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Thursday, February 26, 2009

Oregon House Committee hears predatory towing bill

Portland, Oregon--The Oregon House Consumer Protection Committee heard HB 2578 yesterday, February 25, sponsored by the committee's Vice Chair, Representative Chuck Riley.

Predatory patrol towers are fighting back to protect their towjacking profit margins.

Testimony by a number of witnesses indicated that the patrol towers are largely ignoring the regulations imposed on them by new state laws, still the same packs of junkyard dogs roving around the state.

First speakers up were the Mayor and Chief of Police of the City of Fairview, the first municipality in the state to take action against predatory patrol towing, and they described how 100% of the problem incidents regarding predatory towing went away overnight, with the passage of the citywide ban.

Every city and every county government in the state has the power to do exactly what Fairview has done, simply enact the ordinance.

Now it's up to you, to urge your city and county officials to take action, and to support Representative Riley's bill.

Here's the link to the audio record of the hearing:

Select the date feb 25 2009

The towing bill discussion begins about at the 14:00 mark. My testimony starts at about 1:12:10.

Isubmitted the following written testimony (slightly edited for clarity):

Vice Chair Riley and Members of the Committee:

My name is Sean Cruz. I am a resident of Parkrose neighborhood in NE Portland. I served as Senator Avel Gordly’s Legislative Aide and Chief of Staff, representing Senate District 23 throughout the 2003, 2005 and 2007 legislative sessions. I also claim the distinction of having “Portland’s #1 Predatory Towing Horror Story”, which I write about on my blog.

I led Senator Gordly’s Senate Bill 431 workgroup on patrol towing reforms and I represented her office in the Attorney General’s Senate Bill 116 workgroup, led by Eva Novick. Senate Bill 116 incorporates several of Senator Gordly’s legislative concepts.

Both bills passed the House and Senate with unanimous votes in committee and on the floor, but fell just short of Senator Gordly’s goal, which was to model California’s statute, requiring the property owner or manager to be present at the time of the tow and sign the invoice, in order to promote the safety and wellbeing of members of the general pubic. California’s law also held the advantage of having been recently upheld by the U.S. 9th Circuit Court of Appeals.

Prior to the 2007 legislative session, Oregon’s patrol towing industry was largely unregulated, and there was a lack of clarity in Oregon statutes as to whether the state and local governments had the authority to regulate businesses built around the involuntary towing of citizen’s private vehicles. The Attorney General, for example, had no explicit authority to even receive complaints from the public, much less act on them.

This fact was enormously frustrating to many Oregon citizens, who often found that the local police were also stymied, with no power over the towing disputes they were often called into other than to allow a tow truck driver to take a citizen’s property away.

There was a widespread assumption that federal law regarding interstate commerce pre-empted state and local governments, and on this basis patrol towing metastasized over several decades, seemingly untouchable, answerable to no authority. It was literally the Wild West, here in Oregon, the only state on the West coast that has not banned patrol towing.

The first thing we had to do in 2007 was to establish that authority.

Thanks to the research of a constituent, Tim Barrett, whose car was patrol-towed less than five minutes after his arrival to visit his son in a Fairview apartment, we found what was needed:

In 2005, in Tillotson vs the City of San Diego, the U.S. 9th District Court of Appeals found that California’s law curbing patrol towing was designed to promote the safety of the general public, who might be stranded or whose family might be stranded in unsafe circumstances, and of the tow drivers themselves and is therefore exempted from the federal pre-emption.

Testimony from a number of citizens during the tow bill hearings demonstrated that this was happening frequently, including separating drivers from prescription medications and leaving people in wheelchairs stranded on the sidewalk. You will shortly hear Mr. Michael Meiers describe his experience….

This regulatory authority, in the language used by the federal court, comprises Section 1 of Senate Bill 116, clarifying the exemption regarding the regulation of involuntary towing, including the price thereof.

Paragraph 2 (a) states: “The Legislative Assembly declares that…statutes that assist members of the public in avoiding involuntary loss of use of motor vehicles and in expediting recovery of motor vehicles and the personal property in the motor vehicles promote the safety and welfare of members of the public.”

I want to applaud the City of Fairview, the first municipality in the state to take action under Senate Bill 116, passed on a unanimous vote by this Committee.

Speaking on behalf of Senator Gordly and thousands of aggrieved Oregonians, I want to thank Vice Chair Riley and the Committee for taking this issue on with HB 2578. I wish you great success!

