Policies and Procedures

The Department lacks formal documentation of a comprehensive, strategic approach to the management, utilization and maintenance of its major capital assets: apparatus and associated equipment.

Additionally, the Department reports that each assigned driver of a vehicle or apparatus is responsible for ensuring that preventive and other required maintenance takes place in a timely manner. While there are several General Orders concerning accident prevention and driving rules, there are no current written policies or procedures outlining maintenance responsibilities. Rather, firefighters learn the maintenance requirements during basic firefighter training. Notwithstanding the current ad hoc approach or the large size and dollar value of this inventory, the importance of apparatus in effective firefighting cannot be overstated -it is crucial to the Department"s primary mission. The absence of clear policy direction undermines the level of attention that should be given to apparatus.

Staffing

There are eight civilian positions that are responsible for purchasing, distributing and accounting for medical and station house supplies in the Bureau of Equipment (BOE). The unit also is responsible for managing the Department"s apparatus. Additionally, there are eleven H2 Firefighter positions in BOE, 10 of which are on 24-hour schedules. These firefighters perform the duties of mechanics: pick-up and deliver equipment from the field, service equipment, drive specialized equipment requiring a Class A license, develop specifications for new equipment, inspect new vehicles at the plant of manufacture and on site at delivery, transport vehicles to distant locations for repairs, and other related duties. These positions are considered to be "safety sensitive" and incumbents are, therefore, subject to random drug testing. Incumbents also are on call to service equipment at the fire-ground on greater-alarm fires.

While these employees can be assigned to firefighting duties, their primary responsibility is to ensure that the all apparatus remains in good working order during a fire. We could not uncover any compelling reason why all of the H2 Firefighter positions should not be converted to civilian positions. And, given the size of the Department"s fleet, consideration should given to a professional, civilian fleet manager. Although the number of uniformed personnel in BOE vary from time to time because of modified temporary duty assignments, we support the recommendation to convert those firefighters performing as mechanics to the classification of 7381 Automotive Mechanic.

A fundamental question posed when reviewing the staffing for this function was to consider the Department"s organizational configuration and what the ultimate fleet should be for San Francisco. However, this issue was not pursued as a part of this specific effort. Additionally, concerns were voiced regarding the relationship between BOE and the Purchaser"s Central Shops in terms of which is the best source or location for which specific types of maintenance work and what should be the determining set of criteria and procedures for answering this question on a day-to-day basis. Although this specific issue is also not included in this analysis, we believe that the Department"s initial emphasis should be on internal policy and procedure modifications along with an improved information tracking system. These will result in better control over the fleet and can lead to an even more productive working relationship with staff in the Purchaser"s Central Shops.

Inventory Management Controls

The Department fails to keep accurate inventories and does not have adequate written policies on inventory management. The Department has not maintained records of original purchase costs of vehicles, depreciation or salvage values. It has no fixed-asset information on capital equipment other than vehicles, such as "Jaws of Life" (forced-entry equipment) and generators. Such capital equipment can cost $100,000 or more per item and yet, the Department does not track its location, use and age in a systematized manner. This leaves the Department vulnerable to the potential for theft or other abuse and also to the inability to project and justify future capital equipment needs. The Department does not conduct physical counts of vehicles or other capital equipment as part of inventories. Current inventory databases include missing data, such as mileage and location, for several vehicles.

This lack of management control could lead to stray inventory that, in turn, can be lost through theft or neglect. There is also a potential for abuse and the added liability of under-maintained equipment.

In June 1999, the Governmental Accounting Standards Board (GASB) approved new financial reporting requirements that will encourage state and local agencies to become better stewards of their assets. GASB is a private, non-profit organization that defines "generally accepted accounting principles" for state and local governments. Statement No. 34: Basic Financial Statements-and Management"s Discussion and Analysis-for State and Local Governments (GASB-34), requires state and local governments to include long-lived assets, such as fire apparatus, in their annual financial statements as early as fiscal year 2002. The City and County of San Francisco Controller has begun voluntary compliance with GASB 34 in advance of the required date and is working with various City departments to obtain the necessary information. The Fire Department"s inaccurate inventories and incomplete database represent just some impediments to the Controller"s full compliance with GASB 34. Development and use of an updated information tracking system will greatly improve the Department"s ability to remedy this particular problem.

