Towing Kickbacks: Only one-third of states ban incentives to property owners, law enforcement
Every state can -- and should -- do more to protect drivers from predatory towing
By Jacob van Cleef and Teresa Murray/ Consumer Watchdog team
April 27, 2022
Driving is a staple of American living. In 2020, there were more than 275 million registered vehicles in the United States. An issue that many drivers face or may be worried about is having their vehicle towed. If you ask around in your small circle, someone inevitably has a towing story.
Prior to the pandemic, millions of Americans had their vehicles towed involuntarily every year. Reasons range from unpaid tickets to expired registration to improper parking on private property. There are many ways to stop predatory towing or abusive practices that sometimes occur with legitimate tows, and laws vary widely nationwide.
In a May 2021 report by U.S. PIRG Education Fund, we compared the statuses of 14 common sense towing protections in each state. In some cases, few protections are guaranteed by law. For instance, 37 states mandate that towing companies notify the owner/driver when their car gets towed, making it the most popular protection nationwide. Some states mandate notifying law enforcement within an hour. In some states, the notification is allowed to be mailed to the owner – within seven days. Only 14 states require towing companies to clearly display their rates. And only four states require pictures of the vehicle before it’s towed.
Since the last report, the towing law landscape has begun to change, with lawmakers around the country either pondering or passing new towing protections for consumers. Major cities such as Detroit and Memphis recently approved new laws to protect drivers from predatory towing or abusive practices. While no states have yet approved new towing laws in the last year, legislators in Colorado now want to take on predatory towing in a big way. Other states are interested in new protections as well, according to the National Conference of State Legislatures. Meanwhile, more municipalities are looking at adopting more protections against predatory towing. This report looks at recent changes and what else may be coming. We also look at an emerging issue: kickbacks sometimes paid when vehicles are towed.
Laws banning kickback payments for private property tows is a common sense protection, like many of the others. These kickback payments occur when a property owner or law enforcement officer gets some type payment or other consideration from a towing company for getting a car towed from the property. Some laws also ban towing companies getting extra payments for a tow, but we didn’t consider that as part of kickback laws. Only one-third of states ban kickbacks in some way for private property towing. Some laws are more comprehensive than others.
Meanwhile, towing is on the rise. The industry is expected to take in $11.3 billion in 2022, an increase of 10% from 2020, according to IBISWorld, which conducts research on thousands of industries worldwide. That does include both consensual tows, after a breakdown or wreck, and non-consensual tows, for allegedly leaving your vehicle someplace you shouldn’t. IBISWorld did note that wrecks are decreasing as newer cars typically come with more safety features, such automatic braking systems and lane-change alerts, so the industry growth is expected to come from non-consensual tows.
A tale from one community
The states with the best (and worst) protections:
New laws since last report
Examples of some existing state laws:
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