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Monday, October 25, 2010

Critics: VA Licensing Fees Can Drive Smaller Tow Companies Out Of Business

Here's the story from www.tricities.com:
MARION, Va. – Everything changed for tow truck operators six years ago.

The industry used to be a relatively unregulated process of hook ‘em up and haul ‘em out. But that began to unravel the night a Northern Virginia lawyer’s car was towed from a private lot with a warning sign obscured by tall bushes.

Angered, he pored through state law to find that nothing covered hidden signs, or much else. So, he fired off a letter of disgust and legal insight to a state senator.

“It turns out ... it’s a hot topic with a lot of people,” former senator Jay O’Brien, of Clifton, said of the furor that followed.

For the two years after he received the letter, O’Brien’s life was a mosaic of research, public meetings and rewording state code.

Now, tow truck operators throughout Virginia must have a license to haul cars from accidents, private lots or breakdowns. Simply put, if the tow operator gets paid for the haul, then he needs to be licensed. Additionally, individual drivers must obtain tow truck driver authorization documents.

The tow truck operator also must put a licensing sticker on every truck.

Those regulations, and the operations of tow companies, are governed by a new state body, the Board of Towing and Recovery Operators. Created in 2006, the board is tasked with dispensing the operator’s licenses, tow driver’s authorizations and truck stickers; testing operators on the laws of the profession, a requirement for all new drivers; rummaging through criminal backgrounds; and fielding customer complaints.

“It’s an innocent thing that turned into something much bigger than I thought,” O’Brien said.



Like it or leave it

Roger Blevins, of Rogers Towing in Marion, needed a minute to think when asked how the new licensing laws have affected his profession. He hemmed and hawed as he weighed the drawbacks against the benefits.

On the negative side, he said, the licenses are pricey enough to bankrupt small companies.

“There was a couple of people … that it could put them under in time,” Blevins said of the licensing requirement, which began July 1, 2009.

That first year, the board authorized 1,474 operator’s licenses, approved 4,548 tow driver’s authorizations, and affixed decals to 4,275 trucks, according to the board’s 2009 annual report.

The operator’s licenses must be bought annually and run from $250 to $500 a company, depending on the number of trucks owned and their weight.

The individual tow driver’s authorizations cost $87 a year. The application comes with a $37 fee for a criminal background check. Additionally, every truck must sport a new licensing decal each year, costing $10 each. An extra $50 is added if the business owns three or more trucks, depending on the vehicle’s weight.

In its first year, the application and decal fees generated $1.12 million in revenue, according to the board’s 2009 annual report.

Before the licensing laws kicked in, wrecker companies only had to register their trucks each year with the Virginia Department of Motor Vehicles.

That’s still necessary, on top of the licensing.

Annual registration fees run from $80 to $1,328 a truck, depending on the weight of the tow truck and the average estimated weight of vehicles towed. There also is an annual $10 a truck bulk carrier fee going to the Virginia Operating Authority, which allows the truck to haul in the state.

Blevins also saw a silver lining in the expense incurred on his company by the new towing board – he had to expand his business to cover the fees.

“If anything, it probably helped my business because it convinced me to get on the state police [emergency dispatch] list and to join motor clubs,” Blevins said.

Not every tow operator could envision a positive spin.

Retired tow operator Dave Thomas, of auto repair company Marion Frame and Alignment, quit the wrecker business two weeks after the licensing law began.

“If you’ve been doing something for 26 years, and have been doing things the same way, would you want someone to come along and say you’ve got to have a license?” he said.

Thomas tried to tow wrecked cars without a license, but the towing board ordered him to stop, and had the sheriff’s department remove his company from the 911 rotation list.

Shock over the licensing requirements also erupted from the industry’s sidelines, where retired tow operators are voicing an opinion.

David Pickle, of David’s Auto Repair in Rural Retreat, misses the new faces he met and adventures he enjoyed during his nearly 20 years as a tow operator before retiring in 2003.

He’d consider jumping back in but, like Thomas, fears it’s a case of an old dog learning new tricks.

“I think it would be too much regulations to comply with,” Pickle said.



Still off the radar

Public safety tows, where vehicles are pulled from wrecks or other incidents involving police, are among the few areas left untouched by both the towing board and state law.

The issue is still left to local laws and police policies.

Smyth County, for example, doles the tow calls to wrecker companies based on a rotation list regulated by sheriff’s department policy.

In nearby Wytheville, the rotation list is controlled by a recently enacted ordinance that offers public safety calls to companies inside the town limits before looking to companies in the surrounding county.

Town officials created the new ordinance as an attempt to provide priority status to its in-town businesses while also whittling away at the time spent waiting for a wrecker.

“To have an officer on the side of the road waiting for 20 minutes was just too long,” Town Manager Wayne Sutherland said.

Initially, O’Brien’s state legislation mandated that the towing board decide which companies could answer 911 requests. Regulations were to be based mainly on the equipment in a company’s inventory.

But tow operators argued that the need for costly equipment could differ according to geography, population or whether the wreck is on a mountain road or in a big city.

“There was a view held by many that this particular regulation would be very onerous ... to the mom-and-pops and the one- and two-truck businesses,” board Executive Director Marc Copeland said.

In 2009, O’Brien’s law was changed to prohibit the board from regulating public safety calls.

O’Brien, who left the Virginia General Assembly in 2007, did not know his provision on the public safety tow had been repealed until told by a reporter.

Still, he said, the connection between tow operators and emergency calls is a strong one.

“People often think of the first responder [as] the police, and the rescue squads,” O’Brien said. “But the tow operator sees it all, and has nightmares from it.”

Mandatory fees

To operate a tow truck business, the state requires:

    * Tow operator’s business license: $250-$500.
    * Tow truck driver authorization (each driver): $87.
    * Criminal background check (each driver): $37.
    * Authorization stickers (each truck): $10, with an extra $50 for an operator with three or more trucks.
    * Motor vehicle registration (each truck): $80 to $1,328.
    * Bulk carrier fee (each truck): $10.

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