The Fire Department budget is rarely a hot topic in Palo Alto, where a healthy economy has set the stage for a smooth transition to a new fiscal year.
But as the City Council prepares to adopt the new budget Tuesday night, a proposal to slash $1.3 million in fire expenditures is stoking anxieties among some residents, who are calling on the city to be more judicious and transparent about potential cuts.
The proposal to cut $1.3 million in to-be-determined expenditures is included in the budget that the Finance Committee reviewed and approved last month. If the council follows the committee's recommendation, the budget for fiscal year 2018 (which begins on Saturday) will be adopted Tuesday night.
Even with the proposed cuts, the Fire Department's budget is set to rise by 9.8 percent, from $29.8 million to $31.8 million. By far, the biggest factor in this is the growing costs of salaries and benefits, which are set to rise from $24.8 million in the current year to $27.7 million in 2018. The rising costs are a product of both the statewide trend toward higher pension and health care costs and the city's recent contract with its public-safety unions.
In April 2016, the council approved a three-year contract with the International Fire Fighters Association, Local 1319, that gave firefighters a 7.5 percent raise spread out over three years, along with market adjustments that brought some salaries up to the level of the market median. And in March, the council voted to approve a 15.5 percent raise to the Fire Department's four battalion chiefs. As part of both contracts, the council also capped the city's contributions toward employees' health care costs.
At the same time, the Fire Department has been mired in negotiations with Stanford University for more than four years over a new fire-services contract. The city has been providing Stanford with fire-protection services since 1976, though the two sides have been rethinking their relationship ever since Station 7 was closed in 2012. Fire Chief Eric Nickel told the Finance Committee last month that finalizing the city's negotiations with Stanford over the emergency contract is one of the department's initiatives for this year.
"I believe we're getting quite close with that," Nickel said.
The proposed budget states that while "progress has been made" in negotiations, the two sides have not yet reached an agreement on a full set of terms. Fire Department administrators are also engaged in talks with the union about "alternative staffing strategies."
"Although final agreement has not been reach(ed) in either negotiation, the City continues to pursue and anticipates being able to achieve savings of $1.3 million annually," the budget states.
Even though the city's economic climate has been relatively healthy for some time, the department has been loath to increase staffing or fill its vacancies, which currently total 14 positions. Nickel said that because of uncertainty surrounding the Stanford contract, the department has been "running with almost double-digit vacancies for a couple of years."
"It was my fear that we would either no longer be their provider or have a dramatically different contract amount that we would have to turn around and layoff firefighters, so we've been running very lean and using overtime to fill those vacancies," Nickel said at the May 9 meeting.
The decision to cut $1.3 million in deployment expenditures won the support of the Finance Committee, which voted 2-1, with Greg Tanaka absent, to approve the proposed Fire Department Budget. Committee Chair Eric Filseth, the lone dissenter, argued that the department should do even more to cut costs and to make sure that structural expenses don't grow faster than revenues.
Filseth proposed asking the Fire Department to cut an additional $1 million in costs, though his colleagues Karen Holman and Adrian Fine would not support the additional cut. Filseth argued on May 9 that the current trends, in which the city's revenues are growing by about 6 percent while the public-safety budgets are increasing by nearly 10 percent ever year, are not sustainable for the community. Part of the long-term solution, he said, could be switching from sworn firefighters to civilian positions for medical services.
Nickel noted that cutting an extra $1 million would mean closing a fire station or, at the very least, taking an engine company out of service.
But while the Finance Committee didn't support the additional $1 million cut proposed by Filseth, it approved the $1.3 million reduction that was part of the submitted budget. This despite the fact that the budget gives virtually no indication of where exactly the cuts would come from.
For some residents, this omission is a problem. Fred Balin, a College Terrace resident, predicted that the cuts will likely come at the expense of engine service, rather than the revenue-generating ambulance-transport services. At the June 12 council meeting, Balin asked staff to be more transparent about where the savings will come from.
"Citizens have a right to know," Balin said. "The purpose of a budget process is to elicit an informed public reaction. Bring forth the details."
Mark Nadim, who lives in the Palo Alto Hills, said he and his neighbors are particularly worried about the threat of wildfires in the part of the city that abuts Foothills Park. These concerns became amplified last year, he said, as the city closed down Station 8, a seasonal station that the city had in the past opened during fire-risk seasons.
"The proposed budget cuts to the Fire Department of $1.3 million in the coming fiscal year gets us in the Foothills even more concerned as it will lead to even less available staff to man engines, or even a less number of available engines," Nadim told the council on June 5. "I urge you to take a closer look at budget and make sure there is no cut to the Fire Department budget."
For Andrew Milne, the issue hits particularly close to home. In March 2016, he suffered a cardiac arrest and was "clinically dead" before being revived by local paramedics, who arrived at his house within five minutes of the call. Milne described his ordeal at the June 5 council meeting and then returned the following week, on June 12, to urge council members not to make any cuts to the Fire Department without fully understanding the consequences.
Milne asked the council to "pause, take a deep dive and understand the factors that go into performance."
"This is not a library renovation or a pedestrian footbridge," Milne said on June 12. "Lives like mine and those of my family will be impacted by the decision you make. The council has a fiduciary obligation to protect the interest of residents of Palo Alto and protecting lives has primacy in that."
City Manager James Keene responded to residents' concerns last week, when he asserted that the city "is not concealing any information" about where the cuts will be made. He noted at the June 19 meeting that the city is currently in negotiations with the union about potential changes, which he said "are not even in place yet."
He also noted that the budget is just a plan and that it does not necessarily obligate the city to put into place the things it is considering.
The council, he added, will get a "clear explanation" of the Fire Department plan when it considers the budget on June 27.
On Monday, Nickel responded to residents' concerns with a letter in which he noted that the city is facing a gap of up to $2.6 million in reimbursements from Stanford and that, even with the proposed reduction, the department's overall budget will be going up by 9.8 percent. Without the reduction, he noted, the increase would have been 14.3 percent.
"That would have been by far the largest departmental budget increase, nearly 30 percent more than the next closest department, Police," Nickel wrote. "The increase is due primarily to wage and pension costs. In fact, the Fire Department's budget has increased by more than $5 million in the past two years."
Nickel also noted that the budget does not actually make any changes to current staffing levels.
"It anticipates them, but as we are still in discussions with our labor union, we do not have a final proposal," Nickel wrote. "If and when we do, that proposal will need to go the City Council for full public discussion and Council approval, which will not occur until this fall."
"Every model the City is considering does not reduce effective service levels," he added. "It does expect that we will be able to do some things differently."