. In the last couple of years, the only way we have met the challenges of the budget is by not funding the Capital Fund the way we did before and Mr. Takacs stated that down the road we are going to pay for that and that concerns him.

Per Mr. Takacs, two things have happened. We probably had this problem two years ago and it was not brought to our attention by the Fiscal Officer. We used other accounts to balance off the expenses to meet our needs, but the flag wasn’t waved that the levy money wasn’t coming in like we needed it to. We should have done this 2 years ago but we lived off the EMS billing and Transfer revenue and that bought us time. This is the only way to get us back on cycle where the costs reflect the operation.

Mr. Gauntner said he did not disagree with anything Mr. Takacs said, however, the community is going to ask what you’re going to do if they don’t vote for this, what is going to happen? “I don’t know what to tell people – maybe we’re not going to do Transfers, maybe we’re going to cut back on personnel – we need to have a solid plan.” To say failure is not an option doesn’t cut it, because in the business of government and politics, it is an option and it happens a lot.”

Mr. Frager asked what timeline the Chief is looking at for adding the (6) new people. Chief Lutz replied that the funds will not be available until the second half of 2015 and he does not want to do them all at one time and hit the budget too hard. He is looking to hire (3) in 2016 and (3) later down the road so he can keep an eye on things as we go along. Chief Lutz stated that he did not cause these problems, but he is trying to fix it.

Mr. Frager commented that he is on the Lakeland Board and that they are also going through this process now. He stated that he understands that Lakeland has more resources to put things together, but it has been a lot easier to understand and digest what is happening there. “There is a definitive plan that I can understand as to what happened and what we’re going to do moving forward and what will happen if we don’t move forward. The dollars, to the nickel, is totally accounted for with timelines and everything. Tonight we are being asked to go to the public with 4.5 and I understand what it is going to generate, but I would like to be on more solid ground on what the plan is here, how it’s going to lay out, and what’s going to happen if we don’t. You gave us (3) options I the email, but I am still a little uncomfortable with everything.”

In response to Mr. Frager’s question of how to promote this to the public, Mr. Takacs explained it this way:

“We have enjoyed a certain level of service. We have borrowed time with the EMS billing and Transport billing from the last years. We would never have been able to provide the service we have today if we didn’t have those on board. If you like what you have and you want to understand the issue of the full time and part time staffing problems, a positive vote will get you the service you are used to with more professionalism and a full time staff that is getting paid a little bit better. Equipment will be maintained at a level that you have come to expect and we will be able to keep up with the technology issues. The counter to that is that you won’t have the same services that you have now – not that they won’t come out if your house is on fire or you need a squad – it’s just a matter that there is going to be a limit to how much the resources can be spread over the number of calls that you have. Equipment won’t be replaced as often as we would like and we have to really be serious about whether or not you want to play the technology game or do you just want to let that pass you by, because to catch you back up again will cost you a fortune. When you buy a defibrillator unit that costs@20,000, you buy (5) at a time because you have (5) squads. We can’t not have equipment on a vehicle when we get to your house and have to say, “Wait a minute, it’s not here, it’s in the other squad”. When you explain in terms of multiplicity of services – that you have to make sure the second and third calls have the same level of service as that first call. And that first fire truck is as good as the second fire truck and is as good as the third fire truck when it comes to your house fire, people have to be aware of that.

“From my perspective, if you like what you have today and you enjoy and respect the services that you have and you want to continue that, you have to make some accommodations for that from a financial standpoint. If you say I really think the firemen are swell guys, but I just can’t afford it on my taxes and I’m going to vote no – I understand that, but then you have to understand that the cost of everything we do is going up and we’re not getting the revenue to cover that so something has to give and that means our service has to scale back. Like the Chief said, we are not going out of business, you’re just not going to have the level of service you have today because we borrowed time with these other revenue streams that are how fixed and we have surpassed their ability to compensate out budget”

Mr. Vest surmised that what Mr. Gauntner and Mr. Frager are looking for is almost like a piece of campaign literature that shows what is going to stay, and what is going to go.

Mr. Gauntner stated that the average voter really doesn’t know the level of service he has available. He reported that he has lived in this town 54 years and has only had the need to call the fire department one time. Most people don’t know the level of service that is really out there and figure if they don’t vote for the levy it really doesn’t affect me, I never use the fire department. Mr. Gauntner said, “Until you need them”. Will they have a defibrillator that works when they come take care of my heart attack – I don’t know. It’s a tough sell when you say, “If you don’t vote for this, your level of service I going to drop” and the average guy say, “I don’t use the fire department anyway”. Mr. Takacs agreed and stated that people make the same comments about police departments.

