Can a Tennessee county terminate its fire-protection contract with a non-profit volunteer fire department, and can a new county-wide fire department force existing private fire departments to shut down?

Subject

Opinion No. 10-119, Contract between County-wide Fire Department and Nonprofit Fire Service, December 28, 2010

Plain-English summary

The Tennessee AG addressed three questions about the relationship between a county-wide fire department (organized under Tenn. Code Ann. §§ 5-17-101 et seq.) and a non-profit volunteer fire department operating in the county under a service contract.

First, the AG concluded that a county-wide fire department's broad statutory power to "do all things necessary to provide coordinated fire protection" included the authority to terminate a contract with a non-profit volunteer fire department that was not performing. The right to terminate, however, was still governed by the contract itself, and a non-emergency termination had to follow the contract's own terms. The county was not obligated to keep contracting with the same non-profit and could make other arrangements for the affected area.

Second, the AG concluded that the county's contract termination did not, by itself, undo the non-profit's recognition by the State Fire Marshal under the Fire Department Recognition Act. Recognition rests on standards and qualifications set by the Fire Marshal, not on whether the department holds a particular county service agreement. Neither the statute nor the Fire Marshal's rules at the time provided a procedure for a county to rescind a prior approval issued under Tenn. Code Ann. § 68-102-306(a), so an existing certificate of recognition was not automatically forfeited.

Third, the AG concluded that no statute gave a county-wide fire department authority to prevent a private, duly recognized fire department from continuing to operate within the county. The "coordinated fire protection" language was read to authorize cooperation among existing services, not the elimination of one fire department by another.

Currency note

This opinion was issued in 2010. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Did the AG say a county could break a contract with a non-profit fire department whenever it wanted?

No. The AG read the county's broad statutory power as including the authority to terminate a non-performing contract, but stressed that, absent an emergency threat to community safety, the right to terminate was still constrained by the terms of the contract itself. A county that ignored its own contract language could still face a contract claim.

Did the AG say the State Fire Marshal would automatically pull recognition if the county canceled the contract?

No. The AG concluded that the Fire Marshal's recognition turns on standards and qualifications under Tenn. Code Ann. §§ 68-102-301 et seq., not on whether a department holds a county service contract. A county could notify the Fire Marshal of the termination, but nothing required the Fire Marshal to revoke or refuse to renew the certificate based on that fact alone.

Could the county-wide fire department force an existing private fire department out of business?

The AG said no. No statute expressly gave a county-wide fire department that power, and the AG read "coordinated fire protection" as a coordination mandate rather than a monopoly grant. The county-wide department's role was to make sure existing fire services worked together, not to eliminate competitors.

What about the county's approval power under Tenn. Code Ann. § 68-102-306(a)?

The Fire Department Recognition Act required local-government approval before a new fire department could be established or recognized after July 1, 2003, and that approval had to specify the geographic territory. The AG looked at whether a county could rescind that prior approval and noted that the statute did not address rescission and the Fire Marshal's rules did not provide a rescission procedure. The rules did contemplate territorial changes, but only changes initiated by the fire department (with proof of local approval), not unilateral county-led de-recognition.

Was the answer different if the contract itself was silent on termination?

The opinion did not address contract drafting in depth, but it concluded that, absent a threat to community safety, the right to terminate was governed by the terms of the contract itself. It also cited Tenn. Code Ann. § 5-17-101(e), which allows counties forming a county-wide fire district, with legislative-body approval, to require performance-based criteria in interlocal agreements and service contracts.

