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Keith Morris / Keith Morris/Roundup  

Payson Elementary School first-grader Hudson Hall gives Clifford The Big Red Dog a high-five during the PES Scholastic Dino-Mite Book Fair on Tuesday, Feb. 26. The school holds two book fairs each year to raise money for the school’s library.

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Financial questions dog fire department merger

Advocates for a fire department merger must deal with a series of financial questions to win the approval of the Payson Town Council.

Deborah Barber, the Town of Payson’s chief fiscal officer, has questioned whether the proposed joint powers authority merging the Payson, Hellsgate and Houston-Mesa fire departments makes financial sense. The Roundup obtained a copy of a memo she wrote to the council questioning Payson’s contributions and the long-term stability of the proposed fire district.

She suggested Payson’s contributions should rise by 3 percent annually rather than the 4 percent proposed by advocates. She also wondered whether the new district would face financial problems in three to five years if Hellsgate loses its federal grant.

In response to that memo, consultants said the proposed, merged fire department would have an ample cushion, even if revenues fell short of projections and even if Hellsgate loses its $1.6 million SAFER grant.

In part, that assumption rests on the cushion provided by payments Hellsgate receives for loaning fire crews during the wildfire season. The merged department could actually make more money from wildland firefighting if Payson crews participated, in addition to Hellsgate.

The merged department would remain under the control of three Payson council members, two Hellsgate fire board members and one Houston-Mesa fire board member. The proposed agreement would also allow any of the merged departments to dissolve the partnership.

Here’s a look at the questions Barber raised and the responses the Roundup received from the James Vincent Group (JVG), the consultants who analyzed the deal.

Are contribution estimates accurate?

Contributions from Payson would increase by 4.16 percent per year, based on the history of Payson’s revenues over the past 10 years. Barber challenged the 4 percent figure, saying the average increase in Payson revenues going back 12 years is actually closer to 3 percent.

The consultants said going back 12 years includes the historic revenue downturn during the recession and doesn’t statistically “smooth out” year-to-year fluctuations.

“The projected growth of each partner’s revenue was based on their historical growth rates, economic indicators, and our experience with other similar organizations,” said Gabe Buldra of JVG. “(Barber) presented an average growth rate for the previous 12 years that was less than 4 percent for Payson’s sales taxes during the council meeting.”

Including unusual events like the last recession skews the average, said Buldra. Instead, the JVG analysis used a formula to “smooth” out the year-to-year highs and lows.

“We calculated a 10-year compound annual growth rate (CAGR) of 5.25 percent and five-year CAGR of 5.96 percent, which indicates that sales taxes are improving since the recession,” he said.

But that’s exactly what the council has concerns about — a future recession.

The agreement requires the town to pay 25.75 percent of its general fund tax revenues. So if tax revenues fall, so does the town contribution.

“Yes, there contribution to the JPA is based on a percentage of taxes. Therefore, if their overall sales taxes decreased the total would decrease in line with that drop,” said Buldra.

Will the JPA remain viable if it loses the SAFER grant?

Hellsgate will continue to benefit from the $1.6 million federal SAFER grant for the next few years allowing the JPA to stash away money in a reserve fund.

In the fifth year of the JPA, the need for the grant would end.

The consultants said the district would prepare for that moment by saving money in its reserve fund.

This concerns Barber.

“It appears that trend would continue into year six,” wrote Barber. “This projection assumes nothing will be spent out of contingency or reserves during those five years,” she wrote. “Is it realistic to expect there will be no need for contingency spending in a five-year time period?”

In response, Buldra said each partner would contribute to the reserve fund to ensure the district has a robust reserve fund.

“In year five, we project funding to the reserves will decrease to $44,000, however the reserve balance at that point will be 23.7 percent of the annual operating budget,” he said. “The Government Finance Officers Association (GFOA) recommends a fund balance of at least 16.67 percent, so this projected balance meets this recommendation.”

That leaves an extra 7.03 percent available to spend during the five years addressed in the analysis.

Will operational expenses increase?

What if the JPA operational expenses increase by more than 2.5 percent annually as projected by the consultants?

