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HomeMy WebLinkAbout2024-11-19 Finance Committee Summary MinutesFINANCE COMMITTEE SUMMARY MINUTES Page 1 of 9 Regular Meeting November 19, 2024 The Finance Committee of the City of Palo Alto met on this date in the Community Meeting Room and by virtual teleconference at 5:35 P.M. Present In-Person: Burt (Chair), Lauing, Stone Absent: None. Recused: Veenker Call to Order Chair Burt called the meeting to order. The clerk called the roll and announced Mayor Stone was present as an alternate for Council Member Veenker. Molly Stump, City Attorney addressed the recusals by explaining Council Member Veenker does patent work for Stanford University and City Manager Shikada’s wife was an employee of the Stanford Hospitals therefore both were recused. Agenda Items 1. Evaluation of Fire and Ambulance Service Expansion Options NO ACTION Kiely Nose, Assistant City Manager, indicated that this was a referral that the Committee and Council provided as part of the FY2026 budget process. She wanted to acknowledge the inherent tension the Committee, Community and staff may feel as part of the conversation. She reported a financial report would be on the agenda for December 3. Geoffrey Blackshire, Fire Chief, gave a slide presentation evaluating fire and EMS service expansion options including community needs, measurement of performance, availability and resources with comparison data and resource analysis and options. James Durman, ESD Director, joined the presentation to discuss EMS expansion benefits. SUMMARY MINUTES Page 2 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 Chief Blackshire resumed the presentation discussing the county ambulance and fire service ambulances option A: contract, option B: firefighters, option C: single role civilian and next steps. Lauren Lai, Administrative Services Director, commented that the Finance Committee would receive the packet for the upcoming study of the long-range financial forecast the following Thursday. They would have a deficit for the next three years and could balance in 2030. Fiscal 26 budget was looking more like a $12 million base deficit. The ongoing costs were about $3 million plus. That would have an impact on the foreseeable deficit. She wanted feedback by the full Council. Item 1 Public Comment: 1. Penny Ellson found the report referencing expanding fire service to be misleading stating the option would be to restore a fire engine that was eliminated in 2020 as part of pandemic budget cuts. She hoped Council would give careful consideration to restoring a fire engine at Fire Station Four and 12-hour peak ambulance. Vice Mayor Lauing queried if research had been done as to why they had 75 percent more calls than Mountain View and wanted information about the Stanford component. He asked if calls were triaged before responding. He questioned if they were comfortable with the Stanford service contract and if it varied by volume. He wanted to understand why firefighters had to be dispatched every time. He wondered if they should have separate EMTs that could be added to the three ambulances to avoid having to always send out fire engines. He assumed having a peak ambulance would be just another ambulance parked somewhere. Chief Blackshire replied it could be demographics and that Stanford University draws a lot of calls. He indicated the fire chief in Mountain View stated well over 90 percent of their calls were medical where Palo Alto calls were 63 percent medical. He said the fire dispatchers did a triage for medical services which determines the response method. He explained that fire stations were traditionally strategically placed in a city for quick response. When a 911 calls is received, the goal is for the fire engine to arrive first to provide the level of service. When the ambulance arrives, they do a handover and the engine becomes available to respond to the next call. He explained there are five fire stations in Palo Alto and one in Stanford. There is a fire engine in every station except Fire Station Four. There are currently three 24-hour ambulances serving the City. He explained the peak ambulance would be another ambulance at one of the fire stations that would be available to run medical calls. In the civilian model, three of the ambulances would be EMT and paramedic on the unit. He commented that if there were five engines and five ambulances, whether they would be first on the scene would depend on the SUMMARY MINUTES Page 3 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 acuity of the call. They would need a higher level of compliance with the EMD service to determine a model that would support that. Kevin McNally, Deputy Fire Chief, indicated the Stanford incidents included more fire alarms and medical aids on the weekends and evenings. Regarding the difference between Palo Alto and Mountain View was Palo Alto had a large influx of people downtown. He met regularly with his Mountain View counterpart and they also wondered why they were not getting the same amount of calls but they had medical facilities and other purposes on Google Campus that might take away from the 911 system. He pointed out they have five engine companies at the stations for other incidents so it is a resource with capacity to do