Reader view/opinion: Where’s the money?

Through public records, it has been discovered that South County Fire Regional Fire Authority (RFA) appears to owe the City of Edmonds millions of dollars in payment for transport fees collected but not remitted to the city, which would be a breach of our contract.

Background

South County Fire RFA provides Edmonds fire and EMS services under contract to the city. There are numerous provisions in the contract but one in particular is noteworthy because it provides a revenue stream for the city. That revenue is a reimbursement for Transport Fees collected by the RFA.

Transport fees are generated anytime an EMS unit transports a person from one location to another. An easy example is from an accident scene to the hospital. When that happens, it generates a bill for that service. That bill is sent to the patient and/or their insurance for reimbursement of the cost of that transport.  Per our contract with the RFA:

                   “…the District (RFA) shall receive and pursue collection of all Transport Fees…”

And further states:

                  “The District shall remit the amount so received to the City…”

The operative word in the first clause is “all” and in the second clause “remit.”

Transport Fees are collected by the RFA in two ways. The first is through direct payment by the person transported or by their insurance.  This collection has been remitted to the city per contract terms over the years. However, not all costs are fully collected through this process.  In fact, less than half the costs are recovered this way, as illustrated in a South County Fire report:

The second collection method is through the Ground Emergency Medical Transportation (GEMT) program. The GEMT program provides supplemental payments to cover the funding gap between a provider’s actual costs per qualifying transport and the allowable amount received from Washington Apple Health (Medicaid) and other sources. Our share of these reimbursements has not been passed back to Edmonds per our contract, but rather retained by the RFA.

From the South County Fire 2025 budget:

Analysis

Based on an analysis of the RFA budgets over the years (Budget | South County Fire) would suggest that upwards of over $8 million could be owed Edmonds in past unreimbursed fees. With escalating costs, current estimates are that GEMT revenue may be worth $2 million or more annually to the city.

What did the RFA do with our money? Over the years they have used it in multiple ways. They used it to reduce the costs to their member cities. From a 2020 South County Fire news article:

Yes, neighboring cities benefited from the RFA withholding transport fee revenue from us. This has been ongoing since 2019 when the program went into effect.

All of this was shared with our city negotiating team in the hope that they could use it to better our position in the annexation discussions.  Use it to get us a better deal or postpone the annexation altogether. After all, $8 million will go a long way. Instead, they squandered the opportunity, and we are where we are.

So where is the money now? It appears to be in some form of litigation.  From what I understand, South County Fire now acknowledges that money is owed, however they are disputing the amount. That should be easily verified by auditing the books. Unfortunately, a state audit is a year away. By delaying payment, the RFA could be hoping to spread their liability over a larger tax base should we end up voting to join the RFA. Savvy readers will recognize that this strategy suggests that Edmonds taxpayers will be paying an incremental share of these costs back to our own city if we join the RFA.

Next Steps

What can we do?  A few ideas:

  • Contact our elected officials and ask them to explain how we got here. What are they doing about it?
  • Contact South County Fire RFA and ask where our money is.After all, our city could use it right about now.
  • Vote no on the upcoming annexation ballot measure in April to send our negotiating team back to earnestly evaluate less costly alternatives to joining the RFA. Alternatives that were not identified in the Fitch report and could become viable with the yearly GEMT revenue. Extend the contract to provide the time necessary for a thorough evaluation.

We can do better.

— By Jim Ogonowski

 Jim Ogonowski lives in Edmonds.

Editor’s Note: The information above is an opinion piece, and contains information that has not been independently verified by us. My Edmonds News invited South County Fire to respond to this commentary. Here is the response:

Since 2010, South County Fire and the City of Edmonds have been partners in providing high quality fire and emergency medical services to city residents and visitors through an Interlocal Agreement, or contract. Section 4.8 of the Interlocal Agreement (ILA) states the following:

“As the EMS service provider for the City, the District shall receive and pursue collections of all Transport Fees in accordance with district policy for transports that originate within the City limits. The District shall remit the amount so received to the City, less an administration fee not to exceed the actual cost of collection on a quarterly basis.”

Consistent with the ILA, South County Fire follows its internal policy of charging health insurance providers and individuals a Transport Fee to help recover a portion of its costs in providing Basic Life Support (BLS) transport services.  Since 2010, South County Fire has remitted these Transport Fees to the City of Edmonds, using a third-party ambulance billing provider to account and track amounts billed and received for transports originating within city limits. South County Fire provides the City an annual report which contains, in part, an accounting of the Transport Fees that have been collected and remitted to the City.

