Making a phone call is not "abusing the system." As I recall from reading about MagicJack years ago, the issue is that some CLECs (and ILECs in podunk areas) are "abusing the system" by charging unreasonable fees to connect the call.
Calling a number on another carrier isn't free, and some carriers are more expensive than others.
A local call is a local call, whether it's to the pizza place across the street or to your local police/sheriff's non-emergency number. If it's an AT&T termination, it's like $0.0025/min. There are some carriers that are nearly $0.10/min, though. Your "free" service isn't going to cover those types of places.
You get what you pay for.
Just remember that a local call is a local call, and still has to be paid for. Doesn't matter that it's to an LEA. It's still a local call.