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Towing the Line

Memphis wrecker companies and city officials are negotiating for changes in an outdated wrecker ordinance. How much will it cost taxpayers?


Cynthia Smith’s morning was right on schedule. She left her home for work at the usual time, and although traffic was heavy, she made it with a few minutes to spare. But as she opened her car door, a man approached, flashing a gun underneath his shirt. He ordered Smith from the car, snatched her purse, then got in and sped off.

Eventually the thief was caught in Smith’s car, where he had been living for more than a week. Her car was towed to the Memphis Police Department’s (MPD) impound lot, where it sat for days while Smith wrangled with her insurance company over liability and fees. While the company finally agreed to tow the vehicle to a dealership, Smith had to pay two towing bills, impound-lot storage fees, and thousands of dollars in damages.

Not only was Smith robbed by a gunman, she was gouged by a Memphis towing system that is badly in need of an overhaul. A city ordinance is supposed to regulate the towing industry through a division of the Police Department. Unfortunately, the division is a one-person operation, and the ordinance — last revised in 1989 — is years beyond its usefulness. A committee composed of wrecker operators, attorneys, city councilmen, and members of the Police Department is working to update the policy and prevent lawsuits that have plagued other cities.

The MPD wants to regulate all service and storage charges. Wrecker owners say free enterprise is important to their business and that accusations of gouging are mostly unfounded. Meetings have been held since spring, headed by committee chair and city councilman E.C. Jones. “There had been requests from some wrecker owners about fees that haven’t been increased for some time, especially due to the increase in fuel costs,” Jones says. “We also had concerns from the Police Department that we needed to strengthen the ordinance a little. We’re not trying to keep people from getting in business, but we’re trying to make sure that the public is not being taken advantage of by unethical people.”

Everybody’s Business

When your car is towed for being illegally parked, or picked up after an accident, or moved from your home to a service station for minor repair work, you’re being served by the tow-truck industry. In Memphis, approximately 100 companies provide this service — towing cars, overturned tractor-trailers, hazardous-material containers, and stalled school buses — in order to keep city streets clear. The MPD uses a rotating list of 48 wrecker companies to tow more than 2,600 vehicles each month involved in wrecks, thefts, and DUIs.

Police sergeant Monique Campbell is the one-person division that enforces the city charter wrecker ordinance. Campbell is responsible for wreckers and other transportation services, such as taxis, horse carriages, and motorized scooters. “I feel safe in saying that [the MPD] is in good control of who’s driving and who’s towing for us,” she says. “But a lot of companies not on the [police rotation] list are not regulated by anybody. Sometimes they don’t even have regular business licenses, and that is a requirement.”

The city pays towing companies $75 for each car towed to either the city’s impound lot or to a privately owned lot. The fee is recouped by the city from vehicle owners or from their insurance companies. Companies set their own prices for private calls and non-consent tows. Vehicles towed by companies that are not on the police rotation list often charge fees double or even triple what the city pays.

The committee is proposing a $10 increase in fees to $85 and an increase to $95 over the next three years. The price would be standard for MPD calls, but officials are also considering regulating private towing companies as well. Wrecker operators say the increase is long overdue but still not adequate.

“Most of my business is private tows and body-shop contracts, but there are some [wrecker] companies out there really hurting because the city price is too low,” says All-Care Towing president and CEO Mike LaBudde. Like most wrecker operators, he thinks the $85 proposal from the city is inadequate. “The cost ha sn’t been raised in 10 years,” he says. “If we had been receiving a simple 3 or 4 percent cost-of-living raise each year, we wouldn’t be in this situation now. All we want is a fair price.”

A fair price is relative, says Dallas’ administrator of Transportation Regulation, Don Bearden. In the late 1990s, Dallas towing companies sued the city for an increase in police-call fees. Before the lawsuit, police tows in Dallas paid $48. The fee was increased to $95 after the suit, but with the fee increase came stiffer penalties for violating city towing ordinances. Similar issues have sparked new regulations and fee changes across the country. Congress is now considering legislation that would give authority for towing regulations to state governments.

“It’s funny that the wreckers talk about the injustice of the low city money but will tow for auto clubs for a lot less,” says Bearden, who oversees 43 companies on the Dallas police rotation list.

