Sedona AZ (October 5, 2012) –  The SedonaEye.com publishes the Minutes of the September 27, 2012 Sedona Fire District Board meeting without editorial comment:

Sedona Fire District 

2860 Southwest Drive, Sedona, Arizona 86336

Telephone (928) 282-6800 FAX (928) 282-6857

REGULAR BOARD MEETING

Station #1 – 2860 Southwest Drive – West Sedona – Multipurpose Room

Thursday, September 27, 2012 / 4:00 PM

~ MINUTES ~

I. CALL TO ORDER/ROLL CALL.

Board Present: Ty Montgomery – Chairman; Corrie Cooperman – Clerk; Diane Schoen –Member

Board Absent: Craig Dible and Nazih Hazime – Members

Staff Present: Fire Chief Kris Kazian; Assistant Chief Terry Keller; Finance Manager Sandi Schmidt; Executive Assistant/Recorder to the Board Tricia Greer

Others Present:

Bill Whittington, Attorney;

Approximately 33 Members of the Public (including family members of employees to be honored at the badge-pinning ceremony)

Board Chairman Ty Montgomery opened the meeting at 4:00 PM and moved to go into Executive Session pursuant to ARS 38-431.03(A)(3) for legal advice; ARS 38-431.03(A)(4) instruction to attorney; and ARS 38-431.03(A)(7) for consultation/negotiation with representatives regarding real property on the listed Executive Session items, as well as to receive legal advice on Items #VI.B.4 and 6; Board Member Diane Schoen seconded and the motion unanimously passed at 3 to 0.

II. EXECUTIVE SESSION.

A. Vote to go into Executive Session relating to the following items:

1. ARS 38-431.03(A)(3) Legal Advice and ARS 38-431.03(A)(7) Consultation/Negotiations with representative for the possible Purchase, Sale or Lease of Real Property – Re: Sedona Area Property; Easement Issues on Sedona Area Property; other SFD Real Property.

2. ARS 38-431.03(A)(3) Legal Advice and ARS 38-431.03(A)(4) Instruction to Attorney – Re:

a. Lowell Johnson Complaint.

b. Negotiation with Cottonwood Fire Department on its Dispatch IGA with SFD.

III. RECONVENE INTO PUBLIC SESSION.

A. Salute to the Flag of the United States of America and Moment of Silence to Honor all American Men and Women in Service to Our Country, Firefighters, and Police Officers.

Mr. Montgomery reconvened public session at 5:15 PM and led the Pledge of Allegiance; he recognized Fire Chief Kris Kazian, who asked all to remember the death of the son of a Dallas Firefighter, Dyrk Burcie, to whom SFD recently dedicated a “Dyrk Strong” video.

B. Badge-Pinning Ceremony for Division Chief Scott Schwisow; Battalion Chief Ed Mezulis; Training Officer Michael Duran; Firefighters Jake Hanna, Dave Yingling, and Tyler Woo.

Chief Kazian welcomed and honored three new Firefighters, undergoing a two-week fire academy training; he then introduced them: Jake Hanna served as a Hot Shot Firefighter and a Reserve with Central Yavapai Fire District, and has an Associates, as well as a Bachelors degree; Tyler Woo came to SFD from the South San Francisco Fire Department, and has an Associates degree in Fire Science; Dave Yingling was formerly in Marketing, but found his passion in the fire service, and was previously a Reserve with Avra Valley Fire District and Rural Metro. He then asked the Firefighters’ families to come forward to pin the badges.

Chief Kazian introduced SFD Firefighter Michael Duran, who recently tested for and was chosen to serve as the new Training Officer for our organization. Michael has served at SFD since 2002; he is only a few courses short of attaining his Bachelors degree, and is ready to take this challenge. He conveyed to Chief Kazian that becoming SFD’s Training Officer was a “dream come true”. Michael’s family, Claudia and Steven, shared the moment with Chief Kazian pinning his badge.

Chief Kazian said in his recent review of the SFD organizational chart and in order to maximize the operational potential, he requested interest from the organization to fill a Division Chief of Support Services position; Battalion Chief Scott Schwisow applied and received the job, which is a lateral transfer. Chief Kazian then asked Scott’s family, Beverly and Jake, to come forward for the badgepinning.

