Wall Street Journal: Putting Out Fires for a Fee

Mar 27, 2012

The following article was published in the Wall Street Journal on March 12, 2012:

Putting out Fires for a Fee

Volunteer Departments Gets Taxes, But Some Insist That Residents Pay More

By Timothy W. Martin

When fires or medical emergencies beset this rural county in the Appalachian foothills, the volunteer fire department races to the scene—seemingly free of charge.

But residents can’t take their fire service for granted much longer. Declaring it needs a hefty cash infusion to continue to operate, the Bell County Volunteer Fire Department this year started asking residents and businesses to pay a voluntary, annual subscriber fee, ranging from $60 to $150. Without the help, “we’ve got two years, max,” said David Miracle, assistant fire chief.

A growing number of volunteer fire departments, most of them in the rural South, are asking residents to pay an additional fee for firefighting service, though not for such things as responses to medical emergencies, which make up most fire-department calls. This throwback to a centuries-old practice comes as public budgets get slashed and local donations dry up.

A Different Type of Emergency 

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Shawn Poynter for The Wall Street Journal

David Miracle said his Bell Country, Ky., department fielded five times the calls it did a decade ago.

Firefighters in South Fulton, Tenn., have let two homes burn to the ground over the past two years since the city commission started enforcing a rule that the department serve only subscribers who pay the $75 annual fee. The city commission is expected to vote Thursday whether to amend that policy to allow the fire department to put out all blazes and then bill nonsubscribers $3,500 for the service. Paying members wouldn’t be billed.

South Fulton Mayor David Crocker didn’t respond to requests for comment. The town’s fire chief, David Wilds, when asked how the crew reacted as it watched a home burn down, said: “They didn’t like it.”

Volunteer departments get most of their funding from public budgets, which come from taxes or fees paid by insurance-policy holders that insurers route to municipalities. Less than one-fifth of their budgets come from fund-raising efforts like spaghetti dinners or bake sales, according to the National Fire Protection Association, a group that advises municipalities on safety guidelines for fire protection. That means that subscribers in these communities are generally paying a supplement, on top of taxes or other fees, for assurance that a blaze on their property will be doused.

While most insurance plans would cover losses from a fire, insurers typically wouldn’t cover a fire-service bill for $3,500. Property insurance “is built upon the assumption that fire protection is a general public service that’s made available by taxpayer dollars. All people benefit, all people pay,” said David Snyder, a vice president at the American Insurance Association, a trade organization.

When a fire department pulls service, as Bell County did by shuttering two fire houses, the lack of fire protection can lead to higher home-insurance rates.

The number of volunteer fire departments using a fee-based system isn’t known but is in the hundreds, said Janet Wilmoth, editorial director of Fire Chief Publications. About 85% of all fire-department crews, serving one-third of the U.S. population, are staffed mostly by volunteers.

The fees raise questions of whether residents should be entitled to fire service. “If you go to a pure subscription service, that community is saying fire service is not a public good anymore,” said Adam K. Thiel, the fire chief in Alexandria, Va., who is critical of the fees.

Volunteer fire departments say they need the fees because public budgets are declining at a time when they are busier than ever and spending more on new equipment and training. U.S. fire departments responded to 28.2 million calls in 2010, up 38% from 2000, according to the NFPA. But two-thirds of those calls in 2010 were for medical aid, with fires representing just 5% of that year’s calls, the NFPA said, down from 8.3% a decade earlier.

 Departments were eager to pick up more medical emergencies and traffic accidents as the number of calls to put out fires declined. “There’s a whole bunch of things that can be done with the staffing and equipment of a fire department,” said Phil Schaenman, president of TriData, a public-safety consulting firm.

The drop in number of blazes has some municipal officials saying departments don’t need the budgets they once did. “Regionalization is really the answer, as opposed to having a number of smaller departments,” said Bill Ganz, a Deerfield Beach, Fla., city commissioner. The city’s local fire department was dissolved in August into a Broward County unit.

Firefighting fees aren’t a novel idea. In Colonial times, homeowners displayed metallic fire marks above their front doors to show they had paid their insurers and that volunteers would be reimbursed for dousing blazes. Such fees remained common until the early 1900s,when firefighting evolved into a profession of full-timers paid to stay on call, following blazes that struck in Chicago, Baltimore and Boston.

In Bell County, where dust from local coal mines piles up on the highways, Chief Executive Albey Brock cut the fire department’s $400,000 annual budget to about $130,000 in 2007. “It was obvious the fire department had more money than was necessary,” he said. The fire department had more in savings at the time—$600,000—than did the entire county, he said.

But Mr. Miracle, a volunteer since 1996, said his department fields five times the calls it did a decade ago in the county of 29,000 people, which has just two towns but several dozen unincorporated communities that were once coal or lumber camps. The fire department is hoping membership tops 35% and brings in $180,000. But only about 1% of residents have joined, Mr. Miracle said. He said his department will continue to put out nonsubscribers’ fires, but they will be billed a minimum of $500, with the potential to stretch into the thousands of dollars based on the blaze’s severity, the time required and other variables.

The budget cuts prompted a series of legal spats between the fire department and county officials. One case, filed in 2010 by Mr. Brock, seeks to prevent the fire department from closing two fire houses. The other, filed in October of 2011 by the Bell County Board of Elections, seeks to block the fire department from charging a fee to use its firehouses as polling stations. Both cases are pending.

County residents are divided on whether to pay. Steve Bryant, an unemployed former coal miner, was unequivocal. “Nope,” he said, standing across the street from a shuttered fire house. “They’re getting enough money off of us already.”

But Steve Dixon, an office-supply worker, is paying. County volunteers put out a fire at his house a decade ago. “If we didn’t have them, we’d be paying more for house insurance,” he said.