Mr. Takacs commented that the first step is to commit to doing this levy issue , if that’s the direction the Board wants to go. The next step, which is equally important, is the job of telling the public what they will get if it passes and what they will have to do without if it doesn’t. People need to see that. There has to be an awareness that there is a problem here if they want to keep the level of service that they now have. It’s an educational process and we need to work hard to pull together the information for the public co they understand the need.

Mary Ann Guy-Froebe – “ I understand that a few of you aren’t comfortable asking for a replacement of such millage. I don’t like comparing Madison to other communities but, according to the Board of Elections as of July 21, 2015, Concord is going for an additional 4.0 mills for their Safety Forces so you will see that 4.5 replacement isn’t out of line. It’s up to the community to decide but they need to know the positive things that will come from passage as Mr. Takacs mentioned, as well as the negative things that will happen with a failure. At the last meeting, the new building seemed to be a stumbling block for some of the Board members, but the building has to be paid for whether the levy passes or not. I encourage you to put this on the ballot. I have told the Chief that I will do all I can to get it passed. Now it is your job as the Board, and firefighters who have a vested interest due to contract negotiations, to step away from your personal mindset and market the levy for passage. Thank you.”

Resolution #15-020 – Replacement 4.5 Mill Continuing Levy:

This Resolution declares it necessary to submit to the electors of the Madison Fire District, the question of the replacement of a 2.0 mill levy by a 4.5 mill levy for a continuing term on the November 3, 2015 election for the purposes of providing and maintaining fire, ambulance, or emergency equipment, buildings, and services in the District.

Motion to approve and submit to the Board of Elections by: Mr. Vest

Seconded by: Mr. Wayman                                                           ROLL CALL: 3 Ayes; 2 Nays

(2/3 majority required –

Motion Not Passed)

Motion to adjourn @ 7:55 pm by: Mr. Takacs

Seconded by: Mr. Vest                                                                   ROLL CALL:   All ayes

_______________________                           _______________________

Mr. Pete Wayman, Chairman                               Nila Brass, District Clerk

July 21, 2015

SPECIAL MEETING – REPLACEMENT LEVY (2003)

CALL TO ORDER @ 7:00 pm

ROLL CALL           x Mr. Anderson                        x Mr. Takacs                   x Chief Lutz

x Mr. Frager                              x Mr. Vest                      – Ms. Clapp                                        x Mr. Gauntner                           x Mr. Wayman                        x Ms. Dame                                                                                      

Chairman Wayman stated that the purpose of this Special meeting is to discuss a potential replacement or increase in the Madison Fire District’s 2003 Continuing Levy (2.0 mill).

Chief Lutz asked Stacy Dame, District Law Director, to discuss the potentially conflicting language – “in excess of 10 mills” – in Resolution #15-019 being presented to the Board at this Special meeting. He reported that Madison Fire District’s three levies currently total 6.48 mills (2.0, 2.48, and 2.0) and indicated that we were not outside the 10 mill limitation. Mr. Gauntner and Mr. Takacs questioned whether the “10 mills” was just for the Fire District or for all County taxes. Ms. Dame stated that, from what she has seen, it is her opinion that the District is in excess of the 10 mill limitation, therefore, the resolution she prepared is based on previous resolutions and action taken referencing 5705.03(B). Ms. Dame reported that the November of 2002 levy (2003 Tax year) being discussed at this meeting was based on Ohio Revised Code 5705.03(B), and used the language “in excess of 10 mills” and the process of adding the issue on the ballot to be voted on by the electorate. She asked for clarification from the Board as to their reasoning for taking this action in the past. Ms. Dame explained that if the total millage was, in fact, under 10 mills, Ohio Revised Code 5705.03(A) allows the Board, as the taxing authority for the Fire District, to simply levy the taxes annually by resolution, certify and submit it directly to the County without a vote. She stated clearly that she does not believe that this is the case here, but indicated that she is willing to verify the millage with the County Auditor and Board of Elections if there is a question. Ms. Dame stated that, because she believes the District is in excess of the 10 mill limitation and because the levy now being considered was previously put on the ballot for vote, she recommends that the Board continue to follow ORC 5705.03(B) and proceed with the due process of discussing and voting on Resolution #15-019 as presented and, if so desired, get certification from the County Auditor and, if so desired, put this levy issue on the November 3rd ballot as was done in the past.

 

LEVY DISCUSSION:

Mr. Takacs asked Chief Lutz to discuss in detail the pros and cons of considering an additional 1 mill, 2 mills and 3 mills for the 2003 levy. Chief Lutz began by saying that, if we do nothing, we will be in deficit spending by November, 2015. The District currently has

about $28,000 in the checking account and we are still waiting on the second half tax payment.

