Costa Mesa will keep its Fire Department instead of contracting out with county.

Just before midnight Tuesday with a 5-0 vote — nearly six hours into its regular meeting — the City Council motioned to rescind the layoff notices issued to 78 sworn and nine nonsworn firefighters.

The move effectively canceled a proposal to use the services of the Orange County Fire Authority, which was expected to absorb most — but not all — of the Fire Department's employees.

The firefighters comprise nearly 43% of the 203 city employees who have received layoff notices since March 2011, when the council began its outsourcing research and implementation.

The council will now work with interim Fire Chief Tom Arnold on a Fire Department restructuring plan that aims to improve service and save money. Councilman Gary Monahan said that the plan would address the high costs of overtime.

The council will then review the plan, which could include closing a fire station and cutting nine positions, at the May 8 study session.

"The administrative staff is quite relieved," Arnold said. "The issue has weighed very heavily on staff, and this decision obviously boosts morale. Everyone is working very hard with less."

Arnold, who came on in November, has met with every member of his department in the past three months, researching solutions to "improve efficiency, effectiveness and response times, and achieve real and long-term cost reductions."

He said that overtime costs will be mitigated with the new plan by using fewer people "deployed in a more efficient way."

"The good news is we only had 224 fires in 2011. The bad news is we had 224 fires," Arnold said. "We still had to put out fires. That's not a lot, but we still have to be prepared for that."

He added that the key to keeping fires small and not needing more resources from larger organizations like the OCFA to put them out is to get the scenes sooner.

The council was dissatisfied with OCFA's fire service proposal submitted in February 2011.

Mayor Pro Tem Jim Righeimer said that keeping the Fire Department and restructuring its operation by applying some of the items outlined in that proposal could save the city more than $15.7 million in five years.

"We have great firefighters here in Costa Mesa, but we have a horrible contract," Righeimer said Wednesday, specifically pointing to overtime costs and alleged waste.

Fire service, the largest and most expensive of the 18 services under review, was the first to undergo the outsourcing analysis and has set the benchmark for how the process will function moving forward.

City CEO Tom Hatch said the council in May will review six incoming bids for other city services, including jail operations, street sweeping, building inspection, video production and animal control. Telecommunications technical and dispatch services may also be considered by that time.

Righeimer said that the outsourcing process might end up being a good fit for only jail operations and street sweeping, and that many city departments have been cutting their own expenses and costs to prevent the need for hiring out.

"We don't have the numbers yet," he said, "but in several cases, they've brought their budgets down so low that they may have solved the problems themselves."

Righeimer disagreed with the idea that keeping the Costa Mesa's firefighters was a move away from outsourcing.

"This vote is no shift in direction at all," he said. "It's exactly what we said we would do, which is to look at our resources and conduct a cost-to-benefit analysis. It's the first major outsourcing issue that has come to us that's been analyzed, and we've learned a lot from it."

"I think we need to talk to our organization and resolve the issues that we have and solve the problem," Councilwoman Wendy Leece said in an interview Wednesday. "We need to retain our firefighters because we need their institutional knowledge. Costa Mesa firefighters know our city."

OCFA Battalion Chief Kris Concepcion said his organization doesn't solicit cities for business, and that it has only been approached for proposals on how to streamline fire operations.

"We truly believe that the regional fire service approach is the best model out there as far as providing fire service," he said. "We realize the economy of scale, we have specialized equipment available to our entire region that's not typically afforded by a smaller fire departments. It's working for Santa Ana, and it could have done so for Costa Mesa, should they have chosen to accept the proposal."

Jennifer Muir, a spokeswoman for the Orange County Employees Assn., applauded the motion, but criticized the council for its approach on the city's financial crisis.

"It's great that there are a number of employees who don't have to live with an ax over their head anymore," she said. "But there are still more than 100 employees who do, and they've received those notices more than five times."

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