The Town Council will meet in a closed executive session this week to provide staff direction in negotiating a new contract with Rural/Metro Corp., the town’s fire suppression and emergency medical services provider.

Rural/Metro has served Fountain Hills since long prior to incorporation and its most recent five-year contract is set to expire with the current fiscal year.

Late last summer Rural/Metro filed for Chapter 11 bankruptcy, which prompted the town to take a wait-and-see approach to negotiating a new agreement.

Town Manager Ken Buchanan said the town does have the option to extend the existing contract for two additional one-year terms if it were deemed necessary.

However, Rural/Metro announced in late December that it had officially emerged from the bankruptcy court proceedings ready to continue serving its clients.

According to a press release issued by the company, “Rural/Metro’s Plan of Reorganization was confirmed by the U.S. Bankruptcy Court for the District of Delaware on Dec. 17, 2013.

“Rural/Metro has met all closing conditions of its Plan of Reorganization.

“Through its financial restructuring, Rural/Metro has reduced its financial indebtedness by approximately 50 percent. In addition, Rural/Metro’s bondholders will provide the Company with a new equity capital infusion of $135 million to help position the Company for renewed growth.”

“Today marks the successful completion of our financial restructuring and the start of a new chapter for our Company,” said Scott A. Bartos, president and chief executive officer of Rural/Metro.

“As a stronger and more competitive company, we will continue to invest in infrastructure and technology and advance our commitment to providing state-of-the-art medical transportation and fire services.”

In a separate issue, but one tied to the bankruptcy clearance, Rural/Metro agreed to pay a $2.8 million settlement to the federal government to resolve allegations of false Medicare claims.

The settlement resolves claims by the federal government that between Jan. 1, 2007 and Dec. 31, 2007 various ambulance companies operated by Rural/Metro in Arizona made false billing claims.

The company allegedly billed Medicare for transporting patients between hospitals on an emergency basis when in fact these were not emergency transports.

As a result Medicare paid substantially more for the transports than was warranted, according to the federal suit.

“The need to protect federal funds, including the Medicare trust fund, from fraud, waste and abuse has never been greater,” U.S. Attorney for Arizona John S. Leonardo said in a press release.

“The U.S. Attorney’s Office will continue to use the False Claims Act to pursue entities and individuals who improperly profit from federal dollars at the expense of the public.

“This settlement agreement is a substantial recovery for taxpayers and sends a clear message that the federal government will not stand idly by when its programs lose money due to false claims for payment.”

Rural/Metro officials stated that the settlement agreement is not a finding of any wrongdoing on the part of the company. The settlement was reached in an effort to save time and money at a time the company was emerging from bankruptcy.