Replacement Only – No Increase: Chief Lutz explained that if we simply replace the levy at the current millage, the tax payer will get charged 12.5% and the District will only receive an additional $84,000. He stated that the additional monies raised will not even cover the 2015 deficit, let alone cover the anticipated deficit in the 2016 budget. In Chief Lutz’ opinion, if the taxpayer is going to experience a 12.5% increase, they should get something out of it, which will not happen because it simply falls short of the current need and does not address any future need.

1 Mill Increase: Per Chief Lutz, a 1 mill increase will net the District $360,000 which will only prolong the deficit issue for a year or so and the District will find itself again in the same position we are in today.

2 Mill Increase: Chief Lutz reminded the Board of the Part Time employee shortage issue discussed at the July 8th meeting and stated that this option would only allow him to hire (1) additional Full Time employee per shift instead of the (2) per shift that he feels is necessary to reduce mandatory overtime wages being paid to Full Timers to fill the current schedule and meet minimum manning. In addition, with only a 2 mill increase, it will be necessary to eliminate the Transfer Program to further reduce Part Time wages and Full Time overtime which will result in revenue loss of $400,000/year. The District’s debt reduction funds are designed to be paid from this EMS revenue, but Chief Lutz commented that, if he gets rid of the Transfers and only hires (1) additional Full Timer per shift, there will probably be some left over to pay down the debt.

Mr. Gauntner inquired why the District would lose $400,000/year in revenue if the Transfer Program was eliminated. Chief Lutz explained that the Transfer Program (facility to facility Transfers) which operates 24 hours a day, currently brings in $400,000 per year. A 2 mill increase would only allow him to schedule (5) Full Time and (2) Part Time personnel per shift instead of the (9) staff required for the additional (2) Part Time paramedics to run facility to facility Transfers.

Mr. Takacs further explained that, initially, the Transfers were manned by personnel receiving lower scale wages so there was a profit for the District. The current shortage of Part Time Transfer staff has forced Full Time personnel making much higher wages, and in some cases, overtime wages, to cover these runs which is causing us to actually lose money on the deal.

Mr. Takacs added that when the District implemented the Transfer Program with the Lake Hospitals, it was with the intent to generate revenue. He explained that we designed the debt service for Station #3 to come from the Transfer revenue, NOT the General Fund. We had the funding mechanism in place to devote 35% of Transfer revenues to debt reduction and 65% to the EMS Fund. If we eliminate the Transfers, the debt service will have to come out of some other fund, probably the General Fund, which was never the intent.

Mr. Gauntner surmised that we based the mortgage for Station #3 on the Transfers, now we don’t have the money so, bottom line, we have to increase the millage to hire enough people to cover the debt service. Chief Lutz replied, “Only if you cut the service”, and Mr. Gauntner agreed.

Mr. Gauntner stated that he was not on the Board when the District purchased St. #3, but he has heard it (that the new station was being paid for by the levies) both before and since becoming a Board member. In his opinion, the problem is that as soon as you put a 5 mill levy on the ballot, the people in this town are going to say, “I told you so. They built that 3 million dollar Taj Mahal and now we have to pay for it. Why did we have to have such an expensive fire station?” Mr. Gauntner again stated that he wasn’t here at that time so he really can’t answer the question, but predicted, “That’s what you’re going to hear from people.” He further stated, “Quite honestly, we are paying the debt service with the levies because we have to ask for that kind of money just so we can do the Transfers to cover the debt service”.

Chief Lutz disagreed and reiterated that the increase in the levy is to “pay for the people” (employees). Mr. Gauntner stated that the money is for staff to keep the Transfer Program running to pay for the debt services. “To pay for the people… you have to have the people to do the Transfers so, really, you’re covering with the levy is what you’re doing – it’s kinda like the shell game – it’s smoke and mirrors, really.”

Mr. Frager commented that he wasn’t here either and asked, “When this was put together vs. what is happening now, is the difference the fact that you can’t get Part Timers – is that the whole thing?” Chief Lutz answered that the problem is that he can’t get people to come to work. “We don’t have the staff to cover – not anymore – because we’ve lost so many people to full time jobs elsewhere.”

