Scottsdale Report Applied to Medford Scottsdale Savings

Scottsdale Report Applied to Medford

Medford Scottsdale Savings

The Scottsdale Report distinguishes between reactive and proactive fire control (Ford 1997). Medford Fire & Rescue has been trying to move toward proactive control since at least 2007 (Patterson 2007), because not only does proactive control saves lives, it also saves the taxpayer cost. This report describes ways the Department may be able to show those cost savings as revenue, or at least as performance improvement in the bottom line for the City.

The Scottsdale report explains how installing sprinklers could save development costs for the city and private sector before the first new building even went up, by allowing higher density for private residences by 4%; reductions in street width which would save the city paving, maintenance and right-of-way costs; removing a 360-degree access rule for fully sprinklered new commercial development, and mitigating existing fire prevention construction code compliance like door requirements or 'one-hour' fire compartmentalization construction. Even more significant development savings were achieved in Scottsdale reducing fire hydrant spacing (direct plant and ongoing maintenance cost) by nearly one half; a full step-reduction in water main diameter; smaller water storage tank size, and the ability to use reclaimed, untreated water fighting fire. This saved an estimated $7.5 million in Scottsdale in development and water costs across the entire system (1997). Bucks County, Pennsylvania found a five-fold reduction in water usage from similar cases (Jakubowski 2011), and up to 18 times less water usage and 12 times less damage in other real, documented cases (Jakubowski 2011). These savings would occur off the Department's balance sheets but Fire & Rescue would likely save equipment costs requiring less large-diameter hose (Jakubowski 2011).

Smaller-gauge hose would reduce costs in several ways beyond the expensive hose itself, requiring less storage space; faster deployment and filling; and thus faster response time and higher performance ratings. These benefits could spill over to the total community if a higher rating delivered lower insurance costs to every consumer, perhaps even if sprinklers were only required in new development. The Scottsdale report indeed found such a reduction in insurance costs of "approximately 75%" after sprinkler installation (1997). These savings slow insurance cost growth for all consumers. If these development savings were achieved, the result in Scottsdale was to push down on the need for new fire stations. In Scottsdale at that time, this represented a savings of $6 million immediate capital investment with an annual $1 million in savings per year every year after that (1997). This is relevant to Medford because we must build or relocate fire stations in order to meet population growth.

Medford Fire & Rescue put out 381 fires in 2007 (City of Medford, Oregon Fire & Rescue 2008). If population continues to grow, so will the cost of reaching new development, with $15 million in capital costs projected in the 2008 strategic plan building or relocating stations, and payroll growth of over half a million per year to staff them. If we can reduce these future capital and annual operating cost growth rates compared to the total population growth rate, the result will be an increasingly smaller share of total social cost for the Fire & Rescue department compared to the rest of the City. While these savings usually do not appear on balance sheets as revenue per se, the lower share of total cost would be measurable in annual financial performance indicators relative to the other departments.

The original Report estimated property savings of over 85% (1997) and 8/9 fires controlled or eliminated with one or two sprinkler heads. After 15 years, the actual measured results beat these estimates. The 15-year update to the Scottsdale report found a 50% reduction in civilian fire fatality due to sprinklers, and property loss reductions of 90% (2005). The residential sector cost was usually between 55 and 75 cents per square foot in average new homes without any measurable impact on home prices or sales.

Unfortunately one of the main things Scottsdale also found was that organized opposition, in the form primarily of industry associations, was able to prevent sprinkler ordinances using the political process. Medford has already encountered bureaucratic obstruction on part of the State itself (Patterson 2007), even though Oregon promotes the benefits of sprinkler installation on its own Web page (State of Oregon 2011). Therefore in order to imagine the best possible way to imagine proactive solutions is to pretend an emergency has been declared and the Fire Marshall appointed temporary dictator. That way we can brainstorm the best ways to increase safety, save private lives and cost, and reduce Department and thus taxpayer cost growth, which, given stable funding levels, will increase Department revenue. Then we haggle over where to find the political muscle to achieve such legislation.

Best would be to mandate sprinklers for all buildings. Given the age of many structures in Medford, this might be a hardship for property owners and the renters onto whom they pass those costs. Therefore we mandate sprinklers in new construction and remodeling, particularly for multi-family dwellings: Why? Because if one person's negligence harms themselves only, that is their risk, but as soon as they start endangering others who do not choose to take that risk, the risk takers need to insure their actions. City could charge an insurance penalty, on grounds that if individuals want to (must) insure their structures, then we add insurance cost to structures that do not have sprinklers, such that future owners / builders find it cheaper to install sprinklers than not. The cost of avoidance would shift back from the taxpayer to the individual property owner. This would initially spill over to all insurance consumers in higher prices, until they all had sprinklers, in which case the cost shift would disappear.

One major cost savings could be the cost of upgrading all other Fire & Rescue services to achieve higher ISO rating. At the time the Scottsdale report was issued, no ISO upgrades were awarded for sprinkler installation (p. 20). Medford has a goal to upgrade from ISO 4 to ISO 3, or had in 2008 at least (City of Medford, Oregon Fire & Rescue, 2008). The actual cost savings from compliance with ISO today was difficult to ascertain, seeing as how even downloading their extensive rules incurs significant cost. Ironic how sprinkler opponents continue to complain about costs that have been demonstrated to be actual savings since 1980, even while imposing costs on those attempting to achieve those savings.