The Washington State Health Care Authority administers a GEMT program which allows participating providers, such as South County Fire, to apply for reimbursements to help cover the shortfall between the actual cost of providing qualifying emergency ambulance services to Medicaid clients and the allowable amount received from Medicaid and other sources. Under advisement of legal counsel, South County Fire has consistently treated GEMT reimbursements separate and apart from Transport Fees because South County Fire does not “bill” a patient or insurer for GEMT funds. GEMT program participation standards, including the requirement to submit an annual cost report to the WA State Health Care Authority, are complex and require management by a third party.

Though South County Fire and the City of Edmonds may share differing interpretations about the term “Transport Fees,” both entities have been and will continue to work together to ensure their respective contractual obligations under the ILA are satisfied.

 

  1. I am just not sure about the path forward the villain is not the taxpayer! But who pays? If I said we need to pay more for the service we have been receiving, I might just agree but by how much? Is it 100% more than we have been paying for the whole city a reasonable amount?, I don’t think so, and to top it off the city wants even more than that just to keep the doors open. Our cost has become to high our government has failed its people, the only recourse I see is for it to substantially reduce its spending. I have to budget, I have to make compromises but it seems our city doesn’t think they should have to. I know local government will suffer greatly but who is more important them or the ones that pay their salary? So I can’t support annexation as proposed. Hit me up with a reasonable compromise, this one we have is a non starter.

  2. The contract wording seems clear. However, it appears the RFA believes GEMT monies don’t fall under the “transport” umbrella as defined in the contract. But the contract says the RFA shall collect ALL transport fees and remit those fees to the city. It defies logic that GEMT isn’t transport, since those fees are collected for transporting patients via aid car from point A to point B. In my opinion, this is another reason the city should continue under contract for fire/EMS for a period of time to sort out issues such as this (and the sorting out process could involve litigation). If it is determined millions in GEMT monies were inappropriately withheld from Edmonds, those monies should be applied to the fire/EMS contract price to benefit Edmonds taxpayers.

  3. Citizens should just vote no on annexation, forcing the contract to be continued until adults in the room can sort out the least expensive option for the taxpayers with a system everyone can understand. Right now hardly anyone knows how it really works or what it really should cost if run efficiently. As Dave points out, there is a good chance RFA will force litigation which will only make it cost that much more. The coming ECR public forum will be a thinly disguised sales job in favor of annexation. Don’t be fooled. We can do better. JUST VOTE NO and make the Mayor and Council do their jobs for us. I’m speaking strictly as one private town citizen and this is my honest opinion. Property taxes are going up substantially no matter what. They will most likely go up even more with annexation and resulting loss of local control.

    1. Clint, my friend, I believe you have it wrong about the ECR annexation forum on Feb. 3rd. I’m on the ECR Board and also a member of the Program Committee~ I know we are trying hard to be objective and present only truthful information, not tilting towards either Yes or No.

      What we present will be fair and balanced. The whole event is only 90 minutes, so we won’t have time to answer many of the questions that are sure to emerge. Additional forums willl come later, sponsored by other organizations, where citizens will have opportunities to ask questions and get answers on this large and complicated matter.

      1. Direct Quote from ECR Announcement: “The ECR will summarize what benefits would occur by annexation with Regional Fire as well as summarize what we currently know about what happens if the voters say no.”

        It goes on to say the main presenters will be City Council Members who helped negotiate the agreement with RFA and representatives from RFA to answer questions in individual discussions groups.

        So please explain to me how this is unbiased, if known anti RFA annexation possible presenters, such as Jim Ogonowski or Diane Buckshnis, or Theresa Hutchinson aren’t also on the program?

        As I said, Roger, I’m just one person with one opinion on this matter, and to me your announcement for the event itself looks pretty oriented to selling the “benefits” of annexation and contemplating the possible consequences if the voters say no. It, doesn’t look very unbiased to me yet. Please prove me wrong with a truly objective event. I’d be thrilled to see it, frankly.

  4. Jim – thanks for your article. Like quite a few other Edmonds voters, I am going to vote ‘no’ in our April special election about RFA annexation. The business management practices of this RFA are sub-par in my opinion. And your article explains one of those practices. In 2019, Lynnwood was the only City that ‘belonged’ to this RFA. MLT and Brier were cities were served via a contract (and Mill Creek was served via contract with a different RFA).
    Do you know if this RFA withheld their GEMT payments from MLT and Brier also in the 2019 – 2023 period?

