funding the kent fire department rfa
DESCRIPTION
Funding the Kent Fire Department RFA. Compliance with RCW 52.26.240 Using Taxes and Fire Benefit Charge. Kent Fire Authority FBC Funding System. Specified in RCW 52.26.240 Reduced tax levy + fire benefit charge. Assessed Value Source for Levy. FBC Data source. Use & Value. Structure Size. - PowerPoint PPT PresentationTRANSCRIPT
RCW 52.26.230 Compliance Hearing 1
Funding the Kent Fire Department RFA
Compliance with RCW 52.26.240Using Taxes and Fire Benefit
Charge
October 3, 2012
RCW 52.26.230 Compliance Hearing 2
Kent Fire AuthorityFBC Funding System
$1.50 Tax$1.00 Tax
Levy
FBC Assessment
(Size, Use & Risk)
Total Annual Fire
Assessments
October 3, 2012
SPECIFIED IN RCW 52.26.240REDUCED TAX LEVY + FIRE BENEFIT CHARGE
RCW 52.26.230 Compliance Hearing 3
Assessed Value Source for Levy
October 3, 2012
RCW 52.26.230 Compliance Hearing 4
FBC Data source
October 3, 2012
Structure Size
Use & Value
RCW 52.26.230 Compliance Hearing 5
FBC Basics
• Benefit charge capped:
– Cannot exceed 60% of “Operating” budget• 2012 Fire Benefit Charge was:
–39% of the Preliminary Operating Budget
October 3, 2012
RCW 52.26.230 Compliance Hearing 6
FBC Exemptions• Facilities used for religious worship or education
– 100% exemption• Low income Seniors and Disabled
– Same as tax exemptions (up to 75%)• Annual household income of $35,000 or less• Retired because of physical disability and have an income of
$40,000 or less• Must qualify through King County 206-205-5759
• Agricultural uses– 75% exemption for those structures for the growing of
crops/livestock• Vacant Land and structures less than 400 sq ft.October 19th 2011
RCW 52.26.230 Compliance Hearing 7
Determining Annual FBC Amount
• Calculated by:– Determining Expenses
– Subtract revenue sources other than FBC
– Balance equals FBC revenue needed
– Add 1% for King County
Item Amount
2012 Expenses $33,313,961
Less levy revenue ($14,759,990)
Less other revenue ($5,337,390)
FBC revenue needed $13,216,581
Total 2012 FBC Revenue Request
$13,050,700
October 3, 2012
RCW 52.26.230 Compliance Hearing 8
Apportionment of FBC
• RCW 52.26.180 Benefit charges.– (2) A benefit charge imposed must be reasonably
proportioned to the measurable benefits to property resulting from the services afforded by the authority.
October 3, 2012
9
Apportionment of FBC• Categories Used to Apportion
– Size of structure• As determined by King County Assessor
– Category of structure• One and two family residential• Mobile homes• Multi-family homes• Commercial buildings
– Response size needed• Firefighters needed
– Risk of structure• Hazardous materials or uses
– Discounts• Built in protection and alerting
• FORMULA =– Square Root of Area X 18 X Category x Response x Risk x Discount
October 19th 2011
RCW 52.26.230 Compliance Hearing 10
Fire Ratings and Insurance CostsLeague of Minnesota Cities 2010
Ratings & Effect on Insurance Fire Service Savings• Homes in Kent Fire service
area– 35,355
• Value of rating to homes– $1,072 – $670 = $402– $402 x 35,355 = $14,212,710
Kent = Fire Class 3Covington = Fire Class 4/3
October 3, 2012
RCW 52.26.230 Compliance Hearing 11
•Total Fire Insurance Savings
Based UponKent Fire Department Fire Rating
Homes $14,005,278
Apartments $5,865,180
Commercial $2,866,789
Total $22,740,247October 3, 2012
RCW 52.26.230 Compliance Hearing 12
Value of Benefit of Fire Department
• Direct Fire Insurance Benefit $22,740,247• Estimated EMS Benefit $12,000,000• Fire Prevention $Value Added• Fire Investigations $Value Added• Public Education $Value Added• Accredited Agency Status $Value Added• Cares Program $Value Added• Emergency/Disaster Services $Value Added• Technical Rescue Services $Value Added• Property & Life loss without FD $Value Added • Estimated Benefit $34,740,247 PlusOctober 3, 2012
13
Value of Benefit of Fire Department
• Total Estimated Value of Benefit exceeds:
$34,000,000
• Benefit exceeds cost of FBC by: $19,000,000
