Pflugerville-commissioned study concludes city subsidy to ESD No. 2 not needed

Pflugerville City Council on June 21 reviewed options to continue emergency medical services and advanced life support beyond Sept. 30 in the city and its extraterritorial jurisdiction.

As part of the discussion, AP Triton, a consulting firm specializing in service delivery methodology and practices for fire and emergency care services, presented findings of a study it conducted this year. The city budgeted a little more than $33,000 for the study.

It analyzed Travis County’s Emergency District No. 2, which services about 139,000 residents across 77 square miles.

Over the course of his presentation, Rich Buchanan from AP Triton said the study found ESD No. 2 does not need an annual payout of $2.793 million that it has requested from the city. He also laid out five options for Pflugerville during the June 21 workshop.

“Our purpose here … was to be able to solve a problem,” Buchanan said, adding the solutions he was presenting would have a minimal, if any, tax burden on Pflugerville residents.

Situational history

Emergency Services District No. 2 provides fire and rescue, emergency medical services (EMS) and advanced life support (ALS) services to Pflugerville, the city’s extraterritorial jurisdiction, parts of the city of Austin and unincorporated Travis County.

As part of a May 1 election, residents in parts of Austin and unincorporated Travis County voted to add an overlay, or additional, district called ESD 17 within the ESD 2 boundaries. This decision means ESD 17 will have a separate property tax rate to fund staffing and equipment that will provide first response EMS and ALS in the parts of Austin and unincorporated Travis County within the ESD 2 area.

Pflugerville City Council decided to not include the ESD 17 proposition on the city’s ballot.

The board of commissioners for ESD 2 has stated that due to funding issues it will no longer be able to provide EMS and ALS along with fire and rescue services after Sept. 30.

A Jan. 15 letter from ESD No. 2’s board obtained by Community Impact Newspaper stated that the district’s projections show its financial reserves will be depleted by 2024.

“Please consider this letter as a formal request for the City of Pflugerville to provide funding for the provision of emergency medical services for the City of Pflugerville by the District,” the letter states.

The total annual request from ESD No. 2 to the city of Pflugerville for $2.793 million includes funding for ambulances and operational costs for staff, equipment and capital expenses for emergency medical first response.

Findings of ESD No. 2 analysis

AP Triton began its study at the end of February. Buchanan said it included assessing EMS services and constraints, service provider options within the city, a cost benefit analysis and recommendations to the city.

In a nutshell, AP Triton found ESD No. 2’s request for $2.793 million to be unsubstantiated and stated the district’s financial crisis is self-imposed.

In addition to examining numerous sources and data sets, AP Triton study also included interviews with representatives from ESD No. 2.

“We looked at all of their facilities, and we visited their facilities,” he said. “Then we wanted to look at their finances, and they provided all of their finances.”

Among the findings, the study showed that from 2017 to 2020, the district’s annual call volume more than doubled from 4,177 to 10,705.

However, Buchanan said those figures are not keeping up with the area’s population growth. Projected call volume through 2030 is set at 12,286, he said.

The study showed the highest concentration of calls comes from the western portion of the district. Buchanan said that portion, which is largely in the Wells Branch neighborhood of north Austin and takes up roughly one fifth of the district’s geography, accounts for more than 46% of the service calls.

“Anytime you put a large population in a small area, it’s going to take up more [calls],” Buchanan said.

When isolating for service calls within Pflugerville’s city limits, the study showed from 2018 to 2020, EMS incidents rose from 3,003 to 3,380.

Buchanan pointed to those numbers as further evidence that a subsidy from Pflugerville to the district is not warranted.

Within the five fire stations throughout ESD No. 2, the study stated that in 2020, Station 1 maxed out at an average of 7.7 calls per day. Station 5 had the lowest average calls per day at 4.2.

“7.7 call volume per day is definitely not stressing things out,” Buchanan said.

The study stated ESD No. 2 requires a minimum staffing throughout its five stations of 34 employees at any given time in order to run the district.

When factoring in the amount of sick and vacation time used by ESD No. 2 staff, Buchanan said for 2020 the district’s 139 employees were actually 17 over the total number of 122 needed to run the district.

Asked whether it is common for districts to have a calculated overage of needed employees, Buchanan said it is unusual.

“I can at least say definitively they are not burned out,” he said, adding the need for more employees within the district is probably not yet concrete.

The study also showed the district has “fantastic facilities” and equipment, Buchanan said.

With regard to a financial analysis, Buchanan said the district’s reserves went from about $10.2 million in 2016 to almost $19.6 million in 2020.

“They are very well funded,” he said.

Buchanan said that perhaps the district’s projections of its financial reserves being depleted by 2024 did not account for an overestimation of the fiscal costs of the COVID-19 pandemic.

The study concluded that the district’s EMS billing revenue should be further reviewed to evaluate improvement opportunities in billing and collection practices. It also suggested the district’s current annual revenue projections are at least $2 million short of its true financial situation beginning in 2021.

Options provided

The presentation of the AP Triton study provided five options for the city to consider.

The first was to maintain the status quo, meaning the city of Pflugerville and ESD No. 2 make no changes to governance, staffing or resource deployment.

The second option suggested contracting with a private EMS services provider, which the study stated is a common method for cities and counties.

The third option was similar to the second, but suggested a city-owned “third service” ambulance provider, meaning Pflugerville would become the ambulance provider of record.

The fourth option recommended using Austin-Travis County EMS services. The study noted the city of Pflugerville utilized those services prior to the creation of ESD No. 2 in 2016.

The fifth and final option recommended the creation of a city fire and EMS department.

That option, the study states, requires a significant commitment of financial resources as part of a multi-year phased process that would begin with the creation of a third service EMS/Ambulance transport system that could later support the creation of a municipal fire department.

The study estimated the fifth option would take roughly 3-4 years for full implementation.

AP Triton co-founder Kurt Henke said it would be prudent for the city and ESD No. 2 to continue talks to find common ground.

When pressed, Henke said it is not his place to recommend what the city do, but said if it were him, he would sit the fire department officials down, tell them they don’t need a subsidy, and if down the road, ESD No. 2 can provide evidence of a real need for a subsidy, city officials would agree to discuss that possibility.

“You need to get your finance people from the city and the finance people from the district and come to some sort of commonality here,” Henke said.

Council Member Rudy Metayer, who served with Council Member Doug Weiss on the committee that worked with ESD No. 2 throughout the process, said no matter what officials decide, the city of Pflugerville will not go without EMS/ambulance services.

“Now that we have evidence showing funding models are at issue, we need to have a deliberate deep dive process to better understand the model itself and its effects on the ESD, the city, the county and all other stakeholders,” Metayer said. “The public expects us to be good stewards of our finances, and together with the ESD, we can make that happen, which is a win for all the people we serve.”

Pflugerville City Council had included possible action on its June 22 meeting agenda based on the findings of the AP Triton study.

Along with Metayer, Weiss said he hopes council will take action June 22 to commission a study on EMS funding to help officials better understand the best option.

“This is a generational decision,” Weiss said.