Michigan Increases Licensing Fees 600%

CLINTON TOWNSHIP, Mich.—Michigan has enacted Senate Bill (SB) 425, which increases the licensing fees of security alarm systems contractors 600 percent, from $250 to $1,500. Under the new law, contractor licenses are valid for two years.

SB425 went into effect Oct. 1, but will be reconsidered by the legislature in 2004.  According to Dean Belisle, president of the Burglar and Fire Alarm Association of Michigan (BFAAM), “At that point, it will sunset unless the Senate chooses to renew it, which we fully believe it will.”

Belisle cites the fee increase as one of the reasons why so many smaller alarm companies, particularly integrators, are for sale in the state. “They’re doing 10 or 20 systems a year, and it’s costing $100 a job. I would say that we’re going to lose 20 to 40 of them because of this.”

The BFAAM does not plan on fighting the increased licensing fees because lobbying efforts would be too expensive.

Another aspect of SB425 requires background checks of all alarm company employees. The bill originally mandated security contractors submit fingerprints to the Michigan State Police and the FBI.  Additionally, contractors would have been barred from hiring prospective employees until after background checks, which might take 60 to 90 days, were completed.

“You can’t operate a business if you have to tell a prospective employee that, yes, you’d love to hire him, but you’ll have to get back to him in two or three months,” says Belisle.

This aspect of SB425 was amended so security contractors can now call a 900 number and get a prospective employee’s name cleared quickly. Fingerprints still need to be submitted, but dealers can now hire employees for a specific amount of time until background checks are completed.

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