Privatized Fire District Keeps Costs Low and Service High

Published April 1, 2006

More than 40 years have passed since O’Hare International Airport in Chicago opened and caused a development boom that turned farm fields and wooded lots for miles around into shopping centers, industrial parks, and housing developments.

The boom also caused a crisis in the Elk Grove Rural Fire Protection District, whose two square miles include about 10,000 residents, hundreds of business and office buildings, and the corporate headquarters of United Airlines. The fire district solved the crisis by hiring a private firefighting operation it has used ever since.

“I heard about their predicament and talked to trustees. We reached agreement in December of 1978 and put together a fire department in 30 days,” said Chief Gary Jensen, who organized the private operation and has been district fire chief ever since.

Provider Overwhelmed

The fire district’s looming crisis was the imminent loss of all fire service from the nearby village of Mount Prospect. The Elk Grove Rural Fire Protection District had been buying fire service from the village since 1952.

Back then the area was mostly farms. Fire district trustees decided the fiscally prudent thing to do would be to hire the Mount Prospect fire department to answer the occasional fire protection call.

By 1960 the airport was open, and by the 1970s Mount Prospect had grown and the farms in the rural fire protection district were gone, replaced by thousands of mobile homes, single-family residences, and businesses. That growth caused a huge increase in demand for fire service in Mount Prospect and the surrounding area.

In 1977 the village notified the rural fire protection district that as of January 1, 1979, it would no longer be able to provide service to other communities.

Searched for Answers

Elk Grove Rural Fire Protection District trustees searched for other ways to provide service and commissioned a study to tell them what it would cost to create and maintain their own fire department.

“Even back then the cost was astronomical,” Jensen said. “As I recall, it was $2 million in capital costs and $1 million in operating costs, and that’s in 1970s dollars.”

Jensen has been in fire service all his life, starting as a graduate of the Oklahoma State University fire protection program. In the late 1970s he was working for an insurance trade association in Chicago and was a paid-on-call firefighter.

“I had good background for what they needed,” Jensen said. “I helped put things together for a whole lot less than $2 million.”

Jensen established the private fire service with used fire trucks and equipment, and friends in the fire service donated unused equipment from the back rooms and basements of fire stations.

Still Getting Big Savings

“Our first-year contract was $300,000, and we were providing the same level of service the consultant said would cost $1 million,” Jensen said. “We continue to provide service as good as that of our municipal neighbors, but because we are private, we can operate more efficiently. We save 30 to 40 percent over what a similar municipal department would cost to operate.”

The savings come mainly in personnel. The fire district has 14 full-time firefighters and 28 paid-on-call firefighters, all of whom are privately employed. None is a union member.

“We don’t pay the insane salaries that our municipal neighbors pay,” Jensen said. “Our benefits are more in line with traditional industry. We are non-union, which gives us a lot more flexibility in dealing with our employees. Salaries and benefits are the big savings, but we [also] have a shop where we can rebuild and refurbish fire apparatus for our own use.

“We save money in purchasing almost anything a fire department would use, just by shopping around. We’re very cost-conscious. We watch every penny we spend,” Jensen added.

The fire district contracts with the Bloomingdale Fire Department for dispatching, even though the latter is a government-run operation. “Bloomingdale has state-of-the-art dispatch and can do it a lot less expensively than we can,” Jensen said. “So we outsource to somebody else who can do something a lot more efficiently.”

Joyce Robinson, the Elk Grove Rural Fire Protection District’s board chairman, has been on the board 12 years. She said her seven-member board has many fewer headaches than other fire district boards, because of the decision to contract for private services.

“We don’t have to do hiring and firing. We don’t have all those personnel problems,” Robinson said. “Unions are a big problem in a lot of communities. Our firefighters are not union. I don’t know if most residents know it’s privately run. They just know when they need them they’re there.”

Steve Stanek ([email protected]) is managing editor of Budget & Tax News.

For more information …

Gary Jensen’s company, American Emergency Services Corp., can be contacted at P.O. Box 215, Wheaton, IL 60189; telephone 847-364-7163.

More information on privatization of fire protection and other services is available through PolicyBot™, The Heartland Institute’s free online research database. Point your Web browser to, click on the PolicyBot™ button, and select the Privatization topic.