Atherton ongoing conversation.

Posted by Barbara Wood
Almanac staff writer

Barbara Wood is a registered user.

Atherton City Manager George Rodericks has provided the following information in response to some of the questions that have been posted here:

Outsourcing the Police Department and Police Cost

The Town conducted an informal study a number of years ago (prior to my arrival in October 2012) that provided some broad information about outsourcing the Police Department. I believe some of that data is online. Following my arrival the outsourcing issue continued to swirl around in local politics. The Town was in the midst of labor negotiations with the APOA. Because the cloud of outsourcing continued to be discussed in the community and by members of the Council, the Town was having difficulty attracting and retaining police officers. I put the issue before the Council for a decision on whether or not the Town wanted to formally pursue outsourcing of the Police Department. The issue continued to weigh heavily on negotiations and the Town and APOA could easily have reached a stalemate if the issue wasn’t addressed. The 5-0 vote by the Council decided that outsourcing was not an option they wanted to pursue.

This was a knowing decision. It was a decision despite the clear and public acknowledgement that the Town would save money by outsourcing the Police Department. The issue boiled down to service level, local control, and policing model. It was estimated that outsourcing of the Police Department would save the Town approximately 30% assuming the current staffing and deployment levels are maintained. The cost of police services in Atherton is $6,781,283. The total operations budget for the Town is $12,149,639. This represents 55.8% of the Town’s total operational budget – excluding Capital Projects. The Town has 40 full-time employees (not including contract Building, Planning, Engineering, and Public Works staff). The Police Department represents 29 of these staff or 72.5% of the total Town staff. This is a per-capita cost (7,160 residents) of $947. For some comparisons as percent of budget – small towns:

Town of Woodside (Contract) – $1,737,925/$6,408,768 = 27% = per capita = $317.08
Town of Portola Valley (Contract) – $692,100/$4,499,337 = 15% = per capita = $153.19
Town of Tiburon (Town PD) – $3,278,958/$10,838,457 = 30% = per capita = $357.22
City of Belvedere (City PD) – $1,703,434/$4,599,601 = 37% = per capita = $802.75
Town of Atherton (Town PD) – $6,781,283/$12,149,639 = 56% = per capita = $947
Town of Colma (Town PD) – $5,370,490/$13,627,060 = 39% = per capita = $3,599.52

The differences, per capita, even under the contract model is indicative of the service levels, local control and policing models. Some agencies, like Belvedere maintain their own police force even though they too would clearly save significant funds by outsourcing, but outsourcing was not something the community supported for the police services. Issues of rotating officers (-), busting of cars out of Town in support of more regional safety needs (-), and the ability to manage the police locally (+), and the ability to have a higher, locally controlled deployment model (+) factored into their decision making. It essentially boils down to an affluent community desiring local control over its local policing needs. That’s the case in Atherton.

Basic secured property tax revenues to the Town total $7,222,365. Police services are 94% of that cost. This is all publicly available information for comparison purposes. The Town is very transparent.

Number of Fire Stations in Atherton

There is one fire station in Atherton – Station No. 3. This station is manned by 3 firefighters. One of the 3 is a paramedic. However, the Town is also served by Station No. 4 (Menlo Park) and Station No. 1 (Menlo Park). The District operates on the “closest station” network deployment model so the closest station and the closest vehicle regardless of station responds to issues in Atherton.

Detaching from the Fire District

The Town is not seeking to withdraw from the Fire District. The Fire District receives more than $13 million a year from Atherton taxpayers for the provision of basic fire and emergency response. That’s more than the entire operating budget for the Town itself. The Town is asking the following questions:

– Has the Town’s property value’s increased to the point that the funds received by the Fire District via property taxes far exceed the cost to provide fire services to the community?
– If so, what can be done about it?
– Should something be done about it?
– What options do the taxpayers have?

We have been able to address the issue with the County Library Tax and to a degree, have more control as we’re part of a JPA. But the District is independent of the Town. The Town has raised this issue with the Fire District (beginning in 2013/14). We asked:

– How much does the district receive on average annually in property tax revenue from Atherton residents?
– How much does the district expend on fire services (inclusive of any distributed proportionate share of overhead) within Atherton boundaries?
– If there a surplus between these two numbers, where does the surplus go? Is the surplus expended on paying down long-term liabilities? Is the surplus expended on the purchase of capital infrastructure.
– If there is not a surplus, how does the district make up the difference?

The response was: “We don’t track information that way.” So, we’ve been trying to engage the District in this conversation ever since. Ultimately, the Town (and residents) have the ability to detach from the Fire District and provide fire services on their own (contract, their own department, etc.). Doing so would re-align the property taxes to the Town instead of the District (with caveats via a LAFCO process). That’s only one option and a remote one. There are many others, but first, there needs to be an open and transparent conversation with the Fire District about the issue with the facts at hand. At the end of the day, the answer may be similar to the Police Services answer – yes, we pay more for fire services because we enjoy a higher quality of service delivery and a degree of local control. Or the answer may be, wow, that’s a lot more than we want to pay for fire services, District, what can you do to address this issue? Redistribute property taxes amongst the other taxing agencies within the Tax Rate areas? Upgrade Station No. 3? Spend more locally on fire infrastructure? Neither of these answers involve the Town detaching from the Fire District. Neither of these answers involve the District providing funds to the Town.

