Presented by:

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City of North Port

Fire Assessment Study

City Commission Workshop

May 29, 2012

Presentation of Preliminary Results

Introduction of Burton & Associates

Burton & Associates Firm Background Multi-year financial planning, assessment and rate services to

local governments since 1988 Fire Assessment development has been a significant portion of our

practice over the past ten years

Some of our Fire Assessment clients Brevard County, Lauderdale-by-the-Sea, Deltona, Cape Coral,

Orange Park, New Port Richey, Delray Beach

Some of our clients in the Southwest Florida area Fort Myers, Cape Coral, Pinellas County, St. Petersburg,

Clearwater, Sarasota, Marco Island

Project Staff Mike Burton – President & Project Director Andy Burnham – Senior Vice President & Project Manager Erick van Malssen - Consultant

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Project Scope

Evaluate the current Fire Assessment methodology,

recommend adjustments to the methodology as

appropriate and develop Fire Assessment Rates and

individual property assessments based upon the

recommended methodology

Specific work elements included:

Develop a ten year Fire District financial management plan

Identify an assessment rate structure to achieve a fair and

equitable relationship between:

The benefit received by properties, and

The cost burden of the assessment

Prepare the assessment roll, final report, and provide

implementation assistance

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Background

Fire Assessments are an alternative revenue source to more fairly recover the cost of Fire/Rescue Services

Emergency Medical Services (EMS) costs can not be included in a Fire Assessment based upon a Florida Supreme Court decision

Fire costs must be apportioned to properties based upon benefit

Primary benefit criteria is as follows: Response Readiness (Availability) Benefit – The maintenance of

facilities, equipment, and personnel to provide fire suppression services within acceptable response times

Benefits include: Structures - Protection from loss of the use and value of developed

structures

Land - Maintenance and enhancement of land value and ability to develop vacant land by the availability of central fire service

The Analysis

Cost determination Reviewed the allocation of Fire Rescue costs to Fire and Emergency

Medical Service (EMS) performed by City staff and concur with the appropriateness of those allocations

Included only Fire costs in the Fire Assessment

Property data Provided by the City staff based upon the Sarasota County Property

Appraiser property data base Compiled into a Fire Assessment database

Used Department of Revenue (DOR) land use codes to… Allocate Fire District costs to structures and land

Determine allocation of structure and land costs respectively to residential and non-residential property classes based upon square feet of structure space and land area in each class weighted by the average structure and land value per square foot respectively for each class.

Determine properties to be exempted or excluded from the Fire Assessment (described on next slide)

Used Fire Assessment database to calculate assessment rates by property class and specific assessments for each parcel

Fire Assessment database will serve as the Fire Assessment roll upon approval

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The Analysis (Cont’d)

Property data ( Cont’d) Exempted property classes (not included in the cost apportionment)

Sanctuaries of religious institutions

Public County schools

Federal buildings

Rivers and lakes, right-of-way/buffers, etc.

All other properties exempted from the assessment by the recent

court decision

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Ten Year Financial Plan

Basis of the plan

Fire District FY 2013 operations and maintenance (O&M)

budget escalated each year by appropriate escalation factors

and the Districts ten year capital plan

Results

There are not adequate reserves to fund the cash flow deficit

causes by:

The recent court decision that removed approximately $1.0 million of

annual assessment revenue from properties that are now exempt.

Non payment of assessment for several large parcels due to the

economic down turn (legal within the tax certificate sale process),

one time effect of approximately $1.7 million (now funded with

reserves)

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Ten Year Financial Plan (Cont’d)

Annual increases required

Primarily because of the events outside of the City’s control

discussed on the prior slide, an increase in assessment revenue

of approximately 16% will be required in FY 2013.

Annual increases in subsequent years will also be required in

the order of magnitude of 6% to 10 % through FY 2017.

Depending upon growth, some level of annual increases will

need to continue throughout the ten year projection period.

Summary of results of the ten year financial analysis

The following slide shows the results of this analysis and an

interactive presentation of the financial model will be

conducted during the work shop.

