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1995-0123_ORANGE COUNTY FIRE AUTHORITY_Request for Continuance0 0 12822 Garden Grove Boulevard, Suite D, Garden Grove, California 92643 (714) 638-5550 FAX (714) 741-9457 January 23, 1995 Carolyn Nash, Mayor Members of the City Council City of San Juan Capistrano 32400 Paseo Adelanto San Juan Captistrano, California 92675 Re: Joint Powers Agreement creating the Orange County Fire Authority - Request for Continuance Dear Mayor Nash and Councilmembers: On behalf of the Apartment Association of Orange County (AAOC) we would like to formally request a continuance of any further action regarding the proposed joint powers agreement which would create the Orange County Fire Authority (OCFA). AAOC and other private sector groups are currently reviewing the proposed agreement and are asking that additional time be granted so that we might gain answers to the various questions and issues of concern which this agreement raises. Until we receive these answers, it is impossible to assess this measure's long range impact upon citizens, business or various industries here in Orange County. Of particular concern to AAOC is language contained in the agreement which would allow the Orange County Fire Authority the ability to levy certain fees. If fees are to be assessed on a per parcel or per dwelling basis, the financial impact of the new authority could have a crippling effect on the rental housing industry, not to mention a significant affect on single family homeowners. Through AAOC's review of this agreement it is already quite clear that this proposal_ will impact a wide variety of interests here in Orange County. After all, this proposal impacts fire services, creates a new taxing fee levying authority, and establishes a new governmental body with all of the powers of a general law city and an estimated $70 million annual budget. AAOC believes that any proposal with such a broad scope of impact should be open to the highest level of public input and review. It is with this in mind that AAOC today requests your continuance. Our request is based solely on our desire to thoroughly evaluate the agreement creating the OCFA and gain answers to the questions it raises before moving forward and taking a position. Certainly at a time when Orange County residents are more closely scrutinizing the actions of their elected officials than ever before, it only makes sense to proceed cautiously with an agreement of this magnitude, one which will completely shift the financing and management of fire services to an entirely new entity. /�r X K SLOTS CEACh( �Ot)IJCIl /YIE/rl�3E�P /P��E/V� C . />-7 ✓ A nonpr t organization for the advancement of the rental housi industry JAN 2 51995 JENnJ/FELL X H6 118105 C ' 12-1 t 19 S *Q"& kl-IS 0 0 Carolyn Nash, Mayor Members of the City Council January 23, 1995 Page Two Our association's review of the agreement creating the OCFA has already led to numerous questions and concerns. Many of these have been answered or resolved, however, others still remain. A list of "AAOC Questions and Issues of Concern" is enclosed. This document may help to give you an understanding of the type of information our association seeks before it can clearly determine the true benefits and pitfalls of the OCFA concept. To help in gathering this information and to give AAOC a better insight into this proposal, we have tentatively scheduled a meeting with members of the OCFA negotiating team for Thursday, January 26, 1995. This meeting will include other business and citizen groups and will hopefully provide a forum through which questions are answered and issues resolved. Based on this meeting and other information gathering efforts, on Monday, January 30, 1995, AAOC intends to communicate back to all 18 proposed OCFA member cities and the county our position on the Joint Powers Agreement creating the Orange County Fire Authority. Thus, today we seek your continuance, but only so that by early next week AAOC and other private sector groups can provide you with their thoughts and positions regarding this proposal. By allowing for this, your city council will have the benefit of broad community and business input before moving forward. Such input will only help in assuring the effectiveness of this measure should it be adopted and a more effective measure will ultimately benefit the local governments, businesses, residents, and taxpayers served by the Orange County Fire Authority. Thank you for your sincere consideration of this request. Our association would welcome the opportunity to meet or speak with you and further discuss our findings. In the meantime, if you have any questions regarding this request or our position on this issue, please do not hesitate to contact AAOC's Director of Public Affairs, Rich Lambros at (714) 638-7401. Sincerely, Bill Gower President cc: George Scarborough, City Manager AAOC Questions and Issues of Concern Regarding the Joint Powers Agreement Creating the Orange County Fire Authority (OCFA) General 1) Will the OCFA establish bylaws, policies, and procedures (i.e. staffing levels, response tithes, minimum manning, levels of service)? Who will develop these and will city councils be allowed to independently approve prior to there adoption? 2) The staff report points out that this is not a cost-saving proposal. Considering this, and the size and magnitude of the OCFA, how can anyone approve this agreement without seeing a budget? 3) When will a budget be available for the OCFA? Who will develop it? Who will adopt it? Will it be approved by the OCFA Board of Directors or just the Executive Board? Will city councils be allowed to independently approve? 4) Why is there such a rush to approve this new $70 million governmental agency? 5) Under the agreement the OCFA seems to assume all existing liabilities of the OC Fire Department. What are these liabilities? Will they unnecessarily bind the OCFA? Could the OCFA be liable for any losses incurred by the county bankruptcy? 6) While Orange County is in bankruptcy is it legal for the county to give its fire assets to the authority? 