  5. Why would you want to relinquish local sovereignty to the RFA through annexation? At present, they are not honoring contractual obligations and owe the city millions of dollars. Expanding the relationship would defy reasonable common sense. I will be voting no to annexation.

  6. And a reminder that our relatively high property values also cause a RFA not to be a good financial decision for us. The 2024 tax rate for each of the 4 cities now part of SCF is $1.17 per $1,000 of assessed value. The average value of Edmonds homes is higher than any city in Snohomish County, except for the Town of Woodway. The average Edmonds home value is 21.9% more than the average for the 4 cities – Brier, Lynnwood, Mill Creek and Mountlake Terrace. That means that the average Edmonds homeowner would pay 21.9% more in taxes to SCF than the average for the 4 current cities. In fact, it would be 50% more than Mountlake Terrace and 46% more than Lynnwood.

  7. The total cost for Edmonds taxpayers if Regional Fire District Annexation is voter approved would be approximately $30 million dollars based on .2% Fire/EMS levy calculated on the current assessed value approximately $15 billion dollars.

    The original reason of contracting for Fire and EMS services from the South County Fire District was for the purpose of saving Edmonds taxpayers’ money. This is no longer case. The City Council negotiated proposal doubles our cost with no extra benefits and no control of future increases. South County Fire District has clearly demonstrated the cost of services only go up with no cost cutting measures.

    Edmonds subsidized the Fire District for many years. Edmonds provided Fire/EMS to Esperance for less than the tax dollars the South County Fire District was collecting. Edmonds purchased the South County Fire District Fire Station that now South County Fire District wants back for free.

    Give Edmonds back our Fire Equipment and Fire Fighters for free. The citizens own the Fire Stations and Fire Equipment.

    Vote NO!

    Edmonds is required to provide fire services to the property owners.

  8. Jim, thank you for this article. RFA’s “sub-par” business management practices, as Theresa Hollis describes, are most concerning. Per our contract with the RFA they should be “remitting” “all” the GEMT fees and they are not. These are millions of dollars that belong to us. We can’t trust them to have our best interests in mind – only their own. And why are the firefighters promoting this? I attended a meeting last night in Lake Forest Park where the RFA is trying to take over this community as well in February. They are like a huge machine trying to take over every community in their wake. WHY? It’s actually rather scary and intimidating. I am voting NO in April. Here are some reasons: If we vote NO, will not lose fire/EMS service, we retain local control, we keep tax dollars in Edmonds, allows us time to fully explore alternatives for the same or better service, firefighters will not lose their jobs, we’ll nearly double the cost for the same level of service if we join, lack of transparency and community involvement, we don’t know the tax consequences, and where are the economies of scale demonstrated by joining the RFA? I am voting NO. Let’s hit the pause button and send our negotiating team back and negotiate a better outcome for Edmonds – not the RFA.

  9. Jim- your analysis adds one more nail in the coffin of RFA annexation. Everyone should be voting ‘No!” on RFA annexation. Edmonds ‘can do better.’ Your analysis shows yet another major concern and major unjustified action by the RFA. They have implemented massive contract price increases (50% between 2019 and 2023; and now 65% between 2024 and 2026). In that time, Edmonds had no change in its fire/ems service requirements and no improvement in its response times. RFA management cannot justify the huge price increases because there’s no way their operational costs could have increased by more than 3-4% per year between 2019 and 2026. RFA management is self-serving and oblivious to taxpayer concerns and they have shown no effort or ability to control costs- even though they claim multiple annexations have given them have economies of scale. The withholding of transport fees shows they can’t be trusted. ‘Edmonds can do better’ with alternative fire/ems solutions – and has a head start with 3 functioning fire stations, a contractual right to buy back fire trucks at market prices, and a County 911 system. The Edmonds Council has failed to do proper due diligence on alternative fire/ems solutions. 108 residents who have signed the anti-RFA annexation Petition know ‘Edmonds can do better.’ Please add your name to the Petition and Vote No on April 22. https://www.ipetitions.com/petition/no-to-rfa-regional-fire-authority-annexation

  10. And don’t forget that the firefighters union supported some council members in the last election. This is the exact description of a “quid pro quo”.
    The most discouraging thing of all-that six of our city council members are pushing for annexation that is bad for the City without looking at alternatives.
    Vote NO on RFD annexation and keep local control of costs. The RFD does not seem at all interested in controlling costsl

  11. If the City of Edmonds, using our tax dollars, is paying for the services of South County why is there a transport fee for Edmonds’ residents? So the contract with the City does not cover ambulance transport to the hospital? Does South County charge Edmonds’ residents for response to a house fire? Or a car collision where no one goes to the hospital?

