Concerned Citizen
Sedona, AZ

Station #1 – 2860 Southwest Drive – West Sedona – Multipurpose Room
Wednesday, November 16, 2011 / 5:30 PM Executive Session ~ and ~ 6:00 PM Public Session

~ MINUTES ~

I. CALL TO ORDER/ROLL CALL.
Board Present: David Blauert – Chairman;
Charles Christensen – Clerk
Craig Dible, Phyllis Erick, and Ty Montgomery – Members

Others Present:
Terry Keller, Assistant Chief
Gary Johnson, Fire Marshal
Karen Daines, Business Director
Don Zavala, Board Attorney
Sandi Schmidt, Finance Manager
Approximately 35 Members of the Public
On and Off Duty SFD Employees
Tricia Greer, Recording Clerk

II. EXECUTIVE SESSION – 5:30 PM.

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

1. ARS 38-431.03(A)(3), Legal Advice – Re: Termination of DHR Contract.
2. ARS 38-431.03(A)(7) Consultation/negotiations with representative for the possible Purchase of Real Property – Re: Sedona area property.

Mr. Blauert began the meeting and requested adjournment at 5:30 PM into Executive Session per ARS Section 38-431.03(A)(3), Legal Advice, and ARS 38-431.03(A)(7) Consultation about the agendized items; Mr. Christensen so moved, Mrs. Erick seconded, and the motion unanimously passed.

III. PUBLIC SESSION – 6:00 PM.

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. Blauert opened the Public Session at 6:02 PM with the Pledge of Allegiance and Moment of Silence.

B. Items from Executive Session above:
1. Discussion/Possible Action: Termination of Diversified Human Resources Contract.

Chief Keller stated it is staff’s recommendation to terminate the contract with Diversified Human Resources.

Mr. Blauert entertained a motion to support Chief Keller and staff in their decision; Mr. Christensen moved that due to non-performance of their contract, a phone call between our attorney and their attorney be placed for a mutual agreement to make the agreement null and void with no future monetary compensation; Mrs. Erick seconded. The motion passed unanimously.

2. Discussion/Possible Action: Possible Purchase of Real Property in Sedona Area.
Mr. Blauert said there will be no action on this item at this time.

IV. PUBLIC FORUM.

Doug Ayres, Village of Oak Creek: I’ve been an SFD property owner and resident for a quarter of a century. Tonight, I will attempt to educate four Board Members about the significance of three terms forming the difference between private business and government. Those unique terms are sworn duty, malfeasance, and misfeasance. When the four were sworn into office as Sedona Fire District Governing Board, their status changed significantly. The four pronounced their apparent sole goal was to reduce property taxes, thus several million dollars of district capital reserves were utilized toward that ideological goal. That goal was again proclaimed by the Chairperson in the November 2nd Sedona Red Rock News. Fulfilling an ideological political pledge does not fall into the category of sworn duty. That’s what you signed, all of you, a sworn duty. Rather providing safety and insurance security for property owners, residents, and Sedona visitors is the Board’s sworn duty, and securing adequate tax and fee revenues to do so also is a sworn duty. By refusing offers of education made by the SFD staff about how

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 2

fire protection, EMS, and 911 services operate, you four passed on learning your sworn duty. Rather the hugely expensive hunt for non-existent witches continues by creating an atmosphere resulting in departure of the Fire Chief, Fire Marshal, head of HR, key 911 Center staff, and other SFD personnel, a hostile work environment was created for all SFD employees. That began to veer toward potential malfeasance. The Chairperson’s demand for all e-mails of the former Fire Chief, Fire Marshal and Business Director indicates a deepening pool of ignorance. Obviously, the Chairperson does not understand it is a sworn duty of those three to respond to taxpayer questions about and to protect the vital Insurance Services Office rating, rather he has ridiculed that rating by ignoring staff and citizen committee inputs about importance of the Midway Station, a swing to malfeasance could accelerate. Between lack of that new station, personnel lost, and the hostile work environment, a reduction in ISO rating would dramatically increase insurance premiums, especially for commercial property owners. Of course, the Chairperson will read all 4,000 pages of that demanded e-mail, then apologize to all three for performing their sworn duty. Continuing the current level of Board ignorance ultimately can, and in my considerable experience, always leads to misfeasance when massive outsourcing is achieved. I urge the four of you to have Attorney Whittington elucidate for you the meaning of the now four key terms – sworn duty, malfeasance, misfeasance, and hostile work environment and the implications thereof for the taxpayers and you personally.

Caroline Johnson, Chapel Area: From time to time, I have heard people question why when there is a 911 medical emergency call, a fire truck also responds. So, I would like to share with you something that happened to me 3 weeks ago in Phoenix. I was in the surgeon’s office having what was, for her, a routine 10-minute procedure. Following that procedure, I went to a second doctor to study more of the procedure of the first doctor and somewhere between these two doctors and transportation or whatever, I started bleeding. Dr. #2 tried for awhile to stop the bleeding and that did not happen and she bound me up and sent me back to the surgeon. The surgeon after a considerable period of time, finally managed to get the bleeding stopped. During all this, I lost a lot of blood, not enough to have a transfusion, but certainly a substantial amount. I stood up, hoping to come home, and immediately got very, very lightheaded. So, she sat me down in a chair and I passed out. My husband said it didn’t take her very long to revive me, but it was decided the best course of action was for me to go to an emergency room to see if anything more major than just my reaction to the events of the whole day. There was no way I was going to get to my husband’s car, so she called 911 for an ambulance. Like Sedona, Phoenix has an ambulance service that’s part of the fire district. So, in addition to the ambulance, one and possibly, two fire trucks arrived at the scene. They talked and decided that, yes, I should go to an emergency room and they brought in a stretcher, and asked could I walk to the stretcher. The stretcher was closer than Chief Keller is from me and I looked at it, and thought there is no way I’m ever going to get to that stretcher. So, they said they could carry me. Now, had I been sitting in this chair, 2 professional respondents could have obviously moved the table or moved the chair and moved me on to this stretcher, but I was sitting in the corner of the room, it was a very small room, there was no room to navigate, there was no room to move the chair to manipulate anything, and so, 4 professional respondents grabbed hold of various body parts and very quickly moved me on to the stretcher and went to the emergency room. I honestly do not believe that 2 people could have moved me onto that stretcher and I think that is why sometimes it is really great that there are 4 professional respondents to a medical emergency. I had never considered that before and I would like Mr. Christensen to imagine himself being unconscious lying down and would he rather have 2 professional people come to help get him onto a stretcher or 4. Thank you for listening.

