MTA PUSHES FOR CHANGE
MTA has begun lobbying government to change the way tow and storage costs are recovered when police impound a car on the roadside.
Tow Woes: Police Impounds
The police impound thousands of cars each year and it’s costing the country’s tow operators a small fortune in lost income.
One of the country’s largest tow firms estimates it loses $200,000 a year in storage and tow fees because many owners simply abandon their impounded vehicles.
Police impound cars for around 30 different offences, such as being an unlicensed driver or driving while suspended or disqualified. Failing to stop for police, a defective vehicle, and street racing also results in impoundment.
MTA Industry Relationship Manager Greig Epps says “the current fees were set in 2004 and haven’t been changed since. We believe there is a strong case for a complete review to find a better way for tow operators to be paid for the service they provide to the state. At the moment, towies are carrying the cost of police impoundments.”
He says a review could examine whether police should pay the fees directly, or whether impound storage and tow costs could be added to the court costs awarded against an offender.
“We are meeting with NZTA and the Ministry of Transport to begin discussions on a review and will also be bringing the situation to the attention of Cabinet minister Stuart Nash, the Minister for Police and for Small Business. At the very least, we want to see the fees increased as they are woefully short of meeting the actual costs of towing and storage and fall well short of what the public and insurance companies are charged.”
Scott Goodsir (pictured above) of Auto Salvage (Invercargill and Dunedin).
Scott Goodsir of Auto Salvage (Invercargill and Dunedin) has all his drivers carry his own informal surrender agreement in their tow trucks.
“You can tell by looking at the state of the car on the side of the road and the people with it whether they are likely to ever come back and claim it. If you have a surrender agreement, it can make the disposal process much easier. But of course, they have to be the registered owner and their details have to match the police impound paperwork.”
He says most of the impounded cars are in poor condition. “In the past six months, I’ve only had one (abandoned) impound vehicle that I could sell for a profit.”
Like other tow operators, he would like to see all the fees increased to better reflect the actual costs.
Thames Towing and Workshop owner Frank Bruysten says that lately, only half of the owners of impounded cars have come back to collect them and pay what is owed.
“Over 28 days the standard fees get up to around $400. We are duty bound to hold an impounded car for 28 days, then we notify the owner and they have another 10 days to come and collect it. If they don’t come, we apply to the police for approval to dispose of it. That process can be a real pain. I send off the request, then it turns out the officer at the side of the road hasn’t filled out the forms properly, or he’s on holiday. It can take a month to get the paperwork done.”
Tow operators can apply to have the vehicle plates deregistered which nets them $100 from NZTA as a scrappage fee. They can also sell the car for whatever they can get. Wreckers pay between $50 to $300 but the market is falling as the demand for recycled steel is drying up. Frank reckons he’s owed about $5,000 a year in unpaid impound fees but takes a philosophical view.
“I’m supplying a 24-hour service and feed off the bigger equation. I get around 10 impounds a month and at least three won’t be reclaimed. It’s part of the towing game and if I don’t do it, someone else will and they’ll get on to the police crash roster, which is the source of a lot of our work.”
Frank counts his blessings – the scrap yard is right across the road and he gets $100 for every wreck. “I have four on the truck for them right now.”
Southern District Towing
Pam Watson with two of her drivers, Lionel Caines (right) and Rob Smith.
The biggest Loser
Pam Watson owns Southern Districts Towing in South Auckland. Last year police impounded almost 2,500 cars in her yard and around a third of these were abandoned.Her lost income from impound fees is more than $200,000.
“Our district probably has the highest police impound rates in the country. We would really like to see increases to the impound fees or a change in the charging regime. The current fees are ridiculous. Our storage rates for non-impounded cars are between $17 to $20 a day, compared to the $12.25 allowed, and our average tow fee would be twice the $53.60 we can charge for an impounded car.”
Pam says around four hours of time goes into the disposal process of an impounded car that is abandoned by its owner.
On the plus side, she can get between $200 to $300 from a wrecker, although that is dropping as the market falls away for recycled steel.
She no longer takes anything out of the abandoned vehicles for charities or sale. “In the early days, we used to have clothing bins and would give the child car seats to Plunket for refurbishment. But its too costly in time to do any of that now.”
In Invercargill, Peter Hilston of Parkside Panels says the impound legislation has been a problem since it came into force in 1991.
“In the early days the vehicles were worth more so people would try to get them back. But in the last few years that’s changed. Some of these cars are only worth a few hundred dollars, so a guy who paid $300 for a car isn’t going to come back to get it when he has to pay $380 in impound fees.”
He says it can be difficult to track down owners of impounded vehicles. “Sometimes the last registered owner was five sales back - people don’t do the paperwork.”
Peter also takes the good with the bad. “When you have a contract with the police, it’s for impounds and crashes. If you’re in the tow business you tow whatever is around; if we start picking and choosing we wouldn’t have a business left.”
A review of the system is something he would welcome.