HomeMy WebLinkAboutItem 02 Fire MergerAGENDA ITEM SUMMARY Meeting Date: 4/2/2012
Meeting Type:Work Session
Staff Contact/Dept.: Gino Grimaldi/Randall
B. Groves
Staff Phone No: 726-2292
Estimated Time: 60 minutes
S P R I N G F I E L D
C I T Y C O U N C I L
Council Goals: Financially Responsible
and Stable Government
Services
ITEM TITLE: FIRE MERGER
ACTION
REQUESTED:
1) Direct the City Manager to negotiate an intergovernmental agreement that
implements the governance model outlined in the Council Briefing
Memorandum (Attachment I)
2) Direct the City Manager to negotiate labor agreements under the assumption
that the fire merger will take place
ISSUE
STATEMENT:
Springfield Fire & Life Safety (SFLS) continues to operate as a functionally
consolidated department with Eugene Fire & EMS under direction of joint city
managers. This Work Session item is to discuss a proposed governance model for a
merged fire organization and to seek City Council guidance regarding next steps.
ATTACHMENTS: 1. Council Briefing Memo
DISCUSSION/
he Mayor and four councilors on March 12, but is
ince July 1, 2010, Springfield and Eugene Fire Departments have been
cities to
he primary benefit of a functional consolidation is that it permits both cities to
f
of
ttachment 1 describes a proposed governance model. This would provide a
on,
he City Council has three options:
1) Direct the City manager to negotiate an intergovernmental agreement that
at reflect
r to stop discussions regarding the merger and take
regarding the
It is recCity Council implement option 1.
FINANCIAL
IMPACT:
This item was discussed with t
being brought back so the full Council can participate in the discussion.
S
operating under an intergovernmental agreement (IGA) between the two
share the services of certain key administrative positions in both departments.
T
share savings resulting from eliminating redundant resources, taking advantage o
existing vacancies of key personnel. Meanwhile, service levels are being
maintained or improved as a result of joint efficiencies. In FY11, savings
$606,999 we realized due to the functional consolidation, with Springfield’s
share estimated at $286,952. Projected personnel savings for the City of
Springfield for FY12 is $413,608, with a combined savings of $876,239 for the
two cities.
A
‘next step’ in the creation of a fully merged fire service organization. In additi
should the City Council desire to continue to move forward with a fully merged
organization, it will be necessary to negotiate labor agreement that reflect the
merger and proposed governance model.
T
implements the governance model outlined in the Council Briefing
Memorandum (Attachment I) and also negotiate labor agreements th
a merged organization
2) Direct the City Manage
actions needed to reestablish a separate fire department
3) Request additional information prior to giving direction
governance model and labor agreements
ommended that the
Attachment 1, Page 1 of 10
mergency Medic
Eugene Fire & Eal Services
Office of the Chief
1705 W. 2nd Avenue
Eugene, OR 97402
(541) 682-7100
(541) 682-7116 FAX
Springfield Fire & Life Safety
Office of the Chief
225 Fifth Street
Springfield, OR 97477
(541) 726-3737
(541) 726-2297 FAX
M E M O R A N D U M
Date: 8 March 2012
To: Mayor and City Council
From: Randall B. Groves, Chief of Department
Subject: EUGENE and SPRINGFIELD FIRE SERVICE MERGER: PROPOSED FORM OF
GOVERNANCE
Since July 1, 2010, Springfield Fire & Life Safety (SFLS) and Eugene Fire & EMS (EFD) have operated
as a functionally consolidated department under an intergovernmental agreement (IGA) between the
two cities. The next step in the merger process is to determine a governance model that will serve as
the framework for the metro fire service organization.
BACKGROUND:
In 2007, the Eugene and Springfield fire departments formed an integrated response system, known as
the 3-Battalion System to improve response and the delivery of fire suppression, rescue and
emergency medical response.
