STAFF REPORT
Meeting Date:
April 14, 2026
BUSINESS
19 SUBJECT: REPORT ON AMBULANCE PROGRAM PERFORMANCE, AMBULANCE RATE
INCREASE, AND AMBULANCE PURCHASE
RECOMMENDATION: It is recommended that the City Council:
1. Receive and file the Ambulance Program report;
2. Adopt the attached resolution titled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF LAGUNA BEACH, CALIFORNIA, ESTABLISHING THE RATES FOR THE PROVISION
OF ADVANCED LIFE SUPPORT (ALS) SERVICE AND BASIC LIFE SUPPORT (BLS)
GROUND AMBULANCE TRANSPORT SERVICE, AND PROVIDING FOR ANNUAL
ADJUSTMENTS BASED ON THE CONSUMER PRICE INDEX FOR FIVE YEARS, AND
FINDING THE SAME EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT”, increasing the City’s ambulance transport base rate fee, mileage fee, and incidental materials fee in line with Consumer Price Index increases;
3. Authorize the City Manager, or his designee, to execute a Cooperative Purchase Agreement with Professional Sales and Service, L.C., and related financing documents for the purchase of one (1) ambulance, in an amount not-to-exceed $314,988.71 over a seven-year term (with estimated annual payments of approximately $55,000), subject to annual budget appropriations;
4. Appropriate $55,000 from the available fund balance in the Vehicle Replacement Fund, for the first year payment in FY 2025-26; and
5. Determine that the action is not a project under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Sections 15378(b)(4) and (5), and alternatively is categorically exempt under Section 15301 (Existing Facilities), and that none of the exceptions in Section 15300.2 apply.
SUMMARY OF THE MATTER
The Laguna Beach Fire Department operates a City-run ambulance transport program that provides Advanced Life Support (ALS) and Basic Life Support (BLS) services to the community (“Ambulance Program”). The Ambulance Program continues to deliver a high level of service, support regional emergency response efforts, and serve as a valuable recruitment and training pathway for future firefighters.
The City Council is asked to receive and file the annual Ambulance Program Report, which provides an overview of program performance, transport volume, and financial results. While the program remains operationally effective, rising costs associated with medical supplies, fuel, maintenance, and equipment have created a need to adjust ambulance service rates to better align with current expenditures.
Staff recommends adopting a resolution to increase ambulance transport rates, including base rates, mileage fees, and incidental charges, based on the Consumer Price Index (CPI), with annual adjustments over a five-
REPORT ON AMBULANCE PROGRAM PERFORMANCE, RATE INCREASE AND
AMBULANCE PURCHASE
April 14, 2026
year period. The proposed adjustments are consistent with regional trends and are expected to improve cost recovery while maintaining compliance with applicable billing regulations.
Additionally, staff recommends authorizing the purchase and financing of one (1) additional ambulance to expand the City’s fleet from three (3) to four (4) units. This will enhance service reliability, ensure adequate reserve capacity, and support increased seasonal demand during peak visitor periods. The total cost of the ambulance is approximately $314,988.71, financed over seven years with estimated annual payments of $55,000. The first year payment (FY 2025–26) will be funded through the Vehicle Replacement Fund, with subsequent payments budgeted in the General Fund, Fire Department Ambulance Program. This allows the department to purchase the vehicle now and have it in service by summer.
The ongoing cost of the financing is expected to be offset by increased ambulance service revenues resulting from the proposed rate adjustments. This action supports the City’s goal of maintaining high-quality public safety services and ensuring long-term fiscal sustainability.
DISCUSSION
Ambulance Program Report
On March 12, 2024, the City Council received a comprehensive report on the Ambulance Program, which included performance and operational data for Fiscal Year 2022–2023. The Ambulance Program continues to provide a high level of service to the community and has been successfully replicated in the cities of Fullerton, Brea, Fountain Valley, and Orange since its inception. Currently, nine of the eleven fire departments in Orange County operate an ambulance service.
Over the past three (3) years, the Laguna Beach Fire Department has transported a total of 4,990 patients to local hospitals.
2023 2024 2025 Average Total
1,664 1,680 1,646 1,662 4,990
The following summarizes the program’s performance for Fiscal Years 2023/24 through 2025/26 YTD, including participation in both the Public Provider Ground Emergency Medical Transport (PP-GEMT) program and the State’s Intergovernmental Transfer (IGT) Variable Rate Reimbursement Program (VRRP).
