FESA Ch. 5 Terms

Key Terms and Concepts

• Brownouts: Cost-cutting strategy where fire companies go unstaffed on a rotating basis.

• Budget Reports: Essential for monitoring budget expenditures and detecting any deviations in financial management.

• Capital Item: A long-life asset, such as a fire station, considered a capital item due to its longevity and significance.

• Cooperative Purchasing: A joint buying arrangement that consolidates purchasing power across multiple departments to reduce costs.

• Compliance Audit: Reviews documentation to ensure adherence to legal or policy mandates, particularly in fiscal management.

• Cost-Benefit Analysis: Evaluates the benefits of a decision against its costs to guide financial decisions.

• Debt Ceiling: Legal limit on the maximum national debt that can be incurred by the federal government.

• Encumbrance: An accounting procedure that reserves funds for specific expenditures until payment is made.

• Expenditures: The actual costs incurred in acquiring goods or services within a budget.

• Fire Service Tax: A government tax that may vary based on residency characteristics or fire flow formulas.

• Financial Audits: Conducted to ensure accuracy and completeness of financial records in an organization.

• Financial Management: Involves translating financial resources into services while maintaining fiscal accountability.

• Financial Manager: Responsible for creating, justifying, and monitoring the fire department’s budget.

• Fiscal Year: For many local and state governments, typically begins on July 1.

• Government Bonds: Low-risk investments representing money lending at a low-interest rate, often tax-free.

• Government Fee for Service: Charges by governments for the provision of various services, such as licensing and park entry.

• Income Tax: A tax levied based on a person's earnings, which can be progressive (increasing with income) or flat.

• Lease-Purchase Contracts: Agreements allowing for leasing a capital item with the option to purchase at a later date.

• Line-item Budgets: Financial documents that categorize used and available funds by specific line items.

• Procedural Audit: Focuses on reviewing management policies and procedures, emphasizing financial policies.

• Property Tax: Government tax assessed as a percentage of property value or based on business income.

• Revenue: Money collected by the government from taxes, fees, or borrowing.

• Sales Tax: Tax applied at the point of sale on consumer purchases, such as for electronics or vehicles.

• Total Cost Purchasing: Considers the total cost of ownership, including initial purchase price and ongoing maintenance.

• Unfunded Mandates: Regulations requiring spending without corresponding government funding to support the expenditures.

• User Tax: Taxes applied specifically to the use of certain goods or services, like road usage fees.

• Zero-Based Budgeting (ZBB): A budgeting method requiring that all expenditures be justified as if they were requested for the first time, enhancing accountability.

Test your knowledge on essential fire service concepts, including brownouts and budget reports. This quiz contains multiple-choice questions that challenge your understanding of the operational strategies in fire departments. Perfect for students and professionals in fire safety and management.