Tag Archives: Northfield Fire Relief Association

Update on the Northfield Fire Department and the Northfield Fire Relief Association: What’s the good, the bad, and the ugly?

Northfield’s Fire Department has been the subject of two Northfield News articles in the past week:

Nov. 8: Northfield Fire Department revamps how it selects leaders

Nov. 2: Northfield Fire Department has made "extreme progress" this year

Public Safety Director Mark Taylor’s Fire Department Roadmap upate (PDF of a Powerpoint) is available, too:

Northfield Fire Deparment Roadmap update

Progress! Understanding the structural, financial, and legal operations of the Fire Relief and Rescue Squad associations

At the August 21, 2012 City Council Work Session, TJ Dvorak and Tom Nelson from the Fire Relief Association and Rescue Squad Association met with the Council to:

… provide an update on their efforts to address process and procedural topics of the Association. Attached is supporting information on the steps they are taking in this process and how the Relief Association is integrated with the Fire Department and the Rescue Squad.

It’s been a long and tortuous road to this point (see all the blog posts for background). There are no dollar amounts attached to anything yet, so it remains to be seen whether item 3D Transparency Review will reveal the important numbers to the public. But I’m pleased that there appears to be progress. The document in the packet (PDF) included this outline and flowchart (PDF):

Northfield Fire Relief Assn and Northfield Rescue Squad Relief Assn Funding FlowchartNorthfield Fire Relief Association & Northfield Rescue Squad Association – Progress Update

1. Process Goal: Association and City staff leaders jointly review (with external assistance) the structural, financial, and legal operations of non-profit Fire Relief/Rescue Squad associations, outline recommended changes, and report to City Council

2. Process Team

a. TJ Dvorak – Association President
b. Tom Nelson – Association Secretary
c. Mark Taylor – Public Safety Director
d. Tim Madigan – City Administrator
e. Kathleen McBride – Finance Director
f. External Review/Recommendations members
i. Tom Olinger CPA – Abdo, Eick, and Meyer CPA
ii. Eve R. Borenstein JD – Eve Rose Borenstein LLC

3. Process Steps:

a. Preliminary Meetings and flowchart development
b. Information/documentation gathering for external review
c. Outline Time Line – process, deliverables, and any change management.
d. Transparent Review – Structural, Fiscal, and Legal
e. External Assistance/Recommendations – CPA and Non Profit specialized JD
f. Recommendations Review – External consultants and process team
g. Next Steps & Change management
h. Final Report presentation to Council

Here’s the video from that segment of the work session:


Video streaming by Ustream

Props to the Northfield News for the Fire Relief Association ethics story

Northfield NewsSaturday’s Northfield News carried a front page story titled Concerns arise over Fire Department expenses; Northfield officials fear funding is going toward non-firefighting expenses.  (The headline used for the online version: Ethical questions arise over Northfield Fire Relief Association expenses.)

Griff Wigley with May 12, 2012 edition of Northfield NewsI’ve done four fire department/association-related blog posts since January (here, here, here, and here) as well as a three more on attorney David Hvistendahl (here, here, and here) who’s representing the fire and rescue squad associations. It’s a complex and constantly evolving issue.

So it’s really helpful to have a someone else, in this case, Northfield News reporter Suzy Rook, digging into the story, too.   And for the first time, the paper cited Locally Grown (twice) in a story:

Fire Department officials, including Fire Chief Gerry Franek, did not respond to several requests from the News for association financial records or comment. Assistant Fire Chief Tom Nelson at an April 24 City Council meeting said documents posted on the blog Locally Grown are 2010 and 2011 relief association check registers. But those registers don’t clearly state how and where monies were spent, and are likely a listing of transactions from several accounts compiled into a single document…

The association had a net revenue of $14,263 in 2011, according to a Gambling Control Board report to the Legislature. Of that, $4,110 was used for what’s termed lawful purpose expenditures. In 2010, its net receipts were $17,730. Of that, $8,354 was used for lawful expenditures. Figures provided to the state Gambling Control Board don’t match the association’s 2010 tax return, a document Assistant Fire Chief Tom Nelson says he provided Locally Grown. According to that document, the association lost $2,209 in 2010.

