Last summer, as city of Austin officials debated whether to annex Circuit of the Americas, Ken Bailey looked out his office window and wondered whether to make a big purchase.
Bailey is the chief of Emergency Services District 11, the fire department serving the area around the newly-built Southeast Austin track. The department’s headquarters sit across a two-lane road from the sprawling track and, by Bailey’s reasoning, his crews are responsible for responding to any calamity at the track until Austin’s fire trucks arrive.
So with November’s inaugural Formula One race approaching, Bailey’s fire department bought two fire engines and a ladder truck. It was a $1.8 million purchase based on the assumption the track would provide enough revenue from property and sales taxes to pay for the equipment — an assumption that was partially upended when the Austin City Council decided to claim the track’s tax revenue by deciding to annex it eight days before the race. The annexation took effect in December.
“Unfortunately, the tax dollars we need have been taken by the city,” Bailey said. He contends, in a letter sent to the Austin City Council in late February, that the city is now legally obligated buy the extra equipment his department purchased or turn over nearly $190,000 a year over the next seven years.
But Austin officials appear not to share Bailey’s assessment. A Jan. 22 letter from Deputy City Manager Mike McDonald, addressing another legal dispute involving the track, states that Austin is not allowed to share tax revenue generated by the track, and that the city is likewise not obligated to buy the equipment. The letter also states that Austin fire crews are best able to respond to whatever problems could arise at the track.
Bailey has tweaked his proposal since January, and in response to questions about the situation, the city’s public information office issued only a statement: “The city is reviewing the correspondence from Chief Bailey from a legal standpoint, and will respond appropriately once all of the options have been identified.”
The city’s responses do not address another wrinkle: prior to the city annexing the track, the Emergency Services District collected $1.3 million in taxes from Circuit of the Americas, which remain in a reserve fund. That would cover much of the cost of the new equipment, though Bailey contends the district should not have to spend that money to protect an area that is no longer within its boundaries.
At the heart of the dispute is whether the district crews or Austin’s should be considered the first responders at the track.
Emergency Services District 11 has three stations, a $2.7 million annual budget and 33 employees to cover a 114-square-mile area of Southeast Travis County with 30,000 residents. Like other semi-rural fire departments in Travis County, it has an “automatic aid agreement” with Austin that requires the nearest fire engine to respond to a call for help.
That agreement may soon expire — the district plans to opt out, based on disagreements about how to staff fire trucks — but as long as the agreement remains in place, Bailey said, his department likely will be the first to respond to any call for help from Circuit of the Americas. Even absent an agreement the department should prepare as if it will have to respond should a problem arise at the track, Bailey said; Austin’s nearest fire station is at Austin-Bergstrom International Airport, more than seven miles from the track.
Bailey said that although his crews would probably be among the first to respond to a call during the track’s signature F1 race — the organizers also maintain fire protection at the track for the race — his main worry is the less-publicized events, such as the five races and 10 concerts scheduled between now and mid-November.
“Anytime you put 120,000 people in a space, or 20,000 people, there’s risk you have to account for,” Bailey said.
As last year’s race approached, some Austin city leaders were eager to annex the track, others were cautious, and land owners who thought they might (but ultimately were not) caught up in the annexation objected to being brought into the city limits. Bailey, noting that the city scrapped annexation plans in 2011 only to later revive them, went out a limb and made a “lease purchase” agreement; the engines will be paid off over 10 years, the ladder truck over 15 years.
Bailey said he needed to make the purchase because there was no guarantee about what level of fire protection Austin would be providing. He said the district could not concentrate its resources around the track because if an emergency happened elsewhere within its boundaries they could be slowed or trapped by heavy traffic.
Since the council voted Nov. 8 to annex the circuit, Bailey has been lobbying city officials to either share some of the tax revenue or buy the equipment. He said paying for equipment to protect the track with the $1.3 million collected from the track prior to the annexation would be the equivalent of district taxpayers “spending money to protect something in Austin instead of spending it to protect their own homes.”
That line of thinking has gotten a skeptical reception at Austin City Hall.
“While I understand that the state laws that govern collection and apportionment of sales tax are somewhat complicated, I have been advised that the city cannot ‘contract around’ those laws,” McDonald, the deputy city manager, wrote in January. “Moreover, it is the city’s position that the Austin Fire Department and its regional cooperative agreements are best equipped, and is our preference, for delivering services to the area.”