Towing in Colorado could be in for an extreme makeover

Doris Morales walked to her car one day last summer to take her daughter to a critical doctor’s appointment.

But when she got to her parking spot at her Commerce City apartment building, she realized the vehicle had been towed.

Morales had expired plates. Her hours as a housekeeper had been cut during the pandemic, leaving her to decide between rent and renewing her tags, she said.

Her daughter has Down syndrome and the doctor’s appointment that day was to check whether the food she ate was going down correctly. Without a car, they missed the appointment. It took five months to reschedule.

“It was very anxious those five months to see what would happen in terms of her health and well-being,” Morales said through a translator.

It’s stories like Morales’s that prompted Colorado lawmakers to introduce a bill last week that they say would even the playing field between towing operators and the general public.

The proposed legislation amounts to what sponsors call a new towing bill of rights: It would ban the practice of towing cars for expired plates, and tow companies would no longer be able to keep someone’s car if they can’t afford to pay to get it back.

Costs for nonconsensual tows on private property — like in Morales’s apartment parking lot — would be brought down to be more in line with what a driver might pay if they got stranded on the side of the highway. Towers would have to give 24 hours’ written notice before removing a vehicle from an apartment complex or mobile home park.

The bill would also require more notice and better documentation from tow companies, and include stronger protections within the Public Utilities Commission and the Colorado Attorney General’s Office.

“It’s just about creating parity between nonconsensual operators and car owners,” said Rep. Edie Hooton, a Boulder Democrat who sponsored this bill. “Because right now there is none. There is no accountability for the tow operators.”

The towing industry opposes the bill in unusually strong language, saying lawmakers don’t understand their industry and that these changes don’t ultimately address their root concerns.

“They took the towing industry and said, ‘Those are the bad guys; we’ll throw them on the ground and drive over them with a bus,’ ” said John Connolly, president of the Towing and Recovery Professionals of Colorado. “This bill is, ‘(Expletive) the towers, they’re the bad guys.’ ”

What’s in the bill?

One of the biggest pieces of HB 22-1314 — which is co-sponsored by Rep. Naquetta Ricks, an Aurora Democrat, and Sen. Julie Gonzales, a Denver Democrat —  would take away the ability of tow companies to seize possession of people’s cars if they can’t pay the several hundred dollars it can cost to retrieve the vehicles after a nonconsensual tow from private property.

Under current law, that “possessory lien” can happen after 30 days, and it gives the tow yard the ability to auction the car. This situation puts many low-income people in an excruciating bind: Borrow hundreds of dollars from friends or family? Take out a payday loan with crippling interest? Or just lose the car altogether.

“It’s the loss of a job, the inability to take your kids to school or get food at the grocery store,” said Zach Neumann, co-founder and executive director of the COVID-19 Eviction Defense Project. “All of life’s most important tasks are taken away from you.”

Expired plates have been a common reason for tows, and the issue has only been exacerbated during the pandemic, when the Department of Motor Vehicles fell behind on its paperwork. In October, Denver’s DMV branches closed for two days so officials could chip away at a 52-day backlog in registrations and titles. The city had already stopped issuing tickets for expired tags due to the backlog.

Clara Rodriguez found herself with a $293 bill after her car was towed for expired tags earlier this month from her Aurora apartment building

“It was very difficult,” the 34-year-old said through a translator. “As a single mother, that $293 is coming from other areas that I can be using to support my daughter.”

She had to borrow the money from her sister and friend.

“This is a huge injustice,” Rodriguez said.

Lawmakers in this bill also wanted to address the cost question. Right now, the price difference between consensual and nonconsensual tows can be hundreds of dollars. The bill would mandate that carriers bring the nonconsensual tow fees in line with what they charge for consensual tows.

For someone like Morales, the $380 it cost to get her car back from the lot could have been two weeks of food for her family. Others have seen bills soar even higher.

“Paying $600 is truly life-changing,” Neumann said, citing studies that show the average American doesn’t have the savings to cover a $400 emergency.

Bringing down prices for nonconsensual tows ignores the high overhead and significant insurance costs it takes to operate these tow yards, Connolly argued, including workman’s compensation and expensive liability insurance. Consensual tows cost less because they have fewer expenses.

“All those things add up,” Connolly said. “People just don’t see that. They don’t understand how much it really costs to run a tow company.”

Greater oversight

The bill would also give both the state attorney general and the Public Utilities Commission greater oversight over towing companies that violate the law.

The proposed legislation would create an office of tow hearings to adjudicate disputes between tow carriers and vehicle owners towed from private property without their consent. Hearing officers or administrative law judges would hold hearings to determine whether a carrier violated the law or caused damages.

The attorney general would be empowered to prosecute violators under the deceptive trade practice statute.

Under current law, anyone with a claim against a tow company can file a complaint with the PUC. But a lack of staffing has caused cases to stack up, and investigators have previously told complainants that they have limited resources in adjudicating their complaints.

Former towing investigators and industry experts told The Denver Post that companies often chalk up PUC fines as a cost of doing business.

“We need to give people more channels to express concerns or to enforce their rights when vehicles are taken,” Neumann said. “We have a system right now that if you’re towed, you’re basically guilty until proven innocent.”

The towing industry didn’t immediately push back on this bill. In January, Connolly told Colorado Public Radio that his group looked forward to working with lawmakers to “close loopholes in current private property laws to help protect consumers and the integrity of the towing industry.”

But Connolly now says the legislators didn’t work with stakeholders to hash out the bill’s language and, as a result, the bill doesn’t address what they say it will address. The sponsors, he said, “are too young in the legislature and don’t know what they’re doing.”

“They said that this a consumer bill of rights,” Connolly said. “This isn’t a bill of rights. This isn’t Thomas (expletive) Jefferson here. It’s flashbangs, big headlines.”

Connolly said lawmakers are lumping all of Colorado’s 700 tow companies in with the small number of bad actors that give towing companies a bad name. Most of them, he said, are doing things the right way.

“They have some really dumb stuff in here,” Connolly said of the bill.

Bill sponsors and advocates, however, say it’s more than time for consumers to have protections in this industry. They cited a 2021 report from the U.S. Public Interest Research Group’s Education Fund that found holes in Colorado’s towing protections. This bill is an attempt to fill in those gaps, they said.

“Tow companies have become the judge, jury and bail bondsmen,” Ricks said. “It’s weighted too heavily in their court.”

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