Sedona AZ (April 19, 2012) — Following are excerpts from Minutes of the April 9, 2012, Sedona Fire District (SFD) Budget Workshop and analysis. Minutes are in Draft form, not yet accepted formally by the SFD Governing Board. Where minutes are quoted verbatim, quotation marks will be used. Audio and Video Transcripts appear in full on the Sedona Fire website.
Scott Jablow – Midway/Chapel Area: “I’d like to say that I was unable to attend last week’s budget workshop, but read the published Minutes. I was very impressed with Chief Kazian’s report. For the short time that the Chief has been in town, with the help of his great staff, it appears he understands the budget concerns of everyone and has his finger on the pulse of this organization.
“I’m not surprised that he also communicates this knowledge very clearly and simply so that lay people can understand the seriousness of what SFD is facing for years to come. During this Board’s tenure, it’s not been a secret that the Board hasn’t trusted any of the SFD staff which has caused so many of them to leave.
“Over the strong and vocal and most often, heated criticism of the community, this Board has felt the need to spend over $38,000 so that the Board could have a Chief that you could all trust. Now, when faced with our new Chief’s logical explanation about the mil rate, one Board Member still has a problem accepting the proven facts given by the Chief that you’ve all just hired.
“On page 6 of the Minutes of last week’s budget workshop, there was discussion and recommendations of what to do with the mil rate and Mrs. Erick stated, this is a quote, this is a quote… I understand this is a quote: ‘This is the way I have seen it ever since former-Business Director Karen Daines presented it that way. I did not buy it then, and I do not buy it now’ – direct quote from your Minutes.
“I have real concerns about this Board Member’s statement. If all these professionals and highly educated people including your newly hired Chief have explained the reasons to raise the mil rate, clearly and concisely, and this Board Member still fails to buy it, I think that the taxpayer in the district deserves to know why she feels that way, and what functional information does she have to prove otherwise.
“Mrs. Erick…” At this point, Chairman Blauert explained there are no comments between the Board and public and they will not debate. Mr. Jablow: “I’m not debating. I’m giving her the courtesy. I expect the same. I don’t believe that this Board Member has any formal financial degrees or background or else she would proudly state that information at either of the two candidate forums that I have attended the past few weeks. Or, it would be posted on the SFD website.
“And, yet, when faced with facts by professionals, she doesn’t buy it then and doesn’t buy it now. This Board Member fills an elected position and represents the community. I think she is duty-bound to explain why she doesn’t buy it or her lack of understanding of the topic. She should present her educated reasons for her distrust of so many professional opinions.
“These comments are my own and do not represent any of the organizations, City Boards, or Commissions in which I participate. Thank you.”
Rich Collister – West Sedona: “I’d like to thank the new Chief for his last budget presentation. It was very informative. The material and the predictions sound right on. It seems that Chief Keller and Karen Daines did a similar workshop with nearly the same information and predictions in their workshop a few months ago. It seems that the experts – you Chief, Chief Keller, Karen Daines – all agree on where the Sedona Fire Department stands regarding the budget.
“It appears that the ones who don’t agree are the non-experts who sit up on the Fire Board, and this is reflected in a statement by Ms. Erick, one that was quoted already, it’s in the Minutes – ‘I didn’t buy it then and I’m not buying it now.’
“I know that she has an important job of scheduling appointments for a doctor’s office; however, that job pales in comparison to having the knowledge and expertise in setting an operating budget for an organization which protects life and property.
“And Mr. Blauert, when McGladrey first got here, and arrived here to give their initial report about the audit, you exclaimed, we can now lower the mil rate. Seriously, Dave? It shows a complete lack of understanding and knowledge regarding the Sedona Fire District.
“And a word about the McGladrey audit, $190,000 piece of dog dirt. Three empty suits from McGladrey with no knowledge of fire operations… Mr. Blauert warned Mr. Collister he was ‘pushing it.’ Mr. Collister: I’m talking about McGladrey, I’m not talking about you.
“Board Clerk Christensen commented McGladrey has fire service experience and it is in their report. Mr. Collister said he saw nothing about knowledge of fire operations; Mr. Christensen stated he would show him later.
“Mr. Collister: It’s my opinion and I have a right to my opinion. I am a taxpayer. Three empty suits from McGladrey with no knowledge of fire operations give a report to unknowledgeable Board Members who know nothing about fire operations in the district they govern over. You could have saved $190,000 by listening to your own experts like the Chief and the Business Director of the Sedona Fire Department and you know, if that wasn’t so pathetic, it would be funny.
“So, thank you, Chief and I’d like to thank the members of the Sedona Fire Department.”
____ end of public comments
“Chief Kazian said the proposed budget is $12,323,151 including a Training Officer and hiring one of the three current vacant Firefighter positions, and start-up costs for the Reserve program; it does not include capital projects such as moving dispatch, upgrades to dispatch, or building a Midway Station; it deletes many of the vacant positions formerly held in the past budget.
“Additionally, the proposed budget maintains the General Fund (Fund Balance) which is the 15% allocation directed by Board Policy #2008-1.
