Funding the Kent Fire Department RFA Compliance with RCW 52.26.240 Using Taxes and Fire Benefit...
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Transcript of Funding the Kent Fire Department RFA Compliance with RCW 52.26.240 Using Taxes and Fire Benefit...
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