Chief Kazian stated the Division Chief position being filled by Chief Schwisow created a Battalion Chief vacancy, and using our BC Hiring List, Captain Ed Mezulis was recently named as Battalion Chief of “B” Shift. Ed has been with SFD for 12 years and has a Bachelors degree; his wife, Kristen, and children, Aiden and Abby, participated in the badgepinning.

Chairman Montgomery congratulated all those honored.

C. Discussion/Possible Action: Follow-Up for Executive Session Items:

1. Sedona Area Property; Easement Issues on Sedona Area Property; other SFD Real Property.

Mr. Whittington recommended a motion to direct Chief Kazian to move forward, as instructed in Executive Session; Board Clerk Corrie Cooperman so moved; Mrs. Schoen seconded, and the motion unanimously passed at 3 to 0.

2. Lowell Johnson Complaint.

No action was taken on this item.

3. Negotiation with Cottonwood Fire Department on its Dispatch IGA with SFD.

Chairman Montgomery announced this item occurred because of a potential conflict of interest with current SFD legal counsel, William R. Whittington, in the review and/or representation of SFD in negotiations of dispatch Intergovernmental Agreements with other public agencies. He stated this information came to light at “the 11th hour” which necessitated an emergency session. Fire Chief Kris Kazian articulated the reason this was not done as a regular agenda item was the IGA with Cottonwood Fire Department was approved at a previous Fire Board meeting, resulting in additional dialogue among the participating agencies to negotiate changes to the IGAs. He said SFD is currently operating without an updated IGA for all the dispatching partners except two, which presents a potential liability issue. SFD was required to find alternative legal counsel to legally review the revised IGAs, as well as, possibly, handle any necessary future negotiations. Mr. Montgomery then moved to approve immediate action to hire alternative counsel, Donna Aversa, at the same rate of $175 per hour as is currently paid to Mr. Whittington, and to authorize Ms. Aversa to handle the IGAs, and that notice of this emergency session would be posted within 24 hours of such action. Board Clerk Corrie Cooperman seconded, and the motion passed with Board Member Diane Schoen, Board Clerk Cooperman, and Board Chairman Montgomery voting affirmatively. Mrs. Cooperman stated it is obvious SFD has potential liability without this authorization and it is important to do so on an emergency basis.

Other items from this Agenda added to the Executive Session were: 

Purchase/Lease Agreement with Physio-Control.

Mr. Montgomery stated the Board discussed verbiage related to that contract and now must consider whether to approve the contract, as submitted.

Attorney Whittington said if the Board is considering approval, he recommended they approve the existing contract and proposed addendum received this afternoon, as explained in Executive Session.

Mrs. Cooperman stated this takes care of some technicalities making the contract viable; she then moved to approve the purchase lease agreement with Physio-Control with the addition of the addendum, as provided by counsel; Mrs. Schoen seconded. Mr. Montgomery called for discussion. Chief Kazian asked Assistant Chief Terry Keller to give the Board information about the equipment. Chief Keller confirmed the lease is with US Bank, which is the lender on behalf of Physio, and the motion should reflect same; Mr. Whittington agreed. Chief Keller then informed the Board there are about a dozen LifePak 12 units in our fleet, the oldest of which is from 1998 or 1999; they

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are maintained under an annual service contract and are in good condition, but beginning to show signs of aging and wear. Chief Keller said the proposed models are LifePak 15s; he said it makes sense for SFD to maintain the same brand of heart monitors, as the entire fleet is not being replaced, but rather four in our first- out ambulances. Chief Keller said the newer versions are more “rugged” for on-scene use and have colorized screens versus monochrome on the LifePak 12s; they perform 12-lead EKGs, CO2 monitoring, expanded data capacity, extensive heart attack information and alerting, as well as new technology to measure carbon monoxide levels within the bloodstream of a patient. The older LifePak 12s which these replace will be removed from first-out ambulances and replace even older versions currently being used in other vehicles. Mrs. Cooperman then withdrew her previous motion. Mr. Whittington recommended the Board entertain a motion to approve the US Bank lease agreement #030-0049565-001, and the non-appropriation addendum provided by counsel in conjunction with same; Mrs. Cooperman so moved. Mrs. Schoen provided a second and the motion was unanimously approved at 3 to 0. Mr. Montgomery said as a healthcare provider who has used a defibrillator that did not work in a moment it was needed, he is in favor of having up-to-date equipment. Chief Kazian added these were budgeted items.

