Agenda Item No. 11
CITY OF YUCAIPA
AGENDA REPORT
TO: Honorable Mayor and City Council
FROM: Phillip White, Director of Finance
FOR: City Council Meeting of July 22, 2024
SUBJECT: Special Tax for Yucaipa Paramedic Program
RECOMMENDATION:
That the City Council adopt Resolution No. 2024-50, fixing the Special Tax for Fiscal Year 2024-2025 (FY25) for the Yucaipa Paramedic Program at the following rates:
Residential Dwelling Unit $52
Small Commercial Unit $78
Large Commercial Unit (> 10,000 sq. ft.) $156
Residential Care Facility $78 plus $3 per bed over 26
BACKGROUND/DISCUSSION:
In Fiscal Year 1999-2000, the City assumed responsibility for the provision of fire protection and paramedic services. Up until that time, those services were provided to the community through a Special District of San Bernardino County, known as County Service Area No. 38 (CSA38). As a result of that assumption of responsibility, the City's fire protection services are funded entirely by revenues generated from property taxes that were shifted to the City from CSA 38.
The Paramedic Program (Program) was always intended to be funded entirely through a Paramedic Special Tax (PST) approved by the voters initially in 1987. The original PST equated to an annual amount equal to $24 per individual dwelling unit and $35 per individual commercial unit. Because of the escalation of costs, and the premise that the Program is to be funded entirely by the PST, the voters approved (Measure Y), an increase to the maximum annual PST in 2004 to the current amount of $52 per residential dwelling unit, $78 per small commercial unit, $156 per large commercial unit (> 10,000 sq. ft.) and $78 plus $3 per bed over 26 for residential care facility. The 2004 PST was approved by the voters with no escalation clause. As a result, the PST per unit has not increased in 20 years. Therefore, the total annual revenue is increased only by the number of new units assessed. In 2004, the voters understood that the assessment amount would be sufficient to cover the estimated and escalating costs of the Program for approximately 10 years, or through 2014. FY16 represented the first year in which revenues were not sufficient to cover the annual expenses for the Program. The paramedic services accumulated fund balance had been covering the
annual deficit in the Program since FY16 until funds were depleted in FY20. The Program budget shortfall is now being covered by the Fire Fund:
Actual
Annual Cost
Budget
Shortfall
Funded from:
Paramedic Svcs.
Fund Balance
Actual
Fire Fund
portion
FY 2021/2022
$1,542,886
$760,268
depleted
$452,772
FY 2022/2023
$1,529,295
$979,200
depleted
$441,944
The annual projected deficit will continue to grow, as expenses exceed the revenues generated by the PST.
To address the deficit, the City Council voted to place Measure E on the ballot to levy a general Transactions and Use Tax. Funds generated from Measure E would have been used to: address the Program deficit, decrease response times on emergency 911 calls, generate funds from Yucaipa visitors to benefit local residents; enhance police and fire protection; increase local youth and senior services; and fund other general services provided throughout the City, like streets and parks maintenance. On March 3, 2020, voters did not approve Measure E and the deficit trend has continued.
Estimated
Annual
Program
Cost
Budget
Shortfall
Estimated Fire
Fund portion
FY 2023/2024
$2,227,502
$1,312,502
$1,137,502
FY 2024/2025
$2,468,298
$1,378,298
$1,378,298
To continue collecting the PST, the City Council is required to annually adopt a resolution to levy the PST up to the maximum amount authorized for the needs of the paramedic program as set forth in Measure Y.
Staff recommends that Council set the FY25 Special Tax rates at the maximum amounts allowable, consistent with the provisions of Measure Y. The Special Tax rates are as follows:
Residential
Small Commercial
Large Commercial (Greater than 10,000 sq. ft.)
Residential Care Facilities
$52 per year
$78 per year
$156 per year
$78 plus $3/per bed over 26 beds
As detailed throughout this report, the revenues collected from the PST are no longer sufficient to cover the annual expenses of the Program and the Fire Fund is covering the Program budget shortfall. The City sends a fire engine truck to all emergency medical calls, which make up a majority of total calls, according to city data. The vehicles, manned by fire and ALS paramedic personnel, often arrive before the ambulance, and provide immediate emergency medical treatment. Yet the cost to deploy these employees and render the service has no recovery mechanism other than the current PST.
FISCAL IMPACT:
With an approval of the recommendation, it is estimated that approximately $1,090,000 will be collected through special assessments for FY25. The remaining Program deficit will be funded by the Fire Fund through a transfer to the Public Safety Fund.
Attachment:
1. Resolution No. 2024-50
Approved by:
ATTACHMENT 1
RESOLUTION NO. 2024-50
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF YUCAIPA,
CALIFORNIA, ACTING IN ITS CAPACITY AS THE GOVERNING BODY
OF THE YUCAIPA PARAMEDIC PROGRAM FIXING THE SPECIAL
TAX FOR FISCAL YEAR 2024/2025
WHEREAS, that on June 2, 1987, the electors of County Service Area 38, Improvement Zone M, duly authorized a special tax levy for financing paramedic services; and WHEREAS, on March 2, 2004, the electors of the City of Yucaipa duly authorized an increase to the special tax levy for financing paramedic services; and WHEREAS, The amount of such tax shall not exceed fifty-two dollars ($52) per individual dwelling unit, seventy-eight dollars ($78) per individual small commercial unit, one hundred fifty-six ($156) per individual large commercial unit (greater than 10,000 square feet) and seventy-eight ($78) plus three ($3) per bed, over twenty-six beds, per residential care facility, per year; and
WHEREAS, the total budgeted cost of providing paramedic services for fiscal year 2024/2025 is one million, ninety thousand dollars ($1,090,000).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF YUCAIPA HEREBY RESOLVES AS FOLLOWS:
Section 1.
The City Council of the City of Yucaipa, as the successor to the San Bernardino County Board of Supervisors described in the Local Agency Formation Commission Resolution No. 2638, dated March 17, 1999, acting as the governing body of the Yucaipa Paramedic Program, hereby resolves and orders:
(a) That in order to fund the paramedic services budget, the special tax for fiscal year 2024/2025 shall be set at fifty-two dollars ($52) per individual dwelling unit, seventy-eight dollars ($78) per individual small commercial unit, one hundred fifty-six ($156) per individual large commercial unit (greater than 10,000 square feet) and seventy-eight ($78) plus three ($3) per bed, over twenty-six beds, per residential care facility, per year; and PASSED, APPROVED and ADOPTED this 22nd day of July, 2024.
Justin Beaver, Mayor
ATTEST:
Ana V. Sauseda, MMC
Director of General Services/City Clerk