|Budget Issue:||Staffing levels of Fire Prevention Fee Program|
|Program:||State Board of Equalization|
|Finding or Recommendation:||Recommend fewer permanent staff for fire fee workload|
Fire Protection in State Responsibility Area. California’s Department of Forestry and Fire Protection (CalFire) is responsible for providing fire protection in the State Responsibility Area (SRA). The SRA does not include land within city limits or land owned by the federal government. It is primarily privately owned and covers roughly one-third of the state’s land area.
The presence of habitable structures within the SRA can increase risk of fire ignition, increase potential for fire damage, and limit available fire prevention and suppression options. Furthermore, CalFire’s work reduces fire risk in the SRA, leading to lower insurance premiums for property owners and lower costs for local fire agencies. Consequently, the Legislature determined that the owners of habitable structures in the SRA should pay a fee that covers some of CalFire’s fire prevention costs in the SRA.
Enactment and Implementation of Fire Prevention Fee. Chapter 8, Statutes of 2011-12 First Extraordinary Session (ABX1 29, Blumenfield), requires the State Board of Forestry and Fire Protection to establish a fire prevention fee. In 2011, the board approved a fee of $115 for habitable structures within the boundaries of local fire protection agencies. (Some structures in the SRA fall outside of those boundaries; the fee charged to owners of these structures is $150.) Beginning in 2013-14, the board is required to adjust the amount of the fee every year for inflation.
The State Board of Equalization (BOE) administers and collects the fire prevention fee. BOE issues roughly 750,000 bills per year based on a list of fee payers provided by CalFire. BOE sent property owners their first bills in fall 2012.
Administering the Fire Prevention Fee Has Been Challenging. Several factors have made fee administration challenging for BOE, including data limitations regarding the names and addresses of property owners, fee payers’ lack of familiarity with the billing process, and some fee payers’ opposition to the fee. Much of BOE’s workload is related to fee payer phone inquiries and low rates of electronic filing. BOE’s costs for this program exceeded authorized expenditures by $1.7 million in 2012-13.
Current BOE Fire Prevention Fee Positions Set to Expire. Given the uncertainties regarding this program’s ongoing workload, the Legislature established all 54 positions for it on a limited-term basis. These positions expire at the end of the current fiscal year.
For 2014-15, the administration proposes to make permanent all 54 existing limited-term positions and add 9 new two-year limited term positions and 9.7 one-year temporary positions, for a total cost of $7.3 million. The budget bill also includes provisional language allowing the administration to augment BOE’s budget for unanticipated fee collection costs after notifying the Joint Legislative Budget Committee. All funds for this program (the budgeted amounts and augmentations) would come from the SRA Fire Prevention Fund.
Our review of this program’s workload indicates that BOE’s activities fall into two categories: ongoing duties and tasks related to fee payer turnover. The workload associated with most of the ongoing responsibilities—such as mailing bills, receiving and processing payments, and maintaining program-related computer systems—likely will persist at current levels.
The program’s remaining workload is closely related to fee payers entering and exiting the program. While this workload was high initially (because all fee payers were new), it will decline over time. Going forward, BOE estimates that accounts will turn over at a rate of 10 to 14 percent annually, resulting in 80,000 to 100,000 new fee payers each year. The budget proposal generally accounts for BOE’s prospective decline in workload, with one exception. Specifically, during the first 18 months of this program’s operation, BOE received hundreds of thousands of phone calls from fee payers. Most of the questions posed by callers were unique to new fee payers. For example, some callers asked why they were receiving the bill, how the law got passed, or whether the fee is mandatory. Others inquired about address discrepancies or petitions for redetermination—issues that, once resolved, are unlikely to recur for a given account. Notwithstanding the content of these calls and the 10 to 14 percent estimated annual turnover, the budget assumes that the annual number of calls to BOE will stabilize at roughly two-thirds of its initial level. Accordingly, the budget proposes 18.5 permanent positions to answer phone calls. (These position counts include associated supervisorial and support positions).
Make Fewer Positions Permanent. We concur with the administration regarding the total number of positions for this program in 2014-15. Going forward, however, we think that the number of fee payer calls to BOE will likely decline by more than one-third. For example, if most fee payers stopped calling after receiving two annual bills (a reasonable assumption given the content of the calls), the annual number of calls to BOE would decline by more than three-fourths. Given this potential decline in workload, we recommend that the Legislature shift 12 proposed phone-related positions from permanent to two-year limited term. Overall, we recommend that the Legislature establish 42 permanent positions, 21 two-year limited-term positions, and 9.7 one-year temporary positions. Should telephone workloads not decline as projected, the Legislature could revisit this issue when the limited-term positions expire.