Barber worried the consultants relied on overly optimistic assumptions — that revenue would increase by 4.16 percent annually but spending would rise by only 2.5 percent.

However, the consultants replied their estimates were conservative and based on past performance.

“Our analysis calls for a 2.5 percent annual growth in operational expenses. This is based on the compound annual growth rate for each partner for these costs historically, as well as our experience with other similar agencies in the state,” said Buldra.

In addition, a small error in the rate of increase for either spending or revenue wouldn’t make a big impact on the overall budget, said the consultants.

“An important note is that these costs only account for an average of 13 percent of the proposed five-year expenditures and minor fluctuations in this growth rate would not be material to the budget as a whole. Variances in this area can be reallocated from another budgeted area,” said Buldra.

Neither side considered in their calculations revenues collected from sending Rim Country firefighters out to wildfires.

What about additional support staff positions?

The proposed JPA budget does not provide for administrative support staff for payroll, accounts payable, human resources and financial oversight duties. Would increasing the budget to include several positions further reduce reserve levels?

“The JVG analysis includes two administrative employees that would be in charge of these duties,” said Buldra. “One of the concerns expressed by Ms. Barber was whether that is an adequate number for these tasks. In our follow-up memo we provided a comparison of similar sized fire districts and the number of administrative employees that each has. For budgets under $10 million, the average number of administrative employees, including fire chiefs, was three. The two administrative employees budgeted in our analysis were in addition to the two chiefs and in line with multiple other agencies within our state.”

Whatever Payson decides to do, it will set a precedent other cities such as Flagstaff are watching closely. In future articles, the Roundup will interview fire chiefs from JPAs already in place to see how their funding and staffing models work.


Photo courtesy of the Payson Fire Department  

Payson firefighters responded to 73 fire calls last year, including this brush fire on State Route 87. They also responded to 102 calls for mutual aid, mostly in Star Valley. Payson and Hellsgate firefighters would like to merge and become a fire authority

Report: fire department answers more calls

The Payson Fire Department answered more calls last year than ever before.

The fire department received 3,626 calls during the fiscal 2017/18 year, according to its annual report, which was recently released.

That is a 2.7 percent increase in call volume over the prior year and marks a 58 percent increase in 10 years, when the department answered 2,287 calls in 2007.

“The most notable trend in the data this year is the leveling of call volume,” said Fire Chief David Staub. “The PFD calls per month historically indicated a sharp increase in calls during the summer months, this year the call volume remained constant across all the months.”

In fact, the months where the call volume decreased were June and July, which are typically the busiest months in Payson with summer visitors. That may be due to the forest closure last year, which deterred many from coming to Rim Country. The months that saw the greatest increase were October (257 in 2017 vs. 332 in 2018) and April (271 vs. 320).

“The calls by day of the week have a similar pattern where historically the weekend was busiest, we are now experience a constant call volume every day,” Staub said.

Wednesday was the slowest day last year with 457 calls and Friday the busiest at 573 calls.

Besides more calls each day, the department is seeing the call volume peak earlier and last longer.

“The peak call volume is now extending into the 9 a.m. hour,” he said.

Calls start to trickle off after 8 p.m. and pick back up again around 7 a.m.

The most dangerous and staff demanding calls, like structure fires, occur most often during low call hours.

But the PFD does not get a lot of fire calls in general. There were 73 fire or explosion calls last year, representing just 2 percent of all calls. The department’s “save ratio” during structure fires was 65.4 percent up from 60 percent the year prior.

Like most fire departments, medical emergencies make up the bulk of their calls. Last year, there were 2,346 medical responses or 65 percent of all calls. That is on par with past years.

The PFD did see a decrease in the number of “hazardous condition” calls last year, going from 86 in 2017 to 47 in 2018.

Answering these calls are 40 full-time and part-time firefighters.

“Your Payson firefighters have once again demonstrated their professionalism and preparation to assist in a time of emergency by logging more than 12,600 hours of training or more than 350 hours of training per member,” Staub said. “That number exceeds the national standard by almost an hour a day.”

The department recognized Thorry Smith as firefighter of the year and Jimmie Rasmussen, a battalion chief who retired after 28 years of service.