Delegation Agreement #06-053 Between SFD and Arizona Department of Environmental Quality.

Chief Kazian stated the Arizona Department of Environmental Quality (ADEQ) is the agency that authorizes SFD to provide burn permits for citizens to burn brush from yard clearing and this Agreement is a “blanket” document used throughout the State; he said the concern is the Agreement lacks some required statutorial language which was left out by ADEQ; as SFD is in the process of issuing burn permits, he recommended the Agreement be approved, as presented, with the request he work with Attorney Whittington to subsequently add the correct language. Mr. Montgomery clarified this document went to many fire departments and districts across the State, and SFD is not the only agency dealing with this issue. Mr. Montgomery then entertained a motion; Mrs. Cooperman moved to approve Delegation Agreement #06-053 between SFD and ADEQ, as is, but with the stipulation Chief Kazian work with Board counsel on adding the appropriate legal language; Mrs. Schoen seconded and the motion was unanimously approved at 3 to 0.

IV. PUBLIC FORUM.

A. Public Comments.

There were no responses to the call to the public.

B. Executive Staff Response to Public Comments.

There were no staff responses.

V. CONSENT AGENDA.

A. Consent Agenda – Discussion/Possible Action:

1. August 22, 2012 SFD Regular Business Meeting Minutes.

2. August 22, 2012 Executive Session Minutes.

Mrs. Cooperman then moved to approve the Consent Agenda; Mrs. Schoen seconded, and the motion was unanimously approved at 3 to 0.

VI. BUSINESS.

A. Monthly Staff Report – Fire Chief Kris Kazian.

Chief Kazian reported:

Yearly call volume is on pace to reach about 4,000, which is the same as last year, but one area of note is the number of rescue assignments at 28 with only 12 last year; he stated rescue calls can be very lengthy and require a large number of personnel, which take away from the response capabilities of the district. Mrs. Schoen commented a presentation on safe hiking could be presented to the Sedona Westerners hiking club; she said Mike Holmes is the president, and they meet once a month at the Jewish Community Center. The Regional Communications Center continues to have very small declines in calls overall.

In September, the SFD Firefighters Association raised about $1,300 for the Muscular Dystrophy Association with the entire Verde Valley raising about $6,500.

Captain Ralph Kurtz has been helping with the two-week Fire Academy for the new Firefighters, with two of the individuals starting shift on Sunday and one on Tuesday.

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The equipment the Board approved as surplus a few months ago was put up for bid, but no proposals were received; the gear was donated to a small fire district in southern Arizona.

Fire Prevention Week is October 7th through 13th and this year’s theme is “Have Two Ways Out” and reminded all to practice exit drills in your homes to keep the family safe, and also a good time to remember to check your smoke detector batteries. His monthly article in the Red Rock News will focus on Fire Prevention Week.

B. Items from Staff:

1. Wildland Fire Update.

Chief Kazian announced this continues to be a very active wildland fire season. Currently, there are three SFD employees on assignment; Battalion Chief Jayson Coil told him, normally, there are about 6,100 wildland fires a year in the nation that typically burn 6.5 million acres; however, this year, 8.7 million acres have burned in only 4,700 fires. Chief Coil said it is the second busiest season he has seen in 12 years. He reminded the Board and public SFD netted about $50,000 in revenue so far this year in wildland billing. Mr. Montgomery asked what the prior year’s revenues were and Chief Kazian responded, $66,000, but outstanding billing remains and $35,000 was allocated as projected revenue in the budget.

2. August 2012 Financial Report.

Chief Kazian stated reports were included in the Board’s packets of information. Finance Manager Sandi Schmidt stated, financially, SFD is on track for the year, and the auditing firm is on-site this week at Station 1. Chairman Montgomery said the auditors interviewed him today and will give a formal presentation of the audit findings to the Board in January.

3. Discussion/Possible Action on Items relating to ARS 38-961 – For Public Safety Employees:

a. Possibility of Extending the Insurance Benefit for an additional Six-Month Period to complete revision of SAP #1031, Workers’ Compensation.

b. Insurance Policy for Mandatory Coverage for Public Safety Employees on Workers Comp.