It was not my personal predatory patrol towing horror story that brought Senator Gordly to see a need for legislative action, although when the towers broke my transmission that Saturday morning, they sidelined the vehicle that I used to drive the office carpool to the Capitol every day. We had to switch to Senator Gordly’s Executive Assistant Denise Pederson’s vehicle for the remainder of the session.

I would like to note for the record that 100% of the many dozens of complaints that Senator Gordly’s office received regarding predatory or wrongful towing practices involved patrol towing. None were a result of the legitimate practices and operations of tow companies that do not patrol tow.

Senator Gordly’s legislative concepts came about from what we learned about how the industry has operated unregulated in Oregon, from what we learned directly from interviews with many dozens of Oregonians, from the tow companies’ practices and business model, from the attitudes of its employees, and from the tow company’s own invoices.

Burden placed on public resources

All of these citizens called the police when their vehicles were taken. Unlike any other commercial activity in Oregon, patrol towing creates a direct burden on local police resources, paid for entirely by the taxpaying general population.

This burden begins when the tow driver calls the police to report that he is towing a certain vehicle. Then there is the second call to the police, coming either when the vehicle owner finds her vehicle gone and is reporting it stolen, or when the vehicle owner returns to her vehicle and finds some surly stranger with a tow truck hooking it up. This driver is fully aware that either money changes hands at this moment, or he is wasting his time, about to drive off with an empty wallet.

The third burden on police resources comes when at least one officer is called to the scene, and then anything can happen or might have already happened.

Beyond this lies the burden on the court system that can follow, all at public expense, and all of this hubbub began—with members of the public left stranded in every sort of circumstance—with a decision made by a tow truck driver working on commission, generally in the dead of night, underpaid and under great pressure.

They’re stealing parking….

In the 2007 legislative workgroup discussions, the patrol towers stated that they regarded all of their tows to be lawful and righteous, that they always dealt with every mistaken tow incident swiftly and properly…we disputed that.

In those same discussions, the patrol towers stated their opinion that the people whose vehicles they towed were “stealing” parking. They were thieves.

In their own minds, a small number of patrol towing companies had created a crime called theft of parking, and through a mass of agreements with individual property owners, carved out a niche for themselves as a quasi-police force, with sole authority to make and enforce the law, to act as judge, jury and tax collector.

If your vehicle was towed, it was because you were a thief, stealing parking. And your story was a pack of lies. So when Mary Q. Public came to their tow yard to claim her vehicle, she was viewed as a thief and a liar and treated as such. This is how they described their operations….

Furthermore, it is not only the drivers who are paid on commission. So is everyone else in the organization. So when Mary Q. Public comes to the tow yard and argues about the bill, she is talking to people who are not going to take a dollar out of their own pockets for any reason, certainly not for this lying parking thief.

“Attitude” fees and confiscation

These are the people that have been willfully charging the public “attitude” or “anger” fees in this state for decades.

And they have openly charged the public fees in amounts that are beyond anything reasonable, beyond deterrence, beyond fair recompense, beyond punitive…many of their tows result in the actual confiscation of the car.

In the last interim, Senator Gordly’s office received a call from a constituent in East Multnomah County, requesting our urgent assistance. A patrol tow company was about to auction off a vehicle that belonged to a person who was a patient in the Oregon State Hospital. The towers claimed that the owner owed them $ 2000 in storage fees, accrued since the time they had towed the vehicle from a hospital parking lot.

The young man had gone to the hospital for a medical appointment, parked his car in the lot, but suffered a psychotic episode there and was taken directly to the State Hospital, where he continued to reside. He had no intention of parking there over the limit, and hospital personnel would certainly have not made towing their first choice, if they had a role in authorizing the tow.

If the tow company auctioned off the car, the young man would emerge from the hospital with an unfair burden of debt and without the car. His only income was his disability check going into this situation.

We intervened and the tow company released the vehicle without the charge.

Apples to apples

The patrol tow industry opened this can of worms itself when Retriever Towing took my two vehicles, parked side by side on my own property in my own driveway, at the same time and under the same circumstances, but with completely different invoices and charges, providing an apples-to-apples opportunity to see how they were operating. Those invoices are in your packet as Exhibit “A”.

In March 2005, an absentee neighboring property owner, Hacienda Community Development Corporation, began employing tow companies to patrol the small parking area that serves two triplexes that it owns on a flag lot behind my home.