“He recommended a $1.65 mil rate which gives proposed taxable revenue of $8 million and with additional revenue received through ambulance billing and other fees, gives $10,418,000 with appropriation of $1.904 million from the capital reserves leaving a balance of $2.1 million in reserves….
“Chief Kazian said the budget is projected out at 3.85% to 4% increase annually, which does not include huge capital expenses such as a Midway Station or dispatch. He stated if SFD goes to a $1.65 mil rate, in Fiscal Year 2013/2014, staff would most likely be asking for $1.91 mil rate taking the balance of the capital reserves and adding it to come up with the proposed budget.
“He said the following year in Fiscal Year 2014/2015, SFD would have to go to $2.63 mil rate and no capital reserves to carryover, which makes a very large tax increase for our residents to meet the projected budget….
“Chief Kazian stated he is not here to debate whether an increase in the mil rate is or is not a tax increase, but the costs to operate SFD have not gone down – fire trucks, ambulances, energy, etc. all cost more. He said the mil rate is a multiplier that provides SFD with tax revenue necessary to operate efficiently and effectively. He said he has heard individuals say they cannot afford to pay more in taxes; that is why staff is trying not to raise the true dollar amount SFD charged citizens last year and wants to keep it as close to the same amount as possible.
“Chief Kazian said regardless of semantics, SFD is dollar for dollar….”
“Chief Kazian stated he would prefer to incrementally raise the mil rate to get where SFD needs to be, rather than necessitate a huge increase for our citizens at once….”
“Chief Kazian …said we must identify what exactly is a core service and if identified as not being able to maintain, what are we willing to cut? He then restated his commitment, as follows: ‘I’ve been hired by you the Board to run as Fire Chief of Sedona. I am making you that promise that I spoke of earlier, that I will now and forever operate with fiscal responsibility and dedication to maintain the services we do have here in Sedona. I have a job as a Fire Chief and that’s to provide effective fire and EMS services for everyone, maintain sound business practices, and have a staff that’s appropriately sized to handle the office part of the job. It’s your job as the Board to see that we make sure we are operating with the necessary tools and the resources needed to be effective.’”
“SFD is 46% leaner in taxes than a few years ago; he asked can we continue to operate that way losing, losing, and losing?”
“Mrs. Erick commented for FY 2012, people should be told there was contingency included; Mr. Dible said the budgets on the handout are not what was actually spent, but rather, was given to the county as budgeted. Chief Kazian also asked the Board to recall that the $15.9 million budget in FY 2009 included millions of dollars allocated for capital projects so that number looks inflated as well, just as Mrs. Erick mentioned for this year’s budget.
“Mr. Dible asked if SFD had spent $11.2 million of the current budget of $13.28 million. Chief Kazian replied as of 3/31/12, the current budget is at $7.6 million spent year to date; Finance Manager Sandi Schmidt stated she believes SFD is on-target to spend $11.2 million, but that amount has not been yet been spent. Chief Kazian said we are at 59% spent of the budget with 75% of the fiscal year completed, and some is contingency, although the $190,000 paid for the McGladrey report has been removed from contingency; Mr. Dible commented it appears we will have spent $11.2 million of the $13.2 million at the end of the fiscal year; Chief Kazian said staff is estimating $4 million carryover in capital reserves at the end of this fiscal year….
“Mr. Christensen asked why we are not using the capital reserves; Chief Kazian replied any unspent dollars, such as savings in overtime, get rolled over into the capital reserve fund at the end of the fiscal year, and staff is making an educated guess that it will be approximately $4 million. Mr. Christensen said as a taxpayer and for his constituents, he believes SFD is holding a lot of money in reserve that is the taxpayers’ and he does not ‘like this picture’ with that much money in capital reserves; Chief Kazian said he appreciates that and looking at the graph going back to 2009 when SFD was at $15.9 million, we have been systematically “chipping away” at reducing it and, as stated, in two years, we will have none….”
“Chief Kazian said what must be decided is the mil rate and the amount of capital reserves to be taken; he said that decision could be postponed until another budget workshop before the April Board meeting. Mr. Montgomery moved to include a discussion/possible action agenda item for the budget and the mil rate for the next Board meeting; Mr. Dible seconded. Mr. Dible asked about including another Budget Workshop ahead of the April Board meeting to answer any final questions; he suggested possibly having the Workshop beginning at 4:00 PM before the April meeting; Mr. Montgomery amended his motion to have the Budget Workshop at 4:30 PM on the day of the April Board meeting including discussion and possible action on the budget and mil rate. Mr. Blauert requested another amendment to the motion because if an executive session is needed, he prefers to have that before the Workshop so the public does not have to wait. Chief Kazian said he believes there was an Executive Session item tabled from the last meeting that would be carried over; Mr. Dible agreed there was one issue. Mr. Montgomery re-phrased his motion to hold an Executive Session at 4:30 PM, Budget Workshop at 5:00 PM, with Business meeting to follow at 6:00 PM on Wednesday, April 25, 2012, including an Agenda item for discussion and possible action for the Fiscal Year 2012/2013 budget and associated mil rate; Mr. Dible seconded the amended motion, which unanimously passed at 5 to 0.”