SUBJECT
Title
PROPERTY TAX ALLOCATIONS AND FUNDING FOR FIRE PROTECTION IN UNINCORPORATED COMMUNITIES (DISTRICTS: ALL)
Body
OVERVIEW
On July 16, 2024 (4), the Board of Supervisors (Board) directed the Chief Administrative Officer to review the level of resources, funding, and sustainability of fire protection in the communities of Valley Center, Deer Springs, and Pauma Valley and other parts of the San Diego County Fire Protection District (SDCFPD) and return to the Board in 90 days with recommendations. In San Diego County, unincorporated communities receive fire protection and emergency response services from 12 fire protection districts, including the San Diego County Fire Protection District (SDCFPD), and one municipal water district. These agencies either provide services directly with professional staff or contract with another government agency. Funding for the districts is made available through a property tax allocation from property tax revenue, voter-approved fees, community facilities districts, grants, and service fees.
The Valley Center Fire Protection District (VCFPD) and Deer Springs Fire Protection District (DSFPD) were established after California voters approved Proposition 13 in 1978. For local agencies that existed prior to passage, the law allocated revenue to taxing agencies based on a factor calculated on the revenue received in the three fiscal years prior to 1978, with allocations ranging from 6.4% to 32.3% for fire protection districts. For fire protection districts established after the passage of Proposition 13, their share of property tax revenue was negotiated at a lower rate, ranging from 1.3% to 2.8%. In the past two decades, 23 fire agencies have dissolved, with 20 consolidating into San Diego County Fire (County Fire), and three joining other fire protection districts.
Although VCFPD and DSFPD elected not to consolidate with County Fire or other fire protection districts, the County took action to support VCFPD and DSFPD with funding and in-kind assistance. County Fire has a Memorandum of Agreement with DSFPD, valued at nearly $1 million annually, that includes support for staffing, dispatch, training and fire marshal services. The County entered into a similar arrangement with VCFPD in 2007, valued at approximately $700,000 annually, but the agreement expired in 2013 when VCFPD terminated their contract with the California Department of Forestry and Fire Protection (CAL FIRE). VCFPD added a ballot measure for a parcel tax in 2018 and 2020 to pay for additional fire services within the district. The measures, which required a 66.67% vote, failed twice despite achieving a majority vote.
Increasing the existing property tax allocation for these districts to 6%, which is the allocation the San Diego County Fire Protection District receives, would shift approximately $2.7 million in base property tax revenue from the County and provide $1.5 million to VCFPD and $1.2 million to DSFPD, based upon the Fiscal Year 2024-25 property taxes. A property tax shift is one of the options being presented to the Board of Supervisors. In addition, County Fire has reviewed existing service levels in Pauma Valley, East Otay Mesa, and the Highway 94 corridor and has identified a need for an additional $3.5 million annually to address operational deficiencies and future needs.
Today’s actions are seeking the Board’s policy direction on providing County financial and operational support to VCFPD, DSFPD and SDCFPD, as well as other potential revenue options.
RECOMMENDATION(S)
CHIEF ADMINISTRATIVE OFFICER
1. Provide direction on the following options to support fire protection and emergency response services in the Valley Center Fire Protection District (VCFPD):
a. Pursue an increase in the VCFPD property tax allocation to 6% effective Fiscal Year 2025-26. Direct the Chief Administrative Officer to return to the Board of Supervisors with a resolution and take other necessary steps to complete a property tax reallocation following VCFPD holding a public hearing to consider the effect of the proposed transfer ($1,500,000); or
b. Direct the Chief Administrative Officer to enter into a Memorandum of Agreement with VCFPD to provide reimbursement to fund for 1/3 of the staffing at the third station ($600,000), and offer in-kind dispatching services, training, fire prevention/fire marshal services and other support services through County Fire ($200,000), for a total estimated value of approximately $800,000 and pursuant to Government Code section 26227, find that the funding is necessary to meet the fire protection and emergency response needs in the VCFPD and authorize the Chief Administrative Officer, or designee, to execute an agreement with VCFPD effective July 1, 2025, thru June 30, 2028, and to amend the agreement as needed to reflect changes to requirements or funding necessary to maintain local fire protection and emergency response services; or
c. Direct the Chief Administrative Officer to explore a special tax ballot measure for enhanced fire protection and emergency response services in VCFPD or a broader area, and return to the Board of Supervisors to present necessary actions. Provide County staff with the intended boundary and scope, which could include VCFPD or a broader area; or
d. Add language to the County’s Legislative Program to seek a sponsor in the California legislature to propose legislation that would transfer state funds to underfunded fire protection districts in San Diego County to enhance fire protection and emergency response services; or
e. No action at this time.