I appreciate that. Follow Suzy Rook on Twitter @rooksuzy.

Why is the Northfield Rescue Squad Association retaining attorney David Hvistendahl?

I was surprised to see on page 17 of the April 24 Council packet that there’s a letter (separate PDF here) from Northfield attorney David Hvistendahl to the CPA firm of Abdo, Eick & Meyers in which he’s telling them to not disclose any financial info about the Northfield Rescue Squad Association to the City of Northfield:

Hvistendahl NRSA letter to AbdoRemember your firm’s fiduciary duty owed to the Association on the basis of your professional services to the Association. We assume you will honor that duty and not disclose any information pertaining to the Association without our written consent.

Unless the city has a written agreement with the Association that gives them the power to request such an audit, or unless a Minnesota statute grants the authority to a municipality to compel an audit, the city lacks the standing to request an audit.

The Northfield Rescue Squad Association (NRSA) is separate from the Northfield Fire Relief Association (NFRA). The NRSA runs the bingo and duck race fundraisers during DJJD. I don’t know the history on why there’s a need for two organizations. I don’t understand how the gambling/pull-tab revenue is handled.

But regardless, why is it important that the City not know the Northfield Rescue Squad Association financials?

Now that we know Northfield’s firefighters aren’t really volunteers, more transparency is needed on their fundraising activities

Northfield MN firefighters, members of the Northfield Fire Relief AssociationIt should now be clear to the citizens of Northfield (see this blog post and discussion thread with 201 comments) that Northfield’s firefighters, part-time employees and members of the Northfield Fire Relief Association, aren’t really volunteers in the sense that most people use that term.

Yes, state statute 299N.03, subdivision 7 uses the term ‘volunteer’  to define those firefighters who are paid on an on-call basis as well as those who aren’t paid.  But that’s immaterial.

Northfield’s firefighters get paid $21.63/hour for fire calls and $16.17/hour for training activities (1st Monday of the month paid by the City of Northfield; 3rd Monday of the month paid by the Northfield Rural Fire Protection District).

And if they stay on the job for 20 years, they get a lump sum pension payment of $150,000.  That’s tied for the best lump sum deal in the state of MN.  A few firefighters are nearing 40 years of service and they’ll get $300,000+ when they retire.  (Note: these pension funds are not funded solely by the City of Northfield/taxpayers. State aid/investment returns typically exceed the municipal contribution. See my blog post criticizing the Northfield News for their yet-to-be-corrected error on this.)

It’s true that those firefighters who are also members of the Rescue Squad (is that everyone?) are not paid for going on rescue calls (car accidents, medical problems, etc) nor for rescue-related training (2nd Monday of the month). But I think of these uncompensated hours, as well as the community activities by many firefighters (e.g., speaking to 3rd grade classrooms about fire prevention) as part of ‘the deal:’ stick with this part-time, hourly-pay job that requires a few extra hours per month on your own time and you get a nice nest egg (lump sum pension payment) after 20 years.  Plus, as I’ve written before, it’s an interesting and challenging job in which they get to make a real difference in people’s lives, contribute measurably in the community’s quality of life, and earn our respect for doing so.

Everyone I’ve talked to is surprised that there’s this level of financial compensation for firefighters they considered to be 100% volunteer.  But I’m quick to stress to them that I think this is a good deal for the Northfield community. We get a high quality firefighting force with little turnover for a fraction of the cost of full-time firefighters.

Fundraising by the Northfield Fire Relief Association and the Northfield Rural Fire Protection District (dinners, dances, pull tabs, bingo, duck race, etc.) is a problem. I’ve assumed (as have most of the citizens I’ve talked to) that fundraising money goes towards firefighting equipment or other firefighting-related expenses.  It turns out, that’s not the case.

Northfield Fire Relief Association check register 2010 Northfield firefighters check register 2011 Northfield Fire Relief Association tax form 2010
See the Northfield Fire Relief Association check registers for 2010 and for 2011. See their 2010 tax statement.  While there doesn’t seem to be to be anything inappropriate anything that would indicate a misappropriation of funds that I can tell (how would I know!), it seems that, for the most part, the money raised benefits the firefighters, not firefighting.