Mr. Vest asked, “Even if you have the money, how do you propose to get people to come to work?” Chief Lutz answered that he still has Transfer people, he just doesn’t have enough to cover (7) 24-hour shifts/365 days a year which is 61,000+ hours. Per Chief Lutz, the solution is to hire (6) Full Time people and supplement with 2-3 Part Timers. Mr. Vest asked why the Chief would hire a Full Time Firefighter to do Transfers. Chief Lutz explained that Firefighters have a 240 card and a Paramedic card and respond to many different kinds of calls. Transfer crews are just EMS (Paramedics) – they run Transfers.

Mr. Gauntner asked how many Full Timers we now employ. Chief answered, “12 – (4) per shift.” Mr. Gauntner asked how many Part Timers we now employ. Chief replied, “38, but we used to have more.”

Mr. Gauntner asked, “So if we go to 5 mills, you still need 3 or 4 more Part Timers? Chief answered that with our call volume, we need 8 – 9 on shift every day; (3) at Station #2, (3) at Station #3 and (2) Transfer.

LEVY DISCUSSION – 3 Mill Increase: Chief Lutz reiterated what he reported at the July 8th meeting: We have lost Part Time employees to other departments and hospitals who offer Full Time work, and we have lost numerous Part Time Transfer employees who have been pursuing their nursing degrees to hospitals who offer Full Time employment, benefits, retirement, higher wages and gift cards. Because so many of our Part Timers hold allegiance to their Full Time job, it has been difficult to fill the schedule and we have been forced to mandate overtime for the Full Timers which is disastrous to our under-funded budget. Chief Lutz stated that we are not getting the people to replace the Part Timers we have lost to Full Time positions elsewhere and that the only solution is to hire (6) more Full Time people here so that we have (6) reliable Full Timers on each shift and cover the Transfers with 2-3 Part Timers. “We can no longer stay with the model of (4) Full Timers and (7) Part Timers – it doesn’t work.” Mr. Takacs stated that the system currently in place will have to change and offered that the only other option is to eliminate the Transfer Program and cut staffing to be able to afford the operation. Mr. Vest stated flatly that if we do that, we are putting a levy out to pay for Station #3.

In reply, Mr. Takacs stated, “It was well intentioned to be able to say that when we built the fire station that was needed here – that we had the funding mechanism to be able to pay for it at the time we established what we were trying to do. We knew from day one that the Transfer system could always disappear – that the hospital could say they are not paying for this anymore or they are not doing this anymore and could make that disappear. I don’t think anyone foresaw the difficulties in keeping staffing to the levels that we have and to the point where full time people are now doing Transfer services routinely on the overtime budget.” He offered again that the Board can eliminate the Transfer Program and can eliminate Part Time staffing, but stated, “The reality is that we built a building in the District, we had a funding mechanism to pay for it and, if the Board takes one of those funding mechanisms to pay away by choice, then it has to be paid for by the levy and that’s our choice – that’s your choice.”

Mr. Gauntner again commented that the levy is paying for the building one way or another. Mr. Takacs replied, “That’s true today, but that was not true 2 years ago – the original funding paid for itself for 2 years. The cause of the current situation is, as Chief Lutz has represented; Degenerating Tax Revenue, escalating cost of technology and Full Time overtime due to the loss of Part Timers to full time positions elsewhere – not Station #3.”

Mr. Frager asked how many full time personnel will be scheduled for a 1 mill, 2 mill and 3 mill increase. Chief Lutz assured the Board that no matter what millage is considered, the current Full Timers will stay – Part Timers, unfortunately, will go first.

-         A 1 mil increase will only allow him to schedule the existing (4) Full Time and (2) Part Time personnel per shift.

 

-         A 2 mill increase would only allow him to schedule (5) Full Time and (2) Part Time personnel per shift.

 

-         A 3 mill increase will allow him to schedule (6) Full Time and (3-4) Part Time personnel per shift.

Per Mr. Wayman, the 3.0 mill (1 mill increase) obviously will not help the situation and the 5.0 mill (3 mill increase) may be difficult to get passed. He and Mr. Gauntner stated that they would be willing to go to 4.0 mill (2 mill increase) and try to keep the Transfer Program in place.

Mr. Takacs stated that, from his perspective, the people of Madison deserve to be a part of the process and if they turn it down, it will be clear the direction that they want and the Board and Staff will have to be more frugal, cut the services and cut the staffing. If they understand the need and the levy passes, we will have the opportunity to continue doing what we’re doing.

Mr. Frager stated that he agrees to an extent, but feels that, as an elected trustee, the residents of Madison expect the board to make some decisions. Mr. Takacs stated that that is what he is doing. As a Board member, he has a statutory responsibility and he recognizes the need in the District’s Finance Department and is recommending that his constituents approve a levy increase.

