Some business owners say it’s time for Minneapolis to revamp system, charge less.
Brent Frederick shelled out $2,830 in fees last year because Minneapolis police responded to eight false alarms at his North Loop restaurant, Borough.
If his popular eatery were in St. Paul, it would have cost him $550.
Over the past five years, Minneapolis collected more than $2.5 million in false-alarm fees from businesses and homeowners, according to data obtained by the Star Tribune. It took in nearly $40,000 from the downtown Macy’s alone and more than $22,000 from the Minneapolis School District.
Business owners say that the penalties are eating into their revenue and that it’s time for the city to charge less. The city says it needs to charge the fees to pay for the police resources used to respond to false alarms.
“The city is doing its job. The only thing I have an issue with is how much they are charging us. It’s astronomical,” Frederick said.
When an alarm is triggered, the alarm company must try calling the key holder, often the home or business owner, twice before they ask for police response. If that person can’t be reached, the police usually send two squad cars to respond to the alarm. If the officers find nothing wrong, they can designate a false alarm.
In most cases, the alarm was accidentally tripped by human error, such as a failure to disarm the system or a sensor that was too sensitive.
The city used to give alarm users two free false alarms in a year and charge $200 for the third, with each additional alarm costing an additional $100. But heavier fees were implemented in 2007 after the city estimated it was spending more than $800,000 to respond to them. In 2006, police responded to 15,600 false alarms.
“It was perceived as being abused,” said Grant Wilson, the city’s head of business licensing, which issues the false-alarm fees.
Now, alarm users are charged $30 for their first false alarm, which registers the system with the city. Users are also given educational materials on preventing false alarms.
The second false alarm costs $100 and additional ones go up in $100 increments. That means four false alarms cost Minneapolis residents $630.
False alarms have dropped 24 percent in the six years since the stiffer penalties were put in place. Although city officials say they are pleased by that, local business owners are not.
They’re often harder hit with false alarms than homeowners because they have more complex systems, with numerous doors, windows and sensors that have the potential to go off inadvertently.
Three false alarms this year cost Serendipity Road owner Will Determan $330, or as he says, three days worth of sales. “That’s not even with paying ourselves,” said Determan, whose boutique opened in November. “We are a new business, and that really hurts us.”
The St. Paul system
St. Paul requires all alarm users to purchase a yearly permit for $27.
Ricardo Cervantes, director of St. Paul’s Department of Safety and Inspections, says this system anticipates that alarm users will have at least one mishap. St. Paul gives residents and business owners two free false alarms, then charges $35 for the third. Adding all the fees together in one year, a seventh false alarm will cost a user $427. In Minneapolis, the cumulative cost would be $2,130.
Permit and false-alarm fees help cover most of the costs associated with false alarms, said Cervantes, who was head of Minneapolis’ business licensing department when the city implemented the harsher fees. He initially proposed a permit-fee system, but City Council members opted not to require all alarm users to pay for a permit.
“There’s more than one way to get the job done, ”said Cervantes, adding that Minneapolis should re-evaluate the fees if they’re becoming too burdensome for the community.
“We have to be willing to hear what people have to say,” he said.
Switching to a system similar to St. Paul’s would require Minneapolis to prepare and send annual billing statements, open and process the returned bills and process the payment, Wilson said. In other words, the costs to the city may outweigh the benefits.
“The cost of all that clerical processing can sometimes exceed the benefit when it relates to a fee as low as $27,” Wilson said.
The Minneapolis Police Department does not have a current estimate on how much the false alarms cost the department. The city said cases have so many variables that it isn’t possible to have a standard cost for the police response.
Wilson also thinks it’s unfair to make those who use their systems correctly to pay a fee. The city, he said, wants to focus on the repeat offenders.
Dozens of false alarms
Take Macy’s in downtown Minneapolis. Police responded to 53 false alarms since 2009 at the store, leading to a total of $39,920 in fees.
A Macy’s spokeswoman declined to comment, saying the company does not discuss its security procedures.
An Associated Bank branch in the Cedar-Riverside neighborhood had $26,020 in fees from 46 false alarms.
“Associated is fully aware of false-alarm issues that have occurred over the past few years, and we have taken the necessary steps to improve our security alarm system,” said Nicole Koremenos, a bank spokeswoman. “Since implementing new tactics, false alarms have dramatically decreased.”
The Minneapolis public schools also racked up about $22,000 in fees. The district says it has about 70 buildings and uses a central communication center that vets alarms before police are requested.
“If staff see a broken window or open door and do not feel safe going in, then the situation is elevated and police are contacted,” said Stan Alleyne, chief communications officer for the district.
Some businesses or homeowners have so many false alarms that the city stops responding. The city did not release those names because it could put them in danger.
Stopping police response, Wilson said, is a “last resort.”
Alejandra Matos • 612-673-4028 Twitter: @amatos12