The Grand Event Center For example, in attendance at the annual Firefighters’ banquet (not the benefit dance) at The Grand Event Center are the firefighters and their wives/girlfriends and some representatives of the Northfield Rural Fire Protection District. City leaders (mayor, police chief, city administrator) are typically invited. The steak/lobster dinner and open bar the entire night costs a few (several?) thousand dollars.

Fundraising of various kinds pays for this, of course, not tax dollars. I might be supportive of a lavish affair like this if the firefighters were 100% volunteers. But they’re not. They’re well-compensated. And for them to conduct fundraising activities that benefit themselves as if they were volunteers seems more than a little disingenuous to me.

The gambling (pull tabs) revenue is significant ($100,000+) but the cost of goods sold and various expenses were such that gambling generated no profit in 2010.  Is that typical? I don’t know but if it is, why do it?  The purpose of charitable gambling is to generate a profit for the charity’s mission.  Maybe I’m missing it but I don’t see evidence of mission-related expenses.

I think the Northfield Fire Relief Association should quit marketing itself as the Northfield Volunteer Fire Department.  And any public fundraising activities should be pitched as directly benefiting a specific cause, activity, or piece of equipment.  If they want to have an all-expenses paid annual banquet/bash, fine, but make sure donors know that that’s what their contributions are paying for.

An easy first step towards more transparency would be for both the Northfield Fire Relief Association and the Northfield Rural Fire Protection District to each have separate websites where Articles of Incorporation, by-laws, mission, and members are all posted and where financial statements, meeting minutes, etc. are regularly updated.  Nearly every Northfield area non-profit and membership association of any size has a website and most have blogs. Why not these two? They both play an important role in our community and public awareness/accountability is now needed.  They both have the financial resources to pay for it.

Northfield News story on firefighters’ pension is misleading

Northfield Assistant Fire Chief Tom Nelson; Griff Wigley March 13 Nfld News:  Northfield’s firefighter wages, pensions among highest in state DSC08083 Northfield Assistant Fire Chief Tom Nelson; Griff Wigley
Northfield Assistant Fire Chief Tom Nelson stopped by my corner office at GBM yesterday. We mostly argued, hence the scowls in the left photo. (Feel free to sort through the 180+ comments to my blog post to find my criticisms of the Northfield Fire Department. More to come?)

But one thing we did agree on (hence the smiles in the right photo) was that the two versions of the Northfield News stories about the firefighters’ pension contained some misleading information. In the March 6 version, Northfield firefighters: paid or volunteers?, reporter Suzy Rook wrote:

According to a state auditor’s report for 2009, the city’s firefighters, who also serve the Northfield Rural Fire District, have $7,500 apiece placed in the fund annually;

In the sidebar:

$7,500 — Northfield’s annual pension contribution per firefighter

After the March 6 story appeared, Tom’s email to me and Suzy included this:

Northfield Fire Relief is presently at $7500/yr of service.  This is not to be confused with “The City pays each member $7500/year” as was stated in the Northfield News e-edition last week.  The impact on the annual budget is only the Municipal Contribution amount.  For this year, the impact is slightly more than $900/fire fighter.

Likewise, in the comment thread attached to the March 6 story, firefighter Aramis Wells argued with her about this issue.  But to no avail, as this week’s March 13 version, Northfield’s firefighter wages, pensions among highest in state, contained the same text and sidebar.

My take

Individual firefighter pension obligations DO NOT cost the City of Northfield/taxpayers $7,500/year, as the Northfield News’ stories indicate.

Rather, if they stay on the job for 20 years or more (and past the age of 50), the pension fund pays them $7,500 per year of service. Big difference.

The amount in the fund fluctuates with the stock market and so the City’s annual contribution to the fund fluctuates.  Back in 2008, the City contributed nearly $100,000 to the fund. In 2009 it was half that. This year, Tom says it’ll be about $29,000.

I think the City of Northfield and we citizens get a good deal with this arrangement because the pension encourages firefighters to stay on the job.  Lack of turnover is generally a good thing when it comes to firefighting and I think we’re better served by having so many firefighters with so many years of experience.