Mr. Frager commented that part of his lack of comfort lies in the fact that it is relatively easy to say “let’s just put on a levy and get more money”. He surmised that a 2 mill increase seems to be the trending here, but asked, “What’s the plan? If it passes, as a voter, I want to know exactly what the District is going to do with this money. People will come up to me and say what’s going to happen with these dollars.”

Mr. Vest stated that the first thing the Madison residents are going to want to know is, “Are we paying for Station #3?” Chief Lutz stated that no matter what answer you give them, whether you say it’s for staffing, or for the building, or whatever, because it’s a new building, it is the first easy stab anybody can take at you. The truth is, the debt service for Station #3 is, and has always has been, taken out of the EMS Transfer Fund. Personnel is taken out of the General Fund (6.48 mill Levies) which is not making enough money to pay for the people we have. The$900,000 from the EMS Fund is not a deep well of two or three million dollars and will only last so long. It simply is not enough to make up for the shortages in Tax Revenues from old levies.

Chief Lutz reported that, per the Lake County Auditor, a Madison resident with a $100,000 home is currently paying $200.82 a year for all three District levies. The 3 mills increase will raise their tax by $135.00 a year for a total of $335.82 a year which is what they were paying back when the levies were new. Again, the problem lies with the fact that tax revenues have dropped substantially over the years because our continuing levies have not been renewed every 5 years. The two 2.0 mill levies (2003 and 2006) are only bringing in 1.7 mills. This community is a Full Time Department and 6.48 mills are not enough to fund 4,300 calls a year. Willoughby, Painesville City and Painesville Township have similar call volumes and are doing it with more people. We have to leave it up to the people of Madison to decide if they want services 24 hours a day/7 days a week or not. It’s up to them to choose.

GENERAL LEVY DISCUSSION:                                                                           

Mr. Frager again asked what happens with the dollars that will be generated by a 2 mill increase. Chief Lutz again reported that a 2 mill increase would allow him to hire (1) additional Full Time employee per shift (3 total). He revisited the fact it has been difficult to fill the schedule because so many of our Part Timers hold allegiance to their Full Time job, but stated that with a 2 mills increase, he would strive to schedule (5) Full Time and (2) Part Time personnel per shift. Chief Lutz confirmed that with only (7) personnel on shift, it will be necessary to eliminate the facility to facility Transfer Program which will result in revenue loss of $400,000/year. He reminded the Board that the District’s debt reduction is paid from this revenue, but again voiced the hope that with a 2 mill increase, there would be some funds left over to pay down the debt.

Mr. Vest theorized that if a 2 mill increase would allow the District to hire (3) Full Timers bringing the schedule to 5 Full Time/2-3Part Time per shift, then a 2.25 mill increase would be sufficient to hire an additional (3) Full Time making it (6) Full Time/2-3 Part Time per shift. Chief Lutz and Mr. Takacs reminded Mr. Vest that the District is already in an operational deficit of about $300,000 by the end of 2015, and that manpower is not the only issue when considering responsible allocation of a levy increase. A portion of the increase must be used to resolve the 2015 and 2016 deficits.

Mr. Takacs concluded that no matter what millage increase the Board may decide on, if any, the question for the Board is – do you want to reduce the staffing and the operation? – or – do you want to go ask the people what they think? Do you want to scale back the operation to offset the deficit – or – do you want to go to the voters and tell them we need to add staff to continue operations. If they say no, then we know what the mandate is.

Mr. Frager asked when the next 2 levies are up. Mr. Takacs reminded him that they are continuing levies and stated that traditionally levies are renewed every five years because all levies depreciate over time and expenses are higher. Madison has continuing levies which in one respect is good because you don’t have to keep going back and putting it on the ballot, but in another respect, continuing levies do not take inflation into account (union contracts, rising technology and other operations costs, etc.).

 

Chief Lutz suggested that the Board consider a 4.5 mills increase. Mr. Takacs commented that 4.5 was less than the Chief had asked for and he wanted it clearly acknowledged that this is a full time operation – that a Part Time operation is just not supporting what we need to get accomplished – and that hiring Full Time staff is key to making it work long term. Chief Lutz commented that it would be tight, but he would try to make it work. He stated that he would endeavor to cover the 2015 and 2016 deficits, finalize both union contracts, add (3) Full Timers in 2016 and under a watchful eye, add (3) more in 2017. He committed to continuing with the Transfer Program for as long as it remains profitable.

Mr. Gauntner asked Chief Lutz what will be cut first if the levy does not pass. He stated that the Transfer Program and manpower will have to be first.

