Running out of money, Central Coventry Fire District weighs $1m credit line from a neighbor
COVENTRY - The Central Coventry Fire District, which is weeks away from running out of money, has an offer from its neighboring fire district of a $1 million line of credit.
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The goal: temporarily keep the fire and rescue trucks running while the troubled district figures out a long-term solution to its financial problems.
“We respond to them and they respond to us,” said Bryan J. Testen, chairman of the board of directors of the Coventry Fire District, which is making the line of credit offer. “All of a sudden, if there’s a void in the middle of town where they’re unable to send out trucks from their stations, that’s going to be a problem.”
Coventry, with a population of 35,000, has four self-governed fire districts: Central Coventry, Coventry (also known as Anthony), Hopkins Hill and Western. They have their own charters and are financially independent from each other — and from the town of Coventry. But they rely on each other, and at times surrounding towns, for mutual aid.
What happens if Central Coventry Fire District runs out of money?
Central Coventry, with a $5 million annual budget, covers the largest area with the most calls, nearly 4,500 a year. The question around the district this summer: what would happen if the district runs out of money?
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“I would just pack my family into the car and drive myself to the emergency room, but a lot of people can’t do that,” said Cynthia A. Fagan-Perry, chairwoman of Central Coventry’s board of directors. “They depend on the fire and rescue truck. Someone will show up, it’s just a matter as of how long it will take to get there.”
Testen agreed: “When seconds matter and the next nearest station is 15 minutes away, that’s when bad things happen,” he said.
Conditions on the $1 million credit line
Testen said he has been thinking about offering the financial lifeline to Central the past several months. His own district has been saving for new equipment, but supply chain issues have delayed delivery.
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“I can make use of funds that I have on hand to make sure my taxpayers are not at risk,” he said.
But with the offer comes a list of conditions. Testen told The Hummel Report that this was a temporary measure, not a takeover, and that it would be a gradual draw on a line of credit to be used only for firefighter salaries if Central ran out of money. Testen added that his district would offer to help negotiate a new contract with the firefighters union. A major issue facing Central has been minimum manning requirements that have resulted in hefty overtime costs.
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In April, Central Coventry asked the state for $3 million in American Rescue Plan Act money - saying it had lost significant revenue from rescue runs during the pandemic, and was dealing with the fallout from a 2019 Rhode Island law that resulted in higher overtime costs for its firefighters. The state told the district it was a local problem and would not help.
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Central Coventry Fire District funds may run out in September
In order to keep paying its firefighters, the district’s treasurer, Gayle Corrigan, has delayed payments on street lights and hydrants. Central has also seen increased revenue from rescue runs as the pandemic eases, but Corrigan said the district will likely have no funds to pay its firefighters by the second week of September.
On Thursday evening, Central’s board is scheduled to discuss the line of credit offer, as well as a proposed budget for next year that voters will decide at September’s annual meeting.
“It’s a nice gesture, but I’m skeptical about taking (Testen) up on his offer,” Fagan-Perry she said.
“Because I feel we may not be able to pay it back.”
Fagan-Perry noted that the district’s voters have consistently rejected tax increases that would put Central of firmer financial ground. The board on Thursday will consider budget options that would result in tax increases ranging from 4% to 14%.
“There are many retired people on fixed income here. I don’t know how you can get more money out of them,” she said.
Meanwhile the district has also asked the town of Coventry for some of the ARPA money it has received. The council will discuss that request at a meeting Monday.
The Hummel Report is a 501(c)(3) nonprofit organization that relies, in part, on donations. For more information, go to HummelReport.org. Reach Jim at Jim@HummelReport.org.