the job. If they had less engine companies and more ambulances, they would run into a problem when the more extreme emergencies happen. Amber Cameron, Senior Management Analyst for the Fire Department, remarked the contract with Stanford was renegotiated in 2018. It was originally put together in the 1970s and had been a 30 percent rate of the entire expenditure. They had a two to three-year renegotiation process that was very contentious and went to mediation for a short time. They were able to agree on a very detailed cost modeling that took their assigned resources and spread out the costs of the department equitably. In that methodology, they accounted for about 19 percent of their expenditures. Assistant City Manager Nose added the contract would end in 2028; however, it contained a clause that stipulates discussions if there are service delivery changes as well as a recalculation of the share upon execution of new labor agreements. Mayor Stone thought option A would reduce the quality of service the community was used to. He wanted to know of option B or C had a greater impact on the reduction of response time. He asked how the single role was differentiated from the current firefighters. He wanted to understand the benefit for the City having multiple firefighters attending somebody rather than multiple paramedics. He wanted to know the long-term pension impacts were between option B and C. If all things were equal, he thought option B seemed the best. He asked why they would have to wait for year two to staff the new engine. Chief Blackshire indicated the outcome would be the same with each model. The only difference would be if the ambulance was staffed with firefighters would be an additional resource to respond to all calls as opposed to just medical. The strategy behind keeping one ambulance with firefighters was always having them on scene. He indicated firefighters were more stable in regards to staffing with the same level of service. All ambulances are currently staffed with a minimum of one medic and one EMT. He added that civilian EMTs and paramedics would only focus on EMS training. He explained if they did the single role model, SUMMARY MINUTES Page 4 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 they would use the firefighters on the current ambulance and they would move over to the new engine. It would take time to go through the bullet points to determine the appropriate model, go through labor negotiations and do the hiring. They would start with a 12-hour peak ambulance but then would use that to get the program started and then expand to the other 24-hour ambulances. At that time, the firefighters could move over to the engine and staff the other two with civilians. Option B would still take significant time. There would be a hiring process to hire 10 firefighters. Ms. Cameron explained that for EMS calls, the responsibilities of EMTs and paramedics would be the same. The difference with what the firefighter staff would be able to do would be respond to hazmat incidents, fire calls and other type of emergency incidents. With medical calls, the single role civilian staff would be doing the same work that firefighter staff currently does. Assistant City Manager Nose also noted there was ultimately a training and cost difference. The cost savings was still to be determined in terms of discussions with CalPERS who would determine if they could make it a miscellaneous pension. She stated the cost of adding six ambulances in a civilian model versus six ambulances in a sworn model would be significant when thinking about the ongoing training necessary for the staffing and equipment. Vice Mayor Lauing asked Mayor Stone if he still had high concerns about the contract ambulance option. Mayor Stone expressed concern that the staff would not be Palo Alto Fire Department employees and that it would likely be a longer process. Ms. Cameron explained it would be about a $1 million cost estimate for a contract with a private ambulance company. They would have to go through an extensive RFP process which factors into the timeline. It would also require labor negotiations. Chief Blackshire remarked they would have to practice within the protocols determined by the EMS director in the county. In his experience, there was a different level of service using contract service. Assistant City Manager Nose heard the desire to implement this quickly but reiterated they were looking at deficit spending next year already and this would make that hole larger. To the extent they wanted to accelerate the timelines outlined in the staff report, she encouraged the Committee to think about what they would reduce. Going for a tax measure would be a general election and would be a few year out. SUMMARY MINUTES Page 5 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 Chair Burt wanted to know how the response times in the service area of Four compared to the rest of the City and wanted to get the actual data and make it available to the public. He asked if they were 10 firefighters lower than in 2019. He questioned how long ago the deterioration in response time happened. He asked if they knew where they would be with 10 additional officers compared to 2019 in terms of number of sworn officers. He wanted to see the