In 2010, the cities took the next step and embarked on an incremental approach to a merged fire
organization with a focus on administration, training and the Fire Marshal’s Office. This approach
allowed both cities time to evaluate the feasibility of continued efforts based on progress reports, prior
to the decision to proceed with a full merger.
The primary benefit of the functional consolidation is that it permitted both cities to share financial
savings resulting from eliminating redundant resources and take advantage of existing and projected
vacancies of key personnel. Meanwhile, service levels have been maintained or improved as a result of
joint efficiencies. In FY11, savings of $606,999 were realized due to the functional consolidation; with
Eugene’s share $320,047 and Springfield’s share estimated at $286,952 (Table 1). Projected personnel
savings for FY12 include $462,631 for Eugene and $413,608 Springfield, with a combined savings of
$876,239 for the two cities (Table 2). In FY13 the projected savings will be a combined $1,169,639,
with Eugene’s share $596,608 and Springfield’s share estimated at $573,0311 (Table 3).
1 FY13 projected savings do not include proposed Eugene fire company closure.
Attachment 1, Page 2 of 10
TABLE 1
(FY11 - Actual Savings)
FISCAL YEAR 2011
FIRE DEPARTMENT EXPENSE REDUCTIONS
Agency Position Savings
Functional
Consolidation (FC) /
Staff Reduction (SR)
Springfield Fire Chief $157,952FC
Springfield EMSO 115,000FC
Spfd/Eug Joint Recruit Academy 14,000FC
Eugene Fire Marshal 125,817FC
Eugene Training Chief 125,817FC
Eugene Sr. Admin. Specialist 68,413FC
Total $606,999
Functional Consolidation $606,999
Total: $606,999 SFLS: $286,952 EUG: $320,047
TABLE 2
(FY12 - Projected Savings)2
FISCAL YEAR 2012
FIRE DEPARTMENT EXPENSE REDUCTIONS
Agency Position Savings
Functional
Consolidation (FC) /
Staff Reduction (SR)
Springfield Fire Chief $157,952FC
Springfield Senior Management Analyst 106,182SR
Springfield Program Technician 46,789SR
Springfield Program Technician 55,896SR
Springfield Clerk 2 46,789SR
Eugene Fire Marshal 128,081FC
Eugene Training Chief 128,081FC
Eugene Admin Specialist, Sr. 69,644FC
Eugene Deputy Chief 136,825 FC
Total $876,239
Functional Consolidation $620,583
Staff/Budget Reduction $255,656
Total: $876,239 SFLS: $413,698 EUG: $462,631
2 Savings presented for FY12 build on savings achieved in FY11.
Attachment 1, Page 3 of 10
TABLE 3
(FY12 – Projected Savings)3
FISCAL YEAR 2013
FIRE DEPARTMENT EXPENSE REDUCTIONS
Agency Position Savings
Functional
Consolidation (FC),
Staff Reduction (SR),
Budget Reduction
(BR)
Springfield Fire Chief $157,952FC
Springfield Senior Management Analyst 106,182SR FY12
Springfield Program Technician 46,789SR FY12
Springfield Program Technician 55,896SR FY12
Springfield Clerk 2 46,789SR FY12
Springfield Deputy Chief EMS 160,000SR
Eugene Fire Marshal 128,081FC
Eugene Training Chief 128,081FC
Eugene Admin Specialist, Sr. 69,644FC
Eugene Deputy Chief 136,825 FC
Eugene USAR Team 125,566BR
Eugene Water Rescue Team OT 7,834BR
Total $1,169,639
Functional Consolidation $620,583
Staff/Budget Reduction $549,056
Total: $1,169,639 SFLS: $573,608 EUG: $596,031
Total projected savings for the two cities over three fiscal years
TABLE 4
(Year-To-Date Savings)
FISCAL YEAR 2011, 2012, 2013
COMBINED SAVINGS BY CITY
Springfield Eugene
$1,274,258 $1,378,709
Total Springfield and Eugene combined savings: $2,652,967
3 Savings presented for FY13 build on savings achieved in FY11 and FY12.
Attachment 1, Page 4 of 10
COST TO RESTORE SEPARATE FIRE DEPARTMENTS:
Table 5 identifies positions, by city, that have been eliminated over the past three years and would
need to be restored to minimally operate as separate fire departments. These additions do not restore
both departments to pre-functional consolidation levels or capacity. The add-backs have been adjusted
for inflation to FY13 dollars.