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FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 20220.00% FY 2017 FY 2022

0.00% 0.00% 4.04% 5.35% 7.34% 9.44% 10.57% 4.63% 14.09% 2.85% 4.47% 28.70% 82.61%0.00% 0.00% 4.04% 5.35% 7.34% 9.44% 10.57% 4.63% 14.09% 2.85% 4.47% 28.70% 82.61%

100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Include Govt? Y

20% 20% 20% 20% 20% 20% 20% 20% 20% 20% 20% Include Non Pay? Y

$200.00 $206.00 $212.18 $218.55 $225.10 $231.85 $238.81 $245.97 $253.35 $260.95 $268.78

FINANCIAL ANALYSIS AND MANAGEMENT SYSTEM (FAMS) SUMMARY

Req'd Assessment Rev Increases

Cumulative Change

Override ►

Last Plan

CIP Execution % ►

Operating Reserve % ►

Homeowners Ins. Savings ►

0

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2

3

4

5

11 12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Operating Fund Current Plan Last Plan Target

0

1

2

3

4

12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Capital Spending Current Plan Last Plan

0

5

10

15

20

12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

Revenue Vs. Expenses Cash In Cash Out

0

1

2

3

4

12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

Long-Term Borrowing Current Plan Last Plan

0.0

0.5

1.0

1.5

12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Surtax Fund Balance Current Plan Last Plan

SAVE CALC

0

1

2

3

4

11 12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

All Impact Fee Funds Current Plan Last Plan

Ten Year Financial Plan

with Gov’t and Non-Pays

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Reserve balances would

have been greater

Required revenue

increases would have

been lower

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 20220.00% FY 2017 FY 2022

0.00% 15.86% 10.23% 5.61% 8.99% 7.39% 4.01% 3.86% 14.00% 2.74% 4.38% 57.74% 108.17%0.00% 0.00% 4.04% 5.35% 7.34% 9.44% 10.57% 4.63% 14.09% 2.85% 4.47% 28.70% 82.61%

100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Include Govt? N

20% 20% 20% 20% 20% 20% 20% 20% 20% 20% 20% Include Non Pay? N

$200.00 $206.00 $212.18 $218.55 $225.10 $231.85 $238.81 $245.97 $253.35 $260.95 $268.78

FINANCIAL ANALYSIS AND MANAGEMENT SYSTEM (FAMS) SUMMARY

Req'd Assessment Rev Increases

Cumulative Change

Override ►

Last Plan

CIP Execution % ►

Operating Reserve % ►

Homeowners Ins. Savings ►

0

1

2

3

4

5

11 12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Operating Fund Current Plan Last Plan Target

0

1

2

3

4

12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Capital Spending Current Plan Last Plan

0

5

10

15

20

12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

Revenue Vs. Expenses Cash In Cash Out

0

1

2

3

4

12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

Long-Term Borrowing Current Plan Last Plan

0.0

0.5

1.0

1.5

12 13 14 15 16 17 18 19 20 21 22

Mill

ion

s ($

)

Surtax Fund Balance Current Plan Last Plan

SAVE CALC

0

1

2

3

4

11 12 13 14 15 16 17 18 19 20 21 22

Mil

lio

ns

($)

All Impact Fee Funds Current Plan Last Plan

Ten Year Financial Plan

without Gov’t and Non-Pays

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Reserve balances

are lower

Required revenue

Increases are higher

Cost Apportionment Results

There will be a shift in the cost apportionment and

the resultant assessments from vacant and

commercial properties to residential properties as

shown on the following slide on a revenue neutral

basis.