different comparisons when they came back and other ways they could get an engine in Station Four at a lower cost than the three options. He thought they needed an understand of the disproportion of non-medical calls compared to Mountain View. He asked about the mutual aid agreement with Mountain View. He wondered why it was that Station Four was selected. He wanted to know what portion of the EMS calls were Stanford and why they did not want to pay extra on medical transport. Deputy Chief McNally answered the response time measured on the 90th percentile. Averages during peak time did show some lowering for an engine company response but not grand. The 90th percentile was higher because if Engine Five or Three responds is great but getting deeper into Engine Two or Six responding those two got extended. He stated going back to 2019, they had 26 personnel during the day and an ambulance that was 12 hours, similar to what was currently being proposed, making it 24 at night. They would be going to 30 during the daytime and 28 at night. It would increase staffing because in 2019 they cross staffed to get additional ambulances. He explained how they went to great efforts to remove cross-staffing a few years back. He remarked they started studying the response times during COVID when they were asked to reduce budgets. They contracted with a group called Levrum that did predictive analytics to best model the personnel they had based on the dollars they were given to best service the needs of the community. They realized some of their times were longer with the cross staffed apparatus. They ended cross-staffing in 2022. He described the shift model of daily staff and explained they were the ones that worked on engine companies, ambulances and the daily battalion chief. In 2019, that would be 26 in the daytime, 24 at night. With the new model, it would be 30 during daytime and 28 at night. Chief Blackshire added it was not uncommon for the fire service to have cross-staffed units but standardly they cross-staff with units that are low demand. When they were cross-staffing in Palo Alto, they took the call type with the highest frequency and take those engines out of service. The unavailability of their units when they cross-staffed initiated the cancellation of their auto aid agreement with Mountain View. He explained the mutual aid agreement with Mountain View ended when they went to cross-staffing. They currently had an auto aid agreement with them on confirmed structure fires and freeway responses. Any other call type outside of those would be requested through a mutual aid process. They have to go through the county and do a request for assistance. This started because they were both on the same CAD system. They were dispatched by the closest unit to the incident. The CAD system could SUMMARY MINUTES Page 6 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 determine which unit but did not know whether it was Palo Alto or Mountain View. Whoever was closest to the call would go. He added the availability of all of the units was the driver because the fewer units that had to respond to the increasing amount of calls would make them less available than they would be with the extra engine. Assistant City Manager Nose remarked that how staff was talking about daily staffing was helpful as opposed to total. Her understanding of the Stanford contract was that there were two options for medical transport services. Either the county would provide medical transport services as part of the county's role responsibilities as the county government or the City would provide those because we have our transport rights. If the City was not providing transport services the county would be responsible and Stanford would not be charged. Ms. Cameron stated they produced an annual report each year that showed the breakdown of the call volume. The call type determination was what was presented after it was completed. She said 62 percent of calls were EMS, 15 were good intent, 13 percent were false alarm or false calls and 8 percent were service calls. She explained the original contract with Stanford included them paying for ambulance transport services. In the 2018 contract, it explicitly said it was only for fire service and did not cover ambulance transport services. They did carve out some of the ambulance costs from the cost calculation to accommodate that. Vice Mayor Lauing wanted information on LAFCO. He asked how they get to the adopted standard. Ms. Cameron explained LAFCO is an independent state mandated agency that oversees boundaries of cities and special jurisdictional issues. They funded a third party review of all fire service agencies in Santa Clara County. They pulled data and information from each one of the fire service agencies and put it together in a report. It is the most comprehensive analysis of the state of fire service done in recent history. Chief Blackshire added based on their findings, their recommendations were not mandated. They took their report and focused on what they felt were the highest priority data points they provided. He said the adopted standard depends on the agency and history. The standard of 8 minutes or less 90 percent of the time is tied to the chain of survival as it relates to medical calls. They