MFPD revised budget for 2009 reflects planned spend down

Directors votes to adopt new three-year pay schedule


A revised fiscal 2009 budget that projects roughly $2.37 million in deficit spending as part of a planned spend down of district reserves was approved last week by the Mehlville Fire Protection District Board of Directors.

The Board of Directors voted unanimously Dec. 30 to approve the revised 2009 budget that projects $19,924,040 in expenditures with anticipated revenues of $17,553,938 — a deficit of $2,370,102.

The district will not go into the red, but will dip into its reserves.

The revised 2009 budget reported a beginning balance of $24,897,405 on Jan. 1, 2009, and projected an ending balance of $22,527,303 on Dec. 31, 2009.

The original 2009 budget had projected $19,504,178 in expenditures with revenues of $17,656,111 — a deficit of $1,848,067.

During the meeting, board Chairman Aaron Hilmer noted the $102,173 decrease in revenue from the original budget to the revised budget was attributable to a decrease in interest rates and inspection fees while the $419,862 increase in expenditures primarily was the result of the nearly $800,000 purchase of property for the district’s new No. 4 firehouse and the completion of construction on the new No. 2 firehouse at 5434 Telegraph Road in Oakville.

Board members voted in August to spend $795,000 to purchase a one-acre parcel at 13117 and 13119 Tesson Ferry Road for the site of the new No. 4 firehouse. The parcel is across the street from the district’s existing No. 4 firehouse at 13106 Tesson Ferry Road.

The existing firehouse, built in 1964, is deteriorating and needs to be replaced, ac-cording to district officials.

Construction of the new No. 2 station was completed in March. The new 6,554-square-foot firehouse is an energy efficient building. Built with three engine bays, it was designed for future expansion, if necessary.

Fire/medics moved into the new facility in late April from the old firehouse, built in 1957, at 5610 Telegraph Road. The old No. 2 firehouse later was sold to NJB Investments for $177,500.

Hilmer told the Call the revised 2009 budget reflects a planned spend down of district reserves.

“What’s interesting is in the first three years of (board Treasurer) Bonnie (Stegman) and I being there, we ran surplus budgets — what you bring in in a year versus what you spend in a year of over $5 million, saving for a rainy day,” he said. “So here we are now in the throes of a great recession and now we’re able to go buy land and build buildings at prices that are so cheap they were unheard of three or four years ago. So I think it’s really a great thing we’re able to do this.

“Certainly, we’re not just going on a spending spree because we have money. What we’re doing is taking care of 50 years of neglect that went on of a failure to prioritize capital improvements. This will be the third firehouse that we’re building …,” Hilmer said of the new No. 4 firehouse.

“I’d like to stress for the umpteenth time, we’re buying this land, we’re building these buildings, we’re buying these fire trucks and ambulances without asking voters for a bond issue or a tax extension. In fact, the only thing we’ve ever asked voters for is a tax decrease,” he said, referring to Proposition 1 and Proposition 2, which voters approved in April. The measures reduced the district’s tax-rate ceiling by 40 cents.

During 2009, the district spent more than $2.6 million on capital improvements.

Besides spending $795,000 for the property on Tesson Ferry Road and $967,000 on the construction of the No. 2 firehouse, the district spent $797,000 for a new ambulance and fire truck, Hilmer said.

“We spent $2.6 million last year — nearly 15 percent of our budget we’re spending on capital improvements … This is a tremendous infrastructure investment we’re making,” he said.

Both the pension fund and the sick-leave reserve fund reflected deficit spending totaling nearly $1.15 million in 2009, Hilmer said.

“We hope this year we finally get the go-head from the IRS (Internal Revenue Service) to dismantle the defined-benefit plan, but this is really a hangover from three years of lawsuits we’re dealing with, and hopefully by next year the pension will just be basically whatever we need for the defined-contribution (plan), we’ll take …,” he said.

Local 1889 of the International Association of Fire Fighters filed a lawsuit just days after the board voted March 16, 2006, to adopt an amendment and two resolutions changing the fire district’s pension plan from a defined-benefit plan to a defined-contribution plan.

That lawsuit was settled in December 2008 two weeks after the Eastern District of the Missouri Court of Appeals affirmed an August 2007 ruling by St. Louis County Circuit Court Judge Thea A. Sherry that dismissed the lawsuit filed against the board by Local 1889.

Regarding the sick-leave reserve fund, he said, “This is something that we inherited from before. This is basically when people retire, they’re able to take these big checks for unused sick leave. We got rid of all that in April of ’05, except if you’re grandfathered in … Certainly we’re not putting any money in the sick leave fund, that’s why it shows deficit spending.”

In a separate matter Dec. 30, board members voted unanimously to adopt a three-year salary schedule.

The board adopted the salary schedule as originally proposed despite a request from Local 1889 President Nick Fahs that “straight-line” firefighters and paramedics be granted a raise. Under the salary schedule, pay for straight-line firefighters and paramedics will be frozen for three years.

On Dec. 23, Fahs had asked the board to consider granting a $500 pay increase to those firefighters and paramedics.

Under the approved schedule, the total cost of salaries will increase by roughly $440,000 from 2010 to 2012 while pension contributions — ranging from 8 percent to 11 percent of gross wages based on years of service — will increase by roughly $69,000 during the same period.

Roughly $9.44 million will be spent on salaries and nearly $810,000 will be spent on pension contributions in 2010. In 2011, more than $9.6 million will be spent on salaries and nearly $845,000 will be spent on pension contributions. For 2012, more than $9.88 million will be spent on salaries and nearly $879,000 will be spent on pension contributions.

Regarding the new salary schedule, Hilmer said, “I am really excited, not only for the district but also for the employees.

“Whether someone agrees with it or not, for the next three years there doesn’t have to be any more discussion and people’s career paths are clear in front of them and they can decide what they want to do from there. I’m very, very excited for the employees and the district,” he added.