Mr. Montgomery stated this is the recent statewide legislation regarding Workers Compensation for Firefighters and requires a new insurance policy. Chief Kazian said ARS 38-961 requires public safety agencies to provide eligible public safety employees may not use vacation or sick leave accruals to offset wages while out on Workers Comp injuries; and, additionally, pension contributions are paid by the employer, as well as requiring an insurance policy to cover the balance of salary after the 66 2/3 covered by Workers Comp. He reminded the Board they were provided a draft of SFD’s administrative procedure on Workers Comp and stated staff is comfortable with its language, but the Board must make a decision whether the initial six-month period stipulated by the law be extended to one year.

He asked Attorney Whittington to give further explanation.

Mr. Whittington stated his recommendation to the Board is they approve the SAP, with the knowledge there may be a further policy brought to the Board for consideration with additional language; the law permits the district to establish criteria for extending benefits from six months to one year; he said this could be done on a case by case basis, but it makes sense to have some continuity; he said he suspects the language will be to leave that determination to the Fire Chief’s discretion, although that is not required. Chief Kazian said it would be helpful to know the parameters before purchasing the required insurance policy; he said there are policies available with a wide range of premiums and staff is looking for the most efficient and cost effective coverage; he has discussed language regarding the time extension and viability of employees being on light duty with Mr. Whittington, which needs more research. For now, he is comfortable with the procedure, as written, as a start. Mrs. Schoen moved to approve SAP #1031, Workers Comp, as written; Mrs. Cooperman seconded, and the motion unanimously passed.

4. Discussion/Possible Action: Purchase/Lease Agreement with Physio-Control.

This item was discussed earlier in the meeting.

5. Discussion/Possible Action: Board Resolution #2012-10, Disposal of Surplus Property – Generators with Waiver of Liability.

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Chief Kazian said SFD identified three generators no longer necessary as part of emergency preparedness. Staff’s recommendation is to request the Board authorize this equipment as surplus and direct staff to try to sell them on the internet, possibly E-Bay or www.publicsurplus.com.

Chief Kazian said a couple of agencies have expressed interest in bidding. Mrs. Schoen then moved to approve Resolution #2012-10, designating the equipment as surplus; Mrs. Cooperman seconded, and the motion was unanimously approved.

6. Discussion/Possible Action: Delegation Agreement #06-053 Between SFD and Arizona Department of Environmental Quality.

This item was discussed earlier in the meeting.

7. Discussion/Possible Action: Memorandum of Understanding Between SFD and Sedona Police Department for Technical Support/Maintenance – SPD Communications Center.

Chief Kazian asked the Board to table this item until next month, as legal is working out terms.

8. Discussion/Possible Action: Amendment to CommSpeed Airport Mesa Tower

Lease/Option and Lease Agreement for Ground and Tower Space Dated August 27, 2002.

Chief Kazian said SFD was contacted by CommSpeed to amend a contract dated August 27, 2002 for the right to occupy tower space on airport mesa, and to upgrade equipment from a four-foot to a six-foot microwave with additional antennae; the terms of the original contract would not change, but rather, revenue from the tower would increase about $300 a month and this is in SFD’s interest to approve. Attorney Whittington recommended if the Board approves the Amendment, they also approve the language providing the terms of the original contract are still effective except as to the terms of Attachment “F”, which is included. Mr. Montgomery then moved to approve the Addendum to the CommSpeed Agreement including the language which provides that except as otherwise modified in the Addendum, the original terms continue in full force and effect; Mrs. Cooperman seconded, and the motion was unanimously approved.

9. Discussion/Possible Action: Revising the IGAs for Dispatching with the Following Agencies:

Black Canyon City Fire District; Camp Verde Fire District; Clarkdale Fire District; Cottonwood Fire Department; Jerome Fire Department; Mayer Fire District; Montezuma-Rimrock Fire District; Pinewood Fire District; Verde Valley Fire District; Verde Valley Ambulance Company (Note: These IGAs are in process of being submitted to alternate legal counsel for review.).

Chief Kazian said they spoke earlier about the need for alternate legal counsel on this matter, and the versions of the Intergovernmental Agreements will be approved and processed to meet the needs of the Sedona Regional Communication Center, but the concern is operating without IGAs, and based on the procedural items pending, he recommended a Special Board meeting be held on Thursday, October 4, 2012, at 4:30 PM for the approval of the IGAs. Mr. Montgomery said the other Board Members must be informed.

