Government-Sanctioned Monopoly Means No Choice and Higher Prices
The City of McHenry, like Woodstock, Crystal Lake and Algonquin, contracted to purchase alarm-monitoring equipment that duplicates existing private-sector infrastructure. These communities then passed ordinances that stripped away the free-market choice of business owners by requiring that fire-alarm systems must be monitored by each community's government monitoring station.
The result is that a single, government-selected company will do all installation and servicing for commercial fire-alarm communication systems, which eliminates incentive to provide competitive rates. This business plan is explained in a letter from the City of McHenry, signed by Assistant City Administrator Bill Hobson. In this letter, Hobson compared prices of completely different technologies and declared the city's $90 monthly alarm-monitoring fee to be "lower." What Hobson failed to explain to the business owners is that the exact same service is available from the private sector at HALF THE COST!
The IESA has been actively trying to educate the McHenry County decision-makers that there are practical, more cost-effective alarm-dispatching methods available today that do not harm the free-market system. One method used was a print advertising campaign in the Northwest Herald. The advertisement ran as a half-page ad from Wednesday, June 22 until Sunday, June 26.
This was Done to Claim the Revenue Stream
In a 2009 memo from City Administrator Chris Black, who was then the Finance Director, the City of McHenry acknowledged that "businesses have the option of having their alarms monitored by the city or a private alarm monitoring service." Black then bemoaned that, "alarm board revenue has declined in recent years as businesses have moved to wireless central monitoring systems."
To justify taking over a private industry, Black made false claims about reducing false alarms via municipal monitoring and improving response times. In the time since writing that memo, both of those claims have been debunked.
The IESA welcomes public debate on those two points, as well as this entire issue.
No Response from Elected Officials
During the past few weeks, members of the Illinois Electronic Security Association initiated a grass-roots, letter-writing campaign in McHenry County to try to stop the government from taking over a viable private industry for the sole purpose of claiming its revenue stream.
Several IESA members – state-licensed alarm contractors - contacted their customers (commercial fire-alarm system owners) in McHenry County to explain that they will now have to pay more for alarm monitoring ... and that this is all MANDATED by ordinance. (See list of linked ordinances to the right.)
The IESA executive director, Kevin Lehan, also wrote letters to local elected officials. The first letter was sent to the City of McHenry mayor and aldermen. A similar version went to the board of trustees for the fire protection district. To date, there has been no response from any of the recipients.
A second letter from the IESA was sent to nearly 300 McHenry County residents to bring awareness to this situation. Included in that mailing are Republican, Democratic and Green Party precinct committeemen, as well as other community leaders. Unlike the first, this mailing has garnered quite a bit of response.
The Business Community is Motivated – Get Involved Today!
After learning that they will no longer have vendor choice and will be charged a higher fee, the local business community has taken notice. Many have expressed their opinions to peers in business and social groups across the county, which has angered some elected officials when they were questioned.
The response has been so high that there are preliminary discussions among several business owners to host an informational session at a McHenry-based business in the coming weeks. If you’d like to learn more about this, please sign up below and the IESA will keep you informed of any developments. Also, if you have an opinion to share with the IESA regarding government monopolies, please call Kevin Lehan at 1-630-305-8800 or send a message below in the comments section.