Bonner County continuing to explore options on EMS situation

SANDPOINT — Bonner County commissioners presented an initial plan on how to handle a cash crunch facing Bonner County EMS at a special meeting Thursday.

The meeting follows news from Nov. 8, when Bonner County Board of Commissioners approved seeking a $2 million tax anticipation loan to fund Bonner County EMS until Jan. 25, when the department will receive a new tranche of funds from taxes. The loan will also provide a cushion for the ambulance district through the next year while they seek to fix cash flow problems.

Commissioner Asia Williams opened Thursday’s meeting by saying the county had come to a solution to the cash flow problems that did not include a reduction of force. She said an apology is owed to EMS personnel who were told they would be let go before the BOCC voted on any reduction in force motion. They later had to be informed that there would not be a reduction in force and that they would retain their positions with Bonner County EMS.

She also said she is continuing to research the matter and is performing a failure mode effect analysis to determine what took place and what the county needs to do to fix it.

The predicament has given rise to a number of questions and concerns from both Bonner County and the public.

$2 million for a new building

One of the questions that has been raised from the outset of Bonner County EMS’ troubles is how $2 million was moved from their budget to pay for part of the construction of a new building across from the county administration building and what part that transfer may have played in their current cash woes.

County Clerk Mike Rosedale told the Daily Bee that the county received funds as part of the American Rescue Plan Act as a response to the COVID-19 pandemic that were earmarked in a way that only allowed them to be used for certain expenses, specifically wage replacement for employees.

The Board of Commissioners at the time decided to use $2 million from Bonner County EMS’ budget that was not earmarked to help pay for the creation of a new county building that would act as the ambulance district’s new headquarters, allowing them to move from their now-former headquarters, which cost $10,000 a month in rent.

According to Rosedale, the county then backfilled that $2 million expense with money from ARPA funds to pay Bonner County EMS employees.

Williams said she believes the transfer of funds raises legal questions that have yet to be answered.

The District 2 commissioner said she has yet to find any resolution that would create a capital improvement account which can be used for physical improvements, repairs and renovations to infrastructure and facilities. The account is carefully governed by statute on how money can be added to it and Williams questioned whether the money that was transferred to Bonner County EMS from several different sources could legally be added to a capital improvement fund.

Williams also said that a capital improvement account specifies that it can be used by the board of commissioners for a purchase. She questioned whether the use of EMS funds to help construct a new building, not purchase it qualified as a valid use of capital improvement funds. She said she has submitted a request for the county’s legal department to review the matter.

EMS Budget “running hot” with overtime

County commissioners said in both the Nov. 8 and 14 meetings that one of the biggest contributing factors to Bonner County EMS’ budget “running hot” or burning through their funds faster than anticipated, is due to overtime hours.

Part of the reason for this, Rosedale said, was because there was miscommunication between the human resources department of the county and Bonner County EMS that led to an underestimation of overtime costs in the budget devised for Bonner County EMS.

Bonner County EMS Chief Jeff Lindsey said they would be addressing the cost associated with overtime hours by changing the structure of EMS’ shifts.

According to Lindsey, EMS currently runs on a 48-96 schedule or two days on four days off. This is the standard shift schedule followed by other EMS organizations in Bonner, Kootenai and Boundary counties, according to Lindsey. It also results in every third paycheck including a 72-hour work week which results in considerable overtime.

Lindsey is proposing the move to a 48-144 schedule which means two days on, six days off and eliminates the 72-hour work week every third paycheck.

All told, it would cut down the number of overtime hours per employee from 840 a year to 320 a year and their total hours from 2,080 hours a year to 1,888 hours a year. This results in roughly $300,000 in cost cutting, Lindsey said.

EMS will be able to accomplish this, according to Lindsey, by restructuring personnel to create an extra shift, so instead of having three rotating shifts of EMS staff the department will have four.

This will mean pulling staff from fly vehicles that currently serve the Priest Lake and Clark Fork communities by meeting volunteer ambulances in those communities and providing a paramedic that they do not have on their volunteer ambulances. Instead, according to Lindsey during the Nov. 8 meeting, those volunteer ambulances will be met by ambulances carrying paramedics who are stationed in Sandpoint, Sagle, Priest River and Ponderay.

Cash flow problems

Despite receiving a loan to help with short-term cash flow problems, Williams said Bonner County EMS still needs to find a long-term solution for their cash flow.

“Right now, where I sit, it looks like $2.5 million needs to be available every six months because of the way the salaries work,” Williams said. “And there has to be a plan that shows how we're going to hit that mark.”

One of the ways Bonner EMS is looking to bring in more money is to raise its rates.

“We're way behind Kootenai County on our rates. One of the things we need to do is increase our rates that we bill the insurance,” Lindsey said. “And Kootenai County is actually looking at potentially increasing their rates.”

Another way that Bonner EMS can receive funding is by increasing its levy.

Rosedale explained that statute caps the amount Bonner EMS can raise their levy at 3% every year.

Bonner EMS can increase the cash it is bringing in through taxes slightly more than the 3% cap through forgone taxes, Rosedale said.

Forgone taxes are property taxes that the government chose not to collect by not raising the levy the full 3% allowed by law, but can still choose to take later.

Rosedale said that the Legislature has limited how much forgone can be claimed each year and that, best case, it would constitute a roughly $240,000 tax revenue increase for Bonner EMS.

Rosedale said the department would need to use all the available tax revenue from foregone and levy increases from here on out.

Rosedale also said that part of the problem Bonner County EMS ran into was a timing problem. Bonner EMS’ fiscal year starts Oct. 1 and with the start of the fiscal year comes a number of expenses, including employee health savings account and lease payments. Bonner EMS does not receive new funds from taxes until Jan. 25; as a result, the department is cash poor right as they are hit with greater than average expenses.

 The resulting cash squeeze is not unique to Bonner EMS; other county agencies have been in similar situations at the start of the fiscal year before. However, this current cash crunch is the most extreme example of the phenomenon that Rosedale said he has seen. 

Williams said the HSA payments would be looked at to determine if paying them out paycheck by paycheck instead of as a lump sum would help alleviate the pressure the payments create at the start of the fiscal year.

Who is to blame?

“I think most of us were upset that the county government threw money at a bleed for over a year, and we got to this point where we could possibly lose something this critical,” a commenter said at Thursday’s meeting. “So, I'm glad you guys are doing something now about it, but why wasn't — when the alarm was first sounded over a year ago — why wasn't it taken seriously? Why do we need to have a larger, louder alert to wake our county government up before we end up to a point where we are going to lose something critical?”

The frustration over a perceived lack of oversight was echoed by several other community members who also spoke at the meeting.

Williams said this is not simply a year-long problem but a compounding problem that has been going on for a much longer period of time.

She hoped county residents can accept that there is no way to know the whole of the situation yet.

She said the county should have known more about the situation and deserves every strike it gets. Yet she said she is proud of the hard work by county personnel to find out so much about the situation so quickly. The county is doing the work, Williams said, and has a plan to communicate with the community moving forward.

“This is an unfortunate situation,” Williams said. “But hopefully people walk away knowing we're not reducing services, we're not reducing our staff, and we have a plan to move forward and to address the need to address a lot of budgets that have cash, so that we come up with a plan, so we don't get here (again).”