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Forest Service vows to address problems with Fossil Creek rescue

Forest Service officials say they’re working to provide better access to Fossil Creek for search and rescue crews on missions to save injured and ill visitors.

Search and rescue crews can already use the road from Strawberry to the creek, said Fossil Creek Coordinator Marcos Roybal. Forest Road 708 is still closed to the public.

Forest Service planners want to meet with Gila County Supervisor Tommie Martin, Gila County Sheriff Adam Shepherd, Pine-Strawberry Fire Chief Gary Morris and Congressman Paul Gosar to improve access to the creek and spring source for Rim Country rescue crews.

Morris and a large group of Rim Country residents showed up at a recent meeting on the Wild and Scenic River Fossil Creek Plan to protest the closure of Forest Road 708 and the road that once followed the Flume Trail to the spring source.

However, Forest Service officials insisted the discussion was separate from the discussion of alternative management plans for recreation and wildlife along the creek over the next 20 years.

A decade ago, Congress designated Fossil Creek as one of two “wild and scenic” river sections in the state, which required the Forest Service to come up with a plan.

The Forest Service decision to shut down FR 708 and demolish a bridge on the Flume Trail Road increased the time it takes to mount a rescue from Pine from two hours to more like eight hours.

Rescue crews have to carry people on stretchers to the nearest road access, which delays treatment, exhausts the often volunteer rescue crews and can endanger sick or injured hikers.

Roybal said the meeting in Pine wasn’t the right place to address those concerns.

“A large number of attendees came to that meeting expecting to discuss emergency response, so Tonto and Coconino National Forest decisionmakers met with those attendees separately after the formal presentations so we could carry on with our meeting. They were not ‘put off,’ but rather given dedicated discussion time with the two district rangers,” he said.

Tonto National Forest District Ranger Debbie Cress said she had scheduled a meeting with local emergency officials in January, but Forest Service officials couldn’t attend due to the shutdown of the national government.

She said they will reschedule the meeting to talk about finding ways to improve access for emergency crews separate from the work on the Fossil Creek plan.

Morris has traveled to Washington, D.C. several times to broach the issue there.

The issue most recently came to a head when the lack of maintenance on FR 708 resulted in flooding that threatened to snap the cable bringing internet and phone service to most of Rim Country.

Several boulders had rolled down onto the trail, blocking access to repair crews. Crews moved the boulders and restored limited access down FR 708 in order to rebury the exposed cable. Emergency crews have also responded to hundreds of rescue calls in the past several years, including five drownings.

Cress said the Forest Service has started to address the problem of emergency crew access.

The Forest Service has already created places for helicopters to land. In addition, the Forest Service placed a limit on visitation and required a permit during the warm-weather months, which reduced the total number of rescues.

“The Forest Service has worked with Chief Morris and Gila County search and rescue to authorize a number of solutions. Over the past years I’ve been partnered with the Coconino on this issue, from water caches to signage to clearing helispots and increasing emergency responder parking to finally initiating the permit system,” Cress said. “It’s clear from their feedback more is needed while the (Fossil Creek Management Plan) process is completed and a plan installed for safe visitor access.”

She said Tonto Forest Supervisor Neil Bosworth supports more meetings focused on access for emergency crews and cable repair crews.

“We are supportive of the road being reopened and maintained for such access. There is a need for considerable stabilization to get to a safe maintenance schedule. I am hopeful a collaborative of interested stakeholders can come up with a fiscally viable solution.”

Roybal said emergency crews can already use FR 708 for rescues — now that crews have removed the boulders.

A Forest Service study estimated it would cost $5 million to $6 million to stabilize the slopes above FR 708 to make it safe to reopen for either ATVs for full-sized vehicles. Currently, the Coconino National Forest has an annual road maintenance budget of about $1 million to $1.5 million for the entire, 1.8-million-acre forest. By contrast, Arizona Public Service spent about $180,000 annually maintaining the road when it operated a hydroelectric generating plant in the canyon bottom.

“That is a difficult decision about how to best spend the taxpayers’ money, considering the limited amount of use that the 708 road would see, compared to roads in the more highly traveled areas of the forest,” said Roybal.