V. CONSENT AGENDA.

A. October 26, 2011 Business Meeting Minutes.
B. October 26, 2011 Executive Session Minutes.

Mr. Blauert entertained a motion to approve the October 26th Business Minutes; Mr. Christensen so moved, Mrs. Erick seconded and the motion passed unanimously.

Mr. Blauert asked for a motion to approve the October 26th Executive Session Minutes; Mr. Christensen so moved, Mr. Montgomery provided a second, and the motion unanimously passed, 5 to 0.

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 3

VI. BUSINESS.

A. Items from Staff:
1. Purchase Order #5296 to Walker & Armstrong in the amount of $15,000 for Annual Auditing Services of Fiscal Year 2010/2011. (Finance Manager Sandi Schmidt)

Mrs. Schmidt said this is to process payment paperwork for our auditing firm. Mr. Dible noted the change of the amount to $16,000; Mrs. Schmidt e-mailed a memo to the Board regarding this.

Attorney Zavala said this item is not listed for possible action, and although the Agenda preamble allows action on any item, felt it would be safer to table.

Mr. Montgomery asked if this invoice was due; Ms. Daines responded it is. Mr. Montgomery then moved to approve PO #5296 in the amount of $16,000; Mr. Christensen seconded.

Mr. Zavala repeated his discomfort with action on this item. Mrs. Schmidt commented the invoice could wait. Mrs. Erick agreed with Mr. Zavala to wait.

Upon a call for the vote, the motion failed with a vote of: Aye – Christensen and Montgomery; Nay – Blauert, Dible, and Erick.

Mr. Blauert asked staff to inform Walker and Armstrong of the Agenda error and that this will be addressed next month.

B. Items from Board Member Craig Dible:

1. Discussion: Economic Outlook Conference at NAU on 11/2/11. Mr. Dible said he was invited by Chief Keller to attend an economic conference at Northern Arizona University (NAU) on November 2nd; he prepared a handout which he read aloud indicating the economic forecast was “grim”; a copy is attached with these Minutes and is on the SFD website.
2. Discussion/Possible Action: SFD Midway (Chapel Area) Station.
Fire Marshal Johnson indicated there were two speakers for this item.

James Evans, Chapel Area: I want to discuss the Midway Station. In 2007, Chief Shobert assembled a committee to prioritize a 10 to 15 year program for capital projects that did not include either ambulances or engines. The final list said a Chapel Station should be built first. LEA was chosen to do the design under the direction of Chief Shobert and the Fire Board. The design was to provide maximum flexibility for future needs using durable and minimum maintenance materials such as masonry walls and a metal roof. It also included solar equipment to reduce operating costs, a design to utilize both rainwater and gray water and the installation of all utilities and landscaping plus the paving of all sidewalks, parking lots, and driveways. LEA has since offered to reduce costs by eliminating one bay, shortening the other two, reducing space where possible and eliminating solar and wastewater equipment. Most of their design, which has already been paid for, could be utilized in the revision and site work could be started this spring using primarily local contractors. The cost for the first LEA building would have raised the fire tax by $12 a year on a house assessed at $350,000. Using available funds now in the budget for construction and with the possibility of using other unspent funds, a tax increase might be avoided. If one was necessary, it would be well below the previous estimate. Mr. Dible showed me pictures of other relatively new stations that cost less than the original LEA building. They certainly looked adequate from the outside. Mr. Blauert, Chief Keller, and I talked to two architects who also felt that a new station could be built for less than the first LEA design. In none of the examples, did we receive complete information about what materials were used and what changes the present users would make to a second building, if any, and if the costs for designing the building and providing design and installation of paving, sidewalks, landscaping, and running utilities to the building were included. Obviously, this information could be obtained. In one case, the outside walls were steel or wood studs and stucco. In another, a dormitory for four people would have to be converted to individual bedrooms so Sam wouldn’t be sleeping with Suzy. Most of the other designs also used tile roofs. Therefore, I recommend that LEA be asked to revise their original design to the new specifications mentioned above. This means that the Fire Board has three questions to answer: Will a Chapel Station be started this year? Will the lower bidder be picked providing a little less room and more future maintenance? Will the higher bidder with a little more room and lower maintenance be chosen? I thank you all.