Fleet Age and Useful Life

Useful Life Definition

The Fire Department reports that the useful life of vehicles is based on equipment use, input from the Purchaser"s Central Shops regarding maintenance for specific vehicle types, and overall condition of the fleet. According to the National Fire Protection Association (NFPA), the expected useful life of frontline engines is generally 10 to 15 years and the expected useful life of frontline trucks is at least 15 years.¹ The NFPA adds that once equipment has reached the end of its frontline service, it can be maintained in the reserve fleet until it is no more than 25 years old. However, the Department has determined that San Francisco is of such unique geographical configuration and topography, and contains such significant areas of historical significance, that useful-life comparisons with other jurisdictions are neither appropriate nor useful.

Using the Department"s determination of useful life, the active fleet is being used well beyond the time it should be placed on reserve. The Fire Department has estimated the useful life of an engine to be seven years. Currently, out of 42 engines in regular service, 24 are at least 7 years old, meaning they have met their useful life period. Of those, 13 are 10 years old or older, meaning they are three or more years beyond their useful life. However, most of this equipment is generally within the useful life parameters recommended by the NFPA.

For trucks, the useful life is determined by the Department to be 10 years. Of the 19 trucks in active service, five are 10 years of age or older. For ambulances, the useful life is determined by the Department to be seven years. All of the 22 ambulances in active service are estimated to have at least one year of useful life remaining.

The Fire Department does not assign a new useful life period to apparatus in the reserve fleet. The 1987 report proposing a Fire Equipment Maintenance and Replacement Program calculated that an engine should be transferred to the reserve fleet after 10 years and completely removed from service after 15 years. The same report proposed that aerial trucks should be put on reserve after 15 years and removed from service after 20 years. The report was completed before the paramedic merger and, therefore, does not address ambulances².

In the Fire Department"s fleet, the average yearly mileage varies widely, even within the same kind of vehicle classification. For example, the average yearly mileage for Sport Utility Vehicles (SUVs) is 10,892 miles per year. However, four-year-old SUVs had yearly mileage averages ranging from a low of 5,750 miles per year to a high of 14,482 miles per year. This underscores the extent to which all SUVs are not being used at the same rate. Consequently, those that are driven quite frequently could be replaced after five years, as suggested by the Department"s useful life definition, while other low-mileage vehicles could last a longer period.

From a total of 285 vehicles for which age information was available and relevant, 178, or 62.5% have met or exceeded their useful life, as defined by the Fire Department. An additional 33 vehicles have only one year of useful life remaining. This means that for the 285 vehicles in the fleet for which age information is available, only 74 vehicles have a remaining useful life of at least two years.

The Department"s useful-life definition for apparatus is more conservative than the convention cited by the NPFA. Justification by the Department for these conservative standards is based on certain physical characteristics of San Francisco and the uneven utilization rates. However, these stringent standards combine with some current vehicle assignment practices to pose a number of questions. For example, uneven usage in the sedan and SUV fleet could be the result of a given officer"s residence. If an individual drives a vehicle to and from home, it may generate very high mileage, especially in the case of an individual whose residence is outside of San Francisco -as with many uniformed personnel. Is it necessary or effective to allow assigned officers to drive vehicles home when they are on call and they live an hour or more away from the City? Are some of the older vehicles with very low miles just sitting and not actually being used? Why are there so many older vehicles? Does the Department have and assign too many cars while some positions actually don"t justify a vehicle assignment? Why has the useful life estimate for trucks been reduced from 15 to 10 years at the same time that call volume for trucks has gone down?