I park my vehicles on my own property, adjacent to the lot.

I learned about the patrol towing contract the day after the tow company posted its signs in the lot, when I woke up that Saturday morning to find both of my vehicles gone. There was no prior notification by any party to the contract, either to the neighborhood or to the tenants themselves.

I called the number posted on the signs. The tow company affirmed that they had indeed stolen my vehicles and that I could pay just under $400 to get them back that day, or I could wait until Monday if I wanted to talk to a manager. I called the property manager, who did not answer their phone. I tracked down Hacienda’s board chair, who informed me that I should either call the police or wait until Monday. I called the police.

A police officer came to my home, looked at my plat and confirmed that my parking area was my own private property. He then drove to the patrol tower’s lot to request the release of my vehicles, but the patrol towers refused to do so.

Eventually, later that day, after a number of phone calls, including more conversations with the police officer, the towers did release the vehicles. At first, they could not find one of my vehicles, although they knew that they had it.

The following Monday, as I was arriving here for work at the state Capitol, I learned that the towers had returned and taken one of the vehicles for a second time.

My absentee-landlord neighbor’s patrol towers have trespassed on my property and towed my vehicle four times—so far—and broken my transmission in the process.

In each of these incidents, to this very day, all parties to my neighbor’s patrol towing contract have disclaimed responsibility for the trespass, the theft of my vehicle, the damage to my property and for all of the trouble they put me through.

The tow company stated that they towed the vehicles according to their contract with the apartment managers, the apartment management company claimed that they told the towers not to tow my vehicles, and the property owner took the position that they knew nothing about it and that I should work it out with the tow company.

Attachment “B” in your packet is a copy of a subsequent letter from the City of Portland Towing Coordinator to the property owner’s Executive Director, and quoting Bertha Ferran the Hacienda board chair as stating “the tower probably has a contract to provide this service, not Hacienda CDC.”

The Ms Ferran knew with absolute certainty about the contract. In fact, Hacienda’s affordable housing properties generate more patrol tows than any other property owner in NE Portland, upwards of 150 tows a year for some 300 apartments.

Attachment “B” also illustrates the ongoing burden on public resources of patrol towing incidents.

The four incidents at my home involved four different drivers, two different tow companies and two different property management companies.

The only constants are the property ownership, the patrol contract, tow drivers working on commission, and the result. It is abundantly clear that none of these incidents would have occurred had HB 2578 been the law of the land, removing commission-paid drivers from decision making and requiring the property managers or owners to be present at the time of the tow.

From that weekend to the present day, these two different patrol towing companies have subjected my neighbors to the same level of intensity, towing the tenants’ legally parked vehicles, towing vehicles despite clearly displayed Hacienda parking permits, showing up and hooking up vehicles minutes after they were parked, and pulling numbers out of the air. I personally witnessed a driver attempt to extort money from one of the families living there. I went back there and broke that up myself.

Four years later, my van is still sitting in my driveway with a broken transmission, and I’ll bet they are sorry now….

Attachment “A.”

Aside from the name of the company, the two invoices are completely different. No line items on the list of charges and fees appearing on one invoice appear on the other, none are identical, and neither are the amounts.

They can’t possibly both be correct. Which, if any, is correct? The towers took the position that they were both correct.

The towing company treated each vehicle in practice differently as well.

We came to learn that the towers were exploiting a line in ORS statute that prevented regulation if the parking lot held ten or fewer spaces. The lot behind my home had parking for only seven vehicles. The City of Portland had limited authority to regulate towing, and only if a parking lot was larger than ten spaces.

Who knew that the size of a parking lot made any difference in how much an Oregon citizen could be charged, on what fees could be assessed, and in how one would be treated?

These two invoices reflected that reality. The upper invoice in Attachment “A” reflects the fees and line items permitted under the authority of the City of Portland.

The lower invoice shows how the towing company was operating absent of regulation. This also explains the enthusiasm with which the tow drivers were patrolling that seven-space parking lot. More fees and charges, higher commissions, no public authority to regulate. I have seen two tow trucks in that lot at the same time.

Under the regulated invoice, the driver took my vehicle to their tow yard only about 25 blocks from my home in outer NE Portland. The City does not permit mileage to be charged.

Under the unregulated invoice, however, the other driver took my vehicle clear across town to their lot at NW 15th and Quimby.