TABLE 5
(Costs Inflated to FY13 levels)
MINIMAL POSITIONS THAT MUST BE RESTORED
SHOULD DEPARTMENTS SEPARATE
Springfield Eugene
Fire Chief $179,209Fire Marshal $146,141
Deputy Chief 166,564Training Chief 152,747
Program Technician 65,000Admin Specialist, Sr. 73,869
Program Technician 65,000USAR Team 125,566
Total $475,773Total $498,323
COST DIFFERENTIAL BETWEEN IAFF CONTRACTS:
Staff also analyzed the cost differential between the two IAFF contracts. The analysis focused on
calculating the overall cost of applying the current Eugene IAFF contract to the Springfield IAFF
positions with the exception of the Springfield retirement article, which allows for the IAFF members to
pay the employee pick-up portion of PERS. As part of the analysis, the cost of the employee PERS
pick-up was applied to the Eugene IAFF members. The results projected a 3.25% cost increase over
the FY11 contract for Springfield and a 1.28% cost increase over the FY12 contract for Eugene4. For
Springfield, cost increases are due to differences in base wages, Kelly Days, and Medic Unit pay;
Springfield’s cost decreases are attributed to reducing or eliminating costs for emergency medical
technician certificate pay, adjusted pay rate for overtime, education pay, and 40-hr incentive pay.
Expenditures not reviewed in this analysis include additional costs for field training paramedics, special
team assignments, and serving as a college intern preceptor; time accrual differences and retirement
payouts; citywide overhead; long-term impacts on PERS; health care costs; or one-time costs
associated with system programming changes. (see Attachment A)
It should be noted that both cities are sharing in an actuarial study to evaluate health care costs and
weighing the benefits of moving to a shared, self-funded, healthcare pool for all city employees. There
is the potential for significant savings in this area. (see Attachment B)
LABOR MARKET:
One question raised about merging fire departments is what effect this would have on the labor market
and comparable jurisdictions? My experience has been that a municipal fire department’s comparable
jurisdictions generally include cities that have a population base of between 50% and 150% percent of
population of the target jurisdiction served. The two cities’ HR managers concur with this assumption.
In the case of the Eugene and Springfield merger initiative, the Eugene Fire and EMS Department’s
market of comparable jurisdictions traditionally has included: Salem (157,460); Gresham (105,594);
4 Springfield 3.25% cost gap does not take into account any wage increase in contract for FY12 which is open and under
negotiation.
Attachment 1, Page 5 of 10
Hillsboro (91,611); and Beaverton (89,803)5. It could also be argued that Bend (83,125) and Medford
(77,485) could also be included
The City of Springfield has contended that the Springfield market should include: Eugene (157,845),
due to proximity; Bend (83,125); Medford (77,485); Corvallis (55,370); Albany (49,530). The Union
contends that Hillsboro (91,611) and Beaverton (89,803) should be included. Since there has been no
recent arbitration to establish market, no set criterion exists. However, given that Eugene is the second
largest city in the State, and that Portland is statutorily excluded from comparison, our market under a
merged organization would most likely remain similar to Eugene’s current market6. In other words,
there is no new layer of comparable jurisdictions between Eugene and Portland. At the same time,
even though the traditional Eugene market includes some larger jurisdictions than the market identified
by the City of Springfield, the cost differential between the two contracts remains remarkably small.
