Discussion and Possible action to authorize the City of San Luis Fire Department to continue with application for a Certificate of Necessity (CON) to provide emergency ambulance services.  (Hank Green)

Previous presentations and discussions regarding our pursuit of a CON was based upon run history, run projections, suggested base and mileage rates, projected revenues, and projected expenses.  The original projections indicated a positive cash flow of nearly $300,000 with subsequent years growth, increased activity and rates providing greater revenues.  Our original business plan was based upon the assumption that SLFD would continue to operate with existing personnel, even absorbing the SAFER Firefighters, from our existing facilities.  This business plan did not include expenses such as utilities (water, sewer and trash collection), bond or loan payments or the allocation of assigned existing personnel's salaries and EREs.

Our CON application has been under review by AzDHS since March of this year and is nearing completion.  I am requesting the opportunity to speak before City Council to address what I believe is probably the final step before our CON is routed to the AzDHS Director for a granting by waiver or scheduled for a hearing before an Administrative Law Judge.  A hearing is the least preferred route our application can take since it will require coordination of schedules of the Law Judge all appropriate parties to respond or answer questions. 

I have attached a Memo with a embedded spread sheet which show variable ways accounting entries which present varies results.  The left column (SLFD) is the simple approach which keeps existing expenses under the purview of SLFD and a positive cash flow of over $500,000.  The right column (AzDHS) was built with allocated expenses requested to reflect the more appropriate representation of the ambulance operations; assigned personnel, facilities, utilities, etc and a negative cash flow of greater than $600,000.  I cannot replicate the "Net Loss" identified by AzDHS ($475,820).

All of this brings me to the reason I am requesting to make this presentation.  AzDHS is understanding that municipalities will off set ambulance enterprise expenses with existing general fund money.  I including a portion of a recent e-mail with AzDHS which their request for confirmation of our intent to "subsidize" the ambulance operations from the City/SLFD funds.
 
 

“I MOVE TO ACKNOWLEDGE:
 

• POSSIBLE YEARLY DEFICIENCIES THAT MAY ENSUE FROM OPERATIONS;
• THE NEEDS TO COVER SUCH OUTCOMES FROM  GENERAL FUND MONEYS WHENEVER NECESSARY FOR THE CITY OF SAN LUIS FIRE DEPARTMENT; AND
• THE NEED TO CONTINUE WITH THE APPLICATION TO THE ARIZONA DEPARTMENT OF HEALTH SERVICES FOR CERTIFICATE OF NECESSITY (CON) TO PROVIDE EMERGENCY AMBULANCE SERVICES.”