An updated Apparatus Management and Replacement Plan would provide, among other things, answers to and recommended actions for all of the above questions. Also, it would offer a clear and defensible explanation of the underlying basis for the Department"s useful life standards pertaining to all of the active and reserve apparatus fleets.

Equipment Maintenance

Cars and SUVs assigned to administrative officers and other ranking personnel are not rotated amongst personnel; once assigned to an officer, the vehicle remains with that individual throughout its use in the Department. This practice results in some vehicles usually being underutilized and others subject to overuse because assigned personnel have widely different driving patterns and some stations simply have more service calls than others. The Department does not rotate passenger vehicles to mitigate this problem.

In the case of Engines and Trucks, scheduling routine vehicle maintenance is determined by vehicle usage hours. Every 200 hours, the officer of the apparatus is responsible for seeing that the vehicle receives a regular lubrication and service. For ambulances, which do not record vehicle usage hours, service is required every 3,000 miles. Actual maintenance services, whether scheduled and routine or large-scale and non-routine, are either performed directly or managed by staff in the Purchaser"s Central Shops. A dedicated unit within Central Shops is responsible for maintenance work on all SFFD equipment. This includes separate staff and facilities for trucks, engines and automobiles. In addition, a mobile mechanic is available to provide a selected range of on-site services and, thereby, minimize the time that apparatus is out of service due to routine service or minor repairs. The Department indicates that a generally good working relationship exists with Central Shops, but that some flexibility is desirable for contracting directly with outside vendors -typically, manufacturers or dealers-for the types of service and repairs that historically have been referred there by Central Shops because it lacks either the technology, materials, technical expertise or some combination of the three for the specific apparatus involved. This issue is simply one of time lost from going through a third party. It seems that some arrangement could be devised to accommodate approval by both parties when the situation warrants the Fire Department "going direct." Another concern voiced by the Department is the need for better oversight of maintenance services by Central Shops and closer monitoring of charges. The Department reports that it completely lost four engines in Calendar Year 2000 and five engines in CY 1999 due to mechanical or accident-related problems. During that period, six new pumpers were added as replacements. This resulted in a net loss of three engines and at this writing another three are out of service. Three engines are on order and expected to arrive next fiscal year (Fall 2002), and two additional engines will be ordered soon with the same expected delivery schedule. Currently, the relief fleet is reduced to 10 vehicles from the normal 16. This alone is sufficient justification for the purchase of new vehicles, and it also points toward problems in maintenance and driving, given the numbers of accidents rated in categories A and C with respect to cause³.

It is important that the plan for managing the Department"s fleet include several other relevant sections, dealing with warranty claims processes, vehicle recalls (especially for the fleet of sedans, pickups and sport utility vehicles), and the resolution of other known equipment deficiencies. As previously noted, there is no evidence of scheduled preventive maintenance policies, and it is unclear how the lack of such policies may be impacting issues related to the useful life of the fleet. These are issues for the Department to resolve as part of a comprehensive approach to vehicle management.

Repair Costs and Age

The aged condition of the fleet clearly contributes to increasing maintenance costs. This is especially the case for apparatus still in the active fleet but beyond its useful life. We analyzed repair costs of the major apparatus types -ambulances, engines and trucks-over a five-year period, FY 1996 through FY 2000. Overall, the total repair costs for these apparatus appear to be relatively flat. However, the most recent positive cost trends are only for ambulances and engines, while the trend for trucks is just the reverse.

Table 1.8.2, below, shows details of the analysis for engines in FY 1999-00. For the active fleet of engines eight years of age or older, average maintenance for FY 2000 was $14,508 per engine; the repair costs of engines seven years of age or less was $10,043 each; for engines more than ten years of age, the cost was $16,246 each; and the average maintenance cost for all engines in the active fleet was $12,169 per engine. Interestingly, the repair cost for engines less than 16 years of age in the reserve fleet was $14,536 while the cost for repairs to reserve engines more than 16 years old was only $7,104 and the average for all reserve engine repairs was $9,962. Maintenance costs for the combined engine fleet, both reserve and active, were $12,744 per engine for those 10 years of age or more and $13,072 each for those more than 10 years old. The average cost for all repairs to engines less than 10 years of age was $10,734 per engine.

