‘Crash tax’ takes hold
Cash-strapped Willows begins billing for Fire Department emergency services
Out-of-town motorists passing through the city of Willows beware. If you get into a car accident and are found at fault, the Willows Fire Department will charge for emergency services provided at the scene.
Willows’ controversial new emergency-services cost-recovery program—commonly called a “crash tax”—was approved by the Willows City Council in July and went into effect Sept. 1.
Costs range from $435 for providing “hazardous materials assessment and scene stabilization,” to $2,200 for “Level 5” services that include extrication and helicopter-transport of an injured party, to an unspecified “Level 6” itemized response with “custom mitigation rates.”
According to the new ordinance, not only will non-residents of Willows be liable for mitigation fees if they are unlucky enough to get in a wreck within the city limits and found to be responsible, but even Willows residents will be charged for Fire Department response if they are deemed to be breaking the law—say, in the case of going around a “road closed” sign on a flooded road and getting stranded.
“Water incident” charges range from $400 (plus $50 per hour per rescued person) for basic response, to $2,000 per hour (plus $50 per hour per rescue person, plus $100 per hour per HAZMAT team member)—and possibly more under special circumstances.
“I am in full support of this—yes,” said Willows Fire Chief Wayne Peabody of the new program. “Just for the simple fact that if I go out on a vehicle accident … I don’t have the money to replace equipment due to budgetary restraints. The money is going directly into the Fire Department’s fund to replace equipment and replenish cost of payroll. It is necessary for our department. I’m hoping for $10,000 [per year], but realistically we’ll probably get $5,000.”
Willows joins a growing number of cash-strapped California cities—including Woodland, Roseville, Stockton, Tracy, Huntington Beach and Fallbrook, and the Fresno County Fire Protection District—choosing to institute a crash tax in an attempt to raise revenue.
“We’re probably one of the last towns up and down the I-5 corridor to do this,” Peabody offered. “Artois has been billing for quite a few years.” A recent crash-tax proposal in Sacramento was put on hold until Sept. 14 for further research.
“We are not billing the individual person,” Peabody stressed. “We’re billing [his or her] insurance company.
“I imagine if we get 50 percent of them to pay, we’ll be lucky,” he added.
Willows, like a number of cities in California, has hired Roseville-based billing contractor Fire Recovery USA to oversee the collection of fees. Fire Recovery USA keeps 20 percent of the money it recovers.
“We’ve been billing for fire services for three or four years,” said Mike Rivera, Fire Recovery USA’s chief business-development officer. Rivera said that about 60 fire departments use his company’s services in this state alone (Fire Recovery USA operates nationwide). “The trend is growing, for sure, because of the economy.”
Rivera said it is cost-effective for fire departments to hire a billing service “rather than hiring additional employees that need to be trained, and hiring attorneys.”
Sam Sorich, president of the Sacramento-based Association of California Insurance Companies (ACIC), disapproves of crash taxes.
“It’s a wrong option, but it’s an attractive option for a city, we admit that,” he said.
“Our perspective is [that] we don’t think our customers should get charged for these fees, either through insurance or directly,” he said. “Especially here in Sacramento—you’re supposed to go visit your [state] government and—bam!—you get hit with a tax if you’re in an accident. Somebody in Sacramento drives to Chico and doesn’t have to pay, but if you’re in Chico and drive to Sacramento, you’re going to pay [if this ordinance passes]. It’s crazy.”
Sorich added that billing for emergency services is “contrary to the image people have of firefighters. They’re out there to help people, not hand them a bill.”
Southern California firefighter Kevin P. Rice, who has been writing anti-crash-tax letters to city councils and media outlets throughout California since early 2009, agrees with Sorich.
“I desired to be a firefighter for one reason—to give back to the community and to help citizens in need,” Rice said. “When I come on the scene of an emergency, I want to be viewed as someone who’s going to provide assistance, not someone’s who’s going to hand over a bill.”
Rice compared the crash tax to the special insurance one is required to buy when driving in Mexico.
“Are we willing to create a patchwork where you cross [city] borders and you’re in a pseudo-foreign city?” he asked, adding that he finds it “extremely hypocritical” for a city such as Roseville, which courts out-of-town shoppers to its famed Automall and Westfield Galleria shopping center, to charge a fee if one of them gets into an accident.
Additionally, said Rice, he is concerned that as insurance companies are being billed for incidents in crash-tax cities, insurance rates will be forced to go up for everyone.
Rice, who travels along Interstate 80 regularly on business, added that he is “never going to stop for fuel or fast food [in Roseville]. If they feel I don’t contribute to Roseville and I’m a drain on their economy, then I don’t want to give my money there.”
“Unfortunately, in our economic state—of anywhere in the state—it’s the only thing we can do,” said Peabody of the tax. “The biggest thing to remember is that we’re not charging the individual, we are charging the insurance company. If they don’t have insurance, we don’t send them a bill. The CHP is going to have other issues with them.”