City OKs doubling towing fees
By Vianna Davila / Express News
City Council passed a new towing ordinance Thursday morning that more than doubles how much companies can charge to haul away illegally parked vehicles but also imposes greater restrictions and regulations on San Antonio’s towing industry.
The ordinance was passed without discussion. It raises the cost of a nonconsent, light-duty tow from $85 to $177.
The new rules go into effect Feb. 10, said Deputy City Manager Erik Walsh.
The existing fee, in place since 2002, has been a point of contention since last spring, when police started to crack down on some towing companies that charged more than what the city allowed. In particular, law enforcement cited Bexar Towing hundreds of times for charging nearly three times more than the $85 cap, with the total towing bill nearly $300.
Bexar Towing founder John DeLoach argued he was within his rights to charge $250, plus more than $40 in other legally sanctioned fees, because that’s the maximum state law allows. Last week, a Municipal Court judge found him guilty of overcharging in at least one case. He plans to appeal.
But with the higher limit on fees comes more intense scrutiny. The new ordinance adopts some rules already outlined in the state code that regulates towing. The state code was referenced in the previous ordinance but many of the rules weren’t specifically outlined in the city rules. The city policy also needed to be adjusted to match state code, which had changed since the city adopted its ordinance in 2002, said San Antonio Police Det. Glenn Condon, with the department’s auto theft unit.
Among the state rules now addressed in the city code is a requirement that tow drivers release a vehicle to its owner for free if that vehicle is not fully hooked up to the tow truck and ready for transport.
Other aspects of the new ordinance include:
A fuel adjustment schedule, that will lower or raise the cost of a nonconsent tow if the price of diesel fuel drops below $3.83 per gallon or goes above $3.95 per gallon. The city will review fuel prices every December.
An $88.50 “drop fee,” the amount a vehicle owner can pay if the vehicle is fully hooked up to a tow truck but hasn’t left a lot. The previous drop fee was $85.
A requirement that tow truck drivers call police and inform them when they “drop” a vehicle. Under the previous rule, tow trucks only has to call police when they towed a vehicle.
Rules about signs posted at parking lots where towing is enforced will now comply with state law and allow a property owner to request signs from the towing company. Previously, property owners had to obtain the signs themselves.
For the first time, the ordinance explains how local towing companies can request a study to re-examine towing charges. State law allows tow companies to request such a study, but San Antonio had no formal rules in place.
However, the new ordinance also implements a four-year stay between tow fee studies, and would require tow companies to pay $5,000 to offset the study costs.
CITY OF SAN ANTONIO
|Agenda Item # 17
Council Meeting Date: 1/31/2013
RFCA Tracking No: R-10049
|DEPARTMENT: SAPD||DEPARTMENT HEAD: William McManus|
|COUNCIL DISTRICT(S) IMPACTED:
Proposed Changes to Non-Consent Towing Ordinance
This ordinance amends Chapter 19, Article XI (Wrecker Services) of the City Code to comply with State law, adjust the maximum allowable fee for non-consent tows, and revise requirements pertaining to items including signage, reporting, release of private property, tow fee studies, and other amendments. [Erik J. Walsh, Deputy City Manager; William McManus, Police Chief]
Non-consent tows include the towing of abandoned vehicles or vehicles parked on private property. State and Federal law authorize cities to regulate the price and safety of non-consent tows. In 2002, the City Council approved a cap of $85 for light duty non-consent tows on the fee towing companies charge vehicle owners for non-consent tows. As a result of an increase in complaints regarding the towing of vehicles from private property, San Antonio Police Department (SAPD) began heightening the enforcement of the 2002 ordinance. During the summer of 2002, a temporary injunction was filed by the largest tow company in San Antonio to stop the City’s enforcement of the oridnance. The 166th District Court upheld the City’s right to enforce the 2002 Ordinance.
SAPD is recommending updates which clarify requirements and bring the ordinance into compliance with State law, including:
Non-Consent Tow Fee Study – In July 2012, due to a request from Bexar Towing, and in compliance with State law, the Public Utilities Division (PUD) of the City of San Antonio’s Finance Department was asked to conduct a non-consent towing fee study.
On July 13, 2012, PUD and the City Attorney’s Office sent a letter to 23 towing companies requesting financial and statistical information needed to study local towing rates, and enlisted the assistance of the San Antonio Towing Association to gather the requested information. Follow-up letters dated August 29, 2012, were sent to the towing companies and the San Antonio Towing Association. Ultimately however, only one company provided their financial information to the City.
Lacking sufficient information needed to conduct a study of local rates, PUD obtained financial data from a May 2010 study of private property towing rates conducted by Morningside Research and Consulting (MRC) on behalf of the Texas Department of Licensing and Regulation. The MRC study contained recommended rates for light duty and medium/heavy duty tows based on 2008 and 2009 data for five geographic zones within Texas. PUD selected the rates inclusive of San Antonio to utilize in its study.
PUD staff also used data from an August 2012 IBISWorld Industry Report (Report 48841, Automobile Towing in the US). IBISWorld is a market research organization specializing in long range forecasting for specific industries and the business environment at large.
The MRC study was used to establish base rates which PUD adjusted by including other costs, as noted in the IBISWorld report and adjusted for inflationary factors. The study conducted by PUD included wages, purchases (i.e. fuel), marketing, depreciation, rent, utilities, and other normal business expenses.
Finally, PUD awarded a contract to review/evaluate the scope of work and methodology to consultant Boisso S Associates (Dale E. Boisso, Ph.D.). PUD incorporated Dr. Boisso’s suggestions (primarily regarding inflation rates more closely matched to San Antonio) into its calculations and is recommending the following rates:
The Police and Finance Departments met with representatives of the towing industry twice to review the proposed ordinance and fees. Based on those meetings, revisions have been made to the proposed ordinance.
The Finance and Police Departments presented both the findings of the tow fee study and proposed changes to Article XI to the Public Safety Committee of the City Council on January 15, 2013. At that time, staff recommended the above listed rates, adoption of the tow fee study conducted by Finance, and the following procedures for conducting future tow fee studies:
The Public Safety Committee approved the Departments’ recommendations and requested staff to have further discussions regarding an annual fuel adjustment clause be included in the ordinance.
As a result, the City and towing industry representatives negotiated and agreed to the following fuel adjustment option. Should the price of diesel fuel drop below $3.83 per gallon or rise above $3.95 per gallon, the City will adjust the fee cap accordingly. Fuel prices will be reviewed in mid-December of each year. Any required adjustments to the tow fee will be based on the average price of fuel over the preceding year.
The San Antonio Police Department, whose responsibility it is to enforce Article Xl, received numerous complaints from residents and the Texas Department of Licensing and Regulation (TDLR). These complaints involve issues such as:
Furthermore, various representatives of the towing industry have voiced concern with what they consider to be an artificially low maximum tow fee limit, and have disputed citations issued by SAPD for violations of the limit in District Court. In each case challenging the City’s current limit ($85), the judge has upheld the City’s action.
If City Council elects not to change the ordinance, the tow fee study will be placed on hold to take additional time on researching how other cities conduct their tow fee studies. Once completed rates will again be brought before City Council for approval.
There is no fiscal impact.
Staff recommends approval of the proposed amendments and maximum rate for the following non-consent towing rates: light non-consent towing rate – $177.00; medium non-consent towing rate – $196.00; heavy non-consent towing rate – $602.00.
Staff believes the recommended changes will strengthen the ordinance, better protect San Antonio residents, and help local towing businesses by adjusting the maximum allowable tow fee rate and clarifying the ambiguities existing in the current ordinance.