Table 1.8.3 provides another level of detail for repair costs by adding the number of vehicles in each class or type to which the maintenance costs were attributable. In this table, the impact of the truck repair cost increase is most noticeable because between FY 1998-99 and FY 1999-00, the dollar amount increased by 40 percent at the same time the number of vehicles decreased by 18 percent.

Table 1.8.2

The per-unit cost for truck repairs has always been higher than for engines and the proportions of apparatus types have remained relatively constant to one another during this five-year period. However, in FY 2000, the average annual repair cost for trucks was nearly double the cost for engine repairs, a more-than 50 percent increase in this ratio over the previous year.

Overall, the Department"s apparatus repair costs and associated trends appear relatively consistent given the size, age and condition of the fleet. Excepting the recent increase in average annual repair cost for trucks, there are no anomalies or surges in cost that easily signal the need for attention. On the other hand, it is unclear whether this level of expenditure is appropriate. Our review suggests that greater emphasis on scheduled preventive maintenance could contribute toward lowering the Department"s maintenance costs.

Replacement Plan

A vehicle replacement program, embodied in a strategic plan, can help to ensure that an adequate supply of essential firefighting apparatus is systematically procured and maintained. Apparatus is a crucial part of fire suppression and can often mean the life-saving difference in urban firefighting outcomes.

Table 1.8.3
SFFD Total and Average Annual Repair Cost
By Type and Year for Five Years

The current Fire Equipment Maintenance and Replacement Plan was proposed in 1987, but never fully implemented. The 1987 Plan addresses only engines and trucks. Thus, the Department has no clearly delineated maintenance or replacement schedule for ambulances, automobiles and other vehicles. And with respect to engines and trucks, a nearly 15-year-old plan could not possibly address the vehicle emission standards required of all new apparatus, standards that are not met in most cases involving the current fleet.

While driving rules do include ambulance drivers, the Department"s inventory does not provide adequate information on ambulances. The information on ambulances is generally less complete than that of other major apparatus, such as engines and trucks. Ambulances were not included in the 1987 Equipment Plan, as it was proposed long before the paramedic merger. However, the Plan has not been revised to reflect this substantial change in organizational structure, operations and capital assets. In light of the current discussions regarding planned implementation of a new delivery system for emergency medical services, the impact of that system on the fleet should be carefully analyzed and addressed in the Plan.

Clearly, the Department needs to have an updated plan that is strategic, comprehensive, that addresses all apparatus and vehicle types, and takes into account the broad range of fleet issues and concerns uncovered during this review. Among some of those issues were the following:

· Special demands imposed on the Department"s apparatus from peculiarities of San Francisco"s mix of historical as well as dense, urban and hilly environment. This is a popular perception and commonly used basis for justifying the shorter useful life of San Francisco apparatus. However, there are no correlative data to support the argument;

· Operating relationships with the Purchaser"s Office (for procurement), and Central Shops (for maintenance). These are viewed as good overall, but the Department prefers greater latitude for contracting selected services in certain instances and closer monitoring of charges;

· Compliance with forthcoming California standards for apparatus emissions (State Government Code Section 1956.8, Title 13 -Emissions). These standards are applicable to all new vehicles so a plan should address the trade-offs between compliance with the standards, vehicular power needs in the San Francisco environment, sizes and types of vehicles, service delivery modules, and size of the overall fleet; and

· Prospective impacts, if any, from implementing the "one-and-one" Emergency Medical Services program or a further variation on current apparatus usage. After the service delivery approach is resolved, then the long-range apparatus needs can be viewed in the proper context.