• Benefit covers 97% total 2011 Budget
October 3, 2012 RCW 52.26.230 Compliance Hearing
RCW 52.26.230 Compliance Hearing 14
Establishing the FBC
• FBC Considerations– Levy Revenues– Other Revenues– Capital Needs from Levy Revenues– Percentage of FBC to Operating Budget– Effect on taxpayer
October 3, 2012
15
Levy Revenue Trend2011 Tax from A/V$15,515,718.00
2012 Tax from A/V$14,759,990
October 3, 2012RCW 52.26.230 Compliance Hearing
2013 Tax from A/V$13,943,050
RCW 52.26.230 Compliance Hearing 16
Levy Revenue Trend
• 2011 Tax from A/V $15,515,718.00• 2012 Tax from A/V $14,759,990.00• 2013 Tax from A/V $13,943,050.00
Revenue 2011-2013 -($1,572,668.00)
Overall Decrease of 11% from 2011
October 3, 2012
RCW 52.26.230 Compliance Hearing 17
Other Revenue Trend
Budget YearOther
RevenueDistrict 37 Revenue
Valley Med Revenue Safer Revenue
Total Other Revenue
2011 $6,971,551 $1,847,353 $575,000 $206,000 $4,549,198
2012 $5,692,047 $100,000 $630,000 $80,000 $4,882,047
2013 $5,834,075 $0 $550,000 $400,000 $4,884,075
$1,947,353.00 $1,755,000 $686,000 Plus 7.4%
Total non-sustainable revenue $4,388,353.00
3 year Average $1,462,784.33
October 3, 2012
RCW 52.26.230 Compliance Hearing 18
Capital Trends
• Preliminary proposal includes $512,000.• Current focus only on life cycle replacement of
equipment.• No dedicated capital to accommodate future
growth.– Mitigation Fees cover minimal capital
• $150,000 collected last 3 years
October 3, 2012
RCW 52.26.230 Compliance Hearing 19
FBC Revenue Trend
Budget Year
Taxes Assessed FBC Assessed
Total Taxpayer Assessment
Tax Payer Change
Purchasing Power
Purchase Power Loss
2011 $15,515,718 $12,311,981 $27,827,699 0.000% $27,827,699 $0
2012 $14,759,990 $13,050,702 $27,810,692 -0.061% $26,778,915 $1,048,784
2013 $13,943,050 $14,617,197 $28,560,247 2.632% $26,178,322 $1,649,377
October 3, 2012
RCW 52.26.230 Compliance Hearing 20
Proposed FBC
October 3, 2012
2013 Operating Expenses $34,432,962Proposed Capital $512,000
Total Revenue Request $34,944,962Less 98% levy revenue -$13,464,156
Less 98% New Construction -$62,870
Less other revenue -$5,834,075
Less vacant positions -$420,000
Less 2012 carry over -$839,000
FBC Revenue Needed $14,324,861
Collection Shortfall $292,336
2013 FBC Revenue Request $14,617,197
RCW 52.26.230 Compliance Hearing 21
FBC Basics
• Benefit charge capped:
– Cannot exceed 60% of “Operating” budget• 2013 Fire Benefit Charge is:
–42% of the Preliminary Operating Budget
October 3, 2012
RCW 52.26.230 Compliance Hearing 22
Ratio of FBC by Property Type
• Residential (>35,000 properties) = 65%– Single Family Homes = 53%– Multi-Family = 12%
• Commercial (1353 properties) = 35%Total Apportioned = 100%
– 2011: 60% Res, 40% Com– 2012: 63% Res, 37% Com
October 3, 2012
RCW 52.26.230 Compliance Hearing 23
Effect of Current FBC Calculations
October 3, 2012
RCW 52.26.230 Compliance Hearing 24
Residential ComparablesTax + FBC
Home Size 2011 Fire Cost
2012 Fire Cost 2013 Fire Cost CPI [email protected]%
1,330 $291 $280 $282 -11.8%
2,070 $376 $366 $376 -8.6%
3,066 $503 $500 $513 -6.3%
3,988 $655 $664 $690 -3.6%
6,350 $966 $1003 $1025 -2.8%
October 3, 2012
RCW 52.26.230 Compliance Hearing 25
Commercial ComparablesTax + FBC
Square Feet
2011 2012 2013 CPI [email protected]%
365,040 $45,807 $42,038 $43,922 -12.9%
135,300 $18,559 $19,310 $20,421 +1.4%
55,800 $10,674 $10,839 $11,228 -3.4%
18,220 $2,330 $2,377 $2,602 +3.1%
6,456 $2,158 $2,123 $2,163 -6.6%
2,265 $658 $682.19 $702 -2.0%
October 3, 2012
RCW 52.26.230 Compliance Hearing 26
Apartment ComparablesSq. Feet 2011 2012 2013 CPI Comp
@8.6%+/- Per Unit per
month
7,984 $1,417 $1,441 $1,515 -1.7% 8/$0.77
28,980 $5,213 $5,473 $5,760 +1.8% 24/$1.00
90,539 $20,578 $21,073 $22,123 -1.1% 96/$0.91
167,422 $32,801 $35,858 $37,593 +6% 175/$0.83
257,634 $55,483 $58,204 $66,243 +10.8% 300/$2.23
381,722 $73,387 $74,373 $84,317 +4.4% 337/$2.70
October 3, 2012
RCW 52.26.230 Compliance Hearing 27
Questions
October 3, 2012