A tower Local Controller reported a taxiing air carrier had an engine fire. There was confusion between the Controller and Supervisor as to the proper procedure for handling the situation.

Narrative

I was working Local Control; which involved departing Runway XX. I heard Ground Control shout MAYDAY 3 times and report an aircraft that was taxiing had an engine fire. According to our LOA with the Fire Department; if there is a crash or a fire; they call out a 'Crash/Fire Alert' on the emergency phone which then requires all aircraft on the airport to stop moving; and all airborne traffic must go around so that emergency vehicles can cross runways to get to the fire as quickly as possible. I announced my intentions to tell Aircraft Y to go heading 320 and 5000 ft with all of their arrivals since I owned the airspace they would be in; but the supervisors told me 'NO' because it wasn't a 'Crash/Fire Alert;' and instead called it an 'Emergency Alert' even though there was a potential fire. There needs to be clarification on what is considered 'Crash/Fire' and what is considered 'Emergency' alerts. Two days ago; another aircraft had an engine fire and it was called a 'Crash/Fire' alert and all airborne aircraft had to go around. There needs to be consistency and then education across all parties.