But LaBudde says comparing auto-club tows and city tows is comparing apples to oranges. “Of course, I’ll tow for AAA for less, because you can be done with the entire call in 20 minutes. Those calls are close to us and have a destination of less than five miles. There’s also no street to clean and no headache. Police calls can take up to four hours, depending on the traffic at the city’s impound lot,” he says.

In addition to running his company, LaBudde is president of the 25-member county towing association and vice president of the 60-member state towing association. The Shelby County organization has proposed raising the standard price for police calls to $135. “The city must come up to $135, or they’ll be hard-pressed to find someone to tow for them,” says LaBudde. “If they go jacking with us, they’ll never forget it.”

What Memphis residents are unlikely to forget are the increased costs. Not only will they be responsible for the towing fee, but other proposed increases would also hit their pocketbooks.

The administrative fee assessed for each tow ticket processed at the city’s impound lot is being raised from $5 to $7.50. The fee, currently paid by wrecker operators, could soon become the responsibility of vehicle owners. Storage fees, also paid by vehicle owners, could increase to $20 each day. Also on the horizon is a Police Department plan to increase the size of the city’s vehicle storage facility, which would cost taxpayers about $17 million in capital improvement funds.

Cost of Business

Under the city’s proposed ordinance changes, fees charged to wrecker companies for things such as zone stickers and permits could increase as well.

“People would be surprised at how much it costs to keep gas in my trucks or that it costs me $870 per truck for tags,” says LaBudde. “That’s not even counting the cost of salaries. I don’t think anybody would want to work today for the same amount they were getting 10 years ago.”

Not only have expenses increased but so has the danger, says Memphis wrecker operator James Birch. While working in Ft. Worth, Texas, Birch nearly lost his life at an apartment complex when the vehicle owner fired 17 rounds into his tow truck. A bullet through the door left Birch with a deflated lung and broken ribs. The shooter’s reason for shooting at the tow truck driver: “to scare him a little.” Birch bought a $55,000 repo-style truck instead of the flatbeds used by most wrecker companies. Now he rarely has to leave his vehicle.

“The city is trying to regulate something they know nothing about,” he says. Birch tows for European Wrecker and Body Shop on Main Street. The business operates three lots and is on the city’s rotation list, towing in downtown and Midtown. “There is no profit to be made in towing for the city, and it takes too long,” says Birch. He says the city is punishing everybody for the actions of a few.

During a Flyer ride-along, Birch removed three vehicles from the New Horizon Apartments on Millbranch. Although the tows were not police calls, they still had to be reported to police communications, or COMSTAT.

The first tow went smoothly. Birch’s new truck can secure a car in about five seconds. The second tow became momentarily tense when the vehicle owner came onto the parking lot, but he left without confronting Birch.

Birch’s biggest complaint is that he can’t get through to COMSTAT on a timely basis. Before towing a vehicle, a wrecker driver must notify the Police Department. On this occasion, Birch got five busy signals before finally reaching an operator. Then he had to wait 20 minutes, after which he was told to call back in 10 minutes. It took Birch a half-hour to get through and report that he was going to tow a vehicle.

“That’s a short call,” Birch says. “Lots of times the system goes down or the operators are in the middle of a shift change and you’re stuck waiting for at least an hour.” Birch estimates that his company spends about 3,000 minutes each month on the line with COMSTAT. “That’s ridiculous,” he says. “Can you imagine holding up your employees for that long? That lost time and money have to be made up.”

Gene and Lisa Gleaves have owned Gleaves Towing on Democrat Road for 30 years and have been on the police rotation list since its inception. About 30 percent of their business is city calls.

Lisa Gleaves is one of the most vocal members of the city’s towing ordinance committee. Gleaves has seen towing-business costs skyrocket. “Everything has increased, from fuel to steel. The city isn’t even offering us what they did 15 years ago,” she says. “It granted companies a $20 increase then, and now they want to give us half of that. I think the police officers understand what we do, because they are out there in the streets with us, and just like them, we’re always the bad guys. Whether it’s an accident or not, no one likes to see a tow truck.”

“We can talk till we’re blue in the face,” says LaBudde, “but we’re going to get what the city gives us.”

Whatever is passed will at least be a step in the right direction, says Lisa Gleaves. “It’s time for this dinosaur to be updated. For many people a car is their second largest investment, and as wreckers we owe them quality service to protect that investment,” she says.

The motto on the back of Gleaves’ business card sums it up: “The bitterness of poor service remains long after the sweetness of low price is forgotten.”

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