The Santa Barbara County Fire Department doesn’t plan to expand its ambulance services, saying it would be financially unsustainable. 

American Medical Response’s new contract allows the fire department to take over services in Lompoc as well as Montecito, Summerland and Carpinteria. 

County Fire’s financial consultant recommends passing on the subcontract, because those areas will not generate enough money to pay for operating costs. 

The Board of Supervisors will make its decision at Tuesday’s meeting in Santa Barbara. 

“Those specific areas are hard-to-serve areas,” Fire Chief Mark Hartwig said. Lompoc is “kind of an island,” and the Carpinteria area is a “cul-de-sac” at the southeastern end of the county. 

“The way to make an area profitable, or in our case for it to be sustainable, is you have to have a unit hour utilization that’s high enough to keep the unit busy and do enough trips to pay for the crew, the overhead, the billing,” he said. “Those areas don’t happen to be busy enough; the areas we were offered were areas that are generally not profitable.” 

Hartwig is also asking permission to return, sell or otherwise dispose of the 35 ambulances he purchased in pursuit of the countywide contract. 

The Fight for the Ambulance Contract 

AMR has provided ambulance services in the county for more than 40 years. 

When the county opened a bidding process for a new contract, AMR and County Fire both fought for it. The Board of Supervisors sided with the fire department, and AMR sued over the process. 

In February, the county approved a settlement agreement and a four-year contract with AMR. 

AMR serves most of the county, and County Fire ambulance crews handle UC Santa Barbara, Vandenberg Village and Cuyama. 

Each provider handles 9-1-1 emergency medical services, interfacility transfers and mental health transports in their areas. 

The county has spent millions of dollars pursuing a fire department ambulance contract, including consultants, legal costs and purchasing a fleet of ambulances.  

After all of that, it looks like the fire department will not expand the areas it serves. 

Hartwig said he was disappointed that the financial analysis didn’t support moving ahead with the subcontract. 

“We got into this with excitement,” he said.

“After six years and kind of ending up without a sustainable way to provide increased services, that’s disappointing, yeah, but we’re not dwelling on that. I know the board made their decision,” he added, referring to the decision to settle the lawsuit and award AMR another contract. 

The whole concept of an exclusive contract “is you take the profitable areas and are required to serve the unprofitable areas,” Hartwig said, adding that the Lompoc and South Coast areas by themselves are not profitable. 

Financial Analysis for Subcontract

The consultant report by Brandt VX LLC says the fire department would not break even at any point during a five-year contract. It also projects $41 million in net losses over five years.  

There are high fixed costs and start-up costs, such as equipment and staffing, the report states. 

More people using the system have Medicare and Medicaid health insurance — which have lower payment rates — than private insurance, which has higher rates. 

The consultant report lists $3.7 million in one-time costs. Most of that is attributed to vehicles, but the department already purchased and equipped 35 ambulances. 

Selling Off the Unused Ambulances 

County Fire purchased that fleet of ambulances for $3.4 million to make its contract bid more competitive, and now it wants to return or sell them.  

Since the board approved the purchase, the board needs to approve selling the equipment, Hartwig said. 

The county initially held off on customizing the vehicles — with logos and equipment — to make them easier to sell, just in case. 

It has since modified them, however, including branding on the outside of the vehicles and buying “specialized EMS equipment” and supplies. 

Now, County Fire will try to return equipment to vendors, and for everything else, try to resell, auction, transfer or repurpose them to county agencies. 

“The sale of surplus EMS assets will recover a portion of the initial investment, mitigating financial losses and redirecting funds toward sustaining Fire District services. Additionally, making these vehicles and equipment available for purchase could benefit other emergency service providers in need of cost-effective resources,” according to a staff report by Deputy Fire Chief Garrett Huff.