Mr. Frager asked what solutions have been considered to the reduce technology costs reported at the last meeting. Chief Lutz replied that he has already been researching repair of opticoms, equipment, vehicles, etc. in lieu of purchasing new.

RESOLUTION AND VOTE:

Resolution #15-019 – 2003 Levy Replacement:

This resolution declares it necessary to levy a replacement of a 2.0 mill with a 4.5 mill tax and requests the Lake County Auditor to certify to the Madison Fire District the current tax valuation and the dollar amount of revenue that would be generated. Per Ms. Dame, after the Certification has been received back from the Auditor, the Board will need to have a Special meeting to vote on a Resolution to send to the Board of Elections to put the Replacement Levy on the November 3, 2015 ballot. The Auditor has 10 days to issue the Certification. The deadline for submitting to the Board of Elections is August 4, 2015.

Motion by: Mr. Takacs     Seconded by: Mr. Wayman

Discussion:

Mr. Gauntner stated that a 4.5 mill levy will be a tough sell. He would agree to 4.0 mills.

Chief Lutz commented that 4.5 mill is necessary to address the staffing problem. People will tell you it’s the building, but it’s staffing, vehicles, insurance, lights, water, sewer….… it’s the cost of everything we do here.

Mr. Frager apologized for his lack of clarity, but stated that it is hard for him because he doesn’t hear a specific plan as to where the money is going to be spent or what the plan is if it goes down. Mr. Wayman replied that the expenses of the operation continue to increase – labor, technology, equipment – everything.

ROLL CALL: 4 Ayes; 2 Nays          Motion passed by Majority

Mr. Wayman suggested that a Special meeting be tentatively scheduled for July 29th @ 7:00 pm at Station #3 Training Center to address a possible resolution to submit to the Board of Elections by the August 4th deadline.

Motion by: Mr. Gauntner             Seconded by: Mr. Frager   ROLL CALL: All ayes

Motion to adjourn @ 7:52 by: Mr. Anderson

Seconded by: Mr. Vest                                                                   ROLL CALL:   All ayes

_______________________                           _______________________

Mr. Pete Wayman, Chairman                               Nila Brass, District Clerk

July 8, 2015

SPECIAL BUDGET HEARING – 2016 TAX BUDGET

CALL TO ORDER @ 6:00 pm

ROLL CALL           x Mr. Anderson                        x Mr. Takacs                   x Chief Lutz

x Mr. Frager (6:04)                  x Mr. Vest                      x Ms. Clapp                                        x Mr. Gauntner (6:07)              x Mr. Wayman                        x Ms. Dame

PLEDGE OF ALLIGENCE

2016 TAX BUDGET – Joanne Clapp, Chief Fiscal Officer, handed out the proposed 2016 Budget and asked for Board approval to submit it to the Lake County Auditor’s Office. Chief Lutz reported that, once the County has approved the budget figures (in September), the Board will need to vote on a resolution to accept the budget for next year.

(Mr. Frager arrived 6:04)

Mr. Wayman asked if anyone from the public had any comments or questions. No comments or questions were voiced.

A motion was made to send the 2016 Tax Budget as presented to the Lake County Auditor’s Office for their review and approval.

Motion by:   Mr. Wayman             Seconded by: Mr. Vest       ROLL CALL: 5 ayes

REGULAR SESSION:

Painesville Elks Club Donation: Chief Lutz reported that George Miller with the Painesville Elks Club had contacted him asking if the Madison Fire District wanted to apply for a $750.00 grant through them. The grant was ultimately awarded and Chief Lutz purchased two cameras and a Crime Scene Kit (flags, bags, measuring tools) for FIU investigations.

(Mr. Gauntner arrived 6:07)

MINUTES:

Minutes of 05/20/15 Regular Session

Motion to approve by: Mr. Anderson                 Seconded by: Mr. Frager

ROLL CALL: 5 Ayes; 1 abstain (Takacs)

BILLS & PAYROLL (May 15 – June 10, 2015)

Bills ($41,688.51) and payroll ($158,626.78) totaling $200,315.29 are motioned for acceptance and payment.

Motion to approve bills and payroll as presented by: Mr. Vest

Seconded by: Mr. Anderson                                                                     ROLL CALL:   All ayes

BILLS & PAYROLL (June 11 –July 1, 2015)

Bills ($45,401.64) and payroll ($ 90,789.27) totaling $136,190.91 are motioned for acceptance and payment.

Motion to approve bills and payroll as presented by: Mr. Gauntner

Seconded by: Mr. Frager                                                                           ROLL CALL:   All ayes

OPENING PUBLIC PORTION:None to report.

COMMITTEE REPORTS: None to report.

