By Brian J. Riker
Times are beginning to look a little rough for the average tower. With labor and equipment still at or near record high costs, insurance premiums rising even without any claims and call aggregators aggressively growing their market share, thereby reducing available direct customers and cash calls, the last thing towers need is to face an ill-informed attack by the federal government on our rates and services provided.
Unless you have been living under a rock you have likely heard about several strategic attacks on the towing industry over the last several years. While this is nothing new, the business model has been under attack for as long as I can recall, the methods being deployed are new.
In recent history, thanks to the hard work of the state and national towing associations and active towers, like this audience, our industry has fought off attempts to raise the minimum insurance liability that motor carriers, and towers by default, would be required to carry, attempts to regulate our rates and services beyond acceptable consumer protections found in non-consensual towing rules and even attacks on how we employ our drivers.
Despite the successes found in fighting off the INSURANCE Act, the Van Hollen Amendment, speed limiters and a number of other pieces of bad legislation, our opponents are not giving up. You might even say that they are just warming up for the fight, and what a fight it will be. Make no mistake, our opponents are well organized, highly funded and very connected locally and in Washington, DC.
In the most recent attack, the US Secretary of Transportation Pete Buttigieg is calling for the Federal Trade Commission (FTC) to include the towing industry in its recently proposed rule making proposal, which would open the door to impose regulations across the board on the towing industry’s rates and business practices, including consensual towing.
His letter to FTC Chair Lina Khan points to a flawed study published late in 2023 by the American Transportation Research Institute that claims overcharging and fraudulent business practices are rampant throughout the towing industry but only relied on less than 500 invoices, hand selected by 390 respondents, mostly ATA members, to justify their conclusions. This is a very disappointing report from ATRI, as they usually publish fair and unbiased research despite being part of the American Trucking Associations.
Supporting the Biden Administration’s war on “junk fees”, which began to combat fees for services like checking your bank balance, bringing carry-on baggage or seat selection fees on airlines, the US Department of Transportation is asking the FTC to declare charging separate and distinct fees for support and ancillary items like specialty tools, safety gear, and consumable items unlawful.
Should this idea of the Federal Trade Commission intervening in the towing industry come to fruition it would pave the way for a patchwork of state level laws governing the towing and transportation of motor vehicles in a similar manner that household goods movers are licensed and regulated.
In the words of TV pitchman Billy Mays “but wait there’s more”. Following the defeat of the Van Hollen amendment, which sought to return to the states the right to regulate rates and services of even consensual towing services, meaning the state could set fees even for private party contracts between consenting parties, several states have taken it upon themselves to attempt to do the same thing by pushing for the development of towing oversight boards or similar entities.
HB179 in Florida would require counties and state troopers to establish a cost-plus recovery structure that towing operators may charge for cleanup and disposal of hazardous and nonhazardous materials incidental to a nonconsensual tow. Cities also would be permitted to enact such rates. Meanwhile, in OOIDA’s home state of Missouri, HB2214, which has had similar language defeated previously, would require the establishment of towing oversight rules including a complaint process and compel towers to release property and vehicles with a payment of as little as 30% of the towing invoice.
While we have a few things in our favor, most notably a very divided Congress that has been having difficulty agreeing on anything, it is an election year and a feel good consumer protection achievement would look good for the campaign.
All hope is not lost Our state and national associations are fighting the good fight on behalf of all towers, members or not, although there is strength in numbers and if there ever were a time your association needed help it is right now! As part of the legislative teams for both the Pennsylvania Towing Association and The Towing and Recovery Association of America, and a frequent consultant to several other state associations, I can assure you these attacks have not gone unnoticed, and we are fighting hard behind the scenes to find solutions, but the fight takes money and support.
It is a cold reality that lawmakers only listen to lobbyists when they bring the support of local constituents to back up their request. Even if you can’t afford to contribute to your association’s PAC or lobby fund, just joining and paying your dues gives your association a boost when speaking on your behalf. Please consider helping fight off these detrimental legislative and regulatory actions by supporting your association of choice.
By Brian J. Riker