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 4

Karen Schmitt, Chapel Area: I live in the stationless Chapel area. Wouldn’t it be nice if the station had already been built and we didn’t have to worry about all this? It should have been built by now. Ever since the Chapel Committee presented its recommendation to the Board, I think it was two months ago, there’s been a concentrated effort to override their well-thought out, exhaustively researched decision or recommendation. First was the survey. Now it appears the Board is working behind the scenes yet again to modify or completely change the design. Since many here in the building may not have been around when the LEA station originally was presented and described, I thought it might be appropriate to review the recommendation in more detail. It was approved in August ’07 by the SFD Governing Board at the time. It was designed to be 3 bays to house some apparatus being housed at the time, at Station 4 which is Uptown because Uptown was likely to end up in a 2-bay station when it’s re-built. The award-winning design of the Chapel Station featured green technologies wherever practical, that is, natural lighting, photovoltaic panels, solar hot water, superior insulation, and water harvesting, and we all know how much energy is going to cost in the future. It was a simplified construction design, single story design, to minimize injuries from falls or trips on stairs. It included a 12-seat training room for training, CPR classes and small community events, nothing really bizarre though. It was an attractive design using natural materials to blend with and enhance surrounding properties and the community. The architect at the time cut the height of the building by 2 feet to accommodate those that complained it was too tall, which also reduced the costs by nearly a quarter of a million dollars. Given the life of a fire station is about 50 years, it is important to plan for growth of the future needs of the community. It is the height of incompetence to design a small, less ecologically harmonious building that is more costly in the long run to maintain and fails to serve the safety needs of the community for the coming years. Since the majority of this Board is now under the very likely possibility of being recalled, I would ask you to respect the on-going needs of this community we love. Accept the original recommendation of the Midway Station Committee leaving a legacy we can all be proud of for the next 50 years. Thank you.

a. Survey of Community. (Per Board direction on 10/26/11)

Mr. Dible stated he concluded there is a better solution which will be presented shortly. He recommended dispensing with the community survey.

b. Alternative Design Options.

Mr. Dible prepared a brief history of the Chapel Station as a handout, which he read aloud and is attached to these Minutes and available on the SFD website. He said in light of what he learned about the economy, he is reluctant to borrow money and raise taxes, but hopes there is another way to build the station. Mr. Blauert said he talked to Mr. Evans and asked him to look at the facts of what we have. Mr. Blauert looked at stations built lately in Arizona and met with a couple of architects. He stated in Kingman, a 5,000 square foot, 2-bay fire station was built for $400,000 including landscaping; the Assistant Chief of Kingman commented that he would never again build a dormitory instead of individual sleeping rooms for the crew, but other than that, was extremely happy with the station; although Mr. Blauert does not agree with the exterior architecture, it is easy to change for local needs and necessity. Mr. Blauert read the following proposals: 5,000 square foot footprint; no additional borrowed money; $600,000 in the current budget for a station; no increase in the taxpayer mil rate; reduced impact on the neighborhood; meets the needs of Chapel area; provides backup response for VOC and Uptown; uses existing personnel and equipment available now; “dotted line” design for potential future expansion. Mr. Blauert noted without future Forest Service trades, the Chapel area is 80% built out. Mr. Blauert then moved that Board direct Chief Keller and his staff to develop an RFQ for architectural and construction management appropriate to the Midway Station for approximately 5,000 square feet to be built for a maximum of $600,000; Mr. Dible seconded.

Mr. Christensen said he believes we are premature with funding and would like to wait for McGladrey’s audit recommendations and the new Fire Chief. Mr. Montgomery stated he is in favor of building the station, but is concerned about the appearance of a 5,000 square foot commercial building for $600,000, and believes Chapel residents would be as well. He wants more information about the Kingman Station

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 5

before developing a RFQ. Mr. Blauert said information is on the Kingman website; he also talked to a Chief from Lake Havasu who built a station at a cost of about $125 per square foot. Mr. Dible said he believes an RFQ could be a good mechanism to give LEA Architects guidelines of what we want if the firm is going to re-submit. Mrs. Erick asked if “no increase in the taxpayer mil rate” was a guarantee; Mr. Blauert responded the RFQ would be designed to come within $600,000, so no extra money would be needed to build. Mrs. Erick remarked that Ms. Daines said in order to sustain what we have after going through the reserves, the mil rate must go to $1.90, and asked what would happen when a station is added to that. Ms. Daines replied she did not say the mil rate must go up to $1.90, but rather, presented assessed valuation forecasts with various projections and $1.90 was a number that could guarantee, from a conservative standpoint, maintaining existing service levels for the next five years; she said some level of increase to the mil rate must occur in order to sustain existing services, personnel, staffing, and stations; Ms. Daines said at $1.40, unequivocally, SFD will not be able to staff a Chapel Station.

Mr. Blauert asked if he misunderstood that the staffing is already in place; Chief Keller said presently we have it. Ms. Daines added that at $1.40 with next year’s assessed values, there will not be enough funding to maintain existing staffing. Mr. Blauert confirmed, however, that we have the equipment and Chief Keller said, “We do”. Chief Keller said to do current operations at existing levels, we will use approximately $2.5 million this year and will have about $2.5 million in the bank at the end of this fiscal year; if we hold the mil rate at $1.40 and maintain all stations and staffing, those reserves will be used up next fiscal year, and after that, the following fiscal year, SFD will be “broke”.

Chief Keller asked for and received permission from Chairman Blauert to discuss the proposed station. He appreciated Mr. Dible’s comments about the Midway Station history, but found some of his facts, while accurate, lacking in other points of view; for example, the 55 signatures gathered by Mark Casper included residents from VOC. Chief Keller pointed out that Karen Schmitt gathered more than 300 Chapel area residents’ signatures on a petition supporting the proposed station. He believes staff has tried to work with the previous and current Boards to do the best thing for the community and has come to the conclusion that life is about compromise. He said this Board’s and the previous one’s actions have been correct and they have done the very best with the information they had at the time; certainly, the current economic situation requires adapting and dealing through compromise. Chief Keller said supporting a tax-efficient operation is an absolute must under these economic circumstances, but there are other standards such as response time, staffing, NFPA 1710 four and eight minute response time that are also correct. He said the standards of safety to which the district tries to adhere to protect our firefighters and the public are also correct assumptions and somewhere in the “middle” is the truth. Chief Keller said the original Chapel Station of about 9,000 square feet came in at $2.8 million and someone said that cost $300 per square foot, but he disagrees because that included parking lots, road surfaces, ramps, tearing into the sidewalk, curb, and gutter of the highway for ingress/egress, reinforcing the asphalt parking lot of the Jewish Community Center to support the weight of fire trucks because they graciously granted an easement to the station; he said landscaping and water retention are not part of the building, but yet, were covered in the $2.8 million figure. He applauds Mr. Blauert’s efforts to try to get a station built because it has been proven to be needed and at some point, will become a point of liability if nothing is done.