In addition, it should be noted that the statutory criterion sets comparability based on “comparable
communities” as opposed to comparable employers. Subsequently, there have been several
arbitrations in which very small jurisdictions have been compared to Tualatin Valley Fire and Rescue
District because the district serves a number of small municipalities7.
GOVERNANCE MODEL:
Springfield and Eugene presently have an Intergovernmental Agreement (IGA) that allows for sharing
some positions, but generally, the cities continue to operate the two fire departments as separate
organizations. The cities can expand the IGA so that the two departments, although remaining legally
separate, function more like one department.
Under this proposed governance structure, the IGA would continue to provide that a single fire chief
reports to both city managers. Each city manager would continue to receive policy direction in the
same way as he currently does from the city council.
Although the reporting relationship keeps the departments separate, at an organizational level, the
proposed governance model proposes that the two departments begin functioning as much as possible
as a single department. The two departments could be known publicly as a single metropolitan fire
department. Administrative staff would be consolidated as much as possible at a single location.
Firefighters would be able to operate out of any of the areas protected by the 16 fire stations, and work
would be initiated to either merge, or normalize, labor agreements to achieve parity and the ability to
cross utilize personnel.
Currently, each department relies on a set of policies (including human resources, purchasing, fleet,
etc.) applicable to that department’s city. Consequently, fire department staff must be familiar with and
apply two different sets of policies. Under this proposed governance model, the metropolitan fire
department would have a single set of policies that apply throughout the department. The city
managers and fire chief would agree on whether a particular policy (for example, HR or purchasing) for
the department would be Springfield’s policy or Eugene’s policy. The goal would be to use the policies
from each city that work best for the combined department, with a secondary goal that the
administrative burden on each city’s other administrative employees does not increase.
The proposed governance model includes one major exception to the “single set of policies” objective.
That exception is budget policy. To ensure that each City Council and city manager retain exclusive
5 Population estimates provided by Portland State University, College of Urban and Public Affairs Population Research
Center for 2010.
6 ORS 243.746
7 Brown, Arbitrator Nancy, May 11, 2000, IAFF Local 3564 and the City of Grants Pass, OR; Lankford, Arbitrator Howell,
October 25, 1999, IAFF Local 2406 and the City of North Bend, OR.
Attachment 1, Page 6 of 10
control over the extent of funding provided by that city to the fire service, each city’s budget policies
would continue to apply.
NEXT STEPS:
The ultimate goal of the fire service merger initiative is to create one organization. This step of
implementing a governance model is the next step in the process and is needed to simplify
administering and supporting the organization. Next steps will be to try and merge or at least normalize
the two fire contracts with IAFF Local 851 (Eugene) and Local 1395 (Springfield). We will also initiate
conversations with AFSCME and SEIU regarding our service work force. In addition, we will continue
to work towards integrating our two departments’ information technologies systems where possible, and
work to standardize the way in which we deliver support services to the two organizations.
If you have any questions, please contact me.
