CT tow truck companies seek higher fees for towing, storing

The tow operators said they need higher rates to keep up with rising costs. They cited utilities, employee pay and maintenance of wreckers, which now ranges from over $100,000 to a million dollars for huge wreckers capable of removing overturned tractor-trailer trucks involved in crashes on interstate highways.

The current outside, gated storage fee of $26 a day for five days or fewer would rise to $41.48 for vehicles under 20 feet in length, under the proposal, which comes four years after the last price increase.

But residents and tenant representatives from Hamden and New Haven brought grievances to the four-hour public hearing Wednesday on the industry’s proposals to change the rates on so-called nonconsensual towing. They complained about a rogue industry in which some tow operators patrol residential parking lots for even minor infractions, then gouge vehicle owners when they try to reclaim their property.

In particular, they said Festa’s operations aggressively enforce parking rules that result in expensive vehicle seizures and storage costs.

A legal-aid lawyer and an attorney for the state insurance industry said the claimed economic hardships of the wrecker industry were over-blown, and the towing companies do not need such a high price hike.

“Quite honestly, we have been driven crazy by this tow company,” said Greta Blau, one of several resident advocates who attempted to refute claims of tow operators of the need for higher prices.

Blau alleged instances of companies towing vehicles for minor infractions in private parking lots, including for not backing into spaces and not parking totally within the lines. She added that the towing has also come without warning.

Speaking in the Legislative Office Building before Brian Carey, a private attorney who is a veteran Department of Motor Vehicles hearing officer, Festa and other wrecker company owners said about 80 percent of their business comes from police calls after crashes or motor vehicle stops where damaged, unlicensed, unregistered or uninsured cars are ordered towed away and stored. The rest come from private calls. 

During 90 minutes of testimony, Festa portrayed the industry as crucial to Connecticut’s commerce, with his four wreckers available around the clock in all types of weather when motorists are speeding and more reckless than ever. “We don’t want people sitting in their car, waiting for a tow truck to get hit,” Festa said. “We don’t want [state] troopers to get hit, and we don’t want people to cause accidents.”

State law allows wreckers to recover “just and reasonable” expenses and a profit determined by the DMV. The average wrecker will participate in about 550 tows per year, 75 percent of which are nonconsensual, Festa said. “Many of my friends, learned people, are going to tell you that raising the nonconsensual rates adversely affects lower-income families,” Festa said.

“Sounds like a good argument, and I am sure they are affected. But they have also gotten a 39 percent increase with the minimum wage through today?” Festa asked. “They’ll have a 48 percent increase as of June 1, 2023. Now that they have this increase, many of them can afford the $38 a year to have the insurance company provide towing for them when their vehicle breaks down, instead of having a nonconsensual tow.”

“We need a leap in our rates for us to keep providing public service at an acceptable level,” said Paul Hilario, whose Hilario’s Service Center in Danbury and Newtown focuses on towing large trucks that get stranded or involved in crashes. 

Opponents of the proposed rate hikes portrayed an industry that they say is predatory, alleging it can sometimes operate outside state regulations.

“As rates go up, it becomes harder and harder for people who have a car that is towed to get their car back, and that is a major concern to us,” said Raphael Podolsky, an attorney with Connecticut Legal Services, which represents low-income state residents and renters in a variety of civil matters. “The [state] statute talks about ‘just and reasonable,'” he said. Regulations protect vehicle owners, particularly from the daily accrual of storage fees, he said.

“The longer it takes you to compile the money in order to be able to bail your car out of storage, the more the cost becomes,” Podolsky said, stressing the distinction between the act of towing and the storage of vehicles. “Fifteen days of storage is about $600 under the proposed rate,” he said. “The cost is not insignificant for a person trying to get their car back. It’s my understanding that sometimes cars that are towed off public property are towed to lots that are a very great distance away, which creates a major inconvenience for the owner of the vehicle.”

Brooke Foley, general counsel for the Insurance Association of Connecticut, said that while towing companies serve essential roles in clearing roads after crashes, nonconsensual tows are an entirely different matter, with car owners unable to negotiate prices or comparison shop. She recalled that it was historic allegations that created the existing pricing regulations set by the DMV commissioner. Foley opposed the rate-hike proposal and contested Festa’s claims of some increased costs.

“The data in the petition is incomplete as well as inaccurate,” Foley said. “These proposed increases in towing and storage prices would disproportionately harm low-income Connecticut residents. Many municipalities tow vehicles as a way to collect unpaid parking tickets and property taxes. When low-income citizens’ cars are towed, they may be losing their only means of transportation to get to work, to get the money that they need to be able to pay for the towing cost as well as the storage costs and release of their vehicle from a cash-only towing yard.” 

Further testimony may be filed until Dec. 21 at: DMV.publichearing@ct.gov.