The PP-GEMT program provides cost-based supplemental Medi-Cal reimbursement and is included within the expenditure/revenue analysis below, while the IGT-VRRP is a separate intergovernmental transfer program that provides additional performance-based reimbursement and is summarized in the Intergovernmental Program chart below. While base operations reflect a net deficit, participation in the IGT-VRRP program generated supplemental reimbursement that more than offset costs, resulting in a positive net revenue position overall.
REPORT ON AMBULANCE PROGRAM PERFORMANCE, RATE INCREASE AND
AMBULANCE PURCHASE
April 14, 2026
Expenditure/Revenue Analysis
FY 2023/24 FY 2024/25
FY 2025/26 YTD
(As of 2/28/26)
Expenditures $1,853,307 $1,851,000 $1,238,411
Revenues $1,691,967 $1,767,450 $1,176,465
Net Total $(161,340) $(83,550) $(61,946)
Intergovernmental Program
FY 2023/24 FY 2024/25
FY 2025/26
ESTIMATE
IGT-VRPP Expenditures $143,706 $124,635
IGT-VRPP Revenues $340,488 $283,557
Net Total N/A $196,782 $158,922
Net Revenue N/A $113,232 $96,976
The Ambulance Program has demonstrated strong success in recruiting and developing talent for the fire service, with five (5) individuals hired as full-time firefighters by the Laguna Beach Fire Department since the program’s inception and an additional 24 hired as full-time firefighters by other agencies.
Ambulance Rate Increase
Current ambulance transportation rates were set by Council Resolution 21.04, effective July 1, 2022.
Emergency medical service costs—including medical supplies, fuel, vehicle maintenance, equipment, and related expenses—have increased since the program’s implementation in 2022 due to regional and national inflationary pressures. A modest adjustment based on the Consumer Price Index for All Urban Consumers (CPI-U) for the Los Angeles–Long Beach–Anaheim area provides an objective and transparent method to realign rates with current operating costs. Applying a CPI-based increase of approximately 10.3% over the 2023–2025 period is projected to increase annual revenue potential by approximately $92,450.
While Laguna Beach’s ambulance rates have remained the same over the past four (4) years, the average BLS rate in Orange County has increased by almost 60%.
City 2021 BLS Rate 2026 BLS Rate
City of Laguna Beach $2,800 $2,800
City of Huntington Beach $1,336 $2,155
City of Newport Beach $1,721 $2,743
City of Orange $1,630 $2,413
City of Fullerton $1,630 $2,413
County of Orange $1,290 $2,413
REPORT ON AMBULANCE PROGRAM PERFORMANCE, RATE INCREASE AND
AMBULANCE PURCHASE
April 14, 2026
Ambulance Purchase
Staff recommends the purchase of one (1) additional ambulance to support front-line operations, increasing the fleet from three (3) to four (4) units and allowing one existing ambulance to be designated as a dedicated reserve.
Between Memorial Day and Labor Day, Laguna Beach experiences a significant increase in population due to tourism, beach activity, events, and traffic. To meet this seasonal demand, the City utilizes and provides staff for two 24-hour ambulances and one 12-hour ambulance daily. Under this deployment model, all existing units are fully utilized, leaving no reserve capacity. In 2025, this extra ambulance crew transported 193 patients.
An additional ambulance will allow for uninterrupted operations in the event of a mechanical breakdown, accident, or other unforeseen circumstances that may remove an ambulance from service.
Staff recommends the purchase of a 2026 Leader ambulance from Professional Sales & Service LLC through a cooperative purchasing agreement with Sourcewell (Contract No. 122123-RVG), with financing through REV Group over a seven-year term. The total cost of the fully outfitted ambulance will not exceed $315,000, financed over a seven-year period, with annual payments estimated at $55,000. This approach is consistent with the financing structure utilized for the City’s existing ambulance fleet.
The first-year payment (FY 2025–26) will be funded through the Vehicle Replacement Fund. Subsequent annual payments will be incorporated into the General Fund, Fire Department budget under the Ambulance Program. The ongoing financing costs are expected to be offset by increased ambulance service revenues resulting from the proposed rate adjustments.
Use of the Sourcewell cooperative purchasing contract is consistent with Laguna Beach Municipal Code Section 2.30.050(c), which permits purchases based on the competitive bidding processes of other public agencies and exempts such procurements from separate City bidding requirements: “Cooperative Purchasing. If a purchase is based on the bidding efforts of another public agency or purchased in conjunction with another public agency, then the purchase is exempt from bid requirements.”
