Last year, the industry’s eyes took a second look at Michigan as new bills were introduced and backed by some new entrants to the industry — showing promise of spreading to other states. The bills were introduced on Sept. 19 and moved through the legislature at high speed. Despite the security alarm industry, law enforcement and Michigan’s Department of Licensing and Regulation speaking out against them, on January 2, 2013, Senate Bills 1291 and 1292 were signed into state law as Public Acts PA580 and PA 581.

Effectively, PA580 and PA581 weaken the current regulation of security alarm companies that operate in Michigan by eliminating safeguards that prevent convicted felons from owning, operating and monitoring the security systems of Michigan’s homes and businesses. 

Before these bills were signed, Michigan law prohibited felons from working any job in the security alarm industry. The legislation passed could leave Michigan consumers unprotected by banning convicted felons from some areas and not others. “Only three specific job functions are now included for criminal background checks (those requiring face-to-face contact with customers),” the Burglar and Fire Alarm Association of Michigan (BFAAM) said. Though felons would be barred from working at the premise of a security alarm customer, they could now own a security alarm company, manage and operate the company, work in administration, technical support, customer service, internal sales and in monitoring stations, with no one the wiser.

In addition, PA 580 and 581 state that criminal background checks are required from the Michigan state police or the FBI, instead of both. Employers could even satisfy the requirement with a background check performed by another state.

BFAAM noted that the bills were supported politically and financially by AT&T and the telecommunications industry.  According to BFAAM, AT&T’s stated intent was “not to protect the citizens of Michigan, but rather ‘to have as little regulation and oversight as possible’ while operating its new security division in Michigan.”

As large telecommunications and cable companies launch security services nationwide this year, the industry could be faced with copycat legislation in other states.

The issue of deregulation is a heated one in the security industry as in any other heavily populated by small- and medium-sized businesses. Still, BFAAM fears catastrophic results as companies could legally place convicted felons to work in areas where they’d have access to clients’ user codes, personal schedules and details on the systems protecting their homes or businesses, as well as give them control over monitoring and dispatch.

While leaving key sectors of a security company open to felons, the new acts can be confusing in their treatment of licensing and registration requirements.  “Current license holders that choose to retain their license will be required to obtain registration under the new acts as they relate to CCTV and access control,” BFAAM explained. “Statute claims the governing agency can only ‘operate’ under the specific guidelines provided in this legislation.  It then allows this same agency complete determination of what the requirements are will be for new applicants.”

BFAAM added that the language clearly prohibits local municipalities from requiring security companies to obtain permits and/or registrations but may also ban the municipality from issuing alarm permits or false alarm requirements and/or fees.  The association expressed concern that this could lead to “a backlash from local municipalities and law enforcement and even the eventuality of a no response policy to alarms.”