by Barbara G. Bedell

Chair, Orcas Fire Board of Commissioners

Emergency response cost recovery is not a new concept nor is it unique to Orcas Island.

More than 90 fire districts in the state of Washington alone currently have a cost recovery program. At the federal level, FEMA publishes a handbook for districts about cost recovery options. The program we are currently implementing on Orcas is the result of careful planning and community input.

Why did we consider a cost recovery program in the first place?

We all know that our beautiful island environment makes Orcas a unique place to live. However, the absence of a hospital or an emergency room is also unique compared to most communities. In the absence of these facilities, Orcas Island Fire and Rescue becomes the one-size-fits-all solution to emergency needs.  This is expensive to operate.

Some will argue that our tax levy is designed to support these expenses. Yes, the levy is a critical financial resource for infrastructure and base operations. However, our call volumes are increasing dramatically, and we are on pace for a record  number in 2015. Through August of this year, volume is up 18 percent. Our variable costs average about $1,742 per response. We strive to keep this average as low as possible through efficient operations, but many factors are out of our control, such as the cost of certain drugs.

A rising response rate results in rising costs. At some point, rising costs will exceed existing resources. The cost recovery program is a proven strategy to offset such rising costs. We may generate as much as $150,000 in new revenue through this program.

What due diligence was done?

We examined cost recovery best practices and options in a task force formed in June 2014. It was comprised of five Orcas residents and myself. We looked at programs in other districts to evaluate options for OIFR, and we determined that a cost recovery program would only work for Orcas if the following conditions were met:

• There would be no impact to response and treatment standards.

• Unnecessary complexity would not be introduced into OIFR operations.

• Orcas residents would not incur out-of-pocket expenses.

• The program would contribute significant net revenue to the OIFR budget

• OIFR commissioners could change or cancel the program after implementation.

We also realized that community input would be critical to the success of any local cost recovery program. Four public town hall events held this year to discuss cost recovery. Former Chief  Kevin O’Brien led the first two sessions and current acting Chief Miklos Preysz held the two most recent town hall events in June. Additionally, the program discussion and approval occurred transparently at public commissioner meetings.

How will we implement the program?

Commissioners voted to authorize Chief Preysz and OIFR staff to begin program implementation as of August 1, 2015. Important program components include the following:

• “Orcas resident” is broadly defined to include property owners, renters, and seasonal workers.

• Orcas residents will never be billed for out-of-pocket expenses.

• Any person can apply for a hardship fee waiver, and the chief can grant a waiver.

• The cost recovery fee schedule was derived from average variable costs incurred by OIFR per response.

• Our billing vendor bills on a flat fee basis per claim. Unlike other vendors charging a percentage of fees collected, our vendor’s only incentive is to provide efficient service.

What do we expect from the program?

The program needs to demonstrate value to OIFR to be effective.

An important way to measure its value is through net revenue generated; the chief will be reporting financial performance to the commissioners regularly. However, the program must demonstrate effectiveness against the other requirements as stated above. We will be vigilant that the program delivers the value everyone at OIFR and the community expects.

The chief will report to the commissioners and the public on the program’s effectiveness.

Based on this and other factors, the commissioners will be able to modify or cancel the program at any time in the future.

Where will the money go?

All funds collected from the cost recovery program will be deposited in a local bank  account maintained by the San Juan County Treasurer on behalf of OIFR. The commissioners and chief are committed to putting cost recovery funds back into our local community.

For example, the standard of excellence for OIFR response and treatment extends to post-incident follow-up. This is a unique, community-focused service provided by OIFR not found in many other areas. Orcas CARES, a key component of this follow-up, will be one direct beneficiary of the cost recovery revenue.

The commissioners appreciate your interest and support of this very important program.