BILL ANALYSIS Ó
SB 239
Page 1
Date of Hearing: August 19, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 239
(Hertzberg) - As Amended June 1, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires written approval from a local agency
formation commission (LAFCO) before a public agency can contract
for fire protection services outside its current service area.
The bill prescribes a public process for approving a fire
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protection reorganization contract, including a requirement
that, prior to submitting an application to the LAFCO, a public
agency must obtain written consent to the proposal from each
affected public agency and the recognized employee organization
representing firefighters of both the existing and proposed
service providers, and conduct a public hearing.
FISCAL EFFECT:
1)Unknown increased GF costs to the Department of Forestry and
Fire Protection (CAL FIRE), likely in the low hundreds of
thousands annually, to comply with specified administrative
requirements prior to contracting with local agencies for fire
protection services. CAL FIRE currently has 115 contracts with
local agencies for full fire protection services, and the
contracts typically have a duration of three years. It is
likely that all of those contracts would meet the criteria in
the bill requiring LAFCO approval. For illustrative purposes,
if CAL FIRE incurred additional costs of $10,000 to extend 38
fire protection contracts in a year through the LAFCO process,
annual administrative costs would be $380,000. It is likely
that CAL FIRE would incur higher costs to assess the impacts
of contracts for larger service areas.
2)Unknown, potentially significant impact on CAL FIRE fire
protection costs (GF). Currently, CAL FIRE provides over $50
million in contracted reimbursements to counties for fire
protection services in "state responsibility areas," and the
state is provided with over $300 million in contracted
reimbursements from local agencies for CAL FIRE to provide a
variety of fire protection services to cities, counties, and
fire protection districts. To the extent this bill discourages
or prevents contracting for fire services, both CAL FIRE and
local agencies could experience increased costs to provide
fire protection.
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COMMENTS:
1)Purpose. According to the author, "Current law establishes
specific LAFCO proceedings to consider new or different
functions or services, or for the divestiture of power, by
special districts. However, LAFCO's do not review and approve
contracts or agreements for services between two public
agencies. Moreover, such contracts do not require any
specific information to be submitted or reviewed regarding the
fiscal conditions of the public agency or potential impacts to
service delivery. SB 239 extends LAFCO's jurisdiction to
include contracts for services between public agencies for
fire protection."
2)Background. Existing law, the Cortese-Knox-Hertzberg Local
Government Reorganization Act, delegates the Legislature's
power to control the boundaries of cities and special
districts to LAFCOs. The Act authorizes a city or county to
provide new or extended services by contract or agreement
outside its jurisdictional boundaries if it receives written
approval from the LAFCO in the affected county. This
requirement does not apply to contracts or agreements solely
involving two or more public agencies where the public service
to be provided is an alternative to, or substitute for, public
services already being provided by an existing public service
provider and where the level of service to be provided is
consistent with the level of service contemplated by the
existing service provider.
Existing law authorizes cities and fire protection districts
to enter into contracts with counties to provide fire
protection services within a local agency's jurisdiction. In
addition, cities, counties, and districts can enter into
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cooperative agreements with CAL FIRE to provide fire
protection services. CAL FIRE currently has 149 contracts
with a value of over $300 million to provide a variety of fire
protection services to local governments (Schedule A
Agreements), ranging from dispatch services to full service
fire protection. CAL FIRE typically enters into an average of
two new contracts each year to provide local fire protection
services; the contracts typically have a duration of three
years and must be mutually beneficial. CAL FIRE also has six
contracts with counties with a value of over $50 million to
provide wildland fire protection in State Responsibility Areas
on behalf of the state (Contract County Agreements).
3)Arguments in Support. Firefighter organizations argue that
this bill provides transparency and oversight when a public
agency considers extending fire protection services outside of
their current service area. They point to communities that
have entered into contracts to shift responsibility to provide
fire protection services from one public agency to another,
which have generated controversy while failing to produce
anticipated cost savings and administrative efficiencies.
4)Arguments in Opposition. Local government organizations argue
that this bill "restricts the ability of fire protection
providers to govern in the best interests of the affected
residents and could potentially disrupt service entirely.
Fire protection providers that negotiate service agreements
are directly accountable to the communities they serve.
LAFCOs are not, and should not be, tasked with making the
day-to-day financial decisions for local agencies."
They continue that this bill "presents a significant unfunded
mandate on the public agencies that must pay thousands of
taxpayer dollars to fund each independent fiscal analysis.
Similar to any significant budget decision, and before a
public agency contracts with another public agency, it first
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conducts a thorough internal fiscal review in order to
determine feasibility and any needs for increasing staff and
equipment. This bill requires a second independent fiscal
analysis that is duplicative and extremely costly. Estimates
for an independent analysis start at $5,000 and can often cost
in the tens of thousands of dollars based upon complexity.
This ultimately reduces the amount of funds available for fire
protection services."
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081