For nearly 30 years, the Centennial Fire District has operated as a cost-saving collaboration for a trio of small Anoka County cities.

Lino Lakes, Circle Pines and Centerville have shared equipment, staff and costs. Each city gets two votes on a six-member steering committee.

Now that alliance is in peril, as Lino Lakes surges in population compared with its partners. It's threatening to withdraw without a new financial safeguard: veto power for each city in all committee votes. "We are not asking for veto power alone," Lino Lakes Mayor Jeff Reinert said. "We are not doing some power grab."

The situation cuts against the grain, coming when cities have been looking to economize by consolidating services. But in this case, Reinert is concerned that the joint venture could eventually cost his city more.

Circle Pines and Centerville have balked at the request because, until now, the district has operated with little controversy. The combined cost to the cities will be down 3 percent in 2014, to about $869,000, the fire chief said.

"It's really curious," Circle Pines Mayor Dave Bartholomay said. "It's the lowest-cost fire department in the county. It's very well-run."

"We are really not sure what the problem is," he said. "It's hard to come up with a solution."

But Reinert said veto power would provide a key financial protection for each city. Lino Lakes pays nearly 70 percent of the annual budget and uses about 70 percent of the department's services.

The steering committee will meet Jan. 15 to discuss the issue. Lino Lakes has until Jan. 30 to reach an agreement or start withdrawal procedures.

The district was formed in 1985. The cities split the annual cost based on a formula that factors in calls for service, population and property market value. This year, Lino Lakes will pay $593,000, Centerville $123,500 and Circle Pines $153,000, Chief Jerry Streich said. The department responded to about 1,000 calls in 2013, he said.

The cities share power equally on the steering committee. That's what concerns Reinert. That worked when they were similar in size, but Lino Lakes now has 20,200 residents, while Circle Pines has 4,900 and Centerville, 3,800.

Circle Pines and Centerville could one day join forces overriding Lino Lakes, Reinert said. He voiced concern about unnecessary future expansion, such as adding full-time firefighters, that could drive up costs. Four and a half professional firefighters handle administration, recruitment and training and cover hard-to-fill daytime hours. There are about 60 on-call firefighters who earn $12.50 an hour.

"We are pretty frugal with our dollars in Lino Lakes. We have lowered our taxes five years in a row even with property value depression," Reinert said. "He [the chief] wants to grow and grow the fire department. Some of it was good and necessary. Some of the stuff he is talking about going forward, we don't necessarily agree with."

Officials from the other cities say they're working to reach a compromise but are reluctant to give each city veto power on all decisions. It could create gridlock and politicking, they say.

Centerville City Administrator Dallas Larson said there are already safeguards. For instance, if the cities don't unanimously approve the department's proposed annual budget, the one in place is automatically adopted with only cost-of-living increases, he said.

Streich, who said he sees everyone's point of view, said he has watched the bottom line. Since he became chief about five years ago, the number of professional positions has increased from three to 4 ½, but he said he has improved the department using outside funds, including $1.2 million in grants; by offering emergency medical training, which generates revenue, and by reorganizing.

He's hopeful for an agreement. "I am concerned for everybody — all three of these cities," he said. "There is nothing broken here. This is a good organization, very progressive. We are doing everything to keep the costs down."