FINANCIAL ANALYSIS
Rate Increase
The proposed ambulance rate adjustment is estimated to generate approximately $92,450 in additional annual reimbursement. These revenues are anticipated to be derived primarily from private insurance, as well as patient cost-sharing mechanisms such as deductibles and co-payments. Medicare and Medi-Cal reimbursement rates are established through existing regulatory frameworks and are not directly impacted by local rate adjustments. Patients without insurance will be billed in accordance with the updated rates; however, accounts are managed based on ability to pay, consistent with applicable policies and State law.
California Assembly Bill 716 further limits the collection of unpaid medical debt.
REPORT ON AMBULANCE PROGRAM PERFORMANCE, RATE INCREASE AND
AMBULANCE PURCHASE
April 14, 2026
The chart below summarizes the 2025 payer mix. The remaining three percent reflects patients associated with auto liability claims, workers’ compensation cases, and certain veterans’ coverage programs.
Medicare Medi-Cal Private Insurance Cash Pay
47% 17% 17% 16%
Ambulance Purchase
The total cost of the ambulance is approximately $314,988.71, financed over a seven-year term, with estimated annual payments of approximately $55,000.
The first-year payment (FY 2025–26) will be funded through the Vehicle Replacement Fund. Subsequent annual payments will be incorporated into the General Fund, Fire Department budget under the Ambulance Program, subject to City Council appropriation as part of the annual budget process.
The proposed ambulance rate adjustments are intended to improve cost recovery for the Ambulance Program, and the ongoing cost of the financing is expected to be substantially offset by increased ambulance service revenues. However, actual cost recovery will depend on transport volume, payer mix, and reimbursement rates.
The addition of one (1) ambulance will expand the City’s fleet from three (3) to four (4) units, improving service reliability and reducing the risk of service disruptions due to maintenance or peak seasonal demand.
The financing approach allows the City to acquire the vehicle without a significant upfront capital expenditure, while distributing costs over the useful life of the asset.
ENVIRONMENTAL ANALYSIS
The recommended action consists of organizational or administrative activities of the City that will not result in a direct or indirect physical change in the environment and therefore does not constitute a “project” within the meaning of the California Environmental Quality Act. (Public Resources Code Section 21065; 14 CCR Section 15378(b)(5).) Additionally, the recommended action consists of the creation of government funding mechanisms or other government fiscal activities, which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment and therefore does not constitute a “project” within the meaning of the California Environmental Quality Act. (Public Resources Code Section 21065; 14 CCR Section 15378(b)(4).) The proposed actions to receive and file the Ambulance Program report, adopt a resolution establishing ambulance service rates, and authorize the purchase and financing of one ambulance are administrative, fiscal, and acquisition activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment and therefore do not constitute a “project” under CEQA Guidelines Section 15378(b)(4) and 15378(b)(5). Alternatively, this action is categorically exempt pursuant to CEQA Guidelines Section 15301 (Existing Facilities), which includes the operation, repair, maintenance, or minor alteration of existing public facilities involving negligible or no expansion of use. Here, the proposed actions to receive and file the Ambulance Program report, adopt a resolution establishing ambulance service rates,
REPORT ON AMBULANCE PROGRAM PERFORMANCE, RATE INCREASE AND
AMBULANCE PURCHASE
April 14, 2026
and authorize the purchase and financing of one ambulance is to support an existing municipal service and facilities without expansion of the use.
Further, none of the exceptions outlined in CEQA Guidelines section 15300.2 apply. The project site does not contain any environmentally sensitive areas. There will be no cumulative impact resulting from successive projects of the same type in the same place, over time. There are no unusual circumstances resulting in a significant impact on the environment. There will there be damage to scenic resources, including trees, historic buildings, rock outcroppings or similar resources, within a highway officially designated as a state scenic highway. The project is not located on a hazardous waste site or any other site included on a list compiled pursuant to Government Code section 65962.5. The project will not result in significant adverse impacts to historical resources as defined by CEQA. Consequently, additional environmental analysis is not necessary to meet the requirements of the CEQA.
ATTACHMENTS
1. Resolution (Pgs. 7-11)
2. Cooperative Agreement (Pgs. 12-53)
Submitted By:
. Approved: .David A Kiff
Niko King, Fire Chief Dave Kiff, City Manager
Report Prepared By: Coordinated With:
Andrew Hill, Deputy Fire Chief Patrick Donegan, Assistant City Attorney Tammie Pickens, Senior Accountant
Kirsten Gallacher, Senior Administrative Analyst