adjust it based on the demographics of the city. Chair Burt asked if the standard of 9 minutes 41 seconds was an aggregate of Foothills and Flats or just Flats. He was interested in knowing what the standard response was excluding Foothills. Ms. Cameron replied it was all urgent calls. SUMMARY MINUTES Page 7 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 Vice Mayor Lauing wanted clarification on why service people could only be on calls 10 percent of the time. He asked for a guess at the revenue streams. He thought they needed to be focused on the increasing medical calls and they needed to increase the capacity for pure medical calls. Chief Blackshire explained he asked the project manager for the LAFCO study why it was 10 percent and he was told the industry standard for AP Triton stated if the standard is 8 minutes 90 percent of the time then 10 was the differential looked at for UHU. If the had a lower unit hour utilization, they would be more readily available to respond to simultaneous calls. This was driven by patient outcomes. Assistant City Manager Nose asked if having a different staffing model with civilian, would that be an additional adjustment to civilian versus sworn and what would the industry standard for UHU be. Deputy Chief McNally replied it would generally be higher. There would be less training needs and more opportunities to get them on calls. The LAFCO study used 10 percent as a model. If the expectation is for them to be at the 90th percentile and they were busier than 10 percent, it would be automatic that that the closest resource would be unavailable at the 11 to 13 percent. Increasing the number of available ambulances shrinks the workload. Ms. Cameron assured the Committee they were actively working on finding revenue sources to help cover the cost. That would be seen as part of the Municipal Fee Study that would be coming. They were looking at increasing the base fee for ambulance transport to augment their budget as well as looking at a first responder fee. With expanding ambulance service, they could contract for inner facility transports in order to generate other revenue. Director Lai added they would continue to look creatively in all the different ways. The hard reality was the majority of the costs were borne and bared by the general fund. They would still have to reconcile with the net cost of the additional programs. 2. Information Item: Calendar Year (CY) 2024 Finance Committee Referrals Status NO ACTION Director Lai wanted to give the Committee an update on the referrals and asked if there were any questions. SUMMARY MINUTES Page 8 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 Vice Mayor Lauing did not think the EPA golf course fees had to go to Commissions. Chair Burt asked what the process would be to implement the nominal one. Assistant City Manager Nose replied staff wanted to look with the Parks and Rec Commission and it would be a policy change. Director Lai thought that staff was recommending they incorporate it in the 2026 fee schedule meaning it would be effective July 1, 2025. Chair Burt assumed they would want to do some outreach to East Palo Alto. Vice Mayor Lauing asked why they would want to wait on this for $8,000 to $16,000. Director Lai answered staff was recommending they go through Parks and Rec along with a public outreach and they would bring it in as a part of the municipal fee update. Vice Mayor Lauing stated they would miss next year’s golf and should wait until 2026. Director Lai said they could take that feedback to the Community Services director. She shared that previously the City would take fee updates throughout the year. It became cumbersome to do it that way and they aggregated it into an annual fee process. They did not want to go back in the year and update the municipal fee. Chair Burt did not think East Palo Alto was necessarily expecting it and did not think there was a sense of urgency. Vice Mayor Lauing thought it might be better to get publicity from the PRC. He did not understand the last sentence about evaluating general fund financial support. Director Lai explained that was referring to the parking permit pricing and parking permit fund financial status. In the FY25 budget, the general fund supported the various parking program in the tune of $2 million. It was not apparent to what extent any of those funds could repay the general fund. The upcoming budget development process would allow time for the Office of Transportation to implement some of the programs and studies and that would guide to what extent it would be realistic that the general fund should anticipate any repayment or the Council may decide what level of financial subsidy at that point because the general fund would not be repaid. SUMMARY MINUTES Page 9 of 9 Sp. Finance Committee Meeting Summary Minutes: 11/19/2024 Future Meetings and Agendas Assistant City Manager Nose announced the next meeting would be December 3 and the agenda would go out the next week. Director Lai said the topics would include the annual comprehensive financial report, the long- range financial forecast, an informational report for Q1’s financial update and a preliminary preview of the utility rate increases that staff was iterating. Adjournment: The meeting was adjourned at 7:27 PM