To be clear, the Town is not pursuing this issue on the basis that we can get fire services cheaper or that we need funding from the Fire District for our own operations. We do not. Those are farthest from the truth. We are a well-managed Town with a fully balanced budget – with a surplus. We presently have nearly a 100% reserve. Our OPEB liability is at a 90% funded level. Our CalPERS long-term liability is well under control. We are not dependent on ERAF or the Town’s Capital Infrastructure Parcel Tax for basic operations – we use it for Capital Projects. For Fiscal Year 2016/17 we have operational revenues over expenditures of $1,285,322 or 10.5%. This is not a revenue alternative issue for the Town. It is purely an equity issue for our residents. We are simply asking the questions and want to have the conversation.

The Town Cannot Withdraw from the District

Yes, the Town can withdraw via a detachment process with LAFCO. The process is a legal LAFCO process that begins with a local affected agency resolution requesting review. Part of the process involves the Town identifying a viable alternative service delivery model. The Town (and its residents) have the ability via detachment from the District to provide fire services to the community. It is within the Town’s purview under the law for local police powers – health, safety, and welfare – general police powers. The Fire District has no such authority or ability with police services. That responsibility for service delivery rests entirely with the Town.

Can the Town use a dual model for Police/Fire as a solution?

Yes. If the Town were to pursue detachment and providing services locally were the option selected, it could opt to have a dual police/fire model similar to Rohnert Park and other communities where officers rotate via one department to police and fire.

Why can’t the Town use the existing firehouse? Can a private company fill the need?

If the Town were to pursue a detachment model existing assets would be distributed and amortized via a LAFCO process. The Town and the District would have to agree on the cost of existing infrastructure should the Town assume it and the Town would have to pay for that infrastructure. This can be done in any number of ways, to include an amortization period whereby the District continues to receive a share of the property tax revenue for fire services and the Town receives the difference. Once the period ends, the Town collects all of the tax for local fire services. Since the tax is associated with the provision of fire services, similar to the library property tax, there is likely to be a restriction on the funds such that they can only be used for fire services. In that case, if the cost for fire services is less than the tax collected, the Town could opt to realign/redistribute the tax amongst the other taxing entities in each affected Tax Rate Area. In doing so, all agencies (Fire, School, Mosquito, Sewer, College, Town, etc.) would receive a proportional share of the redistributed tax.

A private service could be considered, but frankly, I am not sure of the law in California with respect to the provision of service by private sector staffing. There are private medical services, but private sworn fire services – unlikely in California, but worth looking at if that bridge is where we end up.

Town in dire fiscal straights

To be clear, the Town is not pursuing this issue on the basis that we can get fire services cheaper or that we need funding from the Fire District for our own operations. We do not. Those are farthest from the truth. We are a well-managed Town with a fully balanced budget – with a surplus. We presently have nearly a 100% reserve. Our OPEB liability is at a 90% funded level. Our CalPERS long-term liability is well under control. We are not dependent on ERAF or the Town’s Capital Infrastructure Parcel Tax for basic operations – we use it for Capital Projects. For Fiscal Year 2016/17 we have operational revenues over expenditures of $1,285,322 or 10.5%. This is not a revenue alternative issue for the Town. It is purely an equity issue for our residents. We are simply asking the questions and want to have the conversation.

The Parcel Tax is used for capital infrastructure. Residents contribute $1.8m per year to the Town via the Tax and the Town uses the bulk of it (80%) for streets, roads, and drainage each year.

Police Department Salaries

Atherton Police Officers are not paid the highest. Annually, the Town compares police agency salaries/benefits to surrounding agencies – San Mateo County, Brisbane, Los Gatos, Palo Alto, Hillsborough, San Bruno, Belmont, Redwood City, Menlo Park, and Los Altos. Atherton Police Officers are paid at below average levels. Of these 10 agencies, 8 are paying their officers higher than Atherton. For Atherton Sergeants, of these 10 agencies, 7 are paying their Sergeants higher than Atherton. For Atherton Dispatchers, of these 10 agencies, 8 are paying their dispatchers higher than Atherton. It is hoped that through currently ongoing labor negotiations, we can at least bring our staff up to the average for agencies that are the Town’s competition for recruitment and retention.

Using Fire Tax Revenue for the Civic Center

The Town asked the District if they would be interested in contributing to the Town’s Emergency Operations Center in its new facility or if they would be interested in creating a shared space for staging of an emergency medical response vehicle in the Civic Center. The District advised they were not interested and asked the Town if they were asking the same of the Mosquito Abatement District and local schools. The District then asserted that the Town could not use the fire funds because they were taxes and the ballot measure prevent such. The Town advised that if the Town were to receive a grant of funds from an outside entity, this did not violate the ballot measure since it takes the form of grants. Most all grants from any agency – federal, state, local, county, etc. are all derived at their base from taxes of some sort so the assertion is baseless and argumentative..

Further, if the Town were to detach (a multi-year process – long after the Civic Center completes) the Town would likely not be allowed use fire tax funds for Town basic capital infrastructure – similar to using library tax funds – these funds can only be used on library services/infrastructure. The Town’s Civic Center Project will get accomplished whether the Town is a member of the Fire District or whether the District addresses the taxing issue or not. The motivation for this issue is not the Town’s Civic Center.

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