WASHINGTON – Senator Susan Collins (R-Maine) along with Senator Tom Carper (D-Delaware) today introduced legislation to encourage commercial building owners to invest in life-saving fire safety upgrades. The Fire Sprinkler Incentive Act of 2011 strengthens tax incentives for owners of structures, such as commercial office space, nursing homes and other buildings to install fire sprinkler retrofits that can save thousands of lives and billions in property damage resulting from fires each year.
Currently, commercial building owners must depreciate fire sprinkler retrofits over a lengthy 39-year period. The Fire Sprinkler Incentive Act of 2011 reclassifies fire sprinkler retrofits as 15-year depreciable property, thus allowing businesses to receive the tax benefits more quickly. This provides a stronger incentive for building owners to install critically-needed fire sprinkler systems. While building codes require sprinklers in new commercial buildings, tens of thousands of structures across the nation that were built and put in service before sprinklers were required including structures such as commercial office space, college dormitories, and other structures.
“Each year, fires kill roughly 100 firefighters and 3000 occupants of buildings and results in over $15 billion in property damage,” said Senator Collins. “That doesn’t have to happen. I am pleased that this legislation will help small businesses and building owners upgrade to state-of-the-art sprinkler systems. New sprinkler systems are required in new buildings, but we need to do more to ensure the best systems are retrofitted in older buildings. Encouraging the installation of the best sprinkler technology will save lives and property.”
“Modern and effective fire sprinklers save thousands of lives and billions of dollars in property damage caused by fires each year,” said Senator Carper. “Unfortunately, many building owners, particularly small businesses, are unable to afford the high costs associated with upgrades and installation of fire sprinklers. This bipartisan bill would change that by providing much-needed tax relief for businesses that install these life-saving retrofits, helping keep us and our loved ones safe. I will continue to work with my colleagues on both sides of the aisle to make sure this critical bill is passed.”
Providing stronger incentives will be particularly helpful to small businesses, since over 70 percent of the nation’s sprinkler contractors are considered small businesses, having 10 or fewer installers. In addition to accelerated depreciation incentives, the bill also provides small businesses with an up-front tax write-off for fire sprinkler upgrades, instead of forcing them to wait years or decades under existing law to claim the tax benefit. The incentives apply to upgrades installed after December 31, 2010.
Every year Americans suffer over 3,000 civilian deaths, roughly 100 fire fighter deaths, and over 16,000 injuries, all due to fire. The direct property damage caused by fire is over $15 billion and indirect costs associated with fire, such as lost economic activity, is over $100 billion. One of the more effective ways to minimize the loss of life and property is through automatic sprinklers.
The National Fire Protection Association issued a study in June 2007 that concluded that in buildings that included functioning sprinklers, the death rate per fire can be reduced by at least 57 percent and the property damage decreased by up to 68 percent. Overall, the National Fire Incident Reporting System estimates that civilian deaths can be reduced on average by 84 percent when property has operating sprinklers.