2. Provide direction on the following options to support fire protection and emergency response services in the Deer Springs Fire Protection District (DSFPD):
a. Pursue an increase in the DSFPD property tax allocation to 6%, effective Fiscal Year 2025-26, and modify the existing MOA to cover a portion of the staffing and other costs related to the North Regional Urban Search and Rescue Unit. Direct the Chief Administrative Officer to return to the Board of Supervisors with a resolution and take other necessary steps to complete a property tax reallocation following DSFPD holding a public hearing to consider the effect of the proposed transfer ($1,200,000 and a reduction of approximately $700,000 to the existing MOA); or
b. Direct the Chief Administrative Officer to explore a special tax ballot measure for enhanced fire protection and emergency response services, and return to the Board of Supervisors with the necessary actions. Provide County staff with the intended boundary and scope, which could include DSFPD or a broader area; or
c. Add language to the County’s Legislative Program to seek a sponsor in the California legislature to propose legislation that would transfer state funds to underfunded Fire Protection Districts in San Diego County to enhance fire protection and emergency response services; or
d. No action at this time; maintain the existing MOA with DSFPD.
3. Provide direction on the following options to support fire protection and emergency response services in the San Diego County Fire Protection District:
a. Provide a paramedic fire engine in Pauma Valley and East Otay Mesa, and a paramedic squad along the Highway 94 corridor within SDCFPD effective Fiscal Year 2025-26. ($3,500,000); or
b. Direct the Chief Administrative Officer to explore a special tax ballot measure for enhanced fire protection and emergency response services, and return to the Board of Supervisors with the necessary actions. Provide County staff with the intended boundary and scope, which would include SDCFPD; or
c. No action at this time.
EQUITY IMPACT STATEMENT
The San Diego County Fire Protection District (SDCFPD) serves residents in some of our region’s most isolated communities with low Healthy Place Index scores. Rural communities include lower-income households, tribal nations, and residents experiencing health disparities that necessitate the usage of emergency medical services. If the Board of Supervisors (Board) takes action to increase SDCFPD resources, additional firefighting personnel will be provided to further support and respond to calls related to medical emergencies, structural fires, and local emergencies. Valley Center Fire Protection District (VCFPD) and Deer Springs Fire Protection District (DSFPD) both receive a disproportionately lower share of property tax revenue in comparison to other fire protection districts. If the Board takes action to increase revenue to VCFPD and DSFPD, the financial sustainability of these districts would be bolstered, and it would create an opportunity to further enhance the level of service to the community.
SUSTAINABILITY IMPACT STATEMENT
If the Board of Supervisors approves additional funding for the San Diego County Fire Protection District, the investment would be focused in chronically underserved communities. Additional revenue for the Deer Springs and Valley Center Fire Protection Districts would help build resilience in communities in the unincorporated areas.
FISCAL IMPACT
Funds for this request are not included in the Fiscal Year 2024-25 Operational Plan for San Diego County Fire. There is no fiscal impact in Fiscal Year 2024-25.
Option 1a would transfer property taxes to Valley Center FPD and decrease the County’s share of available General Purpose Revenue by approximately $1.5 million annually, plus approximately 3.8% of the annual growth beginning in Fiscal Year 2025-26.
Option 1b would result in additional costs of approximately $600,000 to the San Diego County Fire Protection District beginning in Fiscal Year 2025-26. There is no available funding identified for this cost and therefore will result in reduction of General Purpose Revenue allocated to Public Safety Group departments, including County Fire, to fund this option.
Option 2a would transfer property taxes to Deer Springs FPD and decrease the County’s share of available General Purpose Revenue by approximately $1.2 million annually, plus approximately 3.9% of the annual growth beginning in Fiscal Year 2025-26, and the existing MOA with DSFPD would be reduced by approximately $700,000.