10. Update: Station #6 Architectural Planning Process / LEA Architects.

Chief Kazian informed the Board he and Assistant Chief Keller met with LEA Architects yesterday, and would like to request this as a second item on the Special Meeting agenda for a presentation of the revised design to the public and Board. He said the outside elevation is “stunning” and a very functional station which, operationally, will meet our needs; he believes it is a nice fit to the neighborhood architecturally. Mrs. Schoen asked if the Board would need to approve the design; Attorney Whittington said the Board would not need to formally approve, but would, most likely, want to be on the “inside” of that decision process. Mr. Montgomery said there would need to be a Public Forum included for community comments regarding the station. Mrs. Schoen asked that the two religious institutions on either side of the site be notified of the Special meeting. Chief Kazian noted the reporter from the Red Rock News, Patrick Whitehurst was in attendance, and stated he hopes the meeting notice would be in the newspaper to let as many people as possible know about it.

11. Update: Request For Proposals for a New Ambulance (Budgeted Item).

Chief Kazian reported a Request for Proposals for a new ambulance has been sent out, and once the proposals are received, staff will come to the Board for a decision on funding. Chief Kazian stated he believes the $150,000 budgeted for this ambulance may be “tight” once the bids are in.

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12. Update: Creating New Career Firefighter/EMT List including Reserve Candidates.

Chief Kazian said the three new Firefighters introduced tonight were the only remaining individuals on the previously established hiring list; a new eligibility list is needed for career Firefighters, and to establish Reserve Firefighter candidates to implement the program supported by both the McGladrey report, as well as the previous administration of former-Fire Chief Hazime and Mr. Montgomery. He projected it would take until February or March after a rigorous process including receiving applications, written testing, oral interviews, and other necessary requirements. He stated it is possible there may not be enough interested individuals for a Reserve Firefighter list, but, if possible, the program would be a “win/win” for everyone.

13. Update: Information on Proposition 117 and Effects on Sedona Fire District.

Chief Kazian said this Proposition will be an item on the November election ballot and has a high probability of passing. It is designed to curb dramatic increases and spikes in assessed valuation (AV) of homes and will cap that spike at 5%; he explained there are two AVs – one for Fair Market Assessed Value, which we will not be taxed on and a Limited Value, which will be taxable and is the one to be capped by 5%; for example, if we saw a 10% spike one year in AV, taxing agencies would be capped at 5% and that is not a cumulative effect, so if the AV went up 20% over two years, we could only capture 10%. He stated SFD is lucky enough that the county has a max levy, of which we are $8 million below, so we have a ceiling still to attain; he said many agencies are not as fortunate and will hit that “ceiling” quickly. He projected SFD will run out of mil rate long before we capture that $8 million in growth. The important part to understand is this Proposition will likely pass and will not become effective until 2015; he has informed the Board in the past as the AV goes up, the mil rate would come down, but with the 5% cap, the number which could be multiplied to attain the budget will be dramatically reduced, which means the ability to lower the mil rate will be stunted, and the ability to flexibly adjust the mil rate will be affected by this Proposition; although it is designed to protect the taxpayer from taxes going up at a fast rate, it will also hamper our ability to lower the mil rate at a fast rate. He said staff did a 10-year projection, and although it is speculation, the mil rate is projected to go up; SFD demolished its savings with the low mil rate of the last few years. He stated the Board received a full copy of this complicated Proposition language in their Board packets, as well as his memo explaining same.

14. Update: Newly Revised SFD Organizational Chart Effective October 1, 2012.

Chief Kazian said he introduced this idea at last month’s Board meeting, and wanted the Board to see the staffing. He said the intent at budget time was to create and fill vacancies, of which at the time, it was reported there were three Firefighter vacancies and wanted to fill one this year, one next year, and one the following year, but due to the movement of Battalion Chief to Division Chief and a Training Officer created three “holes” at the bottom of the organization and we will need to hire one or two more to get to the budgeted numbers. Currently, there are 102 employees at the fire district with two vacancies – a dispatcher and the one Firefighter to which he referred. Mrs. Schoen asked what the split between Firefighters and Administrative staff is. Chief Kazian said there are 72 operational staff, 14 in dispatch, with the remainder being Telecommunications, Computer Tech, Fleet, Fire Prevention, and 7 full-time and 1 part-time Admin staff. Mrs. Schoen said she believes some in the public take the total number of employees, subtract the Firefighters and believe all the rest are Administrators, which is not true; she asked him to be more clear in communication of the numbers in Support and Admin staff. Chief Kazian suggested delineating the numbers of employees and vacancies in different sections of SFD on the Organizational Chart.