The preferred Alternative E does envision allowing ATV vehicles less than 62 inches wide to eventually use FR 708 — if the Forest Service can ever find the money, or a partner, to repair the road.

In addition, Alternative F raises the possibility of also building a new bridge and reopening the Flume Road for administrative and emergency use. That option could get added to the preferred Alternative E, he said. However, the Forest Service would still have to find the money, even if the road openings were included in the plan.

But the Forest Service faces big challenges in adopting any management plan for Fossil Creek that requires spending money on infrastructure — or even enforcement of the rules, he concluded.

“This depends on the Forest Service’s annual budgets and possible agreements with partners,” said Roybal. “Also, the Forest Service is beginning to look at options for implementing a fee. Revenue from this fee could go directly back into managing Fossil Creek. Under current funding levels, it is difficult for the Forest Service to simply cover the expenses of current operations.”

Inaugural Mayor’s Forum a polite affair

No one threw rotten tomatoes.

No one yelled.

No one walked out.

If you judge it by those accounts, Payson Mayor Tom Morrissey’s first open mic forum was a success Tuesday night.

Some 100 people braved the snow fringed streets to hear from Morrissey on topics that ranged from the new streetlights to repealing the food tax.

The most dramatic moment of the night came when Mary Hansen, who runs the Oxbow Saloon, pressed Town Manager LaRon Garrett. She said Main Street businesses want to put up a directory sign on the Beeline Highway to attract more motorists.

“Every week I hear the Town of Payson telling me they are working on Main Street,” she said. “Investors don’t want to do anything on Main Street because there are no signs giving directions and no names of businesses.”

Garrett explained the zoning code doesn’t allow for a business to put up a sign off-premises.

“What you are asking for is a code change,” he said. “If the council would like to change it, they can.”

Hansen said she has tried to get the issue on the council agenda for two years.

“Call me and LaRon and we will both meet with you,” Morrissey responded.

Other comments from the audience ranged from support for a fire-adapted building code; criticism of the town’s 3 percent tax on food and complaints about streetlights that drown out the night sky.

The adoption of a wildland-urban interface building code plus an ordinance to encourage Firewise clearing of brush drew support from several speakers.

“I have the forest in my backyard, the elk love it, but I worry about a fire,” said Suzanne Colbert. “It’s not if we have a fire, it’s when.”

Several people called on the town to end the sales tax on groceries, following the lead of the state and most towns in Arizona.

Resident Paul Frommelt wondered why the sales tax increase, which the council approved in 2017, couldn’t replace the food tax.

“Two years ago the town passed a sales tax increase. It has added almost $4.5 million to the town’s revenue,” he said. “I have never lived in a place that taxes groceries ... I would ask you to repeal that.”

Another resident agreed.

“This is a violation of our inalienable right to something that is necessary for life. I expect the council to repeal it,” the man said.

Morrissey had campaigned on repealing the food tax, but backpedaled on his position during the meeting.

“One of the things we have been fighting is the result of the recession — what we are trying to do is build a reserve fund,” he said. “The thing is, my instincts are to sunset the tax — and sunset it proportionately (from) one year to the next.”

In an ironic twist involving the Dark Sky ordinance, residents complained about the new LED streetlights. They said the lights are making it harder for them to see the stars.

“We’re in an area that does not necessarily need that light,” said Jean Fark. “It’s very pretty, but we can’t see the stars.”

Garrett offered some unique solutions.

“I had thought they had turned down the lights 50 percent. There’s also shields that have been ordered,” he said. “If not, we can turn them down a bit lower.”

He said many neighborhoods prefer the brighter light.

Almost 20 people stood up to ask Morrissey questions, Garrett and Deborah Barber, the town’s chief financial officer, during the nearly two-hour meeting at the Church of the Nazarene.

Morrissey wrapped up the evening on a positive note.

“There is doing the right thing and doing the right thing the right way,” he said. “So what I’m proposing is that we look deeply at these problems ... It takes us talking to one another. I so appreciate you being here.”

Morrissey plans on holding forums every six weeks.


 Alexis Bechman  /