Option 3a would result in additional costs of $3.5 million to the San Diego County Fire Protection District beginning in Fiscal Year 2025-26. There is no available funding identified for this cost and therefore will result in reduction of General Purpose Revenue allocated to Public Safety Group departments, including County Fire, to fund this option
If the Board were to select options 1c, 2b, and/or 3b, a special benefit fee, if passed by the voters, would provide funding to SDCFPD and possibly other fire agencies, depending on the jurisdictions included in a ballot measure. Staff would identify any related ballot measure costs and return to the Board for approval if one of these options is selected.
There will be no change in net General Fund cost and no additional staff years.
BUSINESS IMPACT STATEMENT
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ADVISORY BOARD STATEMENT
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BACKGROUND
On July 16, 2024 (2), the Board of Supervisor’s (Board) directed the Chief Administrative Officer (CAO) to review the level of resources, funding, and sustainability of fire protection in the Valley Center and Deer Springs Fire Protection Districts and determined if specified communities within the San Diego County Fire Protection District (SDCFPD) have long-term funding needs to ensure equitable service levels in unincorporated communities.
In 1978, California voters approved Proposition 13 that limits the property tax rate to 1% of assessed value at the time of purchase and restricts annual tax increases to no more than 2% until the property is sold. This resulted in limited financial resources for local governments to invest in services. Independent local government agencies receiving a portion of property tax revenue in their communities at that time were guaranteed that same ratio of revenue in the future. For fire protection districts established in San Diego County after the passage of Proposition 13, their share of property tax revenue was negotiated at a lower rate, ranging from 1.3% to 2.8%. As a result, 23 fire agencies dissolved over the past two decades, with 20 consolidating into San Diego County Fire, and three joining other fire protection districts. In addition to fire protection districts, there are 65 other independent special districts in the region providing service for water, irrigation, sanitation, healthcare, parks, ambulances and other community needs. Funding levels and sources vary from district to district, including property tax allocation, special taxes and benefit fees.
Valley Center Fire Protection District
The Valley Center Fire Protection District (VCFPD) was formed in 1982 and currently receives funding from property taxes, special benefit fees, Community Facilities Districts (CFD) and other revenue sources. Beginning in 2007, as part of the County’s efforts to consolidate and coordinate fire services in rural communities, the County and VCFPD entered into a contract for the County to support the staffing contract with CAL FIRE. The agreement expired in 2013 when VCFPD terminated their contract with CAL FIRE.
Pursuit of option 1a would increase the property tax allocation for VCFPD to be in alignment with SDCFPD’s 6% allocation. County fiscal analysis has determined that increasing the existing property tax allocation (VCFPD - 2.19%) to 6% would shift approximately $1.5 million from the County and provide $1.5 million to VCFPD, based upon the Fiscal Year 2024-25 amounts. Prior to the approval of any transfer of property tax revenues, the affected agencies must hold a public hearing to consider the effect of the proposed transfer.
Option 1b would seek to establish a new MOA with VCFPD. To be consistent with the DSFPD, the MOA could provide reimbursement to fund 1/3 of the staffing at the third station ($600,000), and offer dispatch, training and fire marshal services through County Fire ($200,000). The estimated value received by VCFPD would be approximately $800,000.
Deer Springs Fire Protection District
The Deer Springs Fire Protection District (DSFPD) was formed in 1981 and currently receives funding from property taxes, special benefit fees, and other revenue sources. DSFPD has a local services agreement with CAL FIRE to staff their three stations. However, existing revenue through the property tax allocation and special benefit fees is only able to support staffing for three firefighters on two fire engines. As part of the County Fire Urban Search and Rescue Program and to increase staff safety and operational efficiencies, the County funds a third firefighter on one Deer Springs fire engine. This fire engine cross staffs the North County Type I Urban Search and Rescue Unit. This agreement provides benefit to Deer Springs and the County of San Diego. Deer Springs is dispatched by CAL FIRE/County Fire and is fully integrated into mutual aid and strategic planning conversations. On July 1, 2023, the County and Deer Springs signed a new five-year agreement to support staffing, dispatch, training and fire marshal services, with an annual value of $936,000.
Pursuit of option 2a would increase the property tax allocation for DSFPD to be in alignment with SDCFPD’s 6% allocation. County fiscal analysis has determined that increasing the existing property tax allocation (DSFPD - 2.07%) to 6% would shift approximately $1.2 million from the County and provide $1.2 million to DSFPD, based upon the Fiscal Year 2024-25 amounts. Prior to the approval of any transfer of property tax revenues, the affected agencies must hold a public hearing to consider the effect of the proposed transfer. If the Board approves a property tax exchange with DSFPD, County staff is recommending the existing cooperative agreement be modified to cover a portion of the staffing and other costs related to the North Regional Urban Search and Rescue Unit, a reduction of approximately $700,000.