Background and statutory framework

Two separate statutory schemes were at issue:

1. The Fire Department Recognition Act, Tenn. Code Ann. §§ 68-102-301 et seq., which made the State Fire Marshal's Office (under the Commissioner of Commerce and Insurance) the gatekeeper for who may operate as a "fire department" in Tennessee. Under § 68-102-303, the Fire Marshal, in consultation with the Tennessee Fire Chiefs Association, sets standards and qualifications by rule. Under § 68-102-306(a), no new fire department may be established or recognized after July 1, 2003 without local-government approval specifying the geographic territory. Recognition must be renewed every three years (§ 68-102-304), with renewal applications due at least thirty days before expiration (Rule 0780-2-20-.06(2)).
2. The county-wide fire department statutes, Tenn. Code Ann. §§ 5-17-101 et seq., which let a county create a county-wide fire department and grant it broad authority "to do all things necessary to provide coordinated fire protection to all areas of the county." Tenn. Code Ann. § 5-17-102(a)(7)(B) authorizes contracts with existing fire departments to provide service in any area of the county. Tenn. Code Ann. § 5-17-101(e) lets the county, with legislative-body approval, require performance-based criteria in its interlocal agreements and service contracts.

The opinion treated these schemes as complementary: the Fire Marshal controls who can operate as a fire department, while the county controls whether to contract with a recognized department for service in its territory. Ending the contract does not end the recognition, and the county-wide statute does not give the county-wide department a state-conferred monopoly on fire suppression.

Citations

• Tenn. Code Ann. §§ 5-17-101, et seq. (county-wide fire departments)
• Tenn. Code Ann. § 5-17-101(e) (performance-based criteria in interlocal agreements)
• Tenn. Code Ann. § 5-17-102(a) (broad authority to provide coordinated fire protection)
• Tenn. Code Ann. § 5-17-102(a)(7)(B) (contracting with existing fire departments)
• Tenn. Code Ann. §§ 68-102-301, et seq. (Fire Department Recognition Act)
• Tenn. Code Ann. § 68-102-112 (Commissioner of Commerce and Insurance as State Fire Marshal)
• Tenn. Code Ann. § 68-102-302 (definition of "fire department")
• Tenn. Code Ann. § 68-102-303 (Fire Marshal rulemaking authority)
• Tenn. Code Ann. § 68-102-304 (three-year renewal requirement)
• Tenn. Code Ann. § 68-102-306(a) (local approval and territorial designation for new fire departments)
• Tenn. Comp. R. & Regs. 0780-2-20-.02(3) (notice of territorial changes)
• Tenn. Comp. R. & Regs. 0780-2-20-.04(d) (post-July 2003 establishment rules)
• Tenn. Comp. R. & Regs. 0780-2-20-.06(2) (renewal-application timing)

Source

• Landing page: https://www.tn.gov/attorneygeneral/opinions.html
• Original PDF: https://www.tn.gov/content/dam/tn/attorneygeneral/documents/ops/2010/op10-119.pdf

Original opinion text

Contract between County-wide Fire Department and Nonprofit Fire Service

QUESTIONS

1. Under Tenn. Code Ann. §§ 5-17-101, et seq., a county may form a county-wide fire department and may contract with existing fire departments to provide fire protection services in any area of the county. Tenn. Code Ann. § 5-17-102(a)(7)(B). If a county has entered into a contract with a non-profit volunteer fire department that is currently recognized by the State Fire Marshal's office under Tenn. Code Ann. §§ 68-102-301, et seq., and that has not satisfied the provisions of the contract with the county, can the county terminate the contract and make other provisions to provide fire protection coverage to their contracted area?

2. If the county terminates its contract with a non-profit volunteer fire department, what effect would the termination have on "recognition" of the department by the State Fire Marshal's office?

3. Does a county-wide fire department created by county resolution after the date of the Fire Department Recognition Act, Tenn. Code Ann. §§ 68-102-301, et seq, take precedence over existing fire departments within the unincorporated portions of the county—that is, can a county force an existing volunteer fire department out of business if it does not choose to become part of a newly-formed county-wide fire department?

OPINIONS

1. Tenn. Code Ann. § 5-17-102(a) provides that a county fire department "is empowered to do all things necessary to provide coordinated fire protection to all areas of the county." This is a broad grant of authority and logically includes terminating a fire service agreement with a non-profit fire department that is not meeting its obligations to provide service under the contract. But, absent a threat to community safety, the county's right to terminate would still be governed by the terms of the contract itself. A county fire department has no legal obligation to contract with a non-profit fire department, and may make other arrangements to provide service to the area previously covered by the private department before the contract was cancelled.

