Memorandum 15-126 Fleet Reserves - Ambulance Replacement

Memorandum 15-126

TO:                       Katie Koester, City Manager

FROM:                 Robert Painter, Fire Chief

DATE:                  July 22, 2015

SUBJECT:         Fleet Reserves-Ambulance Replacement

In late 2013 the Fire Department request for Code Blue Grant funding to replace our 1997 Type I Ambulance was approved with an expected local community match of 10%. At that time, the estimated cost of a new ambulance was $170,000.

The Code Blue Grant was established about 14 years ago by an effort of the 3 regional Emergency Medical Service Offices (non-profit corporations) and the State EMS Office in Juneau. The grant was created to assist local agencies in meeting an increasing list of unfunded capital project request for patient care equipment and ambulances. Over the years there have been many funding partners along with the state and local communities, namely the U. S. Department of Agriculture and the Denali Commission. The State Code Blue Committee reviews grant requests and either approves or denies them based on a systematic review of need at the regional level, and a final review of the State Code Blue Committee. Large capital items often have a state cap applied to allow more projects to be funded over time. The cap placed on ambulance purchases is $70,000 of State Code Blue funds, along with whatever additional funding sources can be allocated for the project by the local region EMS office. Unfortunately, over the life of the Code Blue project, finding additional funding partners has proven to be more difficult, requiring local jurisdictions to meet and increasing ratio of costs for each project. Currently, between the State share and USDA funding available, the total funds now available for our approved ambulance replacement will be no more than $95,500, leaving the actual remainder the responsibility of the local jurisdiction to fund. Also, since the initial approval of our Code Blue request, the estimated cost of a replacement ambulance has increased to slightly over $180,000, without equipment. This will require at least another $85,000 from the City of Homer to fund this project. Our current balance in Fleet Reserves is slightly more than $116,000. While this will fully fund the ambulance replacement, and some basic equipment, it will essentially zero out our Fleet Reserve balance.

Options:

Do nothing, realizing that deferring the replacement of the 1997 ambulance only means that there will be increased wear and tear on the newer (2000) ambulance, increasing maintenance costs of both units (we typically “retire” the older ambulance to “second” out status, to spread the load between the two ambulance. Also be aware that we sometime require the use of both ambulances, we cannot function at current levels with only one ambulance. Cost - $0, lose the already committed State funds.
Defer any decision until next year. According to the Regional EMS Director, we can defer making a decision on additional funding until the end of the year, without much risk of losing the dedicated funds already allocated from the state. The regional EMS office in Anchorage has worked for several years trying to find additional funding partners for Code Blue projects, to no avail. In short, grant funds, in current economic times, are becoming more difficult to find. It is unlikely that any additional state funds will be made available for Code Blue than have already been committed by the current state budget.
Fund the unmet remainder of the project to replace the 1997 ambulance. This will complete the project, but essentially wipe out the Fire Department Fleet Reserve account balance. Benefits include reducing wear and tear on the 2000 model ambulance, extending its life, and providing a newer, and safer ambulance for our crews and patients. The new ambulance must meet current federal ambulance standards, including crash testing and stability. Cost - $100,000-110,000.

Recommendation:

It is clear that the 1997 year ambulance must be replaced, the sooner the better. It is also prudent, at this time, to try to postpone the decision no later than the first quarter of 2016, at which time both the 2016 budget and revenue predictions will be more understood. To economize, equipment from the 1997 can be utilized on the new ambulance, except for the ambulance cot/gurney (which must be replaced to meet current standards for a new ambulance); the 1997 Type I Ambulance can be advertised for sale (research indicates that we may be able to sell this age of ambulance for between $15,000 and $20,000). It was the initial intention to retain the 1997 as a reserve ambulance and store it at the Skyline Station where it could be used for mass casualty incidents, or as an immediate reserve if needed in case of breakdown.