Chief Keller said he finds it ironic to haggle over $1 million because he believes the station should be in the $1.5 million range and stated that $600,000 would build a stucco, tile-roofed, wood-framed building that will not stand up over time; this will require someone else to pay for our mistakes in the future. He has been in contact with LEA Architects this week to try to revise the floor plan and they have sketched a plan incorporating the original floor plan scaled back in the number and size of rooms with 2 apparatus bays for an engine and ambulance in 6,000 square feet. Chief Keller said LEA told him that Tolleson built a wood frame station 16 years ago and 2 years ago, that building was razed and re-built because it did not perform over time. He said the architects they met with this week are qualified and he respects the opinion of the Board to do what they feel is best, but is only expressing his opinion that the station be designed to withstand natural disasters, so that first responders are not hindered in response to those that

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 6

need services. He said he also finds it ironic to balk at spending $1 million when Sedona spent $600,000 to build tennis courts at the high school; he said the City of Sedona wants to spend $2.5 million to build wetlands and a bird sanctuary at the sewer treatment plant; and $16 million expended to build the Performing Arts Center; he is not saying those were wrong, but is using those figures as a matter of perspective. Chief Keller said SFD is asking to put a fire station in the Chapel area to save lives and protect property and the Board has acknowledged that needs to happen; he believes it is time to compromise and $600,000 is an inadequate amount for the building, parking lots, landscaping, ramps, road cut, and utilities. Chief Keller asked the Board to consider spending about $1.5 million to work with LEA Architects to salvage the design to have ready in 40 to 60 days allowing SFD to secure a permit in February to break ground and expend the $600,000 this year and, perhaps, finance or use an alternative form of funding for the balance. He then thanked the Board for its attention.

Mr. Blauert stated his appreciation for Chief Keller’s remarks. He said the cost of the Kingman station included the parking area, landscaping, and all furniture, fixtures, and equipment; Mr. Blauert asked Chief Keller to remember during conversation with one of the architects that it was not his request for a wood frame, especially in the bays. He said he is proposing a building for the welfare of the people, and again, we are “haggling” over dollars. Mr. Blauert stated there is a motion and second on the floor for an RFQ and if LEA wants to participate, they could submit a proposal. He asked if there was any other discussion.

Mr. Montgomery commented in looking at building industrial commercial structures, we should consider a 15 year building versus a 50 year building and does not believe $600,000 is the correct solution, as he does not believe a $600,000 station is going to fit into the neighborhood. Mr. Dible asked if there was room for an amendment to the $600,000; Mr. Blauert stated if Mr. Dible wants to amend it, he would recognize it. Mr. Dible asked if there could be a compromise at $1 million. Chief Keller said he has only talked to LEA about the floor plan and looking at doing preliminary elevations based on that revision; he said their experience is based on what they are seeing for the most recent construction cost for a fire station in the Phoenix area at about $200 per square foot; he asked them to remember that is not just for the building but includes engineering, water retention, underground culverts, etc. and the big advantage in going with LEA is we already have their civil and structural engineering which can be largely salvaged. Chief Keller commented a 6,000 square foot station at $200 per sq. ft. would be about $1.2 million, and potentially, could be less. Mr. Dible said the Glenwood Springs station looked nice and at 5,000 square feet cost $1 million. Chief Keller said the other concern he has is the Kingman station was built in 1998 for $400,000 and there could be an inflationary factor at today’s dollars that is, probably, more than $600,000. He asked the Board for guidance so he does not have to talk to so many different architects looking for a solution; he feels the solution is probably not $600,000 and, certainly, not $2.8 million, but is rather, a compromise “somewhere in the middle”. Mr. Dible said the Glenwood Springs station used natural vegetation; Chief Keller agreed but said there would be some necessary planting. Mr. Dible said the Glenwood Springs station is his “reference point” and was $1 million.
Ms. Daines commented the $600,000 is appropriated for this year, and using the previous design costs for construction documents of $250,000, would only leave $350,000 for construction after going back out for architectural services. Chief Keller said he does not know what other architects would charge for design, but it would be a figure that reduces the $600,000. Mr. Blauert commented he has been in construction for 40 years and anything over 6% for architecture is “shame on you”. Mr. Christensen said the Chapel Station has been in the long-term plan and asked what is the plan to improve the Uptown Station or re-build it. Chief Keller deferred to the list of projects the Citizens Committee created several years ago where the Chapel Station ended at the top of the list, and Station 4 was also on the list to re-build at some point, but since it is currently functioning, we do not have response time issues from Uptown; we do from the Chapel area and back-up for the VOC. Chief Keller said the reason SFD backed off from a bond was not to be in competition with the Sedona-Oak Creek School District, which, at that time, was floating a $73 million bond; he acknowledged the best way to approach multiple building projects is bonding, but

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 7

for a single project, it is not cost effective. Mr. Christensen asked why SFD does not try to go for a bond for all the projects and he believes it is the answer; Chief Keller said that is for Board consideration.

Mr. Blauert used the Bank of America building in Sedona as a reference for wood frame construction that has lasted 30 years and will last another 30 years; he knows this because he owns the building; so, he does not believe a frame building only has a 15 year life. He stated he wants to help the Chapel Station become a reality and the architectural design is strictly what is called “outside finish” to complement the community. Mr. Dible asked if Mr. Blauert would accept an amendment to his motion to $1 million and Mr. Blauert agreed; Mr. Montgomery provided the second to the amendment. Upon voting, the motion failed, as follows: Aye: Dible and Montgomery; Nay: Blauert, Christensen, Erick.

