| The Fire Service will be undergoing a | | | | past few years. That means they have been |
| transformation in the next few years that will | | | | borrowing money just to keep the lights on. |
| impact every single fire department in the U.S. | | | | There will be less funds in the future for grants |
| These issues will separate the survivors from the | | | | and large discretionary purchases. |
| perished. | | | | On top of that, the current economic climate will |
| Issue #1: People will be a lot more expensive. | | | | depress tax revenues for some time and there |
| It doesn't matter if you are a paid, volunteer, or | | | | seems to be a growing sense of taxpayer rage |
| combination department. The costs of having fire | | | | which all combines to limit tax growth for all levels |
| fighters will be increasing at an alarming rate. And | | | | of government. |
| it isn't just payroll, it is the total expense of having | | | | It is critical to begin planning now with a tighter |
| people fight your fires. | | | | future budget in mind. For the best departments, |
| The four trends for the higher costs are: | | | | it may only mean flat revenues instead of |
| | | | decreases. For the majority of departments, the |
| 1. Payroll. If you pay your fire fighters, the cost | | | | reality will become that they are being asked to |
| of paying their salary will be increasing. Add to | | | | perform with less financial resources. |
| that the cost of insurance, workman's comp, and | | | | Issue #3: There will be more scrutiny over your |
| payroll taxes, you have a explosive mixture just | | | | financial records. |
| waiting to absorb your budget. | | | | In the past, no one really cared to look at the |
| 2. Attraction Costs. If you don't pay your fire | | | | financial records of volunteer departments or |
| fighters, you will spend more money finding and | | | | small districts. However, as the total amounts paid |
| attracting volunteer labor. The facts are shocking. | | | | to these independent departments grow, there |
| In Pennsylvania alone, volunteer fire fighters have | | | | will be a growing call for careful examination of |
| declined from 300,000 in the 1970's to about | | | | financial expenditures and use of the funds. |
| 75,000 today. While the population of the state | | | | If you are a not-for-profit fire department, you |
| has increased by almost 100,000 people. So, how | | | | are required (with few exceptions) to file an IRS |
| do you get new volunteers? The volunteer culture | | | | form 990 to report your financial activities. This |
| has changed. The time demands of people have | | | | form is required to maintain your tax-exempt |
| changed. What can you do to attract more | | | | status. Some states, such as Pennsylvania, are |
| volunteers? There seems to be no magic bullet | | | | becoming much more strict about financial |
| out there but it will cost more to find a volunteer | | | | reporting and compliance as they purchase new |
| and entice them to join your department. Of | | | | apparatus. |
| course, if your fire fighter force falls below safe | | | | Cities, Townships, and Counties are requiring |
| levels, your costs may increase because you | | | | independent audits of department's financial |
| have to hire paid fire fighters. | | | | records to support the significant monies paid to |
| 3. Training. A brand new fire fighter requires much | | | | departments. |
| more training than ever before - just to fight | | | | There isn't a 2 week period that doesn't go by |
| fires. Add to that, specialized training such as | | | | that a fire department isn't the victim of an |
| confined space, rescue, water rescue, EMT, and | | | | embezzlement in the U.S. Lack of quality financial |
| other expertise that are being demanded of fire | | | | controls are a breeding ground for potential |
| departments today and you get a large | | | | financial crimes. |
| investment in your people - even if they are | | | | There is a brewing storm to make fire |
| volunteer. | | | | departments a lot more accountable for their |
| 4. Equipment. Protective gear and equipment is | | | | funds than in the past. This will be quite a shock |
| more safe than ever. But that safety comes with | | | | to most departments who have felt an |
| an ever increasing price tag. It seems just to | | | | independence about how they run and report |
| provide those who serve to have the safest | | | | about their departments. Forward thinking fire |
| equipment available. But the cost will be rising to | | | | departments will begin to have quality financial |
| keep your people safe. The good ol' days of a | | | | information that is available for anyone to see. |
| bunch of guys leaving their jobs to fight fires for | | | | Anecdotally, there are a growing number of |
| their community are long gone. And, along with | | | | departments now posting their financial records on |
| those days, go the relatively cheap labor costs of | | | | their web site. |
| having guys who fought fires out of a sense of | | | | So, be prepared to fully disclose your financial |
| duty, not because they needed to be enticed in | | | | operations to your community. |
| some way - either by getting a paycheck or by | | | | Issue #4: Essential costs will increase faster than |
| other incentives to attract new volunteers. | | | | inflation. |
| The historical fire fighting labor business model is | | | | Finally, the type of costs and purchases that fire |
| gone. No more free labor. So, savvy fire | | | | departments need will far outpace the general |
| departments will begin to factor in these costs | | | | rate of inflation over the next few years. The |
| now and deal with them instead of getting | | | | specialized equipment fire departments need is |
| slammed by the harsh new realities later on. | | | | highly dependent on high quality raw materials. |
| This issue will become more and more pressing | | | | The prices of these materials will rise very fast in |
| over the next decade. | | | | the near and medium term. Further, the costs of |
| Issue #2: Revenues will harder to come by. | | | | services such as insurance, utilities, and accounting |
| At the same time that the very expensive costs | | | | (see Issue #3) are rising fast also. |
| of adding fire fighters will be felt, the constraints | | | | Of course, many departments will offset these |
| of finding new sources of revenues will become | | | | costs by delaying the purchases or shopping for |
| more difficult. The historical sources of revenues | | | | inferior but cheaper services. While expected to |
| such as fundraising or donations are in competition | | | | help, the prepared department will begin to accept |
| with a increasingly large group of organizations | | | | this premise and plan accordingly. |
| also fighting for the donations. There are a million | | | | In summary, the upcoming years will provide a |
| "good" charities trying to get the attention of | | | | financial perfect storm for unprepared fire |
| your donor - and they employ some sophisticated | | | | departments. With the squeeze of lower |
| techniques to get their share of a stagnant | | | | revenues and higher costs for manpower and |
| donation pie. | | | | everything else, departments must begin to plan |
| Or, if you depend on government funds as your | | | | today to meet these historical financial challenges |
| revenue source, be prepared for the upcoming | | | | or will be forced to consolidate with more efficient |
| budget struggles that all levels of government will | | | | departments at the behest of the local |
| face shortly. Most U.S. Federal, state and local | | | | governments. |
| governments have been running deficits over the | | | | |