  12. Hi Tom, good questions.
    Q3 “charge for house fire?” No, we have a contract with SCF. There is no separate fee homeowners pay for a Fire. The contract is based on the COST for those services. We pay Property and EMS taxes to pay for that cost-based contract. Your other questions. Yes, we pay for Fire and EMS services, but EMS services are for all who call 911. A visitor at the Beach or here for Halloween, or the 4th of July parade may need medical assistance. 911 does not ask about where you live. Medical treatment is started and if hospital treatment is needed “transport” begins. Sometimes transport to a hospital not in Edmonds. Insurance and Medicaid often cover medical services not performed at a hospital and the often cover some of the cost to transport. For those transported, SCF bill their insurance company but if there is no coverage or the coverage is less than the cost, they do not ask the patient to pay!
    If payment is received for someone picked up in Edmonds SCF pays Edmonds minus a small collection fee. Those transport fees help pay the cost of the contract. Transport fees paid today exceed $1m and help pay $12m contact. We pay the other $11m from of Property and EMS taxes. Hope that helps.

  13. Thanks Jim for this analysis…it provides us with good factual information that we needed to figure out where this thing is headed. There are plenty of good reasons to vote no on the RFA annexation.

  14. Roger, in response to your comment. I am most disturbed by the fact that the ECR who promotes itself as “fair and balanced” is not allowing the NO folks to get equal time presenting their point of view at your February 3 annexation forum. It does appear that the ECR is most certainly tilting toward the Yes vote that Mayor Rosen and six council members are mightily promoting in close work with the RFA. As a member of the Program Committee and on the ECR Board, I would think that you would insist on being “fair and balanced”. This forum is far from objective and continues to contribute to the opinions of many that our mayor and council are not being transparent and honest with the electorate – and the ECR is colluding with them is hoodwinking Edmonds. You say questions will not be allowed as the entire 90 minutes will be taken up by the RFA. So just RFA presents and no opposing viewpoints allowed. You say other forums will be held where questions may be allowed. This is not a good look by the ECR. Clearly, the forum is intended to promote the RFA annexation and support Mayor Rosen and Council to help with their budget crisis that they refuse to do the necessary work to fix. Edmonds isn’t that daft.

    1. Theresa, my friend, the RFA is not presenting at the ECR forum on Feb. 3rd. Presentations will be by three ECR members with expertise in the annexation issues. You will not be hearing a Vote Yes sales pitch; several of us have been working to assure the forum is in fact “fair and balanced.”

      There will be other public forums later, by other sponsors, that will include pro and con presentations and vigorous Q&A with the audience. We should all support a full and honest discussion of RFA annexation, so Edmonds voters can make fully informed decisions on voting day, April 22.

      1. In re-reading the ECR announcement I see that it says city council members who negotiated the agreement to put this measure on the ballot and members of the RFA, “will also be in attendance.” It doesn’t really say if these people will be answering questions formally or informally or presenting their viewpoints on the measure in one way or another. The fact that your announcement indicates you know these people will be in attendance suggests there has been at least some degree of collusion with you on what will or won’t be presented and who presents it, whether formally from the lectern or informally in the discussion groups. So the question is “did the ECR also reach out to known anti-annexation proponents and offer them the same opportunity to participate in the same manner as pro-annexation proponents? ” If that did not happen within your ECR group planning, then a question of possible bias certainly exists. Only the ECR can answer that question and claiming to be unbiased, doesn’t automatically mean you are unbiased.

  15. Folks, just use a little basic common sense and logic when you decide to vote on this. For example, I’m asking myself these questions that I think are pertinent to the situation:

    1. Why is a mayor who presented himself to the voters as a person with extraordinary management skills so anxious to give over one of his biggest management duties to an outside source of control and selling it so hard as the right thing to do?

    2. Why is the firefighter’s association (containing both management and line staff personnel) so anxious to be involved in what should just be a decision that Edmonds citizens have to make regarding how they are taxed for a basic service that is the responsibility of the Mayor and City Council?

    3. How can some city council members who got funding and endorsements from SCF firefighters association consider themselves to be unbiased in arguing for your yes vote, or more importantly how can you consider them unbiased?

    4. How can Mayor Rosen, CM Olson, and City Attorney Taraday claim they took part in a “Negotiation” with RFA when the RFA got virtually everything they demanded in that process?

    5. What alternatives to annexation have actually been studied with financial models run by unbiased experts in the fire/ems industry both publicly and privately sourced?

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