He charged me $110 for the tow, $16 for his mileage, driving around town, $3 for the fuel he claimed that he burned while towing my vehicle, $10 for taking a photo of the tow (which clearly identifies the trespass and theft), $35 for the dolly he used to break my transmission, and $15 for a dispatch fee. Other than the tow fee, none of these charges were permitted under City code.

And you can see there are boxes for more fees: “Retow fee”, “Retow dollies”, “recovery and winching”, “service call”, “gate fee” and “service fee.”

Note that the regulated invoice has a $ 20/day printed storage fee.

The unregulated invoice daily storage rate is not printed. Here, the driver has written in a rate of $33. Which is the correct number? The tower claimed they were both correct.

The unregulated invoice bears no printed rates or costs. In all cases, the driver alone decides what numbers to put in the boxes and which boxes to check. The form also has a blank line at the bottom of the price column where the driver or lot employee can invent things to charge, like “anger” or “attitude” fees, and write in a number he likes.

And he is paid on commission.

2007 legislation

At the start of the 2007 session, Senator Gordly filed five legislative concepts to address patrol towing, later concentrated into the two bills.

Our contributions to Senate Bill 116, sponsored by the Attorney General, were these:

Section 1 of SB 116 clarifies the authority of the state and Oregon municipal governments to regulate involuntary towing.

Senate Bill 116 also removed the language from ORS that barred regulation of parking lots if they contained ten or fewer vehicles. In the workgroup, with the assistance of Legislative Counsel, we learned that there was no record of why that line was in statute in the first place, or why the number was ten. Even the patrol towers could offer no reason, other than that they thought it was a good idea. At one point, one of the patrol company owners shouted at me that the City had no right to regulate in that parking lot behind my home. Well, they do now.

Senate Bill 116 requires tow drivers to provide vehicle owners with a printed rate sheet, in order to eliminate the practice of commission-paid drivers pulling a smorgasbord of numbers out of the air.

However, a recent patrol towing incident in Wilsonville, where a driver attempted to tow the vehicle of an injured woman fleeing an assault, indicates that the company involved is not complying with this provision of law. In the extensive media coverage that followed, no one, not the police, not even the owner of the tow company, interviewed on-camera, knew how much money his driver had charged the victim. They are clearly not complying with the provisions passed out of this Committee in 2007.

Senate Bill 431

Senate Bill 431 addressed patrol towing abuses in landlord-tenant relationships.

SB 431 prohibits towers from removing vehicles solely for having expired tags. Those tenants’ rental agreements gave them the right to park their car in the lot, and they were violating no state law as long as they kept that vehicle parked and off the street, which is where it was.

SB 431 requires landlords to provide tenants with written notice that includes the actual costs they might face if their vehicle is towed. It is not unreasonable to have a pre-printed rate sheet, but the patrol towers really howled about this one in the workgroup.

Landlords must provide this information at the time the rental or lease agreement is signed, they must update the tenants if and when any of those numbers change, and they must provide the tenants with parking permits. It is highly doubtful that any are complying with this portion of the law passed by this Committee, as none of the constituents who contacted Senator Gordly’s office in the interim and none of my neighbors have received any such notices or rate sheets or parking permits from their landlords.

Opposition to the 2007 legislation came from lobbyists for commercial property owners, who stated that they absolutely needed patrol towing, but acknowledged that they received these services for free. Their agreements with patrol towers permit the towers to load all costs, real or otherwise, and their profit expectations on the backs of their victims.

Unless landlords and property managers participate in the expense of the service and the cost of police resources they rely on….

In closing:

Despite all of the reforms instituted by the legislature in 2007 and ample fair warning to patrol towers clearly and plainly stated at that time by members of the Senate Commerce Committee and of this Committee, most memorably by Vice Chair Riley, little has changed in actual practice. The patrol towing business model itself is to blame

I would suggest that the Committee, as it works this bill, consider provisions requiring the owners of patrol towing companies that are competing for public towing contracts for any public agency or entity, to conform all of their towing operations under any other name to the standards set in the public contract.


Sean Cruz writes:

Blogolitical Sean, political commentary here:

Aaron’s Law, regarding child abduction prevention and resolution here:

Jim Pepper House, dedicated to the legacy of the late, great Jim Pepper here:

Portland’s #1 Predatory Towing Horror Story, regarding predatory patrol towing practices here:

Chicano Hero Cesar Chavez, dedicated to the Mexican-American giant, here.

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