CCP 09-18-2006 - Laserfiche WebLink

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determine cost splits, however, various capital items that are older were often times purchased directly by the Fire Department which makes determining the cost split by community very difficult. Between 1979 and 1992, five pieces of equipment were purchased directly by the Fire Department from their capital fund. It is diHicuit to determine which community paid for what percentage ofthis equipment. In addition, Engine #3 was refurbished in 1997, with costs paid by the Fire Department. Fire Engine #2 was refurbished in 2001, with costs split by North Oaks and Shoreview. Most of the other major equipment items have been purchased over the years based on the old formula. Essentially, the equipment was paid for by the City where the piece of equipment would be "housed". For example, if a piece of equipment was "housed" at Station #1, Arden Hills was responsible for purchasing it. However, even this formula was not consistently followed. A tanker purchased in 2002 was split among all three cities. Cars for use by LJFD staff were split among all three cities, When a three-way split was used, it was based on the old formula (Arden Hills 25%, North Oaks 12.5%, and Shoreview 62,5%). That same three-way split was used for some general equipment purchases that weren't specific to a station. Analysis has been done to estimate as closely as possible historical spending for capital equipment, to determine if each City has paid its "fair share". Using the concept of the formula, there would need to be some "catch up" by North Oaks and Arden Hills (Approximately $174,704). Two mechanisms for catching up have been discussed if the new formula is implemented. One possibility is direct reimbursement from the two cities to Shoreview. Then, the three cities would reimburse the LJFD for their appropriate shares of a used engine that was purchased last year. This purchase was to be financed via the sale of a command vehicle (sold in November 2004) and a split between the cities for the balance, The reimbursement from the cities to the Fire Department General Fund was delayed until the cities worked out a cost sharing arrangement for capital purchases. The other option would be for Arden Hills and North Oaks to split the cost of the used engine (based on each city's share of "catch up") and reimburse the LJFD General Fund directly. If that was done, it would be approximately $70,000 for the City of Arden Hills and $35,000 for the City of North Oaks. The balance of our "catch-up" would be paid back over period of years (probably five years) by incorporating it into the budget. CAPlT AL FINANCING FOR BUILDINGS (FIRE STATIONS) Buildings and repairs have been paid for by each City according to the following formula: AH Station 1 SV Stations 3, 4 and Y, Station 2 NO Y, Station 2 DISCUSSION The Fire Board is now considering a proposal to apply the new operating budget formula to capital equipment purchases, (Station maintenance and repairs would remain under the current formula outlined above,) There are many reasons for considering this change: - - -.