Case Study

Cherry Hill Fire Department Financial Planning (2005-Present)

PFM was engaged by the Cherry Hill Fire Department in 2005 to facilitate a long-term financial planning exercise to help ensure the Department's fiscal health and to plan for its capital needs. The Board of Fire Commissioners and the Fire Chief wanted to examine the Department's total financial picture to ensure sound and practical financial decisions.

The Cherry Hill Fire Department was established as a professional department in the 1990s by consolidating multiple volunteer companies, and has grown to include EMS and a broader range of services to meet the needs of a growing suburban community. When PFM was first engaged, the Department was considering a major capital program to modernize aging facilities and to consolidate administrative functions, but also held concerns regarding affordability and tax rate impacts.

To support the Department's decision-making, PFM developed a multi-year financial planning model that encompassed a wide range of out-year budget assumptions, including, but not limited to: community tax base growth; changes in employee headcount and compensation; and capital program financing. Using this model, PFM facilitated review by the Board of various capital investment scenarios, inclusive of impact on tax rates, and also advised regarding improved financial reserve practices and policies.

Based on this framework, the Board endorsed a major capital investment program, which was, in turn, approved by the electorate in a local referendum. Going forward, PFM has been retained to refine and update the model, and to advise the Department on debt and workforce issues. Currently, the Department (as a special district) holds a higher credit rating than its coterminous Township, and the credit rating agencies have cited the Department's financial planning practices as a positive ratings factor.