Firemen’s Association conflict erupts at Oster meeting

Friday, March 29, 2019

After a heated 90-minute exchange facilitated by George Oster’s second Skype appearance at the Alta Fire Department, it seems that the months-long blaze that was sparked after a routine Fire Chief appointment has been been contained and reduced to a smolder. Only the next steps will determine whether the fire will be extinguished.

Wednesday’s meeting, with about 15-20 in attendance, erupted after months in the making, delayed after the initial February meeting experienced technical difficulties, much to the disappointment of a packed room of 35.

The meeting with Oster, an expert in 501(c)3’s associated with fire departments, was positioned by Mayor Al Clark and city council as a potential solution to the ongoing conflict that erupted after Clark refused to allow Kirk “Bubba” Reetz to be reappointed as the Fire Chief.

But Oster only got through six slides of his 30-slide Powerpoint presentation before arguments took over during a pause for questions, effectively leaving Oster on standby in the background as he listened to half a dozen individuals hash it out.

Any questions?

A few questions slowly built the tension from a cordial start.

“How will the Fire Department and (Firemen’s) Association distinguish who they are when doing fundraisers?” asked Megan Peterson, city clerk. “How will we know if it’s city or association money?”

“It’s incumbent on the corporation (called the “Association” here) to make clear to the public when doing fundraising activities that it’s being conducted by the non-profit corporation,” replied Oster. If the corporation (Alta Firemen’s Association) raises the money, it doesn’t go into the city’s coffers. But if the Fire Department does, it belongs to the city.

“It’s not about the money."

Oster also clarified that the Firemen’s Association can maintain the anonymity of their donors in financial disclosures, a concern that Reetz previously said could cost them a significant amount in donations if forced to reveal.

Then it hit a boiling point.

“It isn’t even a close question”

“I think we’re dancing around the issue here,” said Alta City Attorney Gary Armstrong. “Is a corporation a component unit of the City of Alta for public accounting purposes?”

The question was a central point of past arguments.

Armstong and the city contend the Alta Firemen’s Association is a “component unit” of the city. Any component unit is required to blend financial reporting with the city, according to newly discovered rules.

According to changes in what was referred to as “Rule 61,” any outside components determined to be both a “component unit” and either financially beneficial or burdensome to the city are required to blend their financial reporting with the city’s.

Previously, the rule stated that outside entities like the Firemen’s Association were encompassed by more stringent reporting requirements only if they were fiscally dependent on a government entity like a city.

Oster could not definitively answer Armstrong’s question, deferring him to an attorney without realizing he is one.

“Who’s money it is isn’t the issue here,” Armstrong said. “The issue here is, do they need to provide the city with their annual budget?”

“Yes, I concur with that interpretation,” Oster replied, clarifying that it’s wise for both the city and the non-profit corporation need to be on the same page for big decisions and expenditures.

“Do we have the ability to manage money and spend it as we deem fit if we fundraise it?” Bubba asked, wondering if the city council has the power to require pre-approval of their expenditures.

“That’s not the issue here,” Armstrong interjected. “It’s not about the money, it’s about a reporting requirement.”

“That’s not how it started though,” Bubba replied, turning the Q&A into a long conversation between the city and the association.

“If you think about it, the reason why you go non-profit is to save the citizens of Alta more money, correct? Because it allows you to go after grants that are tax-free, unavailable to the city,” Clark posed.

“No, it’s to open up funding avenues,” Bubba contested.

“The purpose of a non-profit is to perform, to assist the fire department and the city through fundraising that might not be otherwise available to the city,” George replied. “It is the money of the citizens of the community that is being held in a trust by the city and by the corporation with the expectation that it is being held to benefit the citizens of the city.

“You folks need to get a marriage counselor in there."

“I would encourage you to stop thinking about this as money of the city or the corporation, but rather money the citizens have provided to you by various means to hold in trust,” he said.

“But is it to offset the budget?” asked the fire chief, a concern central to the Association’s skepticism after city budget discussions raised the possibility of splitting annual $50,000 commitments that help the Fire Department save money for equipment, in the face of a Streets Department struggling to keep up with equipment needs.

Faced with pressing needs from that department, the city wasn’t sure where else to look for the money short of tax raises. Nonetheless, they quashed the idea to avoid this very optic between a rock and a hard place.

“In effect, that’s what happens,” George replied.

“This isn’t even a close question. You are a component unit,” Armstrong asserted yet again. “The test is as black and white as possible.”

What seems to be the problem here?

After intently listening and chiming in as requested for a substantial amount of time, Mr. Oster attempts to clarify his own confusion.

“What the hell is the issue?” he asked, understatedly.

“Control!” shouted one.

“Transparency,” said Clark.

“It’s a work in progress,” Bubba told the Pilot-Tribune."

Underneath the contention over reporting requirements lied a fear of the city altering the Fire Department’s budget with increased transparency of what the Alta Firemen’s Association brings in.

“If you get a grant, is there a harm in the city turning around and saying (the amount received by the grant) is something that can be (redirected) to the street department?” Clark asked.

“You folks need to get a marriage counselor in there,” Oster chimed in, after conversation devolved into details on how often finances should be disclosed and how. “You’re having trouble communicating with each other.”

The expert may have earned his $600 fee on one joke prefacing the highlight of a root issue, changing the tone of the rest of the conversation that ended with handshakes and an agreement on how to move forward with arbitration.

Finding common ground

After that, the room had a breakthrough moment on their common purpose: serving the citizens of Alta.

Reetz revealed the association’s attorney, Dennis Brady of Remsen, after it was long held a secret for unspoken reasons.

“I still think (there’s a) misconception,” Councilman Kevin Walsh said. “The council doesn’t want your money. It’s still yours. … What it boils down to is our city auditor, who we pay, says it’s a red flag that we’re not seeing the books (from you).”

“I need everyone to understand that I’m doing my job and I’m not going to forfeit my job (by not following the law),” Peterson followed.

Over an hour in, the heat was reduced to a simmer.

“I think we’re good here, George,” Clark said to their expert guest, dismissing him.

With the name of the Alta Firemen’s Association’s attorney now available, Armstrong, Brady, and accompanying representatives from each party will arrange a time to discuss concerns and negotiate an arrangement that satisfies the city’s minimum legal requirements, as well as articulation of the responsibilities of each party.

Oster was apprehensive of leaving, given what he had just witnessed.

“I have a suspicion you’re lacking trust of one another,” he said.

The city council has trust for the Association, Walsh disagreed—the matter was simply figuring out how to satisfy the auditor.

The tone of conversation calmed, and parties seemed confident Oster had served his purpose.

“George, the consensus is we don’t need you anymore,” Clark reiterated, saying goodbye.

“It’s a process,” the mayor concluded, conceding he misunderstood some things at the beginning of the conflict, before going around the room to shake every Firemen’s Association member’s hand as a gesture of reconciliation.

“It’s a work in progress,” Bubba told the Pilot-Tribune after it was all over.