cc: Gino Grimaldi, Springfield City Manager
file
Attachment 1, Page 7 of 10
Attachment A
Applying Eugene's 851 Contract to Springfield's 1395 Employees
Title
FTE
Eugene
FY12
Base
Wages
Eugene
Wages
adjusted
for PERS3
Eugene
EMT Cert
Pay for FY12
adjusted
for PERS3
Total
Wages
w/SPFD
Fringe3
Springfield
Current
Health
Plan Total
Firefighter/Paramedic 45 $65,643 $69,582 $4,871
$4,105,523 $912,096 $5,017,619
Engineer/Basic 14
69,135
73,283
4,871
1,340,776
283,763
1,624,539
Captain/Paramedic 14
78,238
82,932
4,871
1,506,313
283,763
1,790,076
Captain/Intermediate 1
78,238
82,932
2,087
104,183
20,269
124,452
Engineer/Basic 1
69,135
73,283 ‐
89,801
20,269
110,070
Deputy Fire Marshal1 4
79,789
84,576
1,218
420,528
81,075
501,603
Training Captain 1
83,824
88,853
4,871
114,850
20,269
135,118
Training Engineer 1
74,485
78,954
4,871
102,719
20,269
122,988
Emergency Medic
Service Officer2 1
79,789
84,576
4,871
109,608
20,269
129,877
Other Eugene items not
in current Springfield
contract:
FLSA Overtime Rate
‐ ‐
1,386,187
‐
1,386,187
Kelly Days4
‐ ‐
291,997
‐
291,997
Medic Unit Pay5
‐ ‐
245,756
‐
245,756
Total 82 $9,818,241 $1,662,042 $11,480,283
Springfield cost of contract
9,509,613
1,662,042
11,171,655
Total Difference $308,628 $0 $308,628
Percent Change 3.25%
Notes:
1Only 1 DFM has a paramedic certificate. Amount is 1/4 so the other calculations work correctly
2Eugene's EMS Training Coordinator position for comparison
3Using Eugene Wages inflated by 6% for EE PERS pick‐up and Springfield Fringe Rate of .2254
4 Kelly day assumes reduction in annual hours worked resulting in increased OT pay, reduction of 5th person
off slot, and change in FLSA period
5 Medic Unit Pay (3 units, 24/365, plus 120 extras hours for late call or other OT)
Attachment 1, Page 8 of 10
Attachment 1, Page 9 of 10
Attachment B
Applying Eugene's 851 Contract to Springfield's 1395 Employees with Eugene Health Costs
Title
FTE
Eugene
FY12
Base
Wages
Eugene
Wages
adjusted for
PERS3
Eugene
EMT Cert
Pay for FY12
adjusted
for PERS3
Total Wages
w/SPFD
Fringe3
Springfield
Current Health
Plan Total
Firefighter/Paramedic 45 $65,643 $69,582 $4,871 $4,105,523 $912,096 $4,736,783
Engineer/Basic 14
69,135
73,283
4,871
1,340,776 283,763
1,537,168
Captain/Paramedic 14
78,238
82,932
4,871
1,506,313 283,763
1,702,705
Captain/Intermediate 1
78,238
82,932
2,087
104,183 20,269
118,211
Engineer/Basic 1
69,135
73,283 ‐
89,801 20,269
103,829
Deputy Fire Marshal1 4
79,789
84,576
1,218
420,528 81,075
476,640
Training Captain 1
83,824
88,853
4,871
114,850 20,269
128,878
Training Engineer 1
74,485
78,954
4,871
102,719 20,269
116,747
Emergency Medic
Service Officer2 1
79,789
84,576
4,871
109,608 20,269
123,636
Other Eugene items not
in current Springfield
contract:
FLSA Overtime Rate ‐ ‐
1,386,187 ‐
1,386,187
Kelly Days4 ‐ ‐
291,997 ‐
291,997
Medic Unit Pay5 ‐ ‐
245,756 ‐
245,756
Total 82 $9,818,241 $1,662,042 $10,968,537
Springfield cost of contract
9,509,613
1,662,042
11,171,655
Total Difference $308,628 ‐0‐ $308,628
Applying Est Savings of
Offering Eugene’s Health
Plan to Spld’s IAFF Members $308,628 ‐$270,000 $38,628
Applying Eugene’s Current
Health Rate Per FTE $308,628 ‐$511,746 ‐$203,118
Notes:
1Only 1 DFM has a paramedic certificate. Amount is 1/4 so the other calculations work correctly
2Eugene's EMS Training Coordinator position for
comparison
3Using Eugene Wages inflated by 6% for EE PERS pick‐up and Springfield Fringe Rate of .2254
4 Kelly day assumes reduction in annual hours worked resulting in increased OT pay, reduction of 5th person off
slot, and change in FLSA period
5 Medic Unit Pay (3 units, 24/365, plus 120 extras hours for late call or other OT)
Attachment 1, Page 10 of 10