Equipment Funding Strategies

Fire departments that defer replacing fire apparatus often find themselves in a position of having to replace much apparatus at one time. This may have the advantage of a slight cost saving per unit due to the quantity, but it puts the future in jeopardy as the entire fleet then ages together and all apparatus is suddenly old again. A more scheduled approach allows desired design changes to be evaluated on a unit-by-unit basis and designs that are not working well changed on future purchases. It also provides some newer and hopefully, more reliable vehicles in the fleet at all times.

A good program for procuring appropriate fire apparatus, properly training the operators, properly maintaining the apparatus over its life, and then replacing it before it becomes unreliable is as essential to fire protection in a community as providing personnel to respond on the apparatus. Without the apparatus and the tools it carries, firefighters cannot do their job effectively.

As the Department undertakes revisions to the current plan, it should take into account possible funding strategies to ensure plan implementation. As most of the Department"s support derives from the City"s general fund, the options are somewhat limited: basically, debt funding or cash. Some communities maintain a special replacement fund for apparatus, contributing an amount equal to the annual depreciation of the fleet. Another example is with the City of Chicago, which issues E (equipment) Notes every year to cover capital equipment purchases, including Fire Department vehicles. The San Francisco Mayor"s 2001-02 budget highlighted additional funding for debt-free capital procurement; however, the Board of Supervisors made further cuts in the Department"s capital program, and specifically engines, largely because of insufficient justification by the Department. The matter of debt funding versus pay-as-you-go is a political decision as is the annual allocation of capital funding, both affecting the Department"s overall apparatus inventory. By having a strategic plan that delineates the condition, needs and associated costs of maintaining and systematically replacing the Department"s fleet, this decision-making process is better informed and firefighters have a better chance to remain properly equipped to do their job effectively.

Table 1.8.4, below, provides examples of three schedules for vehicle replacement that the Department can consider in making revisions to the Plan. The first two replacement schedules are based on the Department"s current useful life standards of seven years for frontline engines, ten years for frontline trucks, and five years of reserve service for both, with ambulances having a seven-year useful frontline life. Given the current inventory and ages, this would result in the replacement of 7 ambulances, 11 trucks and 24 engines over the period 2003 through 2005. While the total cost in current dollars, is the same for both schedules, the first one shows over three-fourths of the cost expended in the first year while the alternative schedule shows a relatively level expenditure pattern over the three years. The third replacement schedule is based on a modified useful life that is closer to the NFPA standards of 10 to 15 years of frontline service for engines and 15 years frontline for trucks. The total service in frontline and reserve categories for both types of apparatus would not exceed 25 years. We further assumed that the frontline standard for ambulances would remain at seven years. This modified useful life is also predicated on the Department being proactive about scheduled preventive maintenance to extend the service time of the existing fleet. Thus, a schedule for the same inventory and ages produces replacement requirements over the same period of 7 ambulances, but only 5 instead of 11 trucks, and 20 engines rather than 24. Additionally, these replacements are staged so that about one-half of the total cost is expended in the first year and the remaining cost is evenly spread over the next two years.

Table 1.8.4
SFFD Major Apparatus
Alternative Replacement Schedules

Conclusions

The SFFD does not have a comprehensive, strategic approach to fleet management. The Department"s vehicle replacement plan, proposed in 1987, is out of date, does not include ambulances and was never fully implemented. In addition, the Department does not maintain an up-to-date, accurate inventory on all vehicles and capital equipment.

The Department is somewhat disadvantaged and service quality is potentially compromised by lack of clear policies and planning for the replacement of some of its most critical service-related assets. The lack of clear policy results in inefficient management of the overall fleet. The absence of a replacement plan and supporting justification places the frontline fleet in jeopardy from inadequate resources in the future. This also presents a potential safety issue, as the reserve fleet is often insufficient to accommodate service needs when equipment is out for maintenance or responding to mutual aid calls.