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Apportionment by Property Class

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Description Parcels Current Total

Total $ Revenue

Neutral

Total $ 15.86%

Increase in

Revenue

Residential 26,255 3,580,578$ 5,056,723$ 5,884,409$

Non-Residential 441 893,847$ 755,373$ 879,013$

Institutional - -$ -$ -$

Golf Courses 3 31,503$ 18,729$ 21,795$

Vacant/Agriculture 44,837 2,485,395$ 1,191,425$ 1,386,437$

Exempt 1,497 30,928$ -$ -$

Total 73,033 7,022,250$ 7,022,250$ 8,171,654$

Description Parcels Current Total

Total $ Revenue

Neutral

Total $ 15.86%

Increase in

Revenue

Residential 26,255 3,580,578$ 5,056,723$ 5,884,409$

Non-Residential 441 893,847$ 755,373$ 879,013$

Institutional - -$ -$ -$

Golf Courses 3 31,503$ 18,729$ 21,795$

Vacant/Agriculture 44,837 2,485,395$ 1,191,425$ 1,386,437$

Exempt 1,497 30,928$ -$ -$

Total 73,033 7,022,250$ 7,022,250$ 8,171,654$

Description Parcels Current Total

Total $ Revenue

Neutral

Total $ 15.86%

Increase in

Revenue

Residential 26,255 3,580,578$ 5,056,723$ 5,884,409$

Non-Residential 441 893,847$ 755,373$ 879,013$

Institutional - -$ -$ -$

Golf Courses 3 31,503$ 18,729$ 21,795$

Vacant/Agriculture 44,837 2,485,395$ 1,191,425$ 1,386,437$

Exempt 1,497 30,928$ -$ -$

Total 73,033 7,022,250$ 7,022,250$ 8,171,654$

Property Impact Analysis

An analysis of the impact upon selected property

types within each class is presented on the following

pages.

This analysis compares the current assessment to the

proposed assessment calculated using the

recommended methodology

Two sets of charts are shown:

Revenue neutral with no increase in overall assessment revenue

Including the 16% increase in assessment revenue identified as being

required in the financial plan

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Property Impacts

Revenue Neutral - $7.022 Million

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Property Impacts

Revenue Neutral - $7.022 Million

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Property Impacts

Revenue Neutral - $7.022 Million

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Property Impacts

15.86% Increase in Revenue - $8.172 Million

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Property Impacts

15.86% Increase in Revenue - $8.172 Million

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Property Impacts

15.86% Increase in Revenue - $8.172 Million

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Comparative Survey

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Lot Size 0.25 Acres

Sq. Ft. 2,600

Taxable Value $100,000

$- $50.00 $100.00 $150.00 $200.00 $250.00 $300.00 $350.00

West Manatee

Duette

Pine Island

East Manatee

North Port - Proposed

Nort Ft. Myers

Cedar Hammock

Estero

Bonita Springs

Sarasota County

Parrish

North Port - Current

WestManatee

Duette Pine Island East ManateeNorth Port -

ProposedNort Ft.Myers

CedarHammock

EsteroBonitaSprings

SarasotaCounty

ParrishNorth Port -

Current

Fire Assessment $321.99 $310.00 $300.00 $288.30 $251.07 $250.00 $248.84 $200.00 $199.99 $174.72 $172.25 $149.50

FY 2012 Comparative Fire Assessment Survey

Conclusions

No action is required at this work shop; however, it will

be our recommendation that…

The Commission adopt the Fire Assessments rates (and the resultant

specific property assessments for FY 2013 based upon…

The recommended methodology, and

The level of revenue requirement that includes the 16% increase in

overall assessment revenue identified in the financial plan

It will also be our recommendation that…

The Commission adopt an annual escalator (appropriate CPI index)

or specific annual percentage increase, to insure that the assessments

increase annually to provide sufficient revenue to provide the desired

level of service, and

Update the financial plan annually or bi-annually to ensure adequate

financial resources to fund all Fire District costs.

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Next Steps

A special Public hearing must be held to adopt the assessments prior to September 15th.

A fist class mail notice of the hearing must be sent to all property owners who will be assessed at least 20 days prior to the hearing, which must include among other information the following: Property data - owners name and address and parcel ID

Assessment information – property class, assessment rates, assessment for subject parcel for FY 2013.

The assessments are not required to be included in the TRIM notice Inclusion of non ad-valorem assessments in the TRIM notice is

optional

It is recommended that the Fire Assessment not be included in the TRIM notice this year to avoid confusion re the above referenced public hearing.

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Discussion