Denver Fire is not reviewing costs in agreements with municipalities

Denver Fire is not reviewing costs in agreements with municipalities

Published on April 23, 2026

En español(PDF, 193KB)

DENVER - The Denver Fire Department needs a better balance between accountability and regional relationships when providing fire support services to other municipalities. This is according to a new audit of the fire department's intergovernmental agreements with Englewood, Glendale, Sheridan, and the Skyline Fire Protection District from Denver Auditor Timothy M. O'Brien, CPA.

"Denver Fire's positive relationships with other municipalities are not enough to ensure agreement accountability. Formal practices are needed for mutually beneficial agreements," Auditor O'Brien said. "I am encouraged Denver Fire agreed with all our recommendations to address this."

The department provides support services to the four municipalities through multi-year intergovernmental agreements. From Sept. 1, 2020, through Sept. 1, 2025, Denver Fire collected more than $60 million in exchange for the department's services. As part of the agreements, Denver Fire occupies two fire stations in Englewood and operates out of Glendale's and Sheridan's municipal buildings.

But Denver Fire is not tracking all costs involving the agreements and is not able to verify it recoups all costs and revenues from municipalities. The department is not required to conduct a cost-benefit assessment to review an agreement's value and its process for renewing the agreements is informal.

Tracking expenses and interest

Denver Fire is not required to conduct a cost-benefit assessment before entering or renewing agreements, performing no assessment for its most recent renewal with Sheridan in 2025. Assessments help determine whether Denver resident tax dollars are beneficially spent.

Denver Fire is also not tracking the actual costs to Denver associated with the agreements, saying it does not have the time to track expenses by fire station. It also does not have a process for identifying and tracking expense reimbursements.

"Not knowing this information may result in the city paying for more expenses than is intended by the agreements. It also means the city doesn't know how much is spent each year to provide fire support services to these municipalities," Auditor O'Brien said.

Denver Fire receives either a monthly or annual payment from each municipality. When payment is late, interest is owed under contract terms. Denver Fire is not collecting interest, saying it might impact relationships with the municipalities. But without defined policies and procedures related to collecting late payments and interest, staff cannot track interest owed to the city.

"By not collecting interest, Denver prioritizes relationships with other municipalities over Denver taxpayers' money that may end up subsidizing losses," said Auditor O'Brien. "With improved accountability, processes, and oversight, the department can better support financial sustainability within these agreements and operations."

Informal processes

The department's process for renewing agreements and collaborating with municipality representatives is informal, with little documentation kept of discussions or decisions. Neither Denver Fire nor the city of Sheridan could provide any documentation associated with an agreement renewal process in 2025.

The joint advisory boards, responsible for resolving disputes between Denver and each municipality, also operate informally without policies and procedures.

"Because processes are informal and there is a lack of documentation, there is no guarantee agreement renewals are consistent and transparent," Auditor O'Brien said.

Conclusion

It is important that Denver Fire identifies and documents both the known costs to the city and the qualitative and quantitative benefits associated with these agreements. Knowing and documenting these important factors will help ensure these agreements are mutually beneficial.

We will conduct a follow-up audit to see whether Denver Fire implements our recommendations.

AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor

Denver Auditor's Office

201 W. Colfax Ave. #705 Denver, CO 80202
Email: [email protected]
Call: 720-913-5000
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