7) According to the agreement, the Board of Directors shall designate the "functions to be performed" by the Executive Committee. Other than this the agreement is silent as to the role of the Executive Committee or limitations on its powers. What assurances do citizens, business and member cities have that this small committee (per the agreement a 5 or 7 member committee thus requiring only 3 or 4 votes to pass a motion) does not end -up making critical decisions for the entire body? 8) In order for the OCFA to be established, how many of the 18 proposed member cities must approve the agreement? 9) What happens to the fire protection for any city that does not join the OCFA? 10) What is the latest date that this agreement can be approved? 11) If funding is cut then how would the OCFA get/raise funds? Taxing and Assessment Authority 1) Clearly, according to the Joint Powers Agreement, the OCFA will have the authority to levy taxes and assessments. What voter approval is required? If it is 2/3 as per Prop. 13, is it a 2/3 vote of the voters in each city or is it 2r vote of the voters in the entire OCFA territory? In other words, does each city have an independent vote? 2) Other than real property tax, what other forms of tax and assessment would the OCFA have the power to authorize? 3) Was part of the reason for forming the OCFA to try to prevent the state from taking back more funds? If so, what is to prevent the state from taking the funds away anyway? 1 Fees 1) Under the quorum rules outlined in the agreement it appears that a vote of as few as six .:<:. directors could result in a fee or fee increase. Is this the case or is there a super majority s> _ .-;';•, requirement for fee increases? What procedure would be used? Would city councils , have to approve new fees or fee increases or would the OCFA Board be able to levy fees ' without any additional. oversight? 2) Would fees be limited to cost recovery? If so, who determines what are reasonable operating costs (the OCFA staff, the OCFA Board, members cities, independent group)? 3) Will the OCFA be able to directly charge fees for inspections, services and/or responses? If so, will each jurisdiction have any say about such charges? 4) What cost control measures would exist at OCFA to assure that fees do not become necessary in the future? If costs can be recovered through fees and fee increases, what incentives will be in place to encourage reduced costs? 5) What protection does the public have from excessive fees and charges? How do we prevent more damage to the business environment by uncontrolled costs? 6) The agreement seems to have tight controls on how much the OCFA can raise costs to its member cities, by limiting annual increases to the cities' equity contribution and requiring cities to approve ambulance and paramedic fees. However, within the agreement there does not seem to be any controls or limits placed on fees or fee increases to the general public. Why? 7) What assurance do citizens, businesses, and member cities have that over time the OCFA will not become dependent upon "response fees" and/or "service charges" similar to those already being used by the Orange County -City Hazardous Materials Emergency Response Authority? 8) Is there anything preventing the OCFA Board from granting the Executive Committee the authority to levy fees? Regulation 1) What regulatory authority would the OCFA have? 2) Would cities still be able to control fire code regulations or would the OCFA supersede? 3) Even if cities and the county maintain their authority over fire regulations, wouldn't the OCFA be in a position to strongly influence, if not control, local governments' decisions on fire regulations? EXAMPLE: OCFA staff could report to its Board of Directors that if each member city and the county adopt OCFA's proposed fire code and building code amendments, then OCFA could reduce its minimum manning per engine. Using this scenario, if the OCFA Board agreed with staff's recommendation it would certainly put great pressure on all member cities and the county to adopt the recommended code amendments (even those cities whose OCFA director voted against the recommendation). Wouldn't local governments eventually lose their autonomy on fire regulation to the OCFA Board? Could an individual city break ranks with OCFA on a regulatory issue without ramifications? 2 Regulation (continued) 4) What, if any, control(s) would be in place to prevent excessive, burdensome, or unnecessary types of regulation? Will the input of business and industry be actively sought before regulation is adopted? Will there be any established and regular liaisons with the business community or will the OCFA rely solely upon posted agendas and open meetings as a vehicle for business community involvement? Cost Savings 1) The county staff report on the Joint Powers Agreement creating the Orange County Fire Authority points out that this is not a cost-saving proposal and may in fact cost more money. What are the additional costs associated with the OCFA? Is it worth it, especially at a time when the county and cities are looking for ways to cut and control costs? 2) If there is "no cost savings" why establish another level of government? 3) Would participation in the OCFA limit a city's ability to explore or participate in other cost saving approaches to fire service (i.e. consolidation, contracting out, privatization)? 4) Much of the variable cost associated with fire service is a function of staffing levels, response time, minimum manning, and desired level of service. What oversight would be placed upon OCFA staff to assure cost control and/or cost savings in these areas? 5) According to the agreement, member cities will have their contribution to OCFA capped for the first 3 years at current levels. At the end of 3 years however, there will be an "equity adjustment" and the amount of each city's annual contribution may change (some cities may increase while other cities decrease). The agreement speaks of a 2% cap on contribution increases, would this cap apply to the initial equity adjustment at the end of three fiscal years? If not, what limitations are there? Would the 2% cap apply to all future contribution increases after the initial equity adjustment? .93