Abstract
Federal first responder funding is estimated to be $98 billion below the minimum required level over the 5 years ending in 2010. A significant portion of that shortfall can be covered by savings attained by eliminating non-public-good services, initiating public–private partnerships for meeting peak time demand in emergency situations, and contracting-out other public services. We concentrate on such savings in the context of response to false calls to police, fire, and ambulance services. Solving the false alarm problem for police, fire, and ambulance services and eliminating some non-public-good police services could release significant service-hours and 23.7–31.4% of the required additional Homeland Security (HLS) annual spending. Reducing false alarms means 88,000 police, fire, and ambulance first responders could be shifted to HLS activities.
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Notes
Similar false calls including totally hoax calls beset the U.S. Coast Guard. The problem of false calls is thus even more widespread than our estimates indicate. In any event we do not include the Coast Guard in our estimates because this paper focuses on state and local services.
These services incorporate insignificant externalities and are private in nature. In the case of minor accidents, traffic may be blocked for a brief period of time. However, since both cars are drivable, they may just move to the shoulder of the road. Police shedding will encourage private providers for all these services. For example, participants in the case of minor accidents may hire an investigator to assign blame. Also, existence of scope economies may encourage providers to offer a host of services, including response to burglar alarms, escorting funerals, vacation services, and more.
Vector Security employed enhanced call verification among other practices to reduce the rate of false dispatches from 1.37 per system a year to 0.8 (Goldfine 2006a, p. 32). In general, central station verification is insignificant in reducing false police response since canceling a valid alarm exposes the central station to liability problems.
Besides response to burglar and fire calls, other examples include gas odors, stray animals, and flooding occurrences. More specifically, when a 911 call comes in and the ambulance is dispatched, the driver does not know if it is a true emergency. Only after arriving at the scene can it be determined if a call for service is a real emergency situation. Some who lack health insurance and require non-emergency medical service use ambulances to reach the hospital, expecting not to be denied care through arrival by an ambulance.
For example, Peltzman (1975) argued that making seat belts mandatory and requiring automobile makers to install other safety features may contribute to less cautious driving that in turn leads to accidents, harming innocent drivers and pedestrians as well as the risk taking drivers themselves.
For example, the terrorist attacks of September 11, 2001 have led the Long Beach, CA police department to create both terrorism and special port units. These increased burdens have forced the department of 1,000 officers to reduce foot patrols and narcotics enforcement (Pomfret 2006).
For example, Milwaukee, WI in 2003 had a false burglar alarm rate of 96% on 28,346 calls (Schwartz 2004). Seattle reported a 98% false alarm rate between 2001 and 2004 (Brooner 2004). Chicago experiences annually a 98% false alarm rate and Salt Lake City in 1999 had a 99.7% rate (Sampson 2001). A detailed survey of alarm owners in 3 localities in Pennsylvania has reached the same conclusion (The Hakim-Buck Study 1991). For False Fire Alarms, see NFPA 2005.
Seattle WA reports that between September 2001 and December 2005, it will have spent from the City budget sources $45.5 million on HLS. Also, the Seattle P.D. created a HLS section by transferred officers from other functions within the department. It created a chemical, biological, radiological, nuclear, and explosive unit among other activities. The costs to Seattle do not include the additional security for athletic events (City of Seattle 2005). Further, William Bratton, the current police chief in Los Angeles and former chief in New York City points up the high opportunity cost of false alarms in terms of other more valuable police activities (Goldfine, 2006b, p. 46).
A similar study of patrol officers in Australia found that they spend 8% of their time providing community assistance services like retrieving keys from fired employees, assisting homeowners obtain entry into their own homes when they are locked out, and delivering eviction notices to renters (CJC 1997). Checking on the welfare of individuals is a private service because most cases prove to be unfounded.
Police in many small, suburban communities prefer to retain such non-public services including alarm response. Economies of scope among various police activities are more prevalent than in large cities. Managed competition where police could provide services that are private in nature as long as entry of private or other public entities is not prohibited by below cost pricing or regulatory policies is an appropriate solution.