15. Update: Recent Lightning Strike Damaging Telecommunication Equipment in District.

Chief Kazian reported a communications tower received damage from a lightning strike at Station 1, with some lightning damage also at the airport site; the amount of damage is climbing near $200,000, all of which will be covered by insurance; he wanted the Board to be aware, however, they will be seeing large purchase orders after receiving final approval from the insurance adjustor and the realization of how expensive some of SFD’s equipment is; he also is happy to report that because of good planning, SFD has redundancy to be able to route communications through different channels to continue uninterrupted service; however, right now, SFD is functioning on the redundant system and if that fails, there is no other option, which means this equipment must be repaired quickly. Chief Kazian may need to work with Attorney Whittington on processing the final settlement. Mr. Montgomery stated Chief Kazian told him the insurance adjustor is working in good faith and being timely, but Chief Kazian explained staff is working to educate the insurance company of the

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highly technical needs and liability connected to getting this equipment back on line. Mrs. Cooperman asked about the deductible amount; Chief Kazian responded he believes it is about $1,000.

16. Update: Sutphen Ladder Truck Issues.

Chief Kazian said, annually, SFD has a third-party ladder testing to inspect our ladder and certify it as operational. The third party testing which occurred in April found some points of wear on the aerial platform, which required repair, but did not cause the ladder truck to be taken out of service. Subsequently, staff talked to Sutphen, the manufacturer of our ladder truck, about the repairs and through Chief Keller’s ingenuity brought Sutphen to Sedona, saving an expensive trip. The repairs were made by Sutphen, but “check boxes” were missed, one of which was the need to have another third-party test after the repair.

SFD called the third party company and acknowledged the repair, but there was a breakdown in communication. In the meantime, a southern Arizona fire district using a similar Sutphen ladder truck experienced a significant truck failure causing serious injuries; this caused SFD staff to call the company and express concern about the repairs made to our ladder and the safety of our firefighters; at that point, Sutphen asked about the third-party test. Sutphen will pay for the third-party test, which he expected to result in a stamp of approval; however, an hour into the test, he received the news the ladder truck failed. He immediately called Sutphen and talked to the owner to report the problem and they were in Sedona two days later with engineers. Sutphen is now determining how to re-engineer or repair the truck and realizes SFD wants to be fully compensated; the Chief asked how long it would take and Sutphen stated it would be weeks. For now, while the ladder truck is out of service, we are reliant upon mutual aid from neighbors in the event a ladder truck is needed for a Sedona incident. Mr. Montgomery asked about the possibility of SFD getting a demo truck from Sutphen; Chief Kazian did suggest that, but does not know of its feasibility. He stated he may need the assistance of Attorney Whittington in the event of legal issues. Chief Kazian reported an investigation is being made of the incident in southern Arizona, which may result in other information; he will keep the Board updated on this situation.

17. Reminder: October SFD Board Meeting to be held at Station 3 in Village of Oak Creek.

Chief Kazian reminded the Board and public that the October 24th Board meeting will be held at Station 3 in the Village of Oak Creek, after the Board’s previous decision to hold future October and March Board meetings there. If an Executive Session is needed, that may begin at 4:00 PM.

C. Item from Board Member Diane Schoen:

1. Discussion/Possible Action: Current SFD Board Policy #2011-01, “Principles of Sound Financial Management: Purchasing” to be Policy #2012-01, if revised; Check-Signing Responsibilities. (Tabled on 8/22/12.)

Mrs. Schoen asked management to update the Board on its recommendations of this policy. Chief Kazian reported in the Board’s packets of information was a communication from staff regarding check signing procedures. He said pre-2008, management was allowed to sign up to $500 without Board approval; from 2008 to 2011, management signed all checks up to $1,500 without Board approval; in 2011, the Board required all operating checks be signed by at least one Board Member; in the past, the Chief was authorized up to $10,000 without Board approval, but currently, Chief’s authority is up to $5,000. He stated it is critical to have necessary checks and balances with good fiscal responsibility for our organization. In its review, McGladrey looked at four years of expenditures and praised SFD for its financial controls and processes; he said staff’s recommendation is to maintain best practices and to reduce exposure for check-signing and he is recommending check-signing of staff be limited to Fire Chief and Assistant Chief with the Finance Manager listed on the account, not as a check-signer, but on an informational basis. One of his questions was to consider whether a purchase order is aggregate versus single item, and after talking to staff, he would rather say anything over $5,000 will come to the Board – or, to whatever monetary level desired by the Board based on increasing costs over the years. He has “zero” worries about inappropriate financial activity of staff, but wants to limit exposure. He and Chief Keller recently took a class advocating Chiefs have no check signing authority, but in his opinion, that is the check and balance for the Board to see we have gone through the purchasing process and assures the Board financial controls are in place.