Option 2d would maintain the existing cooperative agreement and level of support to DSFPD.
San Diego County Fire Protection District
The San Diego County Fire Authority, which was established in 2008, transitioned to the San Diego County Fire Protection District (SDCFPD) in 2020 through the Local Agency Formation Commission (LAFCO) district formation process, and the Board set the property tax allocation at 6% with a base revenue transfer of approximately $3.3 million. A total of 20 formerly independent agencies had consolidated into SDCFPD and are today served by around-the-clock, paramedic-level fire engines at 22 fire stations through a partnership with CAL FIRE. Many communities within SDCFPD are disadvantaged and among the lowest scoring in the Healthy Places Index. The property tax allocation for SDCFPD, which is now approximately $11.8 million annually, only offsets a portion of the actual costs for services, and County General Purpose Revenue primarily makes up the difference. In response to the Board direction, County Fire has identified several opportunities to bolster service through additional unidentified County General Purpose Revenue.
Although Pauma Valley is within the SDCFPD, the area has historically been served through a State fire engine that is limited to basic life support services. For 911 emergency medical calls, mutual aid is often required from a surrounding fire agency. Permanently staffing a County funded paramedic fire engine will optimize service to a large geographic area and allow County Fire to support surrounding fire agencies. In addition, the Highway 94 corridor from Boulevard to Jamul is served primarily by CAL FIRE Basic Life Support Fire Engines. With the high demand of serving the International Border with complex remote area rescues, a two-person paramedic squad is needed to augment the State funded fire engines. Border rescues can commit resources for several hours which draw resources from Jamul and other areas, leaving wide gaps in protection. Finally, the community of East Otay Mesa is growing rapidly and has a need to upgrade staffing from a two-person paramedic squad to a three-person paramedic fire engine. East Otay Mesa is especially in need with the rapid growth of warehouses and the new border crossing opening in 2026.
The cost would be $3.5 million to provide a staffed paramedic fire engine in Pauma Valley and East Otay Mesa, and a staffed paramedic squad along the Highway 94 corridor within the San Diego County Fire Protection District. This could be phased in over time as part of the County’s Operational Plan process, depending on funding availability.
Special Tax Ballot Measure
Many independent fire protection districts, including the San Diego County Fire Protection District, have communities that previously adopted special taxes to specifically fund fire protection services. However, special taxes vary in amount and location, and funding may still be inadequate in certain districts. On August 5, 2008 (18), the Board authorized a Countywide ballot measure to fund firefighting in the entire region through a parcel tax, but that measure did not pass. The ballot measure authorized independent fire protection districts and cities to participate in the parcel tax. The measure would have created a joint powers authority to distribute funds in alignment with the approved language. Today’s actions seek policy direction from the Board on whether staff should take the necessary steps to explore a similar ballot measure for residents to self-tax to improve fire protection and ensure sustainability of funding.
The ballot measure could be for:
1. SDCFPD
2. SDCFPD, VCFPD and/or DSFPD
3. All fire protection districts in the unincorporated area
4. All fire protection districts and municipal fire departments in the entire region
Should the ballot measure include agencies besides SDCFPD, a joint powers authority would be needed to receive and distribute funds. If approved, County staff would return in 180 days with proposed options and fiscal projections.
Legislative Program
Another option is to direct the Chief Administrative Officer to add language to the County’s Legislative Program to seek a sponsor in the California legislature to propose legislation that would transfer state funds to the County to enhance fire protection and emergency services in the unincorporated area. In the State’s current fiscal reality, this may not be feasible as other counties may identify similar needs and costs could be in the tens of millions of dollars annually to the State.
Today’s actions are seeking the Board’s policy direction on providing County financial and operational support to VCFPD, DSFPD and SDCFPD, as well as other potential revenue options.
LINKAGE TO THE COUNTY OF SAN DIEGO STRATEGIC PLAN
Today’s proposed actions support the Community Initiative in the County of San Diego’s 2024-2029 Strategic Plan by supporting communities with resources for fire protection and emergency response services.
Respectfully submitted,
ebony n. shelton
Chief Administrative Officer
ATTACHMENT(S)
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