Executives for the industry could be drawn from retirees of public law enforcement agencies, further improving cooperation between the public and private sectors.
For example, electrical facilities are constructed to satisfy peak load times (e.g. late afternoons in the summer).
San Francisco, CA has private police officers who in effect act as public police (Benson 1998, pp. 86–87). The City of Boston, MA developed a volunteer medical organization to provide mass care in disaster situations. A detailed plan, training and exercises have been conducted to assure smooth operation when employed (Menino 2008).
The nationwide cost is 2.2 million false alarms × $365 or $800 million. If $1050 is the cost per alarm, the estimated cost becomes $2.31 billion. In any event, the cost of fire department response is high. Calculations by the Philadelphia Fire Department show that in 2005 response cost was $1,053 per incident, excluding the cost of equipment (Philadelphia Fire Department 2006). Accordingly, our estimates are conservative.
Our estimates do not include the existence and the social cost of injuries resulting from response to false alarms. In just one incident, six people were injured when a fire engine collided with a car while responding to a false fire alarm (Toy 1995).
The cost of response to fire alarms is expected to rise in most non major cities where volunteers primarily provide all fire related service. In general, dual career families, the fact that residents often work far from home, and child care responsibilities are making it more difficult in most communities to attract non-paid volunteers, and repeated false alarms make volunteers reluctant to continuing their service (Mason 2006).
This conclusion arises because at higher prices (fines) price elasticity of demand is greater.
This statement requires two plausible assumptions: price elasticity of demand for false alarms exceed zero and similar demand functions exist for false fire and burglar alarms.
Markets usually provide incentives to produce efficiently, including the encouragement for technological improvements. When, for example the price of energy increases, consumers are inclined to purchase energy efficient vehicles and appliances, and manufacturers have incentives to develop more energy efficient products.
Incidentally, we already witness better and faster verification in large central stations that employ improved receivers (Based on discussions with the president of Vector Security, Pittsburgh, PA).
This calculation is substantiated by the experience of the Province of Ontario, Canada. The number of ambulance responses was 1.6 million in 2004 for a population of 12.4 million (Ontario Ministry of Health and Long Term Care 2005). Maintaining the same ratio of one response for every eight residents would yield 35 million ambulance responses in the U.S.
Response to a false ambulance call includes two paramedics and an ambulance for an average of 1 h. We take the average paramedic salary including fringe benefits to be $50,000 a year. Ambulance response with paramedics in 2005 cost the Philadelphia Fire department $146 per incident, excluding the cost of the ambulance itself (Philadelphia Fire department 2006). Accordingly, our estimates of ambulance response are conservative.
A total of 35 died as a result of ambulance accidents but only 21 white red lights were blinking and sirens were sounding (U.S. DOT 2004, p. 94). In fact some emergency response may occur without lights or sirens so our use of 21 is conservative. We shall assume that 1 out of 5 were the result of false calls.
Design of neighborhoods in a way that that minimizes crime incidents has been developed by Oscar Newman (1996). Newman’s creative ideas are implemented by city planners around the world. Similar efforts could be made in reducing the costs of terrorist attacks through use of resources freed from provision of non- public goods.
A similar phenomenon exists in state and local implementation of privatization ventures. A study by the Government Accounting Office (U.S. GAO 1998) that surveyed privatization implementations suggested that the most important success factor is the existing of influential mayor, governor or council members that champion the effort.
The Coast Guard is also subjected to false emergency including hoax calls to which it responds. Hoax calls alone comprise 25–36% of all calls. Conservatively, there are annually ten thousand hoax calls alone at average cost of $15,000 for a total of $150 million. One search based on a false distress call in the Seattle area cost $194,587 (Spivak 2004). However, even though the Coast Guard provides emergency response, it is not part of this paper that centers on services that are under the control of local governments.
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Blackstone, E.A., Buck, A.J. & Hakim, S. The economics of emergency response. Policy Sci 40, 313–334 (2007). https://doi.org/10.1007/s11077-007-9047-6
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DOI: https://doi.org/10.1007/s11077-007-9047-6