Mr. Christensen again said the most logical way to get all the construction projects done is to bond and that has been his proposal for three years. Mr. Blauert said if we need to increase the amount of money to build the Chapel Station, he concurs with Mr. Christensen, but does not want to be talking about this in six months and still have no future for a Chapel Station.

C. Items from Board Member Phyllis Erick:

1. Discussion/Possible Action: Fire Chief Search Committee Items.

a. Request to Board for Outside Legal Representation for Fire Chief Committee and Agreement for Outside Counsel between SFD and Ridenour, Hienton & Lewis.
Mr. Blauert announced this item has been pulled from the Agenda. Fire Marshal Johnson stated three individuals wish to speak, as follows:

Wendy Tanzer, VOC: Since the item has been pulled, I think most of this is a moot point, but I’ll give it to you anyway. It is impossible for me to comprehend the need for or expense of outside legal representation for any sub-committee appointed by this Governing Board. Certainly, this has never before occurred in any previous Chief’s selection process, nor should it be necessary or permitted at this time. The fact that $5,000 has already been squandered or invested depending upon your perspective is enough. But, because of committee member Ray LeRoy’s generosity in yesterday’s Selection Committee meeting, attendees were given enough information to reach an understanding of the frustrations members of this Selection Committee are currently facing. There is a difference between satisfying legal requirements versus lessons in grammar and punctuation and meeting EEOC standards versus subjective opinions on the description of Sedona’s landscape. I genuinely sympathize with what I’m sure is the confusion and misdirection such lack of definition causes. Perhaps, that should be addressed directly with Board counsel. Committee member Brent Johnson’s letter read into yesterday’s meeting Minutes makes several excellent points and while you cannot go back and correct that which has already transpired, you do have the opportunity to go forward in a productive and positive manner. With two vacancies on the Selection Committee and now two Co-Chairmen, this is an excellent time to include members from SFD Human Resources and forego unnecessary independent legal representation. On tonight’s Agenda is the request for Board approval of several documents with regard to hiring a new Chief. Please allow me to re-state, for Board approval. That is the correct and appropriate procedure with moving forward with all projects, not just the Chief Selection process. Honest differences of opinion can be addressed within the scope of the Board sub-committee relationship and should be resolved in accordance with Statute, parliamentary rule and Board authority. The perception that has been created is one of an adversarial relationship between the Governing Board and members of the Selection Committee. How can that be? It is, always has been, and should forever remain a subordinate relationship. The sub-committee is accountable to the Board. Not the other way around. If members of the Governing Board hold that rightful position, no independent legal representation will be authorized now or in the future. Wrong is wrong. This in-fighting is costly by every definition of the term. Do not allow this process to become an unnecessarily protracted nightmare. The time has come to assert control and move forward. Thank you.

Thomas Purcel, West Sedona: I’m on the Fire Chief Selection Search Committee and there seem to be some ambiguities and some misconceptions. The members of the Committee haven’t sought legal review.

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All the resources we looked at were supposedly vetted and I have no reason to doubt that they have been vetted. We’ve looked at other fire districts, larger districts; we’ve looked at Sedona’s district. Again, these have been vetted. The Board talked about the expenses on legal review before for themselves and I think there’s a misconception that if you get legal review, there’s an umbrella of protection. There is not any umbrella of protection until something is challenged and you go to court. You can have all the legal opinions you want, but that doesn’t give you this protection. So, that’s why we looked at things that were vetted and we took the best of what was out there. We put in a lot of hard work, we gave it a lot of effort, and I think the process is going to be just a terrific process. Thank you very much for your time.

Karen Schmitt, Chapel Area: First, I want to thank Chief Keller for his eloquence trying to save the Chapel Station. We all appreciate that, Terry. I want to read a letter. I attended the Chief’s Selection committee yesterday and I want to read a letter from Brent Johnson because he could not attend. He’s the firefighter that’s on that committee and he had to work yesterday. He sent this and I thought it was really eloquent, too. She then aloud, as follows: Hello all, Unfortunately, due to staffing restraints I will be unable to attend the meeting today, however, I did have a few points to mention. I am concerned about the direction of this committee with regards to its recent past. I would like to mention that the circumstances surrounding the legal issues with our current documentation are a fine example of the problems I warned that we would be facing if we did not have someone from Human Resources serving as a member of this committee. I insisted that there were legal ramifications to the processes we undertook, but my input was disregarded and ignored. Now we have come full circle. We have, indeed, suffered as a committee due to this oversight. We have been inactive for approximately two months, delayed the hiring process, and incurred legal expenses that have never been incurred in any previous hiring process to date. We currently are slated to run a hiring process for the budgeted amount of $15,000.00. I am concerned that our community’s tax dollars are being spent to fix legal issues with documentation that has been rendered by this committee. These are expenses that could have been avoided should we have allowed HR personnel to serve as a part of this committee as I had suggested since the very first meeting. I propose that we make a change to bring existing HR personnel onto this committee so that we can avoid issues of this nature from occurring again in the future. This process is only in its beginning phases. We will need the diligence HR personnel can afford us for all the tasks still ahead of us. I am also concerned that we have no defined criteria or costs for the assessment center. I am told that as of September alone we have spent over $5,000.00 in legal expenses in this committee. This is something that has never been done before in a committee of this kind. Considering that we still need to advertise and put on an assessment center, I am concerned that we will be out of our allotted budget dollars for hiring a fire chief. Now I understand that is a proposal to contract with another lawyer for this committee, which will cost our community more tax dollars in what I consider to be gross and unnecessary legal fees. I am uninterested in paying more lawyers with our community’s tax dollars. I am interested in moving forward in a fiscally responsible fashion. I propose to get HR included as members of this committee and start moving forward in the right direction. Mrs. Schmitt stated she fully agrees with Firefighter Johnson.

b. Board Approval of Fire Chief Search Committee Documents: Fire Chief’s Job Description; Fire Chief’s Job Application; Fire Chief’s Advertisement.

