Authorizes the legislative authority of a city or town, as an alternative to the petition method of formation for fire protection districts and subject to voter approval, to establish a fire protection district with boundaries that are the same as the corporate boundaries of the city or town for the provision of fire prevention services, fire suppression services, and emergency medical services.

Requires a city or town to reduce its general fund regular property tax levy by the total combined levy of the fire protection district as proposed by the district.

Authorizes a city or town fire protection district to establish an ambulance service to be operated as a public utility, however, the fire protection district may not provide for the establishment of an ambulance service utility that would compete with an existing private ambulance service unless the fire protection district determines that the area served by the fire protection district, or a substantial portion of that area, is not adequately served by an existing private ambulance service.

Provides that, with regard to property taxation and the levy of property taxes, the boundaries of a newly established fire protection district are the established official boundaries of the district as of the date that the voter-approved proposition is certified.

Transfers powers, duties, functions, and personnel of a city or town fire department, pertaining to fire protection and emergency services of the city or town, to the fire protection district on its creation date.