OLD BUSINESS:

Mr. Wayman inquired whether Madison residents are still under “soft billing” status for EMS billing. Chief replied that they are.

Mr. Vest asked if Mr. Gauntner had finished his research on building inspection regulations with regards to a discussion at the May 20, 2015 Fire Board meeting. At that time, there was a question about the difference in building code/ inspection requirements for businesses that are being classified as Agriculture as opposed to Viticulture.   The discussion pertained to a local winery with a full scale kitchen and hood system on the premises being classified as an Agricultural business making it exempt from fire and building code authority/inspections. Per Mr. Gauntner, he has not gotten any further clarification regarding the matter because the County Building Inspector position is vacant and the County has requested that he wait until they have a permanent replacement.

NEW BUSINESS:

Mr. Vest asked how often the Fire District physical inventory on building contents is recorded and updated. Chief Lutz replied once a year for VFIS insurance purposes.

Chief’s Report:

1)      The concrete sidewalk at the back of Station #3 has been removed and replaced.

2)     Damaged floor tiles at Station #3 have been replaced throughout.

3)     We are still waiting on the final measurement on any shifting/settling in the side retaining wall. Once it has been determined that the wall is no longer shifting, the concrete in the side driveway and some areas of the back parking lot will be repaired.

4)     Chief Lutz reported that the tax revenues (6.48 mill) this year are not being received as expected and we are running short again this year on funds to take care of ever-escalating expenses, particularly for technology maintenance and manpower costs.

a)     Generator St. #2 – currently OOS     Cost unknown – Generac

b)     Technology Maintenance                   $43,000 – (3 year contract – Physio Control)

(7) AED’s Maintenance (replacement cost – $8,000 each)

(5) Life Pak-15 Maintenance (replacement cost – $28,000 each)

(3) Lucas Maintenance (replacement cost – $25,000 each)

c)      (6) Cot Maintenance –Annual Cost  $2,500 – EMSARS

d)     *Alerting System Maintenance          $54,909 (4 year contract – FSA/Motorola)

(paid for by FEMA Grant)                    (for each department with 2 stations)

*Paul Stefanko with Telcom was supposed to take care of the maintenance on the alerting system, but this did not happen. Now, DRS/Motorola is doing the maintenance and is asking (8) East End departments to each pay the above cost. Department Chiefs plan to meet soon to discuss what recourse they have regarding this unexpected cost. Chief Lutz agreed to keep the Board updated.    

e)     (2) Engines – Class 1 Governors         $1,200 each

f)       (6) Squads – A/C maintenance          $ invoice not received yet

(1) Clutch                                    $ invoice not received yet

(3) ERG Valve                 $300 each

(#2162) – Blown Head gasket        $ invoice not received yet

Airbag Sensors                 $125.00 each

g)     Manpower – Part Time Wages                       $60,000 *still short in 2015 budget

(already cut by1.5 shifts per day)

*Part time – hourly wages budget was based on previous budgets which have since been determined to be grossly understated because the hourly wage used in the calculation was $14.50 instead of $16.29 which has caused a severe shortage in the 2015 budget.

h)    Manpower – Loss of Part Time Employees

We have lost numerous part time employees to other departments and hospitals who offer full time work, benefits and higher wages.

i)       Manpower Loss of Part Time Transfer Employees

We have lost numerous part time Transfer employees who have been pursuing their nursing degrees to hospitals who offer full time employment, benefits, retirement, higher wages and gift cards. One part time Transfer employee was fined $800 on income taxes for not having healthcare.

Even though Madison has an urgent care facility, an emergency department and many doctors’ offices, our EMS call volume hasn’t dropped. A recent study of other local area departments shows Madison ranked 4th in Lake County in number of calls (4,000+/year) behind larger cities like Mentor and Willoughby.

As previously stated, Madison Fire District is losing many part time employees to other departments and hospitals who are offering full time positions, benefits and higher wages. Many hospitals are paying double time because they are so short-staffed. Madison Fire District customarily schedules 4 full time staff and 7 part time employees each day. Because so many of our part timers hold allegiance to their full time job, it has been difficult to fill the schedule and we have been forced to mandate overtime for the full timers just to meet minimum manning, especially during the summer months. Many of our full timers have been asked to work their Kelly days, paid at time and a half, which is disastrous given the already over-stressed, under-funded budget. Also, keep in mind that we are currently negotiating both the Full and Part Time Contracts.

 

When the Transfer program was started, we estimated 500-800 calls per year, but actual call volume is just short of 1,300 per year. 65% of Transfer revenue is used for EMS – 35% is earmarked for debt reduction. This revenue is fairly consistent and is accurately reflected in the budget at approximately $400,000.