Mrs. Erick moved to approve the Fire Chief Search Committee documents of the Fire Chief’s Job Description; Fire Chief’s Job Application; and Fire Chief’s advertisement. Mr. Christensen seconded. Discussion opened with Mr. Montgomery asking if these were reviewed by HR or legal; Mrs. Erick replied “Yes”. Mr. Montgomery asked about the salary range for Fire Chief and Mrs. Erick said that has not been decided and would be discussed tonight for Board approval. Mr. Montgomery asked who Palmer Investigative Services is; Mrs. Erick said that would be brought to the Board at a later date for approval. Mr. Dible said at the time, we still had DHR and they reviewed the documents, as well. Ms. Daines concurred that DHR looked at the documents and one of their concerns was the timeline on the process and there are still issues with having a postmark rather than a “received by” deadline, as well as starting to do interviews on January 3rd; this is because the “postmark” deadline of December 31st is a Saturday, the 1st is a Sunday, and the 2nd is the New Year’s Day holiday with no mail; she said, potentially, you could

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 9

have applications from qualified candidates that do not arrive until the 5th or 6th when interviews are already started; she said this could raise questions. Mrs. Erick asked Attorney Zavala if he looked at those dates. Mr. Zavala said he has not seen the new proposed dates. Mrs. Erick said the packets she handed out yesterday to the Committee were from Mr. Zavala’s office; he said that is correct, but he has not seen the revised dates. Ms. Daines commented the documents vetted by Mr. Zavala were the job description, job application, and advertisement, but not the hiring process and tentative dates. Mr. Dible suggested the deadline for applications be changed to “received by” and not “postmarked by”.

Ms. Daines clarified that the advertisement includes the salary scale and if the Board approves the previous motion, but does not agree with the listed salary scale, they would have to re-do the motion and approval of the advertisement. Mr. Zavala said the current motion could be approving the documents subject to further salary modifications as may be appropriate by the Board, and suggested they could split out the advertisement and wait until after the salary discussion to vote on that. Mr. Zavala said the dates could be modified tonight or could be assigned to the committee. Mrs. Erick called upon the Committee Chairman Joe Demme. Chief Keller asked for and received permission from Mr. Blauert for Committee Member Firefighter Brent Johnson to speak. Mr. Dible asked Mrs. Erick if the received by date for applications could be changed to Thursday, 12/29/11; she and Mr. Demme agreed.

Mrs. Erick amended her previous motion for the Board to approve the Fire Chief Search Committee documents including Fire Chief Job Description and Job Application; Mr. Christensen seconded the amended motion. Upon calling for the vote, the motion unanimously passed at 5 to 0.

c. Fire Chief’s Hiring Process and Tentative Dates.

Mrs. Erick moved to have the Hiring Process and Tentative Dates with the aforementioned changes approved, Mr. Christensen seconded, and the motion unanimously passed at 5 to 0.

d. Fire Chief’s Salary.

Mrs. Erick asked for discussion regarding the Fire Chief’s salary. Mr. Demme said the salary was discussed with Mr. Zavala in a telephone conversation and there was no objection to the range proposed. Mr. Zavala said the Board approves the range. Ms. Daines stated the proposed range for Fire Chief is 23% higher at the starting salary and 15% higher at the top than the existing salary range; she said when our organization sets salary ranges for positions, there is a system to benchmark with “like” organizations to make sure we are industry competitive; she said this would put SFD at the top for the Chief’s range and disrupt the system of internal equity we try to maintain between ranks of positions; this range potentially puts a $40,000 a year gap between Fire Chief and the next lower level; this does not maintain internal equity and parity between salary scales which is part of establishing an organizational salary structure. Mr. Demme replied they spoke with a number of departments around the State regarding salary ranges of Fire Chiefs and the range seems to be between $120,000 to $150,000 for an individual that would be qualified for this district; he said in the job description, they are asking for an individual with exceptional characteristics and talents and in order to get that individual, we will have to pay a little more than in the past, although he understands Ms. Daines’ point. She replied it seems ironic since there has been much public scrutiny over the level of SFD employee salaries, but now, we are going to increase the range of Fire Chief by 23% and, possibly, have to decrease other salaries next year in order to balance the budget.

Mr. Demme replied this position would be able to change the structure of this district and probably a good individual with a real understanding of how to make this district work better may be able to bring down the budget and add real insight as to how to cut a number of areas to actually come in line with what is necessary in today’s economy. He said they are looking for a person that can really handle the budget items without decreasing service in this district and finding a way to bring down costs, and if we have to pay more money for that individual, he is all for it. Ms. Daines commented SFD has many extremely talented, well-educated, well-qualified individuals that make up this organization, not just that one person and those individuals have had no merit increases, no COLAs, no salary adjustments, and decreases to their benefits over the last few years, and to now bump the Chief’s salary up 23% over existing salary

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levels will be problematic for the morale of the organization. Mr. Demme said we need real leadership and he has been in business for 40 years and looks to leadership, and said corporations and other municipalities and districts are willing to pay a higher salary to bring in an individual that can help put an organization back on the right track. Mr. Dible asked what the current Fire Chief salary range is; Ms. Daines stated she believes it is starts around $97,000 to $130,000. Mrs. Erick pointed out the Committee did not say the individual would be hired at the top of the proposed range. Mr. Dible asked Mr. Demme if his committee felt the proposed salary was competitive for the quality and expertise being sought; Mr. Demme replied, “I believe so.” Mrs. Erick stated it is the ultimate decision of the Board when a Chief is hired and this is just a suggested range. Mr. Blauert asked if Mr. Demme had researched any of the disparity between staff salaries at other districts and Mr. Demme said he had not.