Chief Kazian said the other recommendation is to change check signing from every Wednesday to the second and fourth Wednesday, which means one would coincide with the monthly Board meeting, reducing the need

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for Board Members to come to sign checks. He said whether the Board signs $6 or $60,000 checks, it is still a good check and balance. He said staff’s recommendation is to include a check register in the monthly financial reports to the Board for more transparency. Additionally, when Tyler Technologies financial reporting systems are in place in March of 2013, there will be further revamping needed; he asked the Board to consider expenditures for payroll and payroll-related deductions are twice monthly and must be paid every two weeks, which will result in five-week months creating additional check signing for the Board or the Board could stipulate those be handled differently.

Chief Kazian said staff needs direction in creating a new policy to incorporate some of these ideas so that, procedurally, everyone understands what can and cannot be done in a fiduciary manner.

Currently, there are bank transfers of funds made without Board signatures and the wording of the policy says “all operating checks”. Mrs. Schoen apologized for the extra work her questions created for staff, but wants Chief Kazian to know she fully agrees about checks and balances and if his recommendation is to keep the same system and same limits, she concurs and also approves of changing check signing to bi-monthly; she stated her intention was to show trust in management. He wants to make sure policy clearly states staff’s ability to sign transfer checks without Board approval, as it is not now clearly stated; Mrs. Schoen asked staff to bring that language to the next Board meeting for consideration; Chief Kazian said the only other item the Board needs to decide is the Chief’s signing authority of $5,000. Mr. Montgomery said his recollection from the past is that an emergency purchase of more than $5,000 signed by a former Chief created a liability issue of equipment damage or failure. Chief Kazian asked language for emergency purchase be included in the policy; staff believes that language is located in the accompanying Administrative Procedure. Chief Kazian said the amount for emergency purchases should be around $25,000, as $10,000 is not a lot of money for catastrophic emergencies. Mr. Montgomery agreed that language needs to be included. Chief Kazian said in the case of an emergency purchase, the Board would be notified as quickly as possible, at least with an e-mail or phone call to the Board Chairman. Chief Kazian said the draft language will be presented to the Board next month.

D. Item from Board Chairman Ty Montgomery:

1. Monthly Update: Fees from April 2011 to Current for Legal Services Provided to SFD.

Mr. Montgomery said in the interest of transparency, he continues this item so the public knows the legal expenses. For August 2012, he reported Mr. Whittington’s bill was $4,904.62, and there were no bills from other firms. For the last three months, the legal fees have been reduced from $6,200 to $5200, and now, $4900. He said Mr. Whittington understands the goal is to average about $3,000 a month, but there have been many issues needing his attention recently. Chief Kazian stated staff is working to limit those fees, when possible, by doing the “leg work”, but legal expenses will always be necessary. Mr. Montgomery agreed, but pointed out the amount of use has certainly changed from the $14,000, $12,000, and $22,000 monthly expenses previously and $5,000 per month results in a $60,000 legal bill for the year versus the previous track for $140,000 a year; the budgeted amount for this year is $100,000, but is expected to come in under if we stay on track.

VII. FIRE MARSHAL’S SAFETY MESSAGE.

In the absence of Fire Marshal Gary Johnson, Chief Keller said next week is national Fire Prevention Week, and all should look around our homes to examine fire safety issues, such as clearing the area around an older furnace, making sure duct work is in proper order, and fireplaces inspected; additionally, with the recent rain, weeds have grown and fire hydrants are covered by brush; he said if the public lets the fire district know about these problems, we will come out and clear around them. He wished all a safe and prosperous fall season.

VIII. ADJOURNMENT.

The meeting was adjourned at 7:04 PM.

Ty Montgomery, Chairman of the Board:tg