 

The problem lies with the tax revenue which has dropped substantially over the past few years because our continuing levies have not been renewed. The 2.48 replacement levy renewed in 2013 (from 1993) is doing good, however, the other two 2.0 mill continuing levies currently in place are old (2003 and 2006) and need to be replaced because they have dropped and are only bringing in 1.7 mill. To make matters worse, Madison has a huge problem with foreclosure properties for which no revenue is being received.

Chief Lutz requested that the Fire Board approve putting a 5.0 replacement levy (2 mill from 2003 plus an additional 3 mill) on the November 3rd ballot. He explained that time is of the essence because the deadline date for submitting to the county is August 5th, 2015.

 

Option #1: Per the Chief, if we do nothing, the District will be in deficit spending by the end of the year. Likewise, if the Board declines to put a replacement levy on the ballot or if the replacement levy does not pass, we will need to address the part time employee shortage by adding (3) full time firefighters to reduce overtime wages. We will also have to eliminate the Transfer Program (revenue loss = 400,000/year) which will further reduce our dependency on the part time staff. Reducing manning will result in the reduction and/or elimination of some services available to Madison residents.

Option #2: If the Board chooses to put a 5.0 mill replacement levy on the ballot and it passes in November, the District can continue with the Transfer Program, hire (3) full time employees in 2016 and (3) more in 2017 effectively reducing our dependency on the part time staff, and, at the same time, ensuring adequate staffing – (6) full time and (3) part time. Chief Lutz recommended that the Board pursue Option #2 which will allow the District to continue all current services to Madison residents.

 

Chief Lutz stressed that all levies should be replaced every 5 years to keep the Fire District financially sound.   In 2013, the 2.48 mill levy (1999) was replaced, not increased, and in 5 years will only need to be replaced again, not increased. Likewise, if the proposed 2.0 mill levy (2003) is approved at 5.0 mill this year, in 5 years it too will only need to be replaced, not increased, leaving only the third 2.0 mill levy (2006) to still be addressed at a future date.

Mr. Takacs recommend that the Board schedule a Special meeting for Tuesday, July 21st, 2015 @ 7:00 pm to allow the Board adequate time to digest the budget numbers and give consideration to Madison’s current continuing levies, the proposed changes in manning and services and the question of whether to approve putting a replacement levy on the November, 2015 ballot. Chief Lutz committed to emailing to the Board all District budget information, as well as information received from the County pertaining to millage projections.

Motion by: Mr. Gauntner             Seconded by: Mr. Anderson         ROLL CALL: All ayes

The Board directed Stacy Dame, District Counsel, to generate the resolution required for Board consideration and vote regarding the replacement levy issue as proposed by Chief Lutz.

The Board directed Joanne Clapp, Chief Fiscal Officer, who will not be able to attend the July 21st meeting due to a prior commitment, to submit, in writing, her recommendations regarding the proposed replacement levy issue.

The Board directed Nila Brass, District Clerk, to prepare and send notice to the newspaper and to the Madison Fire District website administrator for posting at least 24 hours in advance of the July 21st Special meeting.

2015-16 District Property/Casualty Insurance – VFIS (American Alternative):

Mike Gehring of The Benedict Insurance Agency reported that, other than the standard 4% annual increase on buildings and contents, there are no changes to the District coverage for 2015-2016. He praised the District’s Administration and Staff and reported that, due to the District’s loss control over the past 5 years, the August 1, 2015 renewal premium ($41,068) has actually gone down 3%. The Board thanked Mr. Gehring for his excellent service.

Motion to approve the 2015-16 Insurance Renewal as presented by: Mr. Vest

Seconded by: Mr. Gauntner                                                                     ROLL CALL: All ayes

Mr. Gehring thanked the Fire Board for their continued confidence and encouraged Chief Lutz and the entire staff to “keep up the good work”.

CLOSING PUBLIC PORTION:

Per Mr. Takacs’ and Mr. Anderson’s request, Lt. Brian Faulhammer submitted a letter from the Full Time Union to the Fire Board for their consideration.

CLOSING BOARD COMMENTS: None to report.

Mr. Wayman reminded everyone of the Special meeting on July 21, 2015 and the Regular Session on August 19th, both at 7:00 pm in the Station #3 Training Center.

Motion to adjourn @ 7:10 pm by: Mr. Anderson

Seconded by: Mr. Vest                                                                   ROLL CALL:   All ayes

_______________________                           _______________________

Mr. Pete Wayman, Chairman                               Nila Brass, Clerk