Chief Keller asked if Firefighter Brent Johnson could present his comments. Mr. Demme stated Firefighter Johnson’s statements were read into the Committee meeting’s Minutes yesterday and repeated today by an individual and he sees no reason why we should listen to his comments again; Mr. Montgomery commented Firefighter Johnson is on the Committee. An audience member made a remark and Mrs. Erick told him that if he could not abide by the rules, he should leave; Mr. Christensen agreed.

Firefighter Johnson read the following prepared statement: Thank you for the opportunity to speak today. I’m here to speak as a Committee Member for the Fire Chief Search Committee. Since the onset of this committee approximately four months ago, we have put the lion’s share of our efforts into re-writing existing documents pertinent to the Fire Chief hiring process. I expressed concern as to why we were re-inventing this documentation, rather than simply revising existing documents when necessary. An inordinate amount of time, effort, and money has been placed on this endeavor and previous year’s fire district HR personnel, in cooperation with members of the community, created the original documents with zero cost in legal fees because our HR department knew the legal issues surrounding the development of such documents. Since the first meeting as a member of this committee, I expressed that I wanted HR to be a part of this process since this is their job and they are aware of the legal caveats involved in such a process. I was denied this by the Chairman of the Committee, Joe Demme, as well as being denied the right to have our members of the fire district with experience in this type of hiring process to join the committee. Mr. Demme told me that an attorney told him it was inappropriate for any member of the fire district to serve on this committee. I have documents from an attorney and an HR Specialist stating that it is the normal course of district business for staff to participate in hiring processes. It is not hard to understand that if members of HR had been part of this committee as I had asked, we would not be in our current situation. For the last two months, the committee has been at a standstill for reasons that have never been expressed or explained to me. Yesterday, we had the first public meeting since the onset of the unexplained two month sabbatical. During this meeting, the legal problems with the documentation were downplayed by Mr. Demme when, indeed, there were many legal issues with the documentation that I know certain members of the Fire Board are well aware of. According to the records provided to me by the Administration, over $5,000 of legal fees have been charged to the fire district for repairs made to this documentation. After looking into what is budgeted for this year’s Fire Chief hiring process, we only have $15,000 allotted for this entire line item. Yesterday, during the committee meeting, I again submitted a request to Mr. Demme to include HR personnel in the Committee in light of everything that has transpired to date. Again, Mr. Demme refused to allow HR personnel to serve on this Committee. Despite everything that has happened and the obvious need for such personnel. Instead, I understand that Mr. Demme is seeking now to ask for the Board to give further legal assistance, so we can expect to see yet more bills paid for by tax dollars for the process that has historically been zero legal expenses. Furthermore, I will add that the committee never met officially to discuss requesting outside legal counsel, yet Mr. Demme has submitted a letter of request to the Fire Board which states, it is – in quotations – at the request of the Fire Chief Search Committee – end quotations. He also suggested in the Minutes of yesterday’s meeting that this item was discussed at the last committee meeting. I can tell you that it was not discussed during the previous meeting. So, if he has a recollection of speaking about it at a meeting, all I can say is that it was not an official meeting, it was

~ DRAFT ~ 11/16/11 SFD Board Meeting Minutes / Page 11

not an open meeting, and I was not invited. I feel at this time as though I have done all I can as a member of this committee to assure the success of this hiring process. I need your help to bring sanity and fiscal responsibility back to this committee with sound leadership. I would ask today that the Board remove Joe Demme from the committee, take measures to allow HR personnel to put a stop to the unnecessary legal expenditures. Mr. Blauert asked Firefighter Johnson to stop speaking; Firefighter Johnson replied he feels the committee needs new leadership; he then thanked the Board for their time.

Mr. Blauert commented that Attorney Zavala said there was nothing unusual to review, just like any other contract we have done and although they may be condemned for legal costs, the legal review was requested at last month’s meeting by Mr. Montgomery. Mrs. Erick stated she takes offense at Mr. Johnson suggesting Mr. Demme be removed from the committee and wanted to make sure that was in the Minutes. Mr. Christensen said this committee was selected; if there are any comments, they should proceed through Mr. Demme to Mrs. Erick, the Board Member in charge of this committee and if there is valid reason, it should then come to the Board. Mr. Zavala directed the Board’s attention to the salary issue. Mr. Dible commented his analysis of legal bills from the last Board meeting showed $3,728.50 spent for this item, but it is now being said $5,000 was spent; Ms. Daines said her figure was closer to $5,000 because there were items that came out of Mr. Zavala’s review, specifically, questions pertaining to the Veteran’s preference points and how that relates to Arizona Revised Statutes in our classification, which were probably not included in the figures Mr. Dible analyzed; Ms. Daines said she would provide the itemized bills for the Board showing the breakdown of expenses; Mrs. Erick replied it would be nice for the Board to receive those figures since Firefighter Johnson has them. Mr. Dible said as far as he is aware, all the documents were reviewed as of September 30th.

Mrs. Erick then moved to approve the range of the Fire Chief’s salary of $120,000 to $150,000; Mr. Christensen seconded. In discussion, Mr. Montgomery said he does not understand why the salary range is being increased, although he understands Mr. Demme’s comments about the reason; however, with what has been going on with the district, he does not necessarily agree; he also does not appreciate the “palpable animosity” between Mr. Demme, members of the Board and committee, and remarked that the whole process has been one of excluding staff, the department, and the public, and in his opinion is a thinly veiled attempt to hire a “hatchet man”. Mrs. Erick said the attempt was to not allow the district to hire its own Chief. Mr. Montgomery stated he believes the salary range should remain the same as now. Mr. Christensen said he agreed. Mrs. Erick then amended her motion to accept the Fire Chief salary range from $97,000 to $140,000; Mr. Christensen seconded the amended motion. Upon calling for the vote, the motion was unanimously approved at 5 to 0.