2. Rules promulgated under this statute do not address this issue. A county may inform the State Fire Marshal's Office that it has terminated a fire service agreement, but nothing requires the Fire Marshal to revoke or refuse to renew a fire department's certificate of recognition because of such termination.

3. No statute expressly authorizes a county-wide fire department to prevent a private fire department from continuing to operate within the county. This authority probably falls outside the county-wide fire department's statutory power to "do all things necessary to provide coordinated fire protection to all areas of the county" under Tenn. Code Ann. § 5-17-102(a).

ANALYSIS

This opinion concerns two different statutory schemes. First, under Tenn. Code Ann. §§ 68-102-301, et seq., no city, county, or private entity may operate as a "fire department" unless it has been authorized to do so by the State Fire Marshal's Office. Tenn. Code Ann. § 68-102-303. The term "fire department" means a "department of a municipality, county, or political subdivision, or an organization, agency, or entity that offers its services, for or without pay, for the purpose of suppressing fires, performing rescue services, or for other emergency response purposes." Tenn. Code Ann. § 68-102-302. The definition does not include law enforcement agencies, emergency medical agencies licensed by the Tennessee Emergency Medical Services Board, and rescue squads that do not provide fire protection. Id.

Thus, in general, either a public or a private entity must be recognized as a "fire department" by the State Fire Marshal's Office before operating a fire suppression service. Tenn. Code Ann. § 68-102-303 provides in relevant part that, "[t]he state fire marshal, in consultation with the Tennessee Fire Chiefs Association (TFCA), shall promulgate rules and regulations pursuant to the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, relative to the standards and qualifications for becoming and remaining a fire department." (emphasis added). The Commissioner of Commerce and Insurance is the State Fire Marshal and supervises and directs the activities of the Fire Prevention Division. Tenn. Code Ann. § 68-102-112.

Under Tenn. Code Ann. § 68-102-306(a), no new fire department may be established or recognized within Tennessee without the approval of the local elected governing body. This approval must specify the geographical territory to be covered by the new fire department. Id. Under regulations promulgated by the Tennessee Department of Commerce and Insurance, Division of Fire Prevention, these requirements apply after July 1, 2003, and before a new fire department is established or recognized within Tennessee. Tenn. Comp. R. & Regs. 0780-2-20-.04(d). A certificate of recognition from the State Fire Marshal's Office must be renewed every three years. Tenn. Code Ann. § 68-102-304. A recognized fire department must submit its renewal application at least thirty (30) days before the expiration of the department's certificate of recognition. Tenn. Comp. R. & Regs. 0780-2-20-.06(2).

Second, under Tenn. Code Ann. §§ 5-17-101, et seq., a county may create a county-wide fire department. Under Tenn. Code Ann. § 5-17-102(a)(7):

With the specific exceptions relating to metropolitan governments provided for in this section, the county-wide fire department is empowered to do all things necessary to provide coordinated fire protection to all areas of the county, including, but not limited to:

---

(7) Enter into and perform all necessary contracts, including, but not limited to:
(A) Contracts for the supply of water where necessary for fire protection;
(B) Contract to have existing fire departments and others provide fire protection services in any area of the county, including, but not limited to:
(i) Contracts with incorporated towns and utility districts to provide such service within or without their corporate limits;
(ii) Contracts to provide fire protection services for any city, town, district, or any part thereof within the county;
(C) Contracts to provide training and maintenance;
(D) Contracts to provide and be provided all special service functions, such as arson investigation, inspection, and emergency ambulance and rescue services.

(emphasis added).

1. Cancellation of Existing Contracts

Tenn. Code Ann. § 5-17-101(e) provides:

Any county choosing to create a county-wide fire district as authorized by this section, may, with the approval of the local legislative body, mandate that all interlocal agreements and contracts with providers for services permitted under this section contain performance based criteria designed to ensure timely response and effective services, the exact methodology of which is to be determined by local ordinance.