The SFFD should develop and implement an updated, comprehensive Apparatus Management and Replacement Plan that includes all apparatus as well as auxiliary equipment, and addresses the issue of fleet management. This plan should be kept current and presented annually to the Fire Commission for review.

The Department also should explore the development of a funding strategy for the Plan, prepare written policies and procedures for apparatus and vehicle management, utilize an updated information tracking system, and rotate passenger vehicles based on utilization patterns.

For a nominal one-time cost to develop, this plan can help to ensure a continuous stream of apparatus and vehicles to maintain high quality services. Further, implementation of these recommendations will facilitate full compliance with GASB-34, and reduce uncertainty associated with repairs and replacement.

Recommendations

The San Francisco Fire Department should:

1.8.1 Prepare a written policy and set of procedures that cover management of the Department"s apparatus.

1.8.2 Prepare a strategic and updated comprehensive Vehicle Maintenance and Replacement Plan, implement a related Program for all Department vehicles, and ensure Department-wide compliance with the plan. This plan should be updated annually to reflect inventory changes and budgetary actions.

1.8.3 Develop information tracking systems to monitor vehicle depreciation, value, usage hours, mileage, costs of maintenance, repairs and accidents and all other relevant information in a centralized database to ensure that inventories are accurate and can be effectively used to manage the entire fleet as well as facilitate the Controller"s compliance with requirements of the Governmental Accounting Standards Board (GASB) Statement No. 34 .

1.8.4 Develop a system to ensure that Department vehicles and apparatus receive the proper preventive maintenance.

1.8.5 Rotate passenger vehicles in order to smooth out utilization rates.

1.8.6 Evaluate whether the Department has too many passenger vehicles and if so, work with the Purchaser"s Office to properly dispose of the excess. If the reverse is true, make certain that the Plan addresses and includes justification for additional needs.

1.8.7 Explore alternative funding strategies for vehicle replacement and include a recommendation in the Plan.

1.8.8 Evaluate vehicle assignments to determine the appropriateness of assigning vehicles to on-call personnel who reside a substantial distance from the City.

1.8.9 Review and reach a clear understanding with the Purchaser"s Central Shops on the circumstances under and the extent to which the Department will be able to contract directly with outside vendors for apparatus maintenance.

1.8.10 Follow the recommendation in another section of this report to civilianize positions of uniformed personnel in the Bureau of Equipment that function primarily as mechanics.

1.8.11 Include in the training regimen for the head of the Bureau of Equipment classes in professional fleet management.

Costs and Benefits

A regular and stable vehicle replacement schedule would eliminate the need in the future for acquiring a large number of vehicles in the same budget cycle. It also could prevent a large part of the fleet from aging at the same time, therefore avoiding the necessity of large acquisitions to replace many vehicles -unless that was part of a deliberate strategy by the Department to achieve a lower per-unit acquisition cost. In addition, regularly replacing vehicles when they can no longer be operated economically would eliminate the need for costly repairs of aging vehicles and a reduction in the Department"s maintenance and repair costs. Improved maintenance of apparatus would also contribute to lowering vehicle maintenance costs.

The Department would have more accurate and complete inventory and maintenance records from which to evaluate apparatus utilization and cost efficiency.

Establishing effective management systems may require some modest level of one-time additional resources; however, on-going maintenance of proper records and monitoring vehicle records should be possible with the present level of staffing. The PeopleSoft software currently being implemented may be capable of handling the processing and storage of data necessary for these needs.

¹ NFPA"s Fire Protection Handbook, 18^th Edition as quoted in "Fire Apparatus Replacement" document, NFPA Public Fire Protection Division.

² This merger, involving the paramedic unit"s move from the Department of Public Health to the Fire Department, took place in July 1997.

³ Many of these accidents are attributable to Department personnel (please refer to the section of this report dealing with Vehicle Accidents for details on each category).