Mrs. Erick then moved for the Board to approve the Fire Chief’s advertisement with the changes in the salary range; Mr. Christensen seconded, and the motion was unanimously approved at 5 to 0.

D. Item from Board Member Ty Montgomery:
1. Monthly Update: Current Fees to Date for Legal Services Provided to SFD.
Mr. Montgomery said Mr. Whittington’s bill for last month was about $5,200, but he has not seen the other firms’; Ms. Daines said since this meeting is being held on the third instead of the fourth Wednesday of the month, SFD has not yet received other invoices, if there are any.

E. Items from Board Chairman David Blauert:
1. Discussion/Possible Action: Board Policy #2011-02, Legal Assistance. (Revised per Board direction on 10/26/11)
Mr. Blauert asked if everyone had read the redline of this revised Policy and the Board had; he then entertained a motion to approve Board Policy #2011-02; Mr. Montgomery so moved, Mr. Christensen seconded, and the motion unanimously passed at 5 to 0.

2. Discussion/Possible Action: Board Policy #2011-03, Contract Authorization. (Tabled from 10/26/11)

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As the Policy has not yet been forwarded to the Board, Mr. Blauert asked this item be tabled.

3. Discussion/Possible Action: Revised Resolution Establishing Standards by which Services may be Contracted to Private Parties by the SFD. (Tabled from 10/26/11)

The following individual requested to speak on this item:

Douglas Ayres, VOC: Since I’m the one that provided this originally, suggested it to the Board, I’m making myself available for education and explanation and answering questions, since I have some experience and expertise in how this works and as I mentioned to the attorney a minute ago, he’s going to tell Mr. Whittington that I had to evade his request that I divulge certain cities and counties that had participated in this because all the activity that took place in Executive Sessions. I have since remembered one that I can speak of, if you have any questions.

Mr. Blauert commented the subject would have had to be discussed in Public Session to be recognized by a vote. Mr. Ayres stated, no, because they went to litigation. He then said: I have hired, supervised, and set the salaries of more Fire Chiefs than all of you have met in your lifetime. I have reviewed and been aware of and worked with probably 300 Fire Chiefs. I know quality when I see it. You would save yourselves a lot of grief, money, time, and public confusion were you to just shortcut the process and appoint him (Note: He pointed at Chief Keller.) because he is as high quality as I have ever seen in my 50 years working in that field.

Chief Keller said Mr. Whittington created lists of items from the Resolution that could be used by the fire district and those that are not applicable; he said he received an e-mail from Mr. Whittington’s office this afternoon enumerating those and he and staff would continue to study the process and, possibly, create a draft Resolution for the Board’s review. Mr. Blauert agreed. Mr. Dible asked if that was in response to the November 3rd letter Chief Keller sent to Mr. Whittington and Chief Keller replied, “Yes”.

4. Update: Status Report on Performance, Cost, and Management Audit of the Sedona Fire District by RSM-McGladrey.

Mr. Blauert stated McGladrey has no findings to report, but compliment SFD’s staff and the support they are receiving to find necessary information for the report. He is frustrated at the lack of information to report to the Board at this time.

VII. STAFF REPORTS.

A. Monthly Staff Report – Fire Chief Terry Keller.

Chief Keller reported the following: He introduced Assistant Chief Mary Dalton from Central Yavapai Fire District in Prescott Valley attending tonight and explained she is the “Karen Daines” of Central Yavapai. He said he and Fire Marshal Johnson attended a Yavapai County-wide Fire Chiefs meeting that Chief Dalton facilitated with about 50 other Chief officers to look for partnering opportunities to share costs and ideas. Sedona is one of the larger organizations in the county and shares similarities with Central Yavapai and will bring ideas to the Board as they present themselves to shave costs and share resources. Call statistics since the last Fire Board meeting three weeks ago have been 207 calls including 23 fire calls, 120 EMS, 33 special duty, and 31 interfacility transports. McGladrey representatives were on-site at Station 1 last week and kept staff busy with requests. The week before that, representatives from the auditing firm, Walker and Armstrong, were on-site for our annual statutorily required audit. Staff has been very busy trying to get information and fulfill requests from both auditing firms. Additionally, he reported the McGladrey survey of SFD staff was sent last week, and thus far, approximately a 50% response has been received; SFD staff has some trepidation about responding, but management is encouraging them to be forthright in survey responses. He reminded the Board of the previously-discussed December 8th Public Budget Workshop kick-off. Ending on a positive note regarding economics, he attended the conference at NAU that Mr. Dible discussed previously, which was rather depressing in many ways. Chief Keller studied Economics at NAU and commented there are many economic theories but in reality, none of them work; he said what works is optimism and people have to believe things will get better and they will. Chief Keller

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said pessimism will always lose; the study of economics gives one a perspective of weighing issues for whether or not they have utility; he recommended we all approach life optimistically about things having value and utility including “good, old SFD”. He pointed out there is some economic growth at 2 to 2.5% and although sluggish, it is positive compared to negative growth. He also stated economists predict there will be no “double dip” recession and asked all to focus on the positive and hope for better times in the future. He thanked the Board for its attention.

B. October Financial Report.

There were no comments or questions regarding the Financial Report.

C. Fire Marshal’s Safety Message.

Fire Marshal Johnson said next week is Thanksgiving and asked everyone to be safety conscious and not leave food cooking unattended because what may happen “when you get back from the store” is to have a bunch of “hungry” firefighters waiting for you.

VIII. ADJOURNMENT.

The meeting adjourned at 8:30 PM.
Charles Christensen, Clerk of the Board
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