But we need not worry too much that the current turmoil with the City and the Northfield Fire Department will cause many firefighters to quit.  Fire Chief Gerry Franek’s attorney David Hvistendahl, Northfield Area Rural Fire District administrator Jerry Anderson and others are wrong to, um, fan these flames.

Why?

The firefighters get a good deal, too. If they stick with it for 20 years, they get a decent lump sum payout of $150,000. A few are going get twice that as they been on the job for nearly 40 years. Plus, they have an interesting and challenging part-time job in which they get to make a real difference in people’s lives, contribute measurably in the community’s quality of life, and earn our respect for doing so. Not many $21/hr part-time jobs offer all this.

I’m glad the Northfield News did the story because it has helped raise awareness of the issue.  But I think they owe it to the firefighters and to the citizens to run a correction.

What’s up with the Northfield Fire Department?

In Saturday’s Nfld News: Firefighters want to air concerns to Northfield council

Nfld Fire Dept letter to councilIn a Dec. 28 letter, 27 of the department’s 32 firefighters asked that the City Council schedule a work session “to discuss improvement to the road map for the Fire Department, specifically the selection or election of the fire chief and appointment of officers and the new fire hall.”

Northfield Fire Chief Gerry Franek said last week that he believes a meeting with the council will alleviate some of the firefighters’ concerns. In meetings with the city’s administrator and public safety director, who oversees the Fire Department, several firefighters have voiced their unhappiness with proposed changes the city plans to make when choosing a fire chief…

The mayor also prefers to honor the established chain of command, and continue communicating through the city’ administrator, public safety director and fire chief.

I’m way behind on understanding all the issues with the Fire Department, going back to early last year when an OSHA inspection raised issues and a subsequent report by a consultant cited criticisms.

It’s an odd request for nearly an entire department (27 people) to want to meet directly with the City Council, seemingly without the involvement of their supervisor, in this case, Public Safety Director Mark Taylor. Imagine if all the public works employees made a similar request, going around their supervisor.  Something’s amiss here and I don’t understand what it is.

Northfield area charitable gambling organizations: What percentage of their proceeds is going to community needs?

Which Northfield area organizations are giving a high/decent/respectable percentage of their charitable gambling proceeds to community needs and spending less on their operations?

Today’s Sunday Strib has a front-page story titled Where’s the ‘charity’ in charitable gambling? (That’s a premium link for the next few days, i.e., you need to be a print subscriber and logged in to access it.)

Pull-TabsThis year marks the 25th anniversary of state-regulated charitable gambling in Minnesota, the charitable gambling capital of the nation. Gambling employs more than 12,000 Minnesotans, funnels money to hundreds of charities, and provides entertainment at nearly 3,000 bars, fraternal halls and restaurants in every corner of the state.

But donations to charities have plunged to their lowest levels since 1986. About $32 million, or 3 percent of gross gambling revenues, went to charities in fiscal year 2010, according to a Gambling Control Board analysis this month. That means hundreds of Minnesota groups, such as Boy Scouts, softball teams and food shelves, are receiving smaller or no donations from gambling proceeds.

A second article is titled The trade-off in charitable gambling (premium access also required):

Hundreds of VFWs, American Legions and other groups have come to rely on their charitable gambling revenues to keep their doors open.

A third article (access is open to all) titled How much money goes to charity? has a:

… list of the more than 1,200 organizations that operate charitable gambling in Minnesota, which has been a $1 billion per year industry. They range from VFWs to fire department associations to youth athletic clubs. To sort by city or another column, click on the arrows inside each column head. The column titled "Other Lawful Purpose" refers primarily to property taxes and some building repairs that American Legions, VFWs and other fraternal groups can pay for using gambling profits.

The figures were released this month by the Minnesota Gambling Control Board and cover fiscal year 2010, which is July 1, 2009 to June 30, 2010. This is not data for the 2010 calendar year.

I put together this screenshot of the data for the Northfield groups. Click to enlarge:

Northfield charitable gambling 2010

So let’s crowdsource the analysis of this data. 

Which Northfield area organizations are doing well, i.e., giving a high/decent/respectable percentage of their charitable gambling proceeds to community needs and spending less on their operations?

And which, if any, are doing poorly?