The Town Council has directed staff to create a proposal along with a transition plan to implement an in-house fire department operated by the Town of Fountain Hills. Town Manager Grady Miller said staff would have a plan to the council in November for its consideration. If approved the action could end the Town’s half-century relationship with the Rural/Metro Corp.

David Pock, the Town’s CFO/Finance Director, presented the council with potential cost comparisons between maintaining a Rural/Metro contract and the Town operating the fire department itself. The first year the difference would be about $1.1 million more for the in-house operations. This would include some additional personnel and transition costs. The second year in Pock’s projection, the difference drops to about $400,000 more. Through FY30 the operation costs range to about $600,000 more per year for the Town to operate the department.

Town Manager Grady Miller reminded the council that the existing Rural/Metro expires after FY26 and its contract would likely increase, possibly more than Pock is projecting.

Councilman Alan Magazine was not comfortable with proceeding with the action. His concern is primarily based on the costs.

“We would be saving a considerable amount by staying with Rural/Metro through (FY26),” Magazine said. “Rural/Metro is fulfilling all the requirements of its contract and we are receiving excellent service.”

Mayor Ginny Dickey said this is not just a matter of dollars and cents, but also taking control of the future so as not to have to be reactive to events.

Miller said he believes it is appropriate to be proactive in approaching the situation. He noted that currently Rural/Metro Corp. is a small part of the private equity firm Kohlberg Kravis Roberts (KKR), which is investor return driven.

Currently Rural/Metro has only two fire service contracts remaining in Arizona, Fountain Hills and Carefree. Miller said that while the contract requires Rural/Metro to provide two-year notice of terminating the contract with Fountain Hills, he believes notice could be much shorter.

Councilman David Spelich said he does not believe that a large equity firm would be holding on to such a small and not profitable operation.

Councilman Mike Scharnow, participating in the meeting by phone, said he agrees it is time to act.

“It would behoove us to be proactive on this,” Scharnow said. “We should move on this to be ready.”

In August the council heard a report from McGrath Consulting, a firm it hired to evaluate fire and emergency services for Fountain Hills. Among key recommendations from McGrath were that the Town prepare itself for the eventuality that Rural/Metro would not be an option.

The report states, “should the Town continue using contractual services, it is strongly recommended that a contingency plan be developed for the possibility that Rural/Metro might exercise its right to end their contractual obligations relationship.”

It was also recommended that should the Town chose to create and operate a municipal fire department a primary goal should be compliance with National Fire Protection Association (NFPA) standards that would allow it to join the Regional Automatic Aid System. McGrath’s Craig Haigh said the automatic aid system in the Phoenix Metro Valley is a capstone program modeled nationwide. The system requires additional equipment manning requirements than are used under the current Rural/Metro contract.

Fountain Hills Rural/Metro does have mutual aid agreements, which do have a slightly delayed response from the regional automatic system. Those partners are other Rural/Metro stations in the vicinity, Rio Verde Fire District and Fort McDowell Yavapai Nation Fire Department.

It was also noted that the City of Scottsdale Fire Department will no longer respond to mutual aid requests from Rural/Metro.

“A consultant knowledgeable in the Regional Automatic Aid System (should) be hired to help the Town prepare its application and assist with plan implementation,” the recommendation states.

McGrath is also recommending that should the Town move to establish a municipal fire department it should include separate human resources and information technology positions. Also, it recommends that with a Town fire department employees should be enrolled in the Arizona Public Safety Personnel Retirement System.

“Participation in this system will be important related to recruitment and retention of fire personnel,” the report states.

Councilwoman Sharron Grzybowski indicated strong support for following

the guidance of the consultant.

“They are recommending we prepare a plan now; we are going to need all of two years,” Grzybowski said.

Miller said he would bring back a plan for the council to consider in November. If that is approved it would be a starting gun for a transition.