(May 5, 2016) The Berlin Fire Company received a $400,000 grant from the town during each of the last two years and this year is seeking to more than double that.
During annual budget requests this yea, the company asked for more than $1 million, including $400,000 in operating and capital expenses for fire and rescue, and $600,000 for operating and capital expenses for EMS services.
An additional $500,000 was requested to help build “station three,” on Ocean Gateway near Stephen Decatur High School.
The mayor and council held a budget workshop on Monday with members of the fire company, including Fire Company President David Fitzgerald and Chief Jim Corron.
Also present was CPA John Stern, from Salisbury auditing firm PKS & Company, who briefly went over a three-year audit of the fire company, dated Dec. 31, 2015.
As of that date, BFC had $5.5 million in net assets, up more than $500,000 from the previous year, against $1.6 million in expenses. The audit also showed just over $4 million in cash and certificates of deposit.
During the meeting, Fitzgerald said those numbers were slightly misleading and somewhat dated.
“They don’t realize there’s $390,000 worth of payroll coming out [and] there’s a $471,000 fire truck getting ready to come out and a $265,000 handling fee,” he said. “Yes, it does look like we have more cash and we do – at least temporarily.”
If Berlin approved the budget request as written, Mayor Gee Williams said it would account for 17.5 percent of the town’s general fund budget. The additional $500,000 would represent 14 percent of the town’s entire capital budget.
“We don’t have 17 and a half percent of our budget to give you,” he said.
Instead, he suggested the grant remain at $400,000, with the town picking up the tab for a third-party advisor who would help determine the fire company’s needs – and the town’s means – as part of building a financial roadmap for the future.
Williams elaborated on the situation during a phone interview on Tuesday.
Asked if he felt the increased request was adequately explained, Williams said it was just not possible to explain an increase of that size.
“This is a wake up call to everyone – to all the folks involved – Berlin citizens, the mayor and council, county government and the fire companies,” he said. “If this is the level of funding that is immediately needed after receiving between $400,000 – up to $535,000 [during the last several years] – then there needs to be a good, hard look at how funding is going to be sustained.
“To me, this sounds an alarm that we need to get a reputable and experienced professional consultant to provide expertise on both the current and projected financial needs and requirements of the Berlin fire services and rescue services, and the Berlin emergency medical services.”
During the meeting, Fitzgerald said that the fire company had commissioned a logistics and management study. For this kind of increase, however, Williams said that survey did not go far enough.
He said he hoped a larger study would explore operational needs for up to five years, as well as immediate equipment and vehicle replacement needs for both fire and EMS services, and what projected needs were for the existing headquarters and for station three.
The company’s needs in the context of the greater county area also needed to be examined, Williams said.
“An independent professional consultant with a track record can maybe help us get a much better handle on this changing situation,” he said. “We just don’t have an additional $1.1 million – there’s no way we can do that for one year, and we certainly wouldn’t be able to more than double the annual grant.”
At its current levels, Williams said the grant to the fire company was “far and away” the largest the town provided. Moreover, he said it was “very generous” for a town of Berlin’s size.
He said the Berlin Fire Company has been fortunate enough to build up cash reserves over the years to pay for most of its expenditures, but that most organizations – including municipalities – were not so fortunate.
“We’re not in a position where we can turn over a million dollars of our money so they can then put it away for a time in the future when they need to spend that money,” Williams said. “I do believe this is part of the evolution that’s going on, not just in Berlin, but probably in rural fire and EMS all over the country. This time has probably been coming for a while, but this year’s budget request has sort of brought all this to a head.
“It’s not something that’s adversarial, but we need to find a way to get things done that protects the public, allows the fire company to make the plans for the equipment and buildings and everything else that they’re going to need, but also do it in a way that is sustainable and doesn’t – literally – bring the town to our knees simply because they have a different traditional way of financing major expenses,” Williams added.
Fitzgerald and Corron did not return calls for additional comment.
During annual budget requests this yea, the company asked for more than $1 million, including $400,000 in operating and capital expenses for fire and rescue, and $600,000 for operating and capital expenses for EMS services.
An additional $500,000 was requested to help build “station three,” on Ocean Gateway near Stephen Decatur High School.
The mayor and council held a budget workshop on Monday with members of the fire company, including Fire Company President David Fitzgerald and Chief Jim Corron.
Also present was CPA John Stern, from Salisbury auditing firm PKS & Company, who briefly went over a three-year audit of the fire company, dated Dec. 31, 2015.
As of that date, BFC had $5.5 million in net assets, up more than $500,000 from the previous year, against $1.6 million in expenses. The audit also showed just over $4 million in cash and certificates of deposit.
During the meeting, Fitzgerald said those numbers were slightly misleading and somewhat dated.
“They don’t realize there’s $390,000 worth of payroll coming out [and] there’s a $471,000 fire truck getting ready to come out and a $265,000 handling fee,” he said. “Yes, it does look like we have more cash and we do – at least temporarily.”
If Berlin approved the budget request as written, Mayor Gee Williams said it would account for 17.5 percent of the town’s general fund budget. The additional $500,000 would represent 14 percent of the town’s entire capital budget.
“We don’t have 17 and a half percent of our budget to give you,” he said.
Instead, he suggested the grant remain at $400,000, with the town picking up the tab for a third-party advisor who would help determine the fire company’s needs – and the town’s means – as part of building a financial roadmap for the future.
Williams elaborated on the situation during a phone interview on Tuesday.
Asked if he felt the increased request was adequately explained, Williams said it was just not possible to explain an increase of that size.
“This is a wake up call to everyone – to all the folks involved – Berlin citizens, the mayor and council, county government and the fire companies,” he said. “If this is the level of funding that is immediately needed after receiving between $400,000 – up to $535,000 [during the last several years] – then there needs to be a good, hard look at how funding is going to be sustained.
“To me, this sounds an alarm that we need to get a reputable and experienced professional consultant to provide expertise on both the current and projected financial needs and requirements of the Berlin fire services and rescue services, and the Berlin emergency medical services.”
During the meeting, Fitzgerald said that the fire company had commissioned a logistics and management study. For this kind of increase, however, Williams said that survey did not go far enough.
He said he hoped a larger study would explore operational needs for up to five years, as well as immediate equipment and vehicle replacement needs for both fire and EMS services, and what projected needs were for the existing headquarters and for station three.
The company’s needs in the context of the greater county area also needed to be examined, Williams said.
“An independent professional consultant with a track record can maybe help us get a much better handle on this changing situation,” he said. “We just don’t have an additional $1.1 million – there’s no way we can do that for one year, and we certainly wouldn’t be able to more than double the annual grant.”
At its current levels, Williams said the grant to the fire company was “far and away” the largest the town provided. Moreover, he said it was “very generous” for a town of Berlin’s size.
He said the Berlin Fire Company has been fortunate enough to build up cash reserves over the years to pay for most of its expenditures, but that most organizations – including municipalities – were not so fortunate.
“We’re not in a position where we can turn over a million dollars of our money so they can then put it away for a time in the future when they need to spend that money,” Williams said. “I do believe this is part of the evolution that’s going on, not just in Berlin, but probably in rural fire and EMS all over the country. This time has probably been coming for a while, but this year’s budget request has sort of brought all this to a head.
“It’s not something that’s adversarial, but we need to find a way to get things done that protects the public, allows the fire company to make the plans for the equipment and buildings and everything else that they’re going to need, but also do it in a way that is sustainable and doesn’t – literally – bring the town to our knees simply because they have a different traditional way of financing major expenses,” Williams added.
Fitzgerald and Corron did not return calls for additional comment.