The request asks whether a county-wide fire department may terminate a contract with a non-profit fire department that is not complying with the provisions of its contract with the county.

Tenn. Code Ann. § 5-17-102(a) provides that a county-wide fire department "is empowered to do all things necessary to provide coordinated fire protection to all areas of the county." This is a broad grant of authority, and logically includes terminating a fire service agreement with a nonprofit fire department that is not meeting its obligations to provide service under the contract. But, absent a threat to community safety, the county's right to terminate would still be governed by the terms of the contract itself. A county fire department has no legal obligation to contract with a non-profit fire department, and may make other arrangements to provide service to the area previously covered by the non-profit before the contract was cancelled.

2. County Authority to Rescind Approval under Tenn. Code Ann. § 68-102-306(a)

The second question is whether, once a county cancels the existing contract, the non-profit fire department would still be "recognized" under Tenn. Code Ann. §§ 68-102-301, et seq. Under Tenn. Code Ann. § 68-102-306(a), no new fire department may be created after July 1, 2003 unless the local elected governing body approves it. Its approval must specify the geographical territory to be covered by the new fire department. Neither the statute nor the rules promulgated by the Commissioner of Commerce and Insurance address this issue. But the county's decision to cancel an existing contract with a non-profit fire department, by itself, would not affect recognition of that fire department by the State Fire Marshal under Tenn. Code Ann. §§ 68-102-301, et seq.

The question then becomes whether a county may rescind its approval of a non-profit fire department it previously approved under Tenn. Code Ann. § 68-102-306(a). The statute does not address this issue. Rules of the Commissioner of Commerce and Insurance promulgated under this statute recognize that the county or city may change the territory within which a new fire department is authorized to operate. Rule 0780-2-20-.02(3) of the Tennessee Comp. R. & Regs. provides:

All new fire departments formed after July 1, 2003 shall notify the State Fire Marshal's Office within thirty (30) days of any change in geographical territory to be covered by such fire department. The fire department shall provide proof of the approval of the local elected governing body of any change in territorial boundaries. The fire department shall provide the State Fire Marshal's Office with a written description or geographic description of territorial boundaries.

(emphasis added). But the rules do not specify a procedure by which a county may rescind its initial approval of a fire department's authority to operate in the county. As cited above, Tenn. Code Ann. § 68-102-303 provides in relevant part that, "[t]he state fire marshal, in consultation with the Tennessee Fire Chief Association (TFCA), shall promulgate rules and regulations pursuant to the Uniform Administrative Procedures Act, compiled in title 4, chapter 5, relative to the standards and qualifications for becoming and remaining a fire department." (emphasis added). This statute suggests that the Commissioner of Commerce and Insurance may, by rule, address circumstances under which the Fire Marshal's Office might refuse to recognize a fire department, revoke its recognition of the fire department, or refuse to renew the fire department's certificate. Absent such rules, however, the Fire Marshal is not bound by the county's termination of a fire service provider.

3. Preventing Existing Fire Departments from Operating in the County

The last question is whether a newly created county-wide fire department would have priority over other fire departments already operating in the county. The request asks whether the county-wide fire department may force these fire departments out of business if they choose not to become part of the county-wide fire department. We interpret this to inquire whether the county, upon forming a county-wide fire department, may prevent a privately owned and duly recognized fire department from operating within the county. No statute expressly authorizes a county-wide fire department to prevent a private fire department from continuing to operate within the county. Further, this authority probably falls outside the county-wide fire department's statutory power to "do all things necessary to provide coordinated fire protection to all areas of the county" under Tenn. Code Ann. § 5-17-102(a). The term "coordinated fire protection" suggests that the statute empowers a county-wide fire department to ensure that existing fire services work together rather than eliminating some fire departments entirely.

ROBERT E. COOPER, JR.
Attorney General and Reporter

CHARLES L. LEWIS
Deputy Attorney General

ANN LOUISE VIX
Senior Counsel

Requested by:
The Honorable Judd Matheny
State Representative
205 War Memorial Building
Nashville, Tennessee 37243