Andrew Thompson, CGFO
Chief Financial Officer

Rhea Rivera, CGFM
Assistant Director, Financial Services

Issue Statement:  A preliminary FY 23 fire assessment rate schedule must be adopted by the Commission to be provided to the County Property Appraiser by August 4, 2022. Revenue from fire assessment is used to fund the costs of providing fire suppression services within the City.

Recommended Action: Staff recommends the City Commission approve the preliminary rate resolution adopting the preliminary proposed fire assessment rates, as reflected in the attached Exhibit, including the $251 per residence (annual residential rate), and establishing Monday, 6:00 p.m., September 12, 2022, as the time and date of a public hearing to be held at Commission Chambers as regards to the Fiscal Year 23 fire assessment. 

The City Commission established a Fire Rescue Assessment Program in Fiscal Year (FY) 02. The ordinance establishing this program requires a preliminary rate resolution and an annual rate resolution be adopted during the budget process each fiscal year. The Government Services Group, Inc. (GSG), and Nabors, Giblin & Nickerson, P.A. (NGN), have worked with the City periodically in implementing this annual Fire Rescue assessment program.

GSG was used in updating the recommended rates for FY 10, FY 17 and again for FY 22.  In all instances after each rate study, the rate structures were adjusted in order to ensure they were assessed according to current usage. Since by law a fire assessment can only be used to recover those costs associated with providing fire services to properties and not emergency medical services, part of the study involves identifying that portion of Fire Rescue expense associated with fire services. These are identified as “assessable cost”.

As part of the study completed in FY 21 performed by Government Services Group, Inc. (GSG) with the results and recommendations  presented to the Commission on April 7, 2021, rates for FY 22 were adjusted to reflect that the demand for service changed among the different property classes resulting in an adjustment for FY 22 to the residential fire assessment rate from $199 to $251.  The increase was based on the change in service demand and increased operating, personnel, and capital costs.

The proposed rates for FY 23 remain unchanged from FY 22, with the residential rate remaining at $251 per residence. 

Oakland Park's existing rate of $251 is the 12th lowest assessment rate in the County; lower than neighboring jurisdictions (Fort Lauderdale: $311, Lauderdale Lakes: $334, Tamarac: $350, and Wilton Manors: $267).  

The expected revenue generated by the assessment will continue to fund approximately 91% of the applicable fire suppression costs of the Fire-Rescue Department.   The remaining suppression costs will continue to be funded by other available General Fund revenues.  This 91% funding ratio is based on data from the most recently completed fire assessment study.  

The proposed rates will appear on the TRIM notice mailed to all property owners in August. There will be a hearing in regard to the final adoption of these rates on September 12th to establish the rates to appear on the property tax bill mailed to all property owners at the beginning of November.

At the time of the final hearing, lower rates may be adopted by the Commission if it so chooses, but higher rates can be adopted at that time only with a significant amount of effort and expense. Individual rates can not be selectively adjusted and an adjustment in one rate (e.g., the residential rate), would require corresponding adjustments in all rates.

With early payment discounts applied, the proposed preliminary assessment rates will generate approximately $6.7 million of revenue.  In the recent rate study, it was noted that the costs of fire suppression activities increased from $6.4 million in FY 2017 to $7.8 million in FY 2021. As the cost of providing fire suppression services increases due to increased operational needs and compensation increases, adjustments to the rate will be needed.

As part of the rate study, new exemptions were presented to Commission in FY 22 that exempted specific homesteaded residential properties from the fire assessment if they qualified through the Property Appraiser for the additional low-income senior exemption or are receiving a total exemption from property tax due to qualifying disabled veteran/first responder/total disability status.  The implementation of these exemptions are included in the preliminary rate resolution.  There are approximately 700 residential properties that would receive the exemption, which would eliminate the fire assessment from their annual tax bills, a savings of $251 for this upcoming fiscal year and future years.

Staff recommends the City Commission approve the preliminary rate resolution adopting the preliminary proposed fire assessment rates, as reflected in the attached Exhibit, including the $251 per residence (annual residential rate), and establish Monday, 6:00 p.m., September 12, 2022, as the time and date of a public hearing to be held at Commission Chambers as regards to the Fiscal Year 23 fire assessment.