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"Will my 
insurance cover this?"  

That's a question that many locals have been asking.  On Monday, Watts Insurance in Miles City, started receiving inquiries about a recent article in the Miles City Star concerning a recently passed Resolution No: 4007, titled: "City will bill for fire inspections, vehicle accidents"
Q2 News in Billings also has reported on this resolution, "Miles City adopts law setting charge for emergency response."

Back Story:

C
onversation at Council Meeting 12/13/16:  
  
A.          RESOLUTION NO. 4007-  (Second Reading) A Resolution Establishing and Implementing a Program to Charge Mitigation Rates for the Deployment of Emergency and Non-Emergency Services by the Fire Department for Services Provided/Rendered for the City of Miles City
 
                **  Councilperson Galbraith moved to approve the Resolution by title only, seconded by Councilperson Gardner.
 
                There were concerns from some Council members that Miles City citizens were already paying taxes and these charges would take more money from them.  Fire Inspector Spiess assured Council that if the auto insurance did not pay for the service charge, it would not be billed back to the victim nor is the burden put back on the taxpayers.  It’s already written in the insurance policy and it follows direct guidance of FEMA.  This program would bring in money to cover cost for repair to the fire truck and ambulance so the City wouldn’t have to ask the taxpayer for more money.
               
                               ** On roll call vote, the motion passed 6-2, with Councilperson Andrews and Uden voting no


Full Copy of  RESOLUTION NO. 4007- (Miles City)
CLICK HERE TO READ: 4007 Resolution FD Incident Billing.pdf

Notable Points made by Fire Inspector Spiess:


1. "It's already written in the insurance policy" -  Is it?  Check your automobile and homeowner coverage for "additional coverages".  

2. "Prairie County already charges for those services and is having 'great success' with it."  

Full Copy of  RESOLUTION No. 15-04- (Prairie County)
CLICK HERE TO READ: 15-04 Resolution FD Incident Billing.pdf

Notable differences in the two resolutions:  SECTION 5 in the Prairie County resolution is omitted from Miles City Resolution:

Prairie County Resolution No. 15-03 SECTION 5:

"These mitigation rates will only apply to persons not residing within the County of Prairie, MT as the residents within the county boundaries currently subsidize these emergency service costs through their property taxes.  Responses involving intoxicated drivers, hazmat clean-up, and negligent acts may be subject to all applicable rates regardless of residency." (A Prairie County official, who requested their name not be used in this post, stated that in their opinion it would be unlawful to charge these fees to a county resident, for they already pay for these services via their property taxes. The intent of the program was to recoup funds from individuals causing a burden on the tax base, without contributing to it.  That make sense. So why was that left out of the Miles City Resolution?)

(When contacting the local authorities in Prairie County, I found it odd that no public official had been contacted in regards to their "Great Success" with the program.  Could this information have come from the Third Party Billing:  Fire Recovery USA, LLC salesperson?  I was informed that this Resolution has been used minimally.  However, Prairie County did recently receive a significant settlement for their services, after being called to fight a fire on I-94, caused by a out-of-county resident.  The individual started a grass fire after throwing a cigarette from his vehicle.  There was extensive expense in fighting the fire and preventing further damages.   Now that would make sense:  the individual was LIABLE for damages cause by his negligence.)

3.  "...follows direct guidance of FEMA" (see U.S. Fire Administration- Funding Alternatives for Emergency Medical and Fire Services below)

U.S. Fire Administration- Funding Alternatives for Emergency Medical and Fire Services, (page 27)
User Fees Cities have the authority to impose direct charges, or fees, on individual users of services. Use of these revenues is restricted to paying for the service for which the fees were collected. User fees are a fairly efficient way to distribute the costs of government services. Many communities are serviced by private ambulance providers. As such, a price can be affixed to some services, such as transportation or EMS-standby services, and the customer billed for the provision of those services. Fire departments and EMS agencies have assessed a number of EMS-related user fees as a means of cost recovery or alternative funding. Emergency-Response Service Fees Fire and EMS agencies have experimented with charging fees to insurance companies to raise revenue to support services. Typically, automobile insurance policies provide coverage for medical expenses and ambulance transportation, but not for fire- or police-response services.
These fees try to recoup the cost of providing noncompensated prehospital medical treatment and rescue activities.
This fee is not without controversy. Proponents point out that a high portion of motor-vehicle accidents to which fire and EMS agencies respond to involve drivers who are nonresidents and not part of the local tax base. Opponents of the fee, particularly the insurance industry which calls it a “crash tax,” claim that emergency responses to vehicle accidents are part of the regular duties of first responders and are funded by local taxes. Nonresidents will pay sales taxes and transient taxes that help to cover their portion of the costs. Arizona, Utah, and Kansas have preemptively banned emergency-response service fees.

(Please note that this is a two paragraph section of a 178 page document, proposing alternative funding measures.  "Alternative" and "Direct" have distinctly different definitions.  The majority of this document is comprised of  grant writing options, taxes, and loan options.)

Our intent in doing this research was not to uncover any malicious activity.  Simply, as citizens and small-town businessmen, we are merely doing our due diligence to ensure that our product is adequately supporting our customers needs.  Insurance rates are greatly effected by location, and that is determined by zip code.  Unfortunately, eastern Montana already sees higher rates than many regions, and you can attribute that to animal collisions and hail occurrences.  Major carriers will undoubtedly take in to consideration "Crash-Tax" districts when calculating premiums.  My biggest fear is public safety:  are you going to hesitate calling for emergency services and risk your health/safety while contemplating unnecessary fiscal burden?  I'm certain that the intent of this resolution was not malicious, and there are probably several services that are not being billed for that should be.  With that being said, this resolution being passed in it's entirety without further investigation is simply disgraceful and negligent. 

Please, don't hesitate to contact the City Council in regards to this matter.  I would ask about "Double-Taxation,"  I would ask why so many public entities have revoked the "Crash-Tax" in their communities?  Also, who is Fire Recovery USA, LLC?  Are they legit?  What are their fees?  17%-20%?  Who is going to regulate the assessed charges, and will the involved parties be notified?  Who determines exactly what "emergency services" will be deployed to each incident?  Will I be billed if  the equipment is not utilized?  Will I be billed if I'm not negligent?  What happens if I don't pay the fees?  What if there isn't coverage for these fees in my insurance, will a lawsuit be filed against me in order make a claim against your liability?

Miles City isn't the only place this is happening: (links to articles about "crash-tax" in other communities.)
"Woodland Crash Tax Under Fire by Yolo County Grand Jury"
"A Crash. A Call for Help. Then, a Bill"
"Insult to Injury"

What is the solution?  Our emergency services providers are dedicated, hard-working citizens.  If budget constraints and shortcomings are preventing them from providing our communities adequate service, what can we due to fix that?  How many of the alternative methods for funding have been researched and attempted, that are in the FEMA document mentioned in the Resolution Report?  Click on the highlighted words to read this document:   U.S. Fire Administration- Funding Alternatives for Emergency Medical and Fire Services .  
Does the city receive revenue from the Insurance Premium Tax (ITC) that is charged to the insurance companies conducting business in this State?

We all have family and friends that work in the emergency service occupation.  These are some of the most dedicated people you will meet.  It is our duty and obligation to resolve this matter; for there benefit and our own.  Perhaps there is a better way.  Maybe, in-part, this resolution would just need to be amended?  Let's work together to find a resolution. 

Please contact Blayne Watts, at